Introduction
Orgtology is a study of organisation (Org) and the consciousness that constructs it. It is also defined as the science of organisation. (Hendrikz 2020) In developing an understanding of an organisation through Orgtology, one can then come up with solutions to help the organisation exist more optimally in both performance and relevance. If it applies to all organisations, then we can examine innovation-based organisations that are particularly entering unchartered waters through the lens of Orgtology theory.
It is notable that such a type of organisation is naturally more projective in nature which means that inherently it is high risk and future oriented but through examining Hypothesis 2x, we can determine that this is only one half of the equation. For it to exist in a sustainable manner, it must find an equilibrium in both the projective and receptive activity which interacts within it. Projective activity is disruptive and changes things whereas receptive activity orders, stabilizes and maintains things. (Hendrikz 2020) If it is too skewed in the projective part in the quest for relevance and dominance, then it will not perform thus has no sustenance and will not survive long. It needs to get stable and efficient as soon as possible in its processes and systems. In this manner, it then can find profitability and fulfil its purpose.
Through Hypothesis 2x, we can also determine that a major part of the survival of such organisations is due to the X-factor it possesses. These are the unique human minds that work within the organisation that shape it. Combining all of Hypothesis 2x, in both Orgamatics, which describes its dual systems, and Organamics, which describes its X-factor, an innovation-based organisation can form a blueprint of how to survive and thrive sustainably in the environment it finds itself in as a Relevant and Performing Organisation (RPO). Examining the journeys of existing and prominent innovation-based organisations such as Tesla, Amazon, Google, Netflix and Apple as examples, we will delve into the secrets to their success in relation to Orgtology theory.
Summary of Hypothesis 2x
At the heart of Orgtology is Hypothesis 2x which guides everything. It regards that Org exists in both a physical and non-physical form through the implied processes and abstract thought. (Hendrikz 2020) There is both a rational, mathematical, algorithmic part which is receptive and the unpredictable, abstract part which is projective. These are described in the two arms of study, Orgamatics and Organamics. (Hendrikz 2020) The "2" of 2x addresses Orgamatics. Orgamatics deals with the dual parts form the systems that combine and interact to determine the type of intelligence that Org possesses as well as the work done and results produced in Org. For Org to be both relevant and performing, they need to be in equilibrium. (Hendrikz 2020) Organamics addresses the "x" of 2x. Org is also made up of human minds that are dynamics, unique and unpredictable, whose thinking creates that X- factor that differentiates that Org from others. This part cannot be replicated. (Hendrikz 2020) It features in the intelligences, paradigms and identities held by the humans in Org as individuals and collectively. These must be of use in Org in order to serve it towards being relevant and performing. Both parts of the Hypothesis must also be in equilibrium for Org to thrive. This includes the innovation-based organisations that will be examined.
Understanding Innovation
Innovation-based organisations often begin in the form of start-ups and carve a new path normally find a novel solution to a problem or find a new market to apply a solution. Whatever the perspective, they find an opportunity that they seek to leverage or a need to create or fulfil. Ideas sparked are what drive such organisations. They have a future intent that explores what has never been before and disrupts what was done before, dominating the space they find themselves in eventually. The projective part of these organisations is quite prominent. They seek to pioneer. There may be differing opinions on the different types of innovation. There are controversial arguments for whether it is truly disruptive innovation or is it more of sustaining innovation but the presence of the word innovation means that something new is being done. It is therefore important to understand what innovation is in itself before applying it to Orgtology theory.
One of the innovation based organisations that have become more prominent in recent years is Netflix. Its origins stem as far back as 1995. Harvard Business Professor and revered Tech Business academic, Clayton M. Christensen, coined the term disruptive innovation around 1997 and believed that Netflix was the perfect example for this term. Christensen was a revered author who wrote the prolific "The Innovator's Dilemma" which Steve Jobs included in his must read list. He states that: "Disruption" describes a process whereby a smaller company with fewer resources is able to successfully challenge established incumbent businesses. (Christensen, Raynor and McDonald, 2015) Netflix themselves challenged Blockbuster in order to garner success. How this smaller company does this is by targeting the overlooked segment of customers by providing them a more customized function often at a lower price. They can also develop a new market where there was none, turning non-consumers into consumers. (Christensen, Raynor and McDonald, 2015) The latter part is reminiscent of the Blue Ocean Strategy. This is whereby a company develops a new market from a new product all together instead of fighting for currently existing market share. In essence, it creates its own lane. Apple is a company that can be viewed as one that has made use of the Blue Ocean Strategy. (Chan, Mauborgne and Young Koo 2012)
As new innovation-based companies have emerged, such as Uber in 2009, Christensen's theories have been tested. Christensen argues that Uber is not a genuinely disruptive innovation from the definition and criteria stated previously though many like to describe it such. He argues that it went for the mainstream customers who use taxis from beginning and did not seek out to create a new market or target overlooked customers in the fringes. It went from upmarket to down-market rather than vice versa which is how disruptive innovations normally work. It may be viewed as a sustaining innovation that improved what was already there (taxi service) for mainstream customers by leveraging technology. (Christensen, Raynor and McDonald, 2015) Of course, there were consequences emerging such as car owners opting for the service later on when they realised that the quality of the experience was satisfactory but that was not the main target. It is tricky to differentiate these types of innovation and some organisations can be more of hybrids of the two. Furthermore, Christensen later adjusted and updated his theory. He then gave more specific guidelines to help with the differentiation. (Christensen, Raynor and McDonald, 2015) The two approaches to innovation, disruptive and sustaining, may be different in how they go about things but at the core there is a change that takes place. They can be viewed as a part of the duality that Orgtology contains. It does not have to be an either or. It is about using whatever approach when needed to innovate that will serve the organisation best at whatever point in time.
An important and prominent element of innovation is human thought which generates the ideas that make the organisation come to life. It is why that organisation exists. Founders come up with a solution to a problem then form an organisation around that. In terms of Orgtology, this is x in Hypothesis 2x which forms the X-factor in Organamics. This is a major part of innovation-based organisations as this is what allows them to innovate and creates their competitive advantage in the first place.
Organamics: Exploring The X-Factor and Dynamics of Org
Organamics is about the dynamic individuals that make-up the Organisation. (Hendrikz 2018) They are each unique and cannot be replicated. If you look at some of the companies that are viewed as the most innovative, the founders or those at their forefront are just as famous as the organisation. Elon Musk with Tesla, Jeff Bezos with Amazon and Steve Jobs with Apple. They seem to embody the organisation and what it stands for. They are disruptive and aim to change the status quo. They imagined a future different to what presented to them before. They then gather resources (people, money, assets) to work in the cause of turning their ideas and thoughts into tangible products and services that are useful to humanity and change the course of history and how things are done. The intelligence of the founder(s) must serve Org and what is trying to do. The founder(s) then gather people to work with who have their own intelligence. They need that team to turn dreams into reality.
In the moment of setting up a new venture that is doing something never been before the risk is very high. There is no guarantee of success, no track record. There is only assumption that it is even viable. There are many unknowns. This must be tested and that is a costly exercise that can cost dearly before it can show promise in return on investment. Many fail. This is also where a team can come in. They are a major resource for innovation-based companies especially in the beginning. They have unique intelligences and abilities that must serve Org, conforming to what that Org is about. It must be within bounds of "normality" for that Org pushing boundaries just enough to drive the organisation along otherwise it becomes a threat if it goes too far. More chaos is introduced than can be dealt with. This relates to Theory Ix of Intelligence in Organamics. (Hendrikz 2018) Human intelligence must work together with the algorithmic systems intelligence in the advancement of Org which is further explained in Theory 2I of Orgtelligence in Orgamatics.
For the team of human minds within the organisation to work well when ground is being broken and things are hostile, they must find a connection to the organisation beyond remuneration. Money as a resource is normally limited at this stage and is normally tied up in all that must be established. They must buy into the philosophies of the organisation and the promise of its future success. This is because they have to give 100% (or more) to that organisation. This is what is observed in the origin story of some of the giant innovation-based organisations such as Amazon. It is not uncommon to hear stories such as this:
"One early employee worked so tirelessly over eight months — biking back and forth from work in the very early morning and very late night — that he completely forgot about the blue station wagon that he'd parked near his apartment. He never had time to read his mail..." (Hartmans, 2020)
There are more stories of being understaffed at Christmas time and needing to work like a dog to handle the demand and pressure. Such commitment and loyalty is normally to be found when a person feels deeply connected to Org. Their paradigm or way of seeing must align with the Org that is that their emotive, cognitive and behavioural patterns must align with Org for them to work in a more optimal, sustainable way especially when things are incredibly difficult. This connects to Theory Px in Organamics, which links to the team buying into the culture and vision of that Org because they see themselves reflected in it in term of values. (Hendrikz 2018)
A company such as Google is one that is best known for an enviable and attractive work culture that attracts the best talent. Its values permeate in everything and is clear. The values are internalized and whoever is part of the team has demonstrated that these align with them. These include focus on the user, democracy on the web, being able to be serious without a suit and a spirit of excellence in doing great work. (Brooks 2018)
"These core values paint a picture of what a Google employee might look like… Clearly defined values help companies to hire people that will fit with the culture and reinforce important behaviours." (Brooks, 2018)
"There is also a spirit of community, collaboration and trust in allowing work to be flexible which is favoured creative minds who detest traditional structure thus the team or workers are able to devote themselves to their work if they feel like they are significant and contribute meaningfully. They get to grow with the company or organisation that seems to understand them and support their individuality." (Brooks, 2018)
Another innovation-based organisation that has been able to leverage its stakeholders beyond the internal team is that of Tesla who included customers directly in their operations and strategy. They used their customers to distribute their vehicles which blew the minds of analysts. (Dans, 2018) It is not logical or rational. This can be attributed to Tesla promoting itself beyond being a car company. They put at the forefront that they want to change the world and make it better. (Dans 2018) This resonates with people and the current environmental stance in the world. They then are able to participate as this becomes a noble call to action than a participation in capitalism. A particular narrative is sold. We increasingly live in a world that is enamoured with storytelling at every level. People want to see themselves reflected back. Emotion is a powerful motivator that drives what people do.
Apple is also one of those innovation-based organisations that have been able to connect deeply with its consumers. They are loyal to the core. People possessing advanced Android gadgets may tell Apple users about the superior functionalities that their gadgets possess but many Apple users would still be unconcerned with switching. A strong brand has been created beyond product and function. Steve Jobs is remembered fondly even though he has been gone for almost a decade. His legacy lives on. He set himself apart and that is the way Apple continues to be viewed. "Think Different" is slogan he came up for a marketing campaign which ended up encapsulating what the company represents. (Beattie 2020) It is different and memorable. It competes with numerous brands that are lumped under Android but stands on its own. It emphasises its uniqueness. It has disrupted how things are done and set the precedent. This relates to Theory Ex (E stands for Entity) in Organamics that deals with that difference. It changes things but it can also create conflict. (Hendrikz 2018)
Steve Jobs is an example of difference that creates conflict when boundaries are pushed too far. He was more projective and disruptive than Org could handle at that time. He had to leave his own company when John Sculley came in from PepsiCo as CEO in 1985. He can be viewed as the more receptive of the two in maintaining order and fostering stability that the company needed to survive. The urban legend was that he was fired but digging deeper it emerges that he left on his accord when the board of Apple determined that his pricing strategy was too disruptive and that he was not mature enough to be CEO. This is according to Sculley who spoke candidly about it at the Engage 2015 conference in Prague. (Edwards, 2015) Jobs had hired Sculley for his marketing genius to create Apple as a formidable brand. Cash flow was diminishing with the failure of several products and Sculley was the solution to up sales of the Apple II. (Edwards 2015) It is thus evident to observe from Apple's story that as an innovation-based organisation grows, its needs change at different stages. Steve Jobs was not always the right person at the forefront.
In Orgtology, leadership and management are two human roles that Org needs to perform and stay relevant. These functions are not interchangeable even though they are interdependent. An individual can be assessed according to their ability to do these as needed. Leadership and management must exist in duality because leadership governs the projective elements that change things in Org and management governs the receptive elements that maintain things in Org. Theory Dx addresses these dynamics that give rise to the Relevant and Performing Individual. (Hendrikz 2018) It is evident that Steve Jobs was heavily leaning towards leadership and was not best suited for management which Apple needed at that point in time. He was aware that he needed to hire people who supplemented his weaknesses. He wanted to keep driving the projective part by creating more new things which would make Apple more relevant but at that time, performance was failing and that needed to be turned around.(Beattie, 2020)
After Steve Jobs left, Apple continued to do well because the plans he had set for the vision of the company were well documented. (Brashares 2001, p. 59) It was just a matter of execution. It then hit a slump and the competitors had caught up years later, where Jobs was needed for his innovation to drive the organisation forward. This can be viewed in Orgtology as way to find equilibrium again as the receptive elements appear to have far outweighed the projective ones. It was losing its relevance. There are cycles that Org has to go through in finding equilibrium at different phases than a simplistic linear trajectory to keep both performance and relevance. Tim Cook can be viewed as an individual who has found a balance between leadership and management in the current running of Apple. (Zetlin, 2019) He has improved the iPhone that Jobs began (management) and released new products and services such as Apple Watch (leadership). Under him, in 2018, Apple made history by becoming the world's first $1 trillion company measured by market capitalization. (Beattie 2020) This demonstrates that leadership and management must interact in equilibrium in order to create an empowered system which both performing and relevant. The changes must be incremental and measured as Org matures and gets into process mode. Innovation must thus co-exist with containment. Operations must co-exist with strategy. This will help ensure its longevity and sustainability. Act in the now while your eyes are also on the future especially in a time in the world as volatile as this. This is where it is important to understand the systems and activities of Org that must exist in equilibrium by examining Orgamatics.
Orgamatics: Finding Equilibrium Between Innovation and Containment
Orgamatics can be described as the scientific study used to create strategy and ensure operational efficiency. (Hendrikz 2020) It is a fundamental part of Orgtology which examines workplace systems. These come in dual pairs with projective and receptive elements that work together in Org. The inverse duality means that the elements must be in balance and are interdependent yet they take from the same resource pool thus if you use resources for one side of the equation, the other has less resources to work with. (Hendrikz 2020) It is important to note that determining projective or receptive is not always so clear cut. In Innovation-based organisations the projective, disruptive part is quite pronounced but on the other side, which is receptive, there must be order and structure. Abstract thought must become tangible product/service. There must be containment of the daily operations so that Org becomes more stable and performs as soon as possible. It needs to perfect what it does and how it does it over time yet that still needs to strategic and relevant to its environment.
With a team on board, the organisation takes that idea into the reality of the desired product or service. The human minds that we delved into extensively earlier on in Organamics become one side of the equation in Theory 2I of Orgtelligence. Orgtelligence is the combined intelligence of the systems in Org (technology) and the human intellect that is carried by the human minds in Org. (Hendrikz 2020) These must also work in equilibrium. At times, Steve Jobs was relevant in his thought but the technology available and the people around him had not caught up to making those ideas real. (Beattie 2020) The strengths of both must be leveraged such that the systems handle the predictable, algorithmic and operational work it does better than humans and the humans do the disruptive, creative and strategic work that they do better than technological systems. They must both serve Org. Human beings are such that they are not tied to Org forever. They can leave. It is therefore important that the knowledge and expertise that they have be put on record so that it may be adopted by Org even after they are gone. Just like what happened with Steve Jobs when he left Apple around 1985. (Brashares 2001, p. 59) This knowledge then becomes Explained Intelligence. Over time, it becomes a part of the process as Systems Intelligence. (Hendrikz 2020) Feedback loops are also important to create so that the Orgtelligence knows what to do when it encounters and out of the ordinary response and deal accordingly for example a new risk or opportunity.
Orgamatics and its duality also means that the work performed also is two-fold in nature. These are found in Theory 2P of Work and are namely processes and projects. (Hendrikz 2020) Both are necessary but serve different functions. As innovation-based companies begin, they are entering a space that has not been charted before. They are primarily projective which means that work done is largely project based. This means that it has a beginning and end point. It is non-repetitive. It is done to ensure the relevance of that Org and deal with the unknown future. This is more strategy work that deals with change. It must relate to a process in order to survive. On the other hand, processes become more and more important as Org becomes more stable and established. This about the operations and the daily, repetitive tasks that need to be performed. It is cyclic and perfects the known past. Process targets, measured during a specific point in time, are a form of results that are important to track.
After work is done, there must be a measurement of the work done and its consequences to determine the impact and how Org is doing. Duality is also present in this case. The two types of results, as determined by Theory 2E of Results, are Outputs and Outcomes. (Hendrikz 2020) Outputs are the results of internal performance controlled by Org. This is about efficiency and doing things right. Over time, energy must be reduced without reducing output as the processes to produce that output are perfected. It becomes a "no brainer". Process efficiency helps that organisation to mitigate internal risks. Outcomes on the other have to do with environment that Org exists in supporting the outputs produced. It is about negotiating relevance and being effective. This means doing the right thing. The demands of the environment must be met at whatever cost that will bring a relevant result.
With Apple, under Sculley, they were able to be more efficient in their operations and produced outputs that brought immense financial growth. However, with time, competitors caught up and the effectiveness of Apple diminished. Microsoft became the standard rather than OS which was cheaper and covered a larger sector. Jobs was needed to get relevance back for Apple through his user-centric and digitally centred vision. Currently though, there is a thought that Apple after Jobs may be losing their creative and innovative edge thus their outcomes may not be viewed as favourable as before. (Beattie 2020) Tesla is another case in point finding equilibrium in efficient outputs and effective outcomes. According to (Dans 2018), they were worth more than Ford and were comparable to the world's biggest, historical car brands like GM. This is while producing only 80 000 cars per year in comparison to Ford's 6 million. Their relevance and demand was so high that they were struggling to meet demand for their Model 3. This means that they needed to up their efficiency and perfect their production processes. Equilibrium is important here because the energy and result must be balanced because outputs and outcomes may be at odds in their use of energy and resources. (Tesla)
Though purpose may appear similar in innovation-based organisations to use technology to create solutions for people and what they produce can feel similar, by virtue of having different resources and people, the nature of that purpose will change. Each Org is unique because what makes it up. All Org, however, must strive according to Theory O of RPO to be relevant and performing in order to overcome the Force of Entropy (FOE) which threatens to annihilate it and seek to thrive by being sponsored by its environment. (Hendrikz 2019) Their Operations and Strategy must be in equilibrium using their Orgtelligence, producing appropriate work with desired results. Google is one of those companies or innovation-based organisations that can be viewed as an RPO (Relevant and Performing Organisation).
PhD Researcher and Advisor in Management and Organisation, Annika Steiber, did an in-depth yearlong study on Google which resulted in her book, "The Google Model: Managing Continuous Innovation in a Rapidly Changing World" which explores some of Google's organisational principles and practices contributing to its success. It is evident that this book and the approach correlates almost perfectly with Orgtology. The book covers the six management principles that have been identified by researchers as ones that allow companies to engage in continuous innovation. (Steiber 2014, p. 16) The principle of Ambidextrous Organisation applies the duality of Orgtology. It combines the two forms of organisational logic. These are daily production, which deals with conventional planning and control, and innovation, which has greater freedom and flexibility. (Steiber 2014, p. 16) It is further stated that "A company's ability to create conditions favouring long-term business success is based on being good at both production and innovation." (Steiber 2014, p. 24) Another principle is that of Continuously Changing Organisation which is about finding the balance between chaos and order. (Steiber 2014, p. 19). This is another concept addressed in Orgtology. The book not only touches on the Orgamatics part of Orgtology but also Organamics, which deals with the X-factor and human minds in Org. People Centric Approach is another principle covered which is about taking care of employees and fostering a culture that encourages innovation from the top down. (Steiber 2014, p. 22) There are many more examples that support Orgtology in the book that relate to Google and its success. It is important to note that even Google is not above critique though it may appear to have dealt with equilibrium well. (Dans 2019) addresses the fact that their innovation strategy of constantly testing out new prototypes on users then dumping them may frustrate users who constantly have to adapt, especially if they like the new innovation. It is fine line to walk in pleasing those that you do things for. The environment needs to continue to sponsor you.
Guide To Applying Orgtology Principles As An Innovation-Based Org
From the different case studies of the more successful innovation-based companies, there are some important take-aways that can guide a newly beginning innovation-based organisation. These are:
- Choose the right team that serves Org (X-factor) and create a work culture around them from the beginning that is conducive for innovation but also creates order.
- Evaluate your orgtelligence (which includes your team and systems intelligence) and ensure that they complement each other in strengths and weakness to reduce redundancy. Feedbacks loops are important in clearly guiding what to when the unexpected happens such as when there is a risk or opportunity.
- Define and set-up how you will work in your systems and the type of work to be done and when. (Projects and Processes).
- Evaluate your results appropriately and change things accordingly. (Are your outputs efficient and outcomes effective? How can you improve?)
- Constantly examine which phase Org is in as it goes from more projective to receptive activity thus projects must be adapted into processes as it matures.
- Never stop innovating but do it in a more controlled manner. Equilibrium is important to always have in mind.
Conclusion
Innovation-based companies will not always be as innovative and projective as in the beginning. In the beginning, they are largely projective and disruptive in nature which needs a greater use of projects to create what has not been yet. As they mature, they become the norm and find stability in their processes. This has been explored in cases such as Apple, Google and Tesla. Even the late father of Disruptive Innovation theory, Christensen, eventually recognized that disruption may be a good way to start a company but it is not the best was to grow it. (Lyons 2020) Org thus as to find equilibrium in their projective and receptive elements so that they are in the most favourable position that they can be in in the long run. They need to be intentional about the innovation strategy they introduce for relevance as they manage their daily operations. Their orgtelligence, work and results must be in equilibrium in order to be on the road to being a relevant and performing organisation (RPO).Org must also take care of its X-factor, which is the unique human minds in it, by creating a culture that works best towards Org so that Org is made of relevant and performing individuals (RPI). Equilibrium is not an event, it is continuous and must constantly be evaluated. It must always be adjusted accordingly as the past is perfected (operations) and the future is created (strategy) in the now. It is thus evident that Orgtology is greatly applicable in innovation-based organisations that desire to survive and thrive in the long-run as they ensure performance and secure relevance. Duality and balance is important to address in the ever changing world that we find ourselves in.
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