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Over-engineered organisations are disempowering people

28 Jan 2015


London Business School behavioural experts address HR directors

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Over-engineered organisations have led to disempowered people chasing the wrong targets, a strategy professor from London Business School told HR directors earlier today.

Speaking to more than 70 HR directors at an HR Development Day organised by the School’s Executive Education Department, Julian Birkinshaw, Professor of Strategy & Entrepreneurship, London Business School, said: “Over-engineering our organisations is leading to disempowered people, chasing the wrong targets.

“We are prisoners of a traditional way of working that we inherited from the industrial era. We need to ask ourselves whether we can find better ways of working for the future.”

The problem, Professor Birkinshaw explains, is that while human nature hasn’t evolved all that much, the environments we work in have. And we aren’t keeping pace. “Staff satisfaction surveys show large chunks of people who are not engaged and it’s not just a necessary by-product of being a big organisation”, Professor Birkinshaw cautions.

So, what’s the answer? Management experiments and counter-weights for shareholder financial short-termism are crucial, but so, Professor Birkinshaw says, is purpose – a different way of defining objectives and a new “third way” for modern managers.

“Traditionally work objectives have been arrived at by working backwards from a company’s financial goal in a linear way”, says Professor Birkinshaw.

And while he acknowledges that during the years of financial crisis and recovery it was natural for companies in trouble to circle the wagons and fall back on tried and tested techniques to minimise errors, he also believes that: “The equation breaks down without reciprocal causality between financial performance and investment in people.”

In essence, organisations that don’t involve their people in figuring out how best to achieve the company’s purpose will struggle to get their employees to bring their minds to work and go beyond the minimum.

Richard Jolly, Adjunct Professor of Organisational Behaviour, London Business School, suggests that millennials more intuitively grasp this way of working: “Millennials will do a better job of running organisations than we are.”

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“90% of good ideas don’t come from the executive suite”, he says. “The senior executive’s job is to create a context where others have confidence and purpose.” It might take courage to relinquish the command and control mandate of our industrial forefathers, but our organisations are more resilient than we think.

Richard Jolly says: “The reality is that our organisations aren't china shops. They are more resilient than we think. We have to take risks and in the words of Mark Twain: ‘sail away from the harbour’”.

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