Managermind

In previous post i was falling in philosophy about dynamic aware organisation. In this article a will cover one aspect of real life organisation in companies that prevents them to be dynamic aware and therefore not to have desired advantages in the competition.

I’ talking about Center of Might. I heard about Center of Might (germ. Machtzentrum) several Years ago from Professor Menzel and since that never again. But the conception of Might Center stays in my mind till now maybe because i have seen it in the practise in real life organisations.

Definition

Center of Might is aggregation of competency and bulkheading of some partitions of a company. Traditional or else functional structured organisations divide the whole organisations in such functional partitions of responsibilities but this leads to the establishment of “Might-centers”.

The establishment of such bulkheading between departments grounds on many factors. One of the fundamental things it the understanding of the fact that organisations are nothing else as social structure or network of living people. People tend to have own opinions and different personal interests. One of the well known goals of human is gaining and preserving might. Not considering that in organisation structure leads can lead to such problems.

Nevertheless Traditional Business Study, beginning with Adam Smith don’t covers that point, where people are considered as one of the resources of the company. And the vision of a company dominates the vision of the “well oiled machine“! This vision may work in industrialization age, but fails in modern times. But even today the believe of obedient “machine-worker” dominates the vision of corporate organisation developers.

The other aspect is the complexity, large companies with many departments, organisation units and large hierarchies are often affected by the problems of strong centres of might. This is naturally, cause the management of big companies takes a greater risk by breaking the established and “proved” way. I think that introduction gives provides the understanding of the concept of Center of Might.

Curse of Center of Might

Now we understand the Might-centers, but are they so bad? Yes, the greatest problem in concentration of might on several points inside the same organisation is the personal protectionism, that results from distrust mood between organisations subjects. Therefore one might owner is tended to protect himself. That leads to several problems in organisation:

• Information diffidence
• Even Information falsification
• Resistance for changes/improvements
• Pessimistic Forecasting
• De-motivation

These points are leading to inefficiency of the whole company. The discussion of the problems can be continued and sophisticated, but not intendet here, but can be proceed in as comments …

Organization (of a company) is a very complex subject and difficult and therefor often changing process in the real companies. May be you was wondering why the organisation of your company changes so often. It is because organisation is something dynamic, and this property grounds on two important things: There is no feasible optimum structure of an organization to determine. Second, the environment of organization changes every day.

There is no Optimum

Of cause there could be no optimum, because you never have the complete information about the environment. Even if we would have all information about the environment, this will get soon to old and not valid. Furthermore the complexity of real world environments can’t be modeled even in 100 or 1000 years. So the model has to be relative abstract to be handle and calculable.

Dynamic

I already wrote about dynamic of economy which is the exterior environment of an organization. This dynamic of cause affects the organisation in it self. Then the organization should deal with changing environments, therefore it has to be updated often. Otherwise the organisation can be designed as dynamic and flexible, to minimise the reorganization processes by making them natural.

Dynamic Awareness

How to make an organisation aware of changing environments and markets, this is the question that matters more than ever. But this is also very difficult questions, and it goes through many aspects of a company. When i think about dynamic aware organisation, the following aspect appear as very important to me: organisation as a structure, staff and IT.

1. Hierarchies should be flat and maybe not really tied bound.
2. Companies should understand, that modern staff is not a resource in Adam Smith sense. Modern employee is hard to motivate, but hey should be aware of changes.
3. The IT of companies has also be aware of changes and reorganization. By changes i mean not only some stuff or department changes, but even the whole business process or parts of it.

This three Aspect stood at beginning of considerations of dynamic aware organization.I’ll will cover that aspects more deeply in the future posts. Feel free to comment.