Those of us who have worked in big, clunky organizations know that it’s common to experience a fair amount of dysfunction there. Slow bureaucracy, a toxic workplace, and inefficient time management are but a few of the miseries we’re likely to confront.
As powerless as we may feel in such an environment, there’s hope. It comes in the form of the Loop Approach proposed in the book of the same name by Sebastian Klein and Ben Hughes. This approach equips us with ideas, tools and methods to effect change in an organization one step at a time, one team at a time. In doing so, it helps us transform even the largest of organizations from the inside out.
During the Roman Empire, the Emperor reigned supreme. He sat at the top of a hierarchical pyramid, issuing orders to minions below him.
But while the Roman Empire is long gone, the pyramid structure upon which it was based is not. In fact, most of today’s large organizations and companies rely on a top-down system of organization based on hierarchy. At the top is the equivalent of the Roman Emperor – the CEO – who makes decisions and passes down orders to the bosses below him. From there, the orders move down the tiers of managers and sub-managers until they reach those at the bottom of the pyramid – the workers.
This system is extremely prevalent because it’s effective in organizing large groups of people into an enterprise. That’s because this structure reduces complexity. It’s based on a simple principle: everyone must follow orders from above. It’s largely thanks to the pyramid structure that the Roman Empire came to rule over vast swathes of the Western world. It’s also why so many companies and organizations have conventionally adopted this structure.
But while the pyramid structure worked well for the Roman empire, and until recently, for many large corporations and businesses, that structure is not suited to dealing with the uncertainties that organizations face today.
That’s because times are changing. The business environment is more challenging than ever. For one thing, technology is changing at the speed of light, which means that those businesses that are unable to adapt fall by the wayside. What’s more, new competitors and business models emerge every day, adding further to the uncertainty.
This is where the pyramid structure falls short. While this structure is effective when it comes to executing plans, it’s slow and clunky when it faces change and must adapt.
This is especially true of large organizations. Why? Because they’re so big. When an organization’s environment changes, for instance, it’s not usually the boss at the top of the pyramid who notices. It’s the workers at the bottom, who interact with the surrounding environment directly. But by the time that change in conditions is communicated up the chain of command so that decisions can be made in response, it’s often too late. Faster, more agile competitors have already reacted and moved ahead.
For all these reasons, it’s time to say goodbye to the pyramid structure and hello to the Loop Approach.
It goes without saying: before you can change how you act, you have to change how you think.
What’s true for you is also true for organizations. Just as individuals must cultivate a certain mindset to change their habits, so must organizations.
Traditional organizations rely on a predict-and-control mindset. When they want to change something, they often aim for a certain result – more sales, say. Someone – usually a boss at the top of the pyramid – decides on a predefined endpoint, and then someone else is tasked with scribbling furiously on a whiteboard to come up with a plan for how to get there.
The Loop mindset, by contrast, is based on sense-and-respond thinking. What does this mean? Imagine an organization as a complex machine, in which every employee is an intelligent sensor. In a sense-and-respond organization, employees act as sensors that receive and evaluate signals from the outside world. In this model, the ability to sense and respond is distributed throughout the organization, rather than being concentrated at the top of a pyramid.
Another key principle of the Loop mindset is purpose-orientation – the notion that an organization must not only have well-defined goals and strategies, but also a greater driving purpose.
If we take the electric car company Tesla as an example, we can deduce that its core purpose – the answer to the question “Why does Tesla exist?” – might be, “To accelerate the advent of sustainable transport.” Tesla can come up with different strategies for how to achieve this. For instance, it can improve electric battery technology, or it can work on reducing the cost of electric cars so that more people can afford them. It can also use both these strategies at once. The point is, its core purpose – to accelerate the advent of sustainable transport – guides its shorter-term strategies and goals.
Yet another key principle of the Loop mindset is autonomy and self-organization, which means that individuals and teams must have enough independence to act autonomously. The online shoe retailer Zappos embraced this principle when, in 2013, it eliminated its managers to put more decision-making power in its employees’ hands. The idea is that such a transition will help the company become more flexible in sensing and responding to changing conditions.
Ultimately, these principles are so important because they lay the groundwork for an organization’s ability to transform itself into a more agile, flexible entity.
Sometimes, who you are and what you want are just not clear enough. But without clarity, you can’t move forward.
That’s why the Loop Approach begins by focusing on clarity. To implement the Loop Approach in your organization, you’d hold a series of three workshops, each of which is two days long and is referred to as a module. Module 1, Clarity, kicks things off by helping your team clarify its Alignment, both in terms of its own purpose and that of the organization.
To do so, this module uses a fun exercise called The Purpose Playoffs. You begin by pairing up team members and asking them to define the team’s purpose in a sentence. Then, teams square off against each other until only two sentences remain, which are integrated into a final version of the team’s purpose. The exercise results in a new, crystal-clear definition of your team’s purpose.
Once your team has achieved clarity on its purpose, you move onto the second part of Module 1 – People Potential. This second part aims to clarify team members’ skills and strengths. Why focus on strengths? Because if your team members’ strengths are properly used, then their weaknesses become irrelevant.
That brings your team to the next key exercise, which is creating a Personal Profile for each individual. This profile is made up of both the strengths and competencies that colleagues identify in the individual, as well as the individual’s own estimation of his strong points. In the final step, you and your team share the profiles with each other, so that everyone has a clearer sense both of their own strengths and those of their colleagues.
In the final part of Module 1, your team focuses on better definition of roles, so that team members can also clarify accountability within the team.
Here, you ask team members to list all the tasks that they perform on a regular basis. Then, team members cluster all the tasks that have been identified into roles, so that each group of tasks falls under the responsibility of one role. Once all the participants have an overview of the roles, you ask them to develop and update the team’s role structure collectively by considering questions such as which roles are really needed for the team’s purpose, and whether any roles are missing.
Check out my related post: Renovation and Reimagination?