Article: The organisation of the future

Technology

The organisation of the future

In the evolving organisational landscape, the traditional pyramid structure is transforming into an hourglass, characterised by a lean middle layer, thanks to technological progress.
The organisation of the future

For as long as you remember, organisations are always represented as pyramids. Few people at the top, and bulging to the bottom. Climbing up the pyramid remains a dream for many and yet a mirage for others. After all, there is only as much room at the top. You can’t have two captains of a ship, two coaches for a team, and two CEOs for a firm (albeit this model has been tried with dim success). It seems that higher-order games are often zero-sum. We assume that the organisations of the future will be similar to pyramids, except bloated. Think again! There is no reason that the current changes and choices presented to individuals and firms would save the organisational structure from being severely altered. I propose that the organisations of the future would be more hourglass-shaped than pyramids. Three reasons why.

The middle becomes superfluous

When was the last time you spoke to a Paytm call centre executive? Or have you discussed with an Ola agent to map you to the best driver for your upcoming ride? I never did. Or that your UPI transaction misfired to the wrong account number? It rarely does. If technology does its job well, human intervention can be largely avoided (and to a good effect). For a long time, the middle layer was consumed by mapping jobs to skills. They were breaking down the work into manageable pieces, mapping it to those with appropriate skills, aggregating the outcome into a coherent whole, and then shipping it. The value add was that of a high-fidelity router and sometimes emotional counsellor. But when people know their jobs well, technology does the mapping and customers offer instant feedback, why do you need the middle person? That role is superfluous, if not outrightly hazardous.

The organisations of the future will be radically lean. It doesn’t mean that those in the middle would have vast spans of control, but those at the bottom would be largely autonomous. We are already seeing this in the blue-collar category, gig workforce when your Zomato or Swiggy agent is directed by the app, or when your cab guy finishes the journey without asking you so much as your OTP. Who’s managing? It’s all self-managed. So, if you are smack in the middle, it’s a sign of imminent trouble. 

Either you are with the customer, or busy creating IP

A pertinent question here is – which jobs are more future-proof? I reckon that unless you know your customer like the back of your hand, or you are thick into the creation of intellectual property, you are on precarious grounds. What I mean by knowing the customer is about deep insights into the market of one. Not big data, but weak signals. It’s almost like breaking bread with your customers. Knowing what she doesn’t even think of yet. The people at the fringes, mostly towards the bottom of the classical organisational pyramid are typically closest to the customers. As the former chief of Intel, Andy Grove, reminds us change is detected first by people in the trenches. Those who are closest to the customer, to the market reality. 

As for the IP, it doesn’t necessarily mean R&D, or conjuring up clever products. It’s about raising the content of the product in your service. Products are reliable, repeatable, scalable, and inimitable, and offer you an enduring advantage. Productizing your service or your job means bringing a degree of opaqueness, or causal ambiguity in what you are doing. So, if you are a hiring manager and you devise a new rubric for evaluating incoming talent, that’s your IP. As a plant manager, if you design a predictive maintenance schedule based on past incidents, that’s your IP. It could take the form of code or media, and that’s the currency of the future. That delinks your efforts and outcome, in a scalable manner. 

The top is a network, not a node

 It is deemed that people at the very top are keenly aware of the why, what, and even how, and those below must be meticulous and never second-guessing those above. But that’s no longer true (in fact, it never was). With the rapidity of change, proliferation of technology, democratisation of data and blurring boundaries between industries those at the top are equally vulnerable, if not more. They can’t afford to have an insular view about their organisation and its future. They must tap into the wisdom of crowds, and better still their trusted network.

A lone genius shouting orders from the ivory tower is nothing more than a figment of imagination. Real leaders are well-connected, both within and outside the company. They deliberately surround themselves with different and wise people, whom they learn from and not necessarily like. Leaders increasingly seek intellectual invigoration rather than social validation. This means that it’s a bunch of people, mostly busy creating or sharpening IP, that will relay signals to how the firms would operate. This transition is akin to how innovation migrated from the minds of a genius few, like Edison and Tesla, to the industrial labs and clubs of people donning lab coats. The collective triumphs over the individuals under uncertainty, and the future is not predictable. 

In summary, the organisation of the future will be both bottom-heavy and top-nimble. A lot of people working with and for customers, very few directing and a lot more thinking and creating the future. The organisational boundaries would be porous and ever-shifting, with the leaders forging bonds of convenience, not distinguishing between those among the ranks versus those from the market, for as long as they offer value. As a manager, you are better off moving either closer to the customer or busy creating IP. Even moving up the organisational totem pole is not an inoculation against obscurity. As for technology, it’s better to be an ally than an adversary. Use it well without letting it run your life. 

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Topics: Technology, Leadership, Business, #FutureOfWork

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