We are all to varying degrees prisoners of our metaphors. This is true in both our heads and when we communicate with others. And it’s definitely true in business. Depending on your industry, any number of metaphors can guide the acquisition of new capabilities. However, there is one global metaphor shift that will help you and your organization succeed in the Network Age, and that is shifting from a mechanical to an organic worldview – from a view of your business as a machine to an actual living ecosystem.
In the last few decades, the predominant metaphor has shifted in nearly every one of the sciences from mechanistic to organic. Some scientists have even posited that the universe itself may essentially be a living, complex organism. So it’s just time business updated its metaphor as well.
The machine metaphor is ubiquitous. From the dawn of the Industrial Revolution, we have used metaphors about machines to communicate about work. When things are running smoothly we say they are “humming along” or “it’s well oiled.” Likewise, if we encounter a problem that needs to be fixed, we simply “re-engineer” the machine.
Frederick Taylor, the pioneer of industrial age management, used his stopwatch to measure the motions of people as parts in a machine. This was the machinery of the Industrial Age, and make no bones about it, this reductionist approach yielded unprecedented gains in productivity and material wealth.
It seemed rational to treat people like parts in a machine when the way that you unleashed productivity was by putting people into factories. Those factories required huge outlays in capital. It therefore made sense to make decisions around the binding constraint on growth – capital itself. Measures like return on equity and the Du Pont formula arose to facilitate rationing of capital and ensure its application to highest return opportunities.
Is ROE Capitalism’s “Runaway”?
The cornerstone of the Industrial Age business measurement system was ROE. Several years ago the Harvard Business Review published an article entitled Runaway Capitalism. A “runaway” in evolutionary terms is when natural selection and sexual selection become decoupled, as in the case of the peacock’s tail. The tail offers such evolutionary disadvantage that peacocks would be extinct were it not for the fact that humans like to collect them. Yet peahens are drawn to the tail, so it continues to be selected for by the species even though the natural environment does not support it. The author’s point was that ROE may be capitalism’s runaway. In network science terms, you’d call it a self-reinforcing positive feedback loop. And the implication is that it may threaten the continued survival of the planet and the species.
The Challenges of a Machine Metaphor
If the above is true, then perhaps the biggest challenge presented by machine management is the belief that everything should myopically serve the machine. And that one number, ROE, represents “the One Ring to rule them all” in the machine metaphor.
Other challenges with the machine metaphor include the fact that it stifles initiative. Henry Ford captures the essence of the machine mentality when he asks, “Why is that when I inquire for a pair of hands, they come with a brain attached?” A business that is run solely as a machine is not adaptive. It is too cumbersome and slow and fails to consider externalities. It isn’t designed for emergence. Or as Carolyn Hendrickson, a Ph.D. in organization design quipped, “Why don’t matrix organizations work? Because the mind that designs the matrix is not the mind that inhabits it.”
One of the chief challenges of a machine metaphor is that we continue to apply it to ourselves, when increasingly scientists are showing us that we are ourselves the products of the networks we engage in (see this BCG TED talk on leaders as network designers).
Despite these problems with machine view, there are new perspectives that can include it in a new larger whole – that of the complex ecosystem.
The Power of a New Metaphor: The Complex Ecosystem
Modern organizations are composed of complex living systems or networks. The metaphor of an ecosystem implies we are part of a community of living organisms, intertwined with nonliving components like technology, all interacting as a system.
This boundless system goes far beyond the physical boundaries of the firm and includes psycho-social characteristics as well as the material elements of our supply chain. It also includes the emergent outcomes of local agents acting upon very simple rules (which is why a rigid three-year plan won’t work). In order to compete and stay relevant, we need to stop managing what we think of as static machines and start nurturing our boundless dynamic ecosystems. Some principles for a networked ecosystem design could include the following:
We believe organizations aligned with ecosystem principles will drive innovation through the 21st century and beyond. Why? Because they are more responsive and adaptive. They integrate both top-down and bottom-up organization. They are better suited for dealing our evolving world: a world of transparency where negative externalities are no longer tolerated, a world where sustainability is a key driver of choice, and a world where the choice is yours to make. What metaphor will you choose?
This article is the second in a series on the power of metaphor to shape our world and worldviews. You can read the first here, in our Ways of Seeing department.