PWC’s Annual Global CEO Survey recommends Exponential Thinking because we are in an “exponential world”. This is true, but in ways that PWC fails to identify.
We are accustomed to think in a linear way. For millennia, this thinking was appropriate. It led to thinking of organizations as a sum of various parts where control can be achieved through separation into functions and departments. Only in relatively recent times did science become aware of non-linearity in nature. Non-linear phenomena, like networks, follow different laws. Small changes in a complex system can create unexpected and significant outcomes. These are emergent properties.
None of this is taken into account in traditionally designed and managed organizations, no matter how hi-tech and contemporary they may look.
Knowledge is opportunity
Linear thinking is deeply embedded in the way organizations are designed and managed. The problem is, we now live in a world that is immersed in networks of networks and interdependencies that are unprecedented. All this is accelerated by technology that advances at breakneck speed.
What has this got to do with thinking exponentially? Everything. Thinking linearly in terms of increments is no longer adequate when change (and potential growth) becomes exponential. First of all, you need a way to think exponentially and then you need an organization built to accommodate exponential thinking and exponential growth. This requires a mindset and an ability to continuously innovate.
A method for exponential thinking
If we can only think in terms of incremental growth, this is a limitation. How can we overcome this kind of limitation in a practical way? By learning to think in terms of breakthrough. The Thinking Processes from the Theory of Constraints provide a method to take a situation of limitation or blockage that we perceive to be unsatisfactory and develop a breakthrough solution. Only a breakthrough will take us to a whole new level of performance that is not simply a linear and incremental improvement. Companies can learn and adopt this way of systemic thinking. It will strengthen and underpin the shift to a systemic way of thinking and operating to overcome the limitations of a an outdated, linear approach. It will unveil opportunities that would not otherwise be apparent and it will embed a mindset and method for continuous innovation.
Building the organization for exponential thinking and growth
The transformation of organizations that Intelligent Management advocates is one of system optimization as a prerequisite for innovation. This is because we now live in a time when continuous innovation is a necessity. This kind of organization is one that operates and behaves as one, interconnected system, not a conglomeration of functions and departments. It is one that replaces competition with cooperation, that manages performance using appropriate statistical thinking instead of assessing performance deterministically, and that fosters teamwork and not the ranking of individuals.
The organizational structure that has to be in place embraces and functions on the basis of the PDSA cycle – Plan, Do, Study, Act. An organization that embraces the PDSA model is poised for innovation because it allows imagination to be linked coherently and cohesively to what people eventually will buy and thrive with. What makes Apple unrivalled today is not (only) imagination but the amazing supply chain that connects their ideas to everything else needed to ensure that we can enjoy Apple’s products. Dr. Deming would refer to all of this as Quality.
Sadly, Quality in many companies has become red tape. The essence of Quality, instead, is the understanding of companies as whole systems with well-designed interdependencies and reliable processes. It is a mindset of continuously seeking to do things better.
Exponential leadership
In a world that screams for continuous innovation, leaders have an opportunity to give meaning to their role by creating an organization focused around quality and innovation for exponential growth. This entails creating an organization centred around a network of projects with project management not just as a key method but as a way of being. Companies must systematically foster the ability to develop new ideas or products with speed and to design and execute precise project plans, whether simple or complex. Embracing a paradigm of organizational change becomes a prerequisite for developing an effective system of innovation and exponential growth. The Decalogue method enables companies to plan, execute and adopt the transformational mindset and management practices that foster exponential thinking and growth, from strategy through to the day-to-day.
Innovation as the focus of organizational efforts
Innovation, leadership and quality are intrinsically interconnected. Innovation is not just another company function, much less a department. Innovation is the very reason why a company exists and survives: to supply customers with products of ever increasing Quality. The organizational systems that enable innovation to flourish are what deserve attention, and therefore money, from investors and government because they translate this money into the wealth of not just shareholders but the community at large. Everybody wins.
Learning to think exponentially
The Thinking Processes from the Theory of Constraints take us beyond linear thinking to conceive new possibilities. They feature on our new business novel The Human Constraint. We will also be offering programs in 2025 to allow people to learn these Thinking Processes and transform a situation of blockage into a whole new level of performance. For ifurther information on our new programs, please EMAIL us at intelligentmanagement@sechel.ws
To find out more about ten guided steps to a systemic leap ahead for your company, contact Angela Montgomery at: intelligentmanagement@sechel.ws
SCHEDULE AN INTRODUCTORY CALL WITH US
Intelligent Management works with decision makers with the authority and responsibility to make meaningful change to optimize your company for the digital age. We have helped dozens of organizations to adopt a systemic approach to manage complexity and radically improve performance and growth for over 25 years through our Decalogue management methodology. The Network of Projects organization design we developed is supported by our Ess3ntial software for multi-project finite scheduling based on the Critical Chain algorithm.
See our latest books: The Human Constraint from Routledge; From Silos to Networks: A New Kind of Science for Management from Springer; Moving the Chains: An Operational Solution for Embracing Complexity in the Digital Age by our Founder Dr. Domenico Lepore, and ‘Quality, Involvement, Flow: The Systemic Organization’ from CRC Press, New York by Dr. Domenico Lepore, Dr. Angela Montgomery and Dr. Giovanni Siepe.
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