How to manage your organisation as a whole

According to principle of non-linear thinking, it is far more effective to manage something as a whole.

But how does one manage a huge organization as a whole? Earlier, man devised a fragmentation approach. He broke the organizational 'whole' into components, calling them functions and departments, 'strengthen' each of these components, and hope that together they will produce the whole. We have seen many ‘unintended’ but ‘logical’ consequences of this approach in our organizations. One of them was that the departments conflicted with each other to such an extent that ‘politics’ was discovered.

Another was the constant pushing required for each department ( often called as motivation in the management language), because no department could see what it was contributing to the whole. The worst was that the ‘quality’ parameters were determined not by the real customer, but by internal department rules. Unintended consequences of this approach have been so many, that many management theories were invented to ‘contain’ them.

Later, man also discovered another alternative to this ‘fragmentation’ approach. Let us call this ‘wholistic’ approach.

In this approach, different ‘components’ are linked together to form one link – raw material to finished goods (and even to customer in some cases). Instead of having ‘inventory’ buffers to take care of the ‘stoppages’ in the manufacturing process, these inventory buffers are removed so that when the manufacturing process stops, everyone in the link knows that the ‘whole’ has stopped. Different components (including quality) come together to solve the ‘problem’ so that the flow in the link is ‘reestablished’. Each component (department/function) can now see the whole and therefore knew what is required to ‘maintain the flow in the whole’.

As soon as the manufacturing process ‘stabilises’ in a new flow, the inventory buffers and other buffers are further removed. The newly created instability in the flow ‘pulls’ different functions to come together and ‘solve’ another problem. No external push or motivation is required to ‘energise’ them. The flab/slack is removed from the manufacturing process in this manner until the entire process becomes ‘lean’, with all waste removed. All the support functions – quality, HR, finance, purchase – know their roles clearly in this flow. The objectives of customer satisfaction, productivity, cost and safety can be traded off dynamically, not sequentially. The organization is now managed as a whole.

If you have already heard of this approach, you are right. This is called lean approach. All the tools and techniques have been devised for you to implement this lean approach. Earlier they were devised for manufacturing process. Now they are well documented for service processes in banks or order taking. They have been tested and implemented in many organizations across the world.

Despite this knowledge, what stops an organization to implement this approach of managing their organization as a whole? Is it ignorance of the management theories? Or is it man’s desire to ‘control’ all the time because of which managements cannot relinquish control to the front line staff?

I wonder what are the causes. Do you know any?

Stress drives ones behaviour to nuts

I read a TOI article on Wednesday August 9, 2006. It was captioned ' Stress in Iraq driving US soldier’s nuts'.

It explained the stress that soldiers were going through in Iraq. One of the soldier reported ' the unit was full in despair." Another soldier said ' It drives you nuts. You feel like every step you might get blown up. You are just walking a death walk'. Soldiers often drank whisky and took painkillers to relieve the stress of not knowing whether the day would be their last. These soldiers reportedly went to a house, killed a girl’s parents and then raped her.

Psychologists have reported many ‘situations’ where one behaves beyond what is considered to be normal. Stanford experiment where ‘normal people’ told to become ‘guards’ used ‘dangerous and inhuman punishments’ on the ‘prisoners’ is well known. It is well accepted that normal human beings, can behave very differently, if the ‘context’ is appropriate. For instance, normal ‘honest’ citizens are known to ‘hide’ their ‘incomes’ to save income tax. They alter the very definition of honesty to suit their behavior.

Surprisingly, despite the huge amount of evidence, human beings still refuse to ‘accept’ the power of a ‘situation’ ( context) that can change one’s behavior. For instance, when told about this US soldiers, they refuse to agree that, in a similar context, they may also behave in a similar way.

However, I have found countless situations in organizations where individuals do behave ‘abnormally’ in a situation. Sales people are often seen to make claims about their products which are blatantly untrue by speaking a ‘white lie’. Or production departments often book ‘sales’ to show high quarterly sales that will look good in a balance sheet. Or HR executives often go back on promises they make while recruiting by citing that they did not promise anything in ‘written’. Or bosses often make grand promises, even when they know that they cannot keep their promises.


All these are normal individuals who behave ‘differently’ in a given situation. Although it may look ‘unethical’, the behaviour is absolutely understandable when one accepts the power of ‘context’. However when Enron behaviour happened, all organizational executives sound ‘shock’ and claim that they will never behave in the same fashion. But I am sure, that in the same situation, we all (almost all of us) would behave in a similar manner.