We must remain open to change by building flexibility into our organizational structures and interactions. The more rigid we become, the less access we have to the reality of the system, and thus, the less able we are to shift as the environment demands.
—JULIE ROBERTS PH.D., PRINCIPAL OF CHANGEWORKS
For the last several decades, organizations have dealt with economic shifts using change management. Based on the new science, there are two major flaws with this approach. First, the word change implies an event with an ending. Second, it implies that change can be managed. In a world of economic volatility, this approach is no longer viable. The continuous climate of uncertainty and volatility demands another view, one that supports adaptability and resilience.
THE SHIFTING PARADIGM
Risk management’s inability to adapt to the changing business landscape played a large role in the global financial meltdown.
—DANIEL TU, PRICEWATERHOUSECOOPERS
An adaptable organization is one that self-organizes. Most organizations appear to have order. But order is not the same as organization. Organization involves differentiation and specialization.1
To understand the basic reasons for the resistance to evolve, it is instructive to trace the roots of our traditional business models. The organizational model that serves as the foundation for most companies has its origins in Newtonian physics, which states that all “individual or system behavior is knowable, predictable, ...