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1
Marbella/Malaga, 04.06.2015
HRCongres
@NielsPflaeging
How structure, power,
performance paradigms and HR practices
will change in times of high dynamics
2
3
Culture
4
5
6
7
Formal part of
value creation
Solution: Machine
Dynamic part of
value creation
Solution: Man
8
high
dynamics
Local markets,
high customization
9
Sluggish/dull,
low dynamics
high
dynamics
Spacious markets,
little competition
Local markets,
high customization
10
Sluggish/dull,
low dynamics
high
dynamics
high
dynamics
Spacious markets,
little competition
“Outperformers” exercise
market pressure over
conventional companies
Local markets,
high customization
11
Formal part of
value creation
Solution:
Machine
Dynamic part of
value creation
Solution: Man
Sluggish/dull,
low dynamics
high
dynamics
high
dynamics
Age of
Crafts Manu-
facturing
Industrial Age/
Age of
Tayloristic Industry
Age of
Global
Markets
1850/1900
Spacious markets,
little competition
“Outperformers” exercise
market pressure over
conventional companies
Local markets,
high customization
1970/80 today
12
Periphery
Market
Center
13
1 Impulse
4 Command
3 Decision
2 Information
5 Reaction
Center
Market
Periphery
Client
Is in
charge!
14
1 Impulse
2 Decision
3 Reaction
Center
Market
Periphery
Client
Serves the
periphery,
if needed
Is in
charge!
15
16
17
18
19
20
Theory X Theory Y
People need to work and want to take an interest
in it. Under right conditions, they enjoy it
People dislike work,
find it boring, and will avoid it if they can
Attitude
Direction
Responsibility
Creativity
Motivation
People will direct themselves
towards a target that they accept
People will seek and accept responsibility,
under the right conditions
Under the right conditions, people are motivated
by the desire to realize their own potential
Creativity and ingenuity are widely distributed
and grossly underused
People must be forced or bribed
to make the right effort
People would rather be directed than accept
responsibility, (which they avoid)
People are motivated mainly by money
and fears about their job security
Most people have little creativity - except
when it comes to getting round rules
21
Behaviors
Context
Human
Nature
22
23
”Meritocracy“
Budgeting Planning
Control of work hours
Job Descriptions
Competencies Management
Incentives
Individual targets
Performance Appraisal/360°
Salary Ranges
Training budgets
Personnel Development
Org charts
Target negotiation
Holiday applications
”Personnel Expenses“
Suggestion boxes
Assessment Centers
Knowledge Management
Pay for Performance
Paid extra hours
Bonuses
Sales Quotas
Dress codes
Job titles
HR
Allocations
Cost Management
Plan-Actuals variances
Forecasting
MbO
Development Centers
Bosses hire
Strategic Planning
Travel policies
Jours fixes
Earnings Guidance
Matrix Structures
Key Accounting, Business Areas
Business Partners
SWOT Analysis
…
24
3. Fase „beta“
o “fase de integración“
2. Fase „alpha“
o “fase de diferenciación“
Transformación tipo 2:
“Profundización“
Transformación tipo 1:
“Burocratización“
Transformación tipo 3:
“Transformación Beta“
Young organization Older organization
1. Start-up phase
or “Pioneer phase “
25
3. Fase „beta“
o “fase de integración“
Transformación tipo 2:
“Profundización“
Transformación tipo 1:
“Burocratización“
Transformación tipo 3:
“Transformación Beta“
Young organization Older organization
1. Start-up phase
or “Pioneer phase“
2. Alpha phase
or “Differentiation phase“
26
Transformación tipo 2:
“Profundización“
Transformación tipo 1:
“Burocratización“
Transformación tipo 3:
“Transformación Beta“
Young organization Older organization
1. Start-up phase
or “Pioneer phase“
2. Alpha phase
or “Differentiation phase“
3. Beta phase
or “Integration phase“
27
1. Start-up phase
or “Pioneer phase“
2. Alpha phase
or “Differentiation phase“
Type 2 transformation
“Deepening“
Type 1 transformation:
“Bureaucratization“
Type 3 transformation:
“Beta Transformation“
3. Beta phase
or “Integration phase“
Young organization Older organization
28
Indústry
Retail
Servicies
Government/
NGOs
It is possible.
29
•  Fixed, individual targets
•  Management by Objectives
•  Budgets and Plans
•  Performance Appraisal
•  Hierarchical Pressure
•  Pay by Position or Performance
•  Incentives and Bonuses
•  …
•  Transparency & Improvement
•  Comparisons between peers
•  Comparisons with previous periods
•  Dialog and Dissent
•  Social and group pressure
•  Pay by market value
•  Results Sharing
•  …
30
Law Beta Alpha
§§1 Freedom to act Connectedness not Dependency
§2 Responsibility Cells not Departments
§3 Governance Leadership not Management
§4 Performance climate Result culture not Duty fulfillment
§5 Success Fit not Maximization
§6 Transparency Intelligence flow not Power accumulation
§7 Orientation Relative Targets not Top-down prescription
§8 Recognition Sharing not Incentives
§9 Mental presence Preparedness not Planning
§10 Decision-making Consequence not Bureaucracy
§11 Resource usage Purpose-driven not Status-oriented
§12 Coordination Market dynamics not Commands
31
Formal Structure
32
Informal Structure
33
Value Creation Structure
34
Compliance, Power Social Work/Value Creation
Formal Structure Informal Structure Value Creation Structure
35
36
37
@NielsPflaeging
nielspflaeging.com
organizeforcomplexity.com
betacodex.org
slideshare.net/npflaeging
How structure, power,
performance paradigms and HR practices
will change in times of high dynamics

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Organize for Complexity - Keynote by Niels Pflaeging at HR Congres (Malaga/ES)

  • 1. 1 Marbella/Malaga, 04.06.2015 HRCongres @NielsPflaeging How structure, power, performance paradigms and HR practices will change in times of high dynamics
  • 2. 2
  • 4. 4
  • 5. 5
  • 6. 6
  • 7. 7 Formal part of value creation Solution: Machine Dynamic part of value creation Solution: Man
  • 9. 9 Sluggish/dull, low dynamics high dynamics Spacious markets, little competition Local markets, high customization
  • 10. 10 Sluggish/dull, low dynamics high dynamics high dynamics Spacious markets, little competition “Outperformers” exercise market pressure over conventional companies Local markets, high customization
  • 11. 11 Formal part of value creation Solution: Machine Dynamic part of value creation Solution: Man Sluggish/dull, low dynamics high dynamics high dynamics Age of Crafts Manu- facturing Industrial Age/ Age of Tayloristic Industry Age of Global Markets 1850/1900 Spacious markets, little competition “Outperformers” exercise market pressure over conventional companies Local markets, high customization 1970/80 today
  • 13. 13 1 Impulse 4 Command 3 Decision 2 Information 5 Reaction Center Market Periphery Client Is in charge!
  • 14. 14 1 Impulse 2 Decision 3 Reaction Center Market Periphery Client Serves the periphery, if needed Is in charge!
  • 15. 15
  • 16. 16
  • 17. 17
  • 18. 18
  • 19. 19
  • 20. 20 Theory X Theory Y People need to work and want to take an interest in it. Under right conditions, they enjoy it People dislike work, find it boring, and will avoid it if they can Attitude Direction Responsibility Creativity Motivation People will direct themselves towards a target that they accept People will seek and accept responsibility, under the right conditions Under the right conditions, people are motivated by the desire to realize their own potential Creativity and ingenuity are widely distributed and grossly underused People must be forced or bribed to make the right effort People would rather be directed than accept responsibility, (which they avoid) People are motivated mainly by money and fears about their job security Most people have little creativity - except when it comes to getting round rules
  • 22. 22
  • 23. 23 ”Meritocracy“ Budgeting Planning Control of work hours Job Descriptions Competencies Management Incentives Individual targets Performance Appraisal/360° Salary Ranges Training budgets Personnel Development Org charts Target negotiation Holiday applications ”Personnel Expenses“ Suggestion boxes Assessment Centers Knowledge Management Pay for Performance Paid extra hours Bonuses Sales Quotas Dress codes Job titles HR Allocations Cost Management Plan-Actuals variances Forecasting MbO Development Centers Bosses hire Strategic Planning Travel policies Jours fixes Earnings Guidance Matrix Structures Key Accounting, Business Areas Business Partners SWOT Analysis …
  • 24. 24 3. Fase „beta“ o “fase de integración“ 2. Fase „alpha“ o “fase de diferenciación“ Transformación tipo 2: “Profundización“ Transformación tipo 1: “Burocratización“ Transformación tipo 3: “Transformación Beta“ Young organization Older organization 1. Start-up phase or “Pioneer phase “
  • 25. 25 3. Fase „beta“ o “fase de integración“ Transformación tipo 2: “Profundización“ Transformación tipo 1: “Burocratización“ Transformación tipo 3: “Transformación Beta“ Young organization Older organization 1. Start-up phase or “Pioneer phase“ 2. Alpha phase or “Differentiation phase“
  • 26. 26 Transformación tipo 2: “Profundización“ Transformación tipo 1: “Burocratización“ Transformación tipo 3: “Transformación Beta“ Young organization Older organization 1. Start-up phase or “Pioneer phase“ 2. Alpha phase or “Differentiation phase“ 3. Beta phase or “Integration phase“
  • 27. 27 1. Start-up phase or “Pioneer phase“ 2. Alpha phase or “Differentiation phase“ Type 2 transformation “Deepening“ Type 1 transformation: “Bureaucratization“ Type 3 transformation: “Beta Transformation“ 3. Beta phase or “Integration phase“ Young organization Older organization
  • 29. 29 •  Fixed, individual targets •  Management by Objectives •  Budgets and Plans •  Performance Appraisal •  Hierarchical Pressure •  Pay by Position or Performance •  Incentives and Bonuses •  … •  Transparency & Improvement •  Comparisons between peers •  Comparisons with previous periods •  Dialog and Dissent •  Social and group pressure •  Pay by market value •  Results Sharing •  …
  • 30. 30 Law Beta Alpha §§1 Freedom to act Connectedness not Dependency §2 Responsibility Cells not Departments §3 Governance Leadership not Management §4 Performance climate Result culture not Duty fulfillment §5 Success Fit not Maximization §6 Transparency Intelligence flow not Power accumulation §7 Orientation Relative Targets not Top-down prescription §8 Recognition Sharing not Incentives §9 Mental presence Preparedness not Planning §10 Decision-making Consequence not Bureaucracy §11 Resource usage Purpose-driven not Status-oriented §12 Coordination Market dynamics not Commands
  • 34. 34 Compliance, Power Social Work/Value Creation Formal Structure Informal Structure Value Creation Structure
  • 35. 35
  • 36. 36