Complexity Leaders and Knowledge-Based Organizations

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Complexity Leaders and Knowledge-Based
Organizations
Drs. Philip McGee and Russ Marion Clemson
University
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As we advance deeper in the knowledge economy,
the basic assumptions underlining much of what is
taught in the name of management are hopelessly
out of date Most of our assumptions about
business, technology and organization are at
least 50 years old. They have outlived their
time. Peter Drucker (Forbes, October 5, 1989)
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Were in a knowledge economy, but our
managerial and governance systems are stuck in
the industrial era. Its time for a whole new
model Manville and Ober (Harvard Business
Review, January, 2003)
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Why Traditional Management and Leadership Skills
Often No Longer Work
Increased

• Globalization

• Speed of Knowledge

• Importance of intellectual capital

• Innovation

• Electronic business

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The Shift from the Industrial Age to the
Information Age
In the Industrial Age, leaders focused on
production
In the Information Age, leaders focus on
KNOWLEDGE and INNOVATION
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The shift from producing THINGS to producing
KNOWLEDGE and INNOVATION has brought about a need
to develop new philosophies, values, methods and
practices that redefine the practice of
management and leadership.
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Traditional Leadership and Management Concepts
Are based upon

• Newtonian logic of cause and effect.
• Managers are designers of economic machines
  that produce profits.
• People are interchangeable and disposable,
  i.e., they are a resource just like machinery,
  and raw materials.

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Traditional Leadership and Management

• Human Relations approach
• Authority and Control
• Top-down Goals, Objectives
• Strategy as Function of CEO
• Stability, Order and Predictability

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A New Leadership and Management Model
As noted at the beginning of this presentation,
traditional management thinking and practices are
often inappropriate for the new global
environment that emphasizes speed, adaptability,
innovation and the ability of organizations to
deal with and competed in a world that is
increasingly complex. This new model for
leadership and management is called
Complex Leadership
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Complex Leadership and Management Concepts
Are based upon

• Complexity and chaos theory.
• Emergence and Surprise.
• The world can be understood as a network of
  agents.
• Managers are designers of environments that
  enable emergence.
• Knowledge is a key resource

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Complex Leadership and Management
Emphasize
1. Knowledge production by managing worker
interactions.
2. Encourage knowledge production by fostering
networks of interdependent individuals and groups.
3. The management and distribution of resources
in such a way that that support the
production of knowledge and innovation.
4. The communication of a sense of urgency
(adaptive tension).
5. Creation of indeterminate vision.
6. Culture of creativity and innovation.
7. Rules of interaction, interdependency and
tension.
8. Bottom-up behavior and heterogeneous vision.
9. Foster external relationships.
10. Strategy foster organizations that can learn
and adapt.
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Taking a Closer Look
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1. Knowledge Production by Managing Worker
Interactions
Because complex leaders are enablers. They
design, create, and promote organizational
structures that permit, encourage and reward
interaction between individuals and groups.
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2. Encourage Knowledge Production by Fostering
Interdependency Between Individuals and
Groups
Interdependent relationships are

• The well-being of each agent affected by actions
  of others.

• Both a motivating and controlling force

• Flexible in that they promote beneficial
  adjustments between individuals and groups

The end result is a more adaptive learning
organization that is more competitive!
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3. The management and distribution of resources
in such a way that support the production of
knowledge and innovation.

• Informational Resources data needed to
  produce knowledge

• Physical Resources i.e. money, equipment, and
  personnel

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4. The Communication of a Sense of Urgency
Complex leaders create adaptive tension or a
sense of urgency. For example, Jack Welch, the
former Chairman and CEO of General Electric told
his departments, Be 1 or 2 or you will be
removed.
Such statements create tension but do not
restrain or direct creativity or innovation.
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5. Creation of Indeterminate Vision

• A vision is a Goal with Soul. Visions inspire
  and unite.

• Indeterminate vision does not preempt the
  future, rather it motivates the present.

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6. Culture of Creativity and Innovation
Complex leaders promote a climate and environment
in which creativity and innovation are
encouraged. Hallmarks of these types of
environments include

• The freedom to make and learn from mistakes

• Divergent thinking is viewed as desirable

• Challenging the status quo is the norm

• Information and ideas are freely shared and
  exchanged

• There is a climate of critique

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7. Rules of Interaction, Interdependency and
Tension

• Rules promote and define patterns of behavior
  in complex relationships.

• Rules enable rather than limit

Rules may be grouped into five general
categories - Rules that focus action- Rules
that enable interaction- Rules that foster
interdependency- Rules that create tension-
Rules that encourage bottom-up decision making
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8. Bottom-up behavior and heterogeneous vision

• Top-down decision making and control limits the
  creativity and innovation of the organization to
  one person or a small group of executives.

• Bottom-up decision making and control frees and
  empowers a greater number of people and groups to
  generate creative and innovative solutions facing
  the organization.
• Heterogeneous vision insures a diversity of ideas.

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9. Foster External Relationships
Leaders of complex organization realize that are
not islands but rather that they are part of a
larger network composed of customers, suppliers,
regulatory agencies, and other public and private
organizations that provide similar services or
products. External networks both support and
stimulate the firm.
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10. Strategy Foster Organizations That Can Learn
and Adapt

• Strategy those actions undertaken to enhance to
  fitness of the organization

• Strategic leadership foster organizations and
  networks of organizations that create
  fitnessi.e., learning and adaptive organizations

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A New Approach
In order to meet the new demands for
increasedcreativity and innovation being placed
upontraining departments and corporate
universities, we must find and implement new
structures and leadership practices. The field of
Complex Adaptive Leadershipthat is currently
being developed and implementedby organizations
that will help organizations to grow and prosper
in the global economy and society of the 21st
century.
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Your Presenter Were
Russ Marion Russ has authored two books The
Edge of Organization and Leadership in Education
along with many articles and is considered to be
one of the leading experts in the field chaos and
complexity theory as applied to leadership and
organizational behavior. In addition to his
writing he has made presentations in Europe and
at the India Institute of Technology. Russ is
currently a Full Professor of Educational
Leadership at Clemson University.
Philip McGee For seventeen years, Phil was
involved in the design and implementation of
instructional and organizational systems within
education, government, industry and business
through his company, Instructional Designs, Inc.
In addition to the work he performed through
Instructional Designs, Inc., he also served as
the Regional Program Director for the Doctor of
Business Administration program offered by the
School of Business and Entrepreneurship, Nova
Southeastern University, and as an Adjunct
Professor of HRD for Webster University. Phil is
currently an Assistant Professor of Technology
and HRD at Clemson University.
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