Traditional top-down management and planning structures impose too much control that stifles creativity, and as an alternative, managers should encourage ‘creative chaos’ from employees to achieve greater results, research from Macquarie Business School has found.
Let chaos reign: new research by Dr Lars Groeger has found managers who facilitate rather than impose control achieve better results.
Dr Lars Groeger from the Department of Marketing and Associate Professor Dr Kyle Bruce from the Department of Management found managers should stop managing and become facilitators.
“Almost by definition, top-down management seeks to control and impose order. But the people down the line are playing by a different set of rules. They are on the periphery, both spatially and culturally,” says Groeger.
“This is not to suggest they are not doing what they’re supposed to – they are still acting in the best interests of the organisation. They could just be going about it in different ways. Freed from traditional management rules, they might pursue side-projects. They might even pursue objectives of their own by following a localised discovery or breakthrough.”
Firms that could benefit most include those in rapidly changing markets; firms that are subject to rapid technological change or changes in consumers’ tastes and preferences.
Groeger often encounters objections to his model from management traditionalists who want to know where decision-making should reside, if it is not to be with them. His simple answer: “With everyone.”
“Decision-making should be distributed so that creative types who discover new things are able to independently act on these discoveries and make changes,” Groeger says.
Complexity theory
“Letting go is tricky for traditional top-down managers. They think it will result in chaos. And they are right; it will. But this is actually a good thing. This sort of ‘chaos’ is what helps complex, adaptive systems -- such as organisations, economies and even whole societies -- to evolve.”
Groeger and Bruce looked at the business models in operation at IT company, Cisco Systems. They did this, ironically, with a manager at Cisco, their former PhD student, Dr Iain Rolfe. Their research examined ‘complexity theory’, the idea that several disparate strands of an organisation can order themselves into a coherent system. Groeger simplifies complexity theory as ‘order within disorder’.
Peripheral, not top down: teams tasked with creative problem solving were found to benefit from managers who freed them from traidtional hierarchical models.
“Think of a complex system, such a big company, as having simple rules. Think of them as being open and adaptive to learning. Think of them as being creative and open to the emergence of novel solutions. And think of this being possible at all levels.”
Creative chaos
So what would this look like in practical terms? Groeger is not advocating anarchy; rather a targeted approach to how creatives, or ‘agents’, as they are known in complexity theory parlance, can be set free.
“We believe everything should be on the table and the entire organisation should decide the boundaries of control. More realistically, however, business owners and managers could establish a few simple rules or boundaries, within which creative chaos should reign,” says Groeger.
“When teams or units have full autonomy within their own boundaries and without hierarchical management, we see positive outcomes. Also required is the existence of a psychological safety net; the knowledge that agents can get things wrong and not be punished.
“Manager can then focus on translating the organised chaos into the mainstream language of the organisation, thereby protecting the unit. This requires very different skills to those of traditional management.”
Who benefits?
While Groeger believes the principles of peripheral management could be of use generally, firms in more dynamic arenas are better suited to this style of operating, known as ‘holacracy’.
“Larger organisations are unlikely to put this type of thinking into practice across the entire operation. But it does seem to work for certain units within an organisation, especially those tasked with creative problem solving,” he says.
New thinking: Dr Lars Groeger, pictured, from the Department of Marketing and Associate Professor Dr Kyle Bruce from the Department of Management found managers should stop managing and become facilitators.
“Firms that could benefit most include those in rapidly changing markets; firms that are subject to rapid technological change or changes in consumers’ tastes and preferences. In these organisations especially, allowing peripheral actors to make quicker decisions to deal with opportunities or threats in their localised contexts makes perfect sense. They should be free to use their own perceptions and expertise.
“Other than Cisco Systems, companies such as the tech giant Intel and the telecommunications company Ericsson have employed elements of agents acting independently from the corporate centre.
“Other major firms to have adopted the principles of holacracy include German tech giant SAP, Danish hearing aid manufacturer Oticon, Brazilian conglomerate Semco Partners and US online shoe and clothing retailer Zappos, which is now part of Amazon,” says Groeger.
Dr Lars Groeger is a Senior Lecturer in the Department of Marketing at Macquarie Business School.
