A. Embrace a grand challenge. You can’t build an adaptable organization without adaptable people—and individuals change only when they have to, or when they want to. In most companies, deep change is crisis-driven. People are pushed into the icy waters of change by circumstances outside of their control. But every day human beings all over the world rush out to embrace change—because they are seduced by an opportunity to do something big, exciting or noble. So if you want people to change ahead of the curve, you have to give them something worth changing for. You have to set in front of them some enticing challenge that draws them forward. What keeps many of Google’s engineers moving forward is the chance to empower people with the knowledge they need to improve their lives. At Kiva, it’s the chance to help solve some of the world’s toughest social problems by connecting investors with social entrepreneurs. But in most companies, there’s no glistening, Everest-like peak of purpose that draws people out of their comfy down sleeping bags, and up the slope of change and challenge—and that’s a problem; because in the absence of purpose, the only thing that will disrupt the status quo is pain.
B. Embed new management principles. There’s a simple reason most organizations aren’t very adaptable: they were never built to be so. That’s why getting a big company to change is like getting Bowser to walk on his hind legs. Bowser has quadruped DNA, he wasn’t designed to strut around on his back paws. Modern management was invented a hundred years ago in the quest to make organizations more efficient, and the management principles that are deeply embedded within your organization loyally serve that cause. Standardization, specialization, hierarchy, goal alignment and control—these are great principles, but at the margin, they’re all toxic to adaptability. Changing this will require gene therapy: companies must complement their efficiency DNA with adaptability DNA. This means working hard to learn from the things in our world that have demonstrated their resilience over decades, centuries and eons, like biological systems, democracies, cities, and stock markets. Dig into these highly adaptable systems and you’ll discover the principles for building an adaptable company: Variety (you have to try a lot of new things), decentralization (you need to create mechanisms for bottom-up change), serendipity (you have to create more opportunities for unexpected encounters and unscripted conversations), and allocational flexibility (you have to make it easy for resources and ideas to find one other). It’s pretty simple, really—you can’t build an adaptable company unless you embed the principles of adaptability in every management system and process.
C. Honor resilience-friendly values. The Internet is the most adaptable thing human beings have ever created. From Google to Craigslist to Digg, and from YouTube to Flickr to Facebook, the Web has morphed in ways that few of us would have imagined a decade ago. It has also spawned a host of amazing new social technologies, including crowdsourcing, folksonomies, opinion markets, wikis, mash-ups and tweets. While our management systems are built around a top-down model of control, the Web is all periphery and very little center—its architecture is end-to-end, not center-to-end. The distinction between the technology of management and the technology of the Internet is more than merely architectural, though. At the heart of the Web is a bundle of social values that stands in stark contrast to the values that predominate in most companies. Community, transparency, freedom, meritocracy, openness and collaboration—this is the fundamental ethos of the web. Within the beige precincts of corporate-dom, the values of control, discipline, accountability, reliability and predictability reign supreme. Twenty-first century organizations must amalgamate all of these values. Only then will they be able to deliver the goods day-after-day with penny-pinching efficiency while showing their heels to the winds of change.
– Gary Hamel