The organizational form of the future
Organizational Networks by Patrick Kenis; Bart Cambré
Of this book I only found a Dutch version. But the ideas are too interesting not to share.
Contents
New types of solutions for new types of problems
The world is VUCA. New types of solutions are sought for new types of increasingly complex problems. Problems manifest themselves in several specialist domains at the same time. That’s why the idea grew that solutions also have to come from multiple domains at the same time. So a network is needed to arrive at a total solution.
Nowadays, no organization has all the specialties in-house.
In the introduction, a few examples are mentioned: elderly people, medical assistance, reintegration of prisoners, the electric car, consultancy advice, the ZON education network.
Silos must be removed
It is important when networking in networks that silos disappear. It is replaced by inter-organizational cooperation. The added value is there for everyone in the network. It is also important that an organizational network focuses on effectiveness and not on efficiency. “After all, an organizational network is a necessary condition for finding effective solutions to problems that are complex and therefore cannot be realized by an organization alone.” This way of working transcends thinking in sectors of solutions. It’s more than open innovation. This methodology demands a lot from the participating organisations. Control within your own organization is therefore on the seesaw. So, it’s not the easiest option. This work searches further in the chapters for a number of conditions for the method to succeed. However, it will never be clear when these conditions will be sufficient. But it’s an approach.
What did you remember?
That we should not only focus on the nodes (the actors), but pay particular attention to the connections between them. Connections serve to exchange information, maintain friendship, be accountable, participate in the project, etc. Watch out for the ‘Law of Homophily’: a group of actors who are mainly concerned with each other within a relational system.
The type of organizational network is important for the goals to be achieved. For example, a network for crisis handling is quite different from one for innovation or information exchange.
External relationships are also essential. Relationship capital is becoming increasingly important for modern entrepreneurship. Social capital must be used beyond the boundaries of one’s own company, in order to improve one’s own operations.
The connections that are weak are often more important than strong connections to get new ideas and move forward innovatively. Strong connections are more likely to confirm what you already knew. Because you often bond more strongly with similar people than yourself. Bridging connections between networks are important in this regard.
In the back of your mind, you have to keep in mind the principle of asynchronous reciprocity: just like in an ecosystem, there is no such thing as “what goes for what and the same amount”. The idea is that your “gift” yields a disproportionate amount in an indirect way, i.e. with a detour.
Solutions from the past no longer work. Because of “VUCA”.
Everyone and everything is in a large distributive network. Financial capital is becoming less and less important. Social capital in a network society that is increasingly distributive, open and collaborative, all the more so. Access to products and services is becoming more important than ownership. Who doesn’t know you but can find you and wants to work with you becomes more important than who you know who can do something for you. Companies will purchase services that are not part of their core business.
What Do Organizational Networks Do?
Chapter 3 begins with a definition: “Organizational networks connect and share information, resources, and competencies of sovereign and unique organizations to achieve an outcome that none of the organizations could have achieved alone.” ‘Together’ is the key word here. However, it’s never the easiest path. In an organizational network, no single player is in control. There is no single client. There is not a single requesting party. There is no single vendor or a limited group of vendors. Everyone asks and everyone contributes to the creation of the answer, regardless of whether this is a product or a service or a piece of information for everyone. It is important that the focus is not on one or another organization, but on the issue that concerns everyone.
Differentiation and integration
It quickly takes several years for an organizational network to get up to speed, after a period of trial and error. Many felt called, but few were chosen. Two things are important to increase the chances of success: differentiation and integration. But what is that?
Differentiation means that you involve as many partners as necessary, but nothing more. Integration is about the cohesion in the network. This is necessary to connect the organizations in the network, which are and remain autonomous.
Differentiation does not work with integration. Other characteristics are that it is a closed group, which is limited to create a safe environment for itself.
Integration and connection are important for innovation, customization and the approach to complex challenges. If everyone continues to work on their own little island, and only there, the network will never achieve its goal.
Managing the organizational network
Chapter 5 is about managing the organizational network. “With the aim of connecting or sharing information, resources, activities and competencies of at least three organizations in order to achieve a specific result together in a targeted manner.” Result-oriented work is therefore central. Forms of governance that can help with this are:
- Self-regulating network,
- Leader Organization Network
- Network administrative organization
The situation in which the organizational network finds itself also determines which form of governance is most effective. Network leadership requires four types of behavior: activation, framing, mobilizing, and synthesizing.
One final question is how we know if the network is doing well or not. To this end, the authors provide an assessment framework that they illustrate to the case of reintegration of ex-prisoners.
Title: Organisatie netwerken – de organisatievorm van de toekomst, Authors: Patrick Kenis; Bart Cambré, Publisher: Pelckmans Pro, ISBN: 9789463371643