The trouble with systems

By Thane on Fri 25 November 2011

We have this tendency to want to make our lives easier - perhaps this is a built-in biological mechanism to conserve energy? So we've been constructing systems for ages now: all the way from cars to supercomputers to money- making "systems" that we call organisations. Many people who give advice to entrepreneurs tell them to try to set up "systems" in the company so that they can eventually work themselves out of a job - the "system" is then to just run itself, bringing in "passive income" every month for the entrepreneur.

The production line

Think of a modern manufacturing line: the line assembles one or more types of products, and today it's possible to have the line do so with very little human interaction at all, except for the occasional programming and maintenance. We then churn out as many products as there is demand in order to make a profit.

Figure 1. Car production/assembly line

Many web-based businesses are set up like this too: think Facebook, Google, Groupon, etc. And with artificial intelligence, we're most likely going to start needing even less human intervention. The only time human beings are really needed on the business side is when things go wrong, or one needs to do things that are outside of the system's programming, or one needs to teach someone else how to use the system.

The nice things about systems are that, in general, they can be controlled, they can be optimised (see The Goal by E. Goldratt), and, if set up properly, you don't need highly skilled people (like the original developers of the system) to watch over the operation of the system. It's only in times of serious crisis that the original developers are called back in. This is certainly appealing, especially when it means being able to cut your operating costs, developing economies of scale, to the point that the money just rolls in without you, as the original architect, having to lift a finger.

The organisation as a system

Many people advocate looking at an organisation holistically as a system (for example, Peter Senge's Fifth Discipline) - one whose purpose is to produce profit. So we come up with elaborate organisational designs and incentive schemes to encourage the various "parts" of the system (i.e. you and me) to act in such a way that the whole system produces this profit. We even try to get the organisation as a whole to "learn". Often, the long-term aim of the entrepreneur who establishes such a system is to reduce the organisation's dependence on him.

Figure 2. Traditional organisational chart

The appeal of this kind of perspective, at least in theory, is clear: the smartest person (the entrepreneur) designs the money-making machine, putting all the necessary cogs, wheels, etc. (the "not-so-smart" or highly specialised employees) in place and connecting them in appropriate ways (hierarchies, incentive schemes, etc.), and the entrepreneur cracks the whip (in whatever form that may be) to get them to work together. Out pops a continual stream of profits, and the entrepreneur plays golf all day and goes on long, frequent overseas holidays. (Note: "entrepreneur" here could also refer rather to "shareholders").

Of course, the employees are not so dumb any more, and they know when they're being taken for a ride, so we've established all sorts of elaborate psychological schemes (read here: human resource management, internal branding, team-building, etc.) to basically trick people into thinking that "the company really cares". Sure it does: if its cogs break down, the stream of profit stops, and the shareholders have to cut their overseas holidays short to come home and fix the system.

Not everyone's a greedy, profit-hungry blighter

Not all companies, I admit, are solely focused on profit - many of them have products or services which are truly beneficial to humanity. But seriously, do we really need another iPad? Click here for a pictures of what need looks like. Surely we should all be working together towards fixing this?

Some companies do a lot of good. The non-profit arm of a company I used to work for, the Praekelt Foundation, is using technology in novel ways that's helping solve serious social issues. I'm sure there's a whole range of other companies out there trying really hard to do similar things.

People are getting smarter

Back to the systemic perspective. So it's all fine and well when you've got a simple product line with a relatively stable demand and a work force that's happy with being kept unempowered in exchange for a mere pittance of a salary. What happens though when the people you employ, as an entrepreneur with this systemic perspective, are smarter than you? Perhaps they'll find ways around your incentive schemes and systems to screw you over? Perhaps they'll figure out how to start a company just like yours, only better? You'll probably end up regretting that you treated them like idiots or in ways that made it seem as though you were stepping on them.

Markets are shifting more rapidly

Not only is the composition of the "organisation" changing, but people are getting smarter (especially in first-world countries), the amount of consumer choice that we have is growing at a dizzying rate, and attention spans are shortening (largely, I think, due to social media and a lack of discipline in its use), so it's becoming increasingly difficult to keep people satisfied. Their wants and desires are becoming ever-more fickle, and so the days of setting up production lines that pump out hundreds of thousands of black model-T Fords are most likely over.

The trouble with the system in this case is that even though the market shifts, the system stays facing the same way it was "programmed" to face. If this system is a monstrous organisation with 100,000 employees, and its product or service demand shifts significantly and rapidly enough, imagine the upheaval and distress this would cause! (And the obscene sums of money made by change management consultants in the process of trying to get everyone to work in the new direction).

Towards new ways of organising

We need to start looking at new ways of organising. A friend of mine pointed me towards this site this morning: "UnBoss yourself" is the idea behind it. Quite a simple, powerful idea, but I think it's rather impractical when you're part of a completely under-educated work force and can't do much more than drill holes, wield a spanner and phone the engineers when things go wrong (like huge numbers of people in many factor- and efficiency-driven economies).

Newer ways of organising, such as that seen in Semco and most likely advocated by UnBoss, as far as I can currently see, are most likely only applicable to a highly educated, skilled work force. These are much "flatter", more networked, emergent approaches to organising together. These models assume that the people in these networks can think for themselves - at least to a certain degree, and with at least some individual and collective creativity.

The trouble, I think, comes in with people who cannot yet think critically, and have been oppressed and suppressed and disempowered by the "system" for so long that it would be a mammoth task to free them. I know for a fact that public schooling in South Africa is downright broken at the moment, with us being ranked 127th out of 142 countries in the 2011-2012 Global Competitiveness Report in terms of the quality of our primary school education, and 133rd in terms of the quality of our overall education system. How are we going to be relevant in 20 years' time as a global player if things keep going this way?

In conclusion

Don't get me wrong, I'm all for an appropriately-placed and appropriately- maintained system. We need to admit to ourselves the limitations of these systems though, as well as what we, as humanity, can truly control.

I think that the economy of the future is going to struggle to incorporate docile employees with very specific skill sets such as just Java programming or bookkeeping. We are going to need people who can think critically and creatively for themselves, on top of having a variety of useful, practical skills, and who can network both in the real and the virtual worlds. All of our education systems are most likely going to have to change and evolve to facilitate this. This, I think, is as close to a definition of "true empowerment" that I can get, given our current context.

Not only this, but we will have to rethink our work - that is, what we do on a daily basis - and the ways in which we organise together to accomplish this work.