Sunday, December 17, 2017

Three Perspectives of Debureaucratization

 The more effortlessly you can align, integrate, and optimize the important business factors inside an organization, the closer you can accelerate performance and lead changes.

The root of the word "bureaucracy" is: bureau(fr) = desk and kratos(gr) = rules/ power. The larger the organization and inputs, the larger the amount of 'rules' necessary for its function and to keep dependent variables and outputs delivery stable. However, too many rules will stifle innovation, outdated rules will stop the business from moving forward with accelerated speed. And the overly restricted hierarchy will cause silo, discourage cross-functional communication and collaboration. Hence, dismantling bureaucratization is inevitable because of the ever-increasing speed of changes and expanding interdependence. Here are three perspectives of debureaucratization.

IT-led digitalization can practice de-bureaucratization in a structural way: Technological and social changes continually disrupt the old pattern of thinking and running complex organizations today. Businesses today must become information savvy and adapt to change with faster speed. The purpose of digitization is to make a significant difference in the overall levels of achieving high performing business result. The digital organizations are so technology-driven and information-intensive, organizations rely more and more on information and technology nowadays. In fact, information flow can break down silos, improve decision effectiveness, and expedite business speed. Otherwise, in many digital lagging organizations, the environment changes quicker than the 'speed' with which rules and processes can be changed. Thus, IT-led digitalization can practice de-bureaucratization in a structural way, because IT is in a unique position to oversee the business functions and helps to build a digital workplace in which the organization’s functions become more dynamic via tuning underlying processes. IT continues to dismantle bureaucratization via getting deeply immersed in the new apps, devices, and solutions and making business more productive, collaborative, and smart.

Management innovation is another debureaucratization practices: Most organizations today still practice the classic management discipline based on reductionistic or linear logic, assume that the business as a whole is equal to the sum of pieces. But in reality, today’s digital businesses are nonlinear, volatile, interdependent, uncertainty, and they also face fierce competitions and ambiguous digital environment. Thus, the digital organization needs to be adapted in such a way that it can respond effectively to these dynamic changes in the environment. It requires not only successful innovation management but also effective management innovation. It means that digital leaders and managers today must update their management principles and practices. They should expand their thinking boxes and get a better understanding of the current boxes, figuring out which of them makes sense to challenge and then applying creativity tools (exploring, divergence, convergence) to arrive at a useful new box. Because management innovation changes the way managers do what they do to improve organizational performance and unleash the full digital potential of the business. Digital management requires a different kind of 'control,' for example, the control of desired outcomes, keep the end in mind, not overly control the process of HOW. It also requires learning and the brain power from all the right areas of expertise to explore the better way for running the business, make learning-doing as an iterative continuum, and ensure the business as a whole is superior to the sum of pieces.

Design or fine-tune digital organizational structures to dismantle the business bureaucracy: At the industrial age, most of the organizations are running at silos, with the top down organizational structure and overly restricted hierarchy which slows down the speed of changes. Bureaucracy causes stagnation. Organizations, like individuals, need to be in flow to operate smoothly. There is no "one size fits all"  debureaucratization formula, but "Bureaucracy = Process Inefficiency." "No Bureaucracy ≠ No Rules" make sense to clarify the goal of optimization. The business has to keep optimizing its structure and management pyramid to achieve the state of digital equilibrium. Thus, delayering becomes a lens through which it is possible to examine and fix many other issues including bureaucracy. The digital organization is an integral business system with policies, culture, work climates, people (employees, customers, partners, etc.) and processes. The whole business ecosystem needs to communicate, negotiate and cooperate with each other to reinvent for harnessing innovation and catalyzing changes.

Debureaucratization is a management practice. The more effortlessly you can align, integrate, and optimize the important business factors inside an organization, the closer you can accelerate performance and lead changes. Companies across sectors should be flexible to leverage tailored management approaches to fit specific circumstances, ultimately, respond to the external environment as geopolitics, rapid innovation, and social expectations change the business landscape and blur the digital territories.


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