A New Organizational Paradigm

A New Organizational Paradigm

Senge’s (1990) research illustrated that organizations must maintain maximum productivity, flexibility, and adaptability in a rapidly changing global environment to remain competitive. Innovation in technology created phenomenal growth in e-business over the last decade.  Advantages in e-business applications contribute to profitability (Quan, 2008).  New methods of leading and managing organizations transformed business processes; however, the benefits of e-business generally are attributed to varying processes created by changes in technology (Kanterman, 2008).  Goldsmith (2008) states push technology can help leaders grow, but the general problem is that the virtual workforce is managed using out of date models, degrading performance and innovation (Lojeski, 2010). More diversity as well as tacit knowledge is displayed among stakeholders than ever, creating a need for a new paradigm of systems thinking and organizational theory. The purpose of this paper is to propose a new systems thinking design for virtual organizations.

Background: theoretical approaches to virtual organizations

Jones (2010) acknowledged companies need to harness their employee’s unique talents and contributions to meet the organization’s goals “because these skills and abilities give an organization a competitive edge” (p. 270). Jill Jusko (2003) attributes four main reasons for organizational failures: 1) strategic or organizational mindset failures; 2) cultural bias and close-mindedness; 3) informational breakdowns; and 4) leadership mistakes. Rapid technological innovation and lack of training can leave employees uncomfortable with technology alienated. Jones (2010) stated, “…technology is present in all organizational activities:  input, conversion, and output” (p. 241).  Technology is an integral part in any company, driven by innovation and competition.

Advances in technology allow people to work from remote locations.  The practice of virtual leadership is growing worldwide. By 2011, 30% of the worldwide workforce is expected to work virtually, representing an increase from 758.6 million in 2006 to over 1.0 billion by 2011 (Morganson, Major, Oborn, Verive, & Heelan. 2010). According to Kaplan-Leiserson (2005), companies require new strategies to attract and retain adequately skilled virtual employees. McCallum and O’Connell (2009) project a growing need in virtual leadership skills. Though flexibility and autonomy are job advantages, the general problem is that professional isolation may serve as an opposing force (Morganson et al. 2010).

Independence and freedom are advantages of a virtual work arrangement, but the specific problem is few studies have explored job satisfaction as a result of a virtual leadership position.  The lack of research, information, and understanding of the relationship between job satisfaction and virtual work in a leadership capacity is a little-known phenomenon and a gap in the literature (Kaplan-Leiserson, 2005). Virtual organizations are generally managed and led by obsolete processes (Lojeski, 2010). According to Senge (1990) learning organizations are defined as

“…organizations where people continually expand their capacity to  create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free,  and where people are continually learning to see the whole  together.”

Traditional paradigms of rational, natural, open and hybrids of these theories fall short in emerging organizations that maximize technology, social media, and virtual teaming.  Technology accelerated the pace of business, and the speed of change requires flexible approaches and adaptable strategy to accommodate breakthrough technology and leadership tactics. Organizational modeling provides a template for tactical action in a company and a benchmark for research that contributes discoveries gained from the potential discoveries that may provide organizational leaders with the insight in motivating and enhancing performance of virtual leaders (Golden & Viega, 2008). Insights gained from research may be used to generate data and new knowledge useful in attracting, recruiting, coaching, and retaining successful leaders who are productive and effective in virtual organizations, optimizing organizational performance. The following chart explores, analyzes, and contrasts three traditional systems thinking paradigms.

Table 1

Three Systems Design Paradigms

Paradigm
	Characteristics	Advantages/Disadvantages	Industries	Examples
Rational	Goal attainment – organizations are formed to meet specific goals and objectives that are explicitly defined. Formalization – roles in organizations are defined by rules and standards, impersonal to the characteristics of individuals. Rational organizational systems are defined by high goal specificity and high formalization of roles and social norms. The paradigm encompasses characteristics and structure of the organization.	Clear definition of goals, direction, and objectives. Formal, rule-bound, impersonal. Explicit definitions minimize misunderstanding. Specific procedures, roles, and power delegation allows for easy duplication of organization benefitting growth of organization. No focus on people, impersonal. Focus on structure, not the rationality of people behind the roles. No creativity. Works in a stable economy without much innovation and change.	Chain stores such as McDonald’s Banks Military	Bank of America has a 25 volume guide that outlines how to do every transaction in the bank. Giving step by step instructions and requiring clear levels of authority for each transaction. University of Phoenix does not allow faculty to delete items in the syllabus, ensuring that the course is taught the same way with the same learning objectives regardless of location.
Natural	Developed largely due to criticisms of rational paradigm. Natural systems consider organizational behavior as viable due to goal complexity and informal social systems. It is recognized that rules often don’t guide human behavior and rational systems do not create predictable results. Natural organizations realize that many goals are pursued, some common and some disparate and that individuals operate in their own self-interest. Organizations often have multiple goals that may be in conflict to each other or contradictory. Informal social structures in organizations are often more powerful and important that defined lines of authority and communication.	Gives credibility to organizational behavior and individual roles that may be informally created. Acknowledges that organizations are complex, contradictory, and sometimes not congruent with discussed objectives. Is open to change and flux, recognizing the complexity of the organization includes that range of goals of the company shared by stakeholders, and also the various personal goals that may not be shared drive behavior. Greater predictability of organizational results when complex, overlapping, and conflicting goals are acknowledged. Focus is on common viewpoints and objectives shared by social collective to achieve goals. Domination is achieved by win-lose methods.  Those with greater power win. Conflict naturally occurs.	Most corporations including technology, finance, manufacturing. Microsoft Apple	New ideas are encouraged at Microsoft, but those with greater influence and power make decisions as to research and development allocation of funds. Dominance of upper management in challenging decisions such as layoffs, outsourcing, etc.
Open	Recognizes interdependence of organizations and the interaction with the external environment. Open system that studies, acknowledges, and works with the broader environment whether economic, political, social, or financial. Organic approach recognizes that organizations and their stakeholders react to the external environment.	Acknowledges globalization and various cultures. Studies competition and external threats to competition. Works with the environment and understands interdependence of resources, such as “green” organizations not wasting natural resources. Uses hierarchical and clustering views of reporting relationships. More abstract with loosely coupled goals. Divergent goals can lead to mistaken analysis and misunderstanding. Continual adaptation to environment maximizes potential harnessing of ideas and resources.	Most e-commerce companies such as Amazon, Dell, e-trade, Facebook University of Phoenix as a green organization	e-commerce firms use social media and other emerging technologies to interact with the environment, the competition, clients.  Open communication mediums provided via blogs, Twitter, Facebook.

 

Note: from Scott, W. R., & Davis, G. F. (2007). Organizations and organizing: Rational, natural, and open system perspectives. Upper Saddle River, NJ: Pearson Prentice Hall.

Deconstructing a current world view in the context of underlying assumptions, paradigms, and models introduces a process to break out of limiting ideas and viewpoints. As Kuhn (1996) noted, paradigms and models are limiting and not final or all inclusive, thus he coined the phrase “paradigm shift.” To discuss what constitutes the self, several major approaches are taken.  The first is viewing the self in relation to others; our relationships define us. To communicate is a daily activity for most people.  As Lyotard (1984) discussed, “A self does not amount to much, but no self is an island; each exists in a fabric of relations that is now more complex than ever before” (p. 15).

New paradigm of systems thinking and organizational theory for virtual organizations

Albert Einstein once said: “Without changing our pattern of thought, we will not be able to solve the problems we created with our current pattern of thought.”  Thus conventional formulations and solutions based on the current environment are inadequate to deal with future change. Although most organizational leaders recognize this deficiency, they lack a paradigm that would assist them with organizational transformation.

An organizational theory is a philosophy on how to operate an organization. Power, relationships, communication, motivations, and the environment create and define reality. Various organized religions and philosophies shaped ethical conflicts between corporate expectations and behavior.  An example of this is during a cease and desist order in a bank, being encouraged as a corporate lender to sign a substantive loan based on bogus repayment sources.  Ethically, I knew that adhering to “above-board” business practices would eventually result in losing my position, the managers I worked for wanted employees who would lie and cheat to serve their career progress.

Labyrinth Systems Thinking – the paradigm web of processes

According to Dictionary.com (2010), a labyrinth is defined as any confusingly intricate state of things or events; a bewildering complex. In a dynamic, changing environment traditional models are limiting in application or misguided in execution.  Labyrinth Systems Thinking breaks down technical, human resource, political, and symbiotic elements of an organization into streamlined processes that are flexible in compilation and execution, hence the description of a paradigm web of process.  As processes can be combined in limitless combinations, new pathways for strategy, management and leadership are exposed.

In times of rapid technological information, consideration of the asynchronous global nature of information shared illustrates postmodern strategy in a complex environment of continual change. “The organization takes feedback from users – their experience and knowledge about a product – and combines it with the technical knowledge of their development staff to create new knowledge, for example best practices and lessons learned and ultimately new products ”  (Becerra-Fernandez et al, 2004, p. 306). By understanding the dynamic business environment online, vulnerabilities in strategic execution can be avoided.

Characteristics of the New Paradigm

Human resources aspects of the new paradigm. Technological innovation, increasing pressure to keep up with emerging technologies and virtual communications contribute to employee alienation. Using neo-modernist organizational theory that places value on human interaction in organizational structure assists employee engagement.   The disciplines of psychology, sociology, and anthropology are the basis for this theory.  Managers using this neo-modernist approach promote employee engagement within an organization (McAuley, Duberley, & Johnson, 2007). Stakeholders that are employees gain self-worth through cultural belonging, rewards systems, and recognition.

Benefits of the new paradigm. Organizational effectiveness lies on the ability to design the organization with a clear vision of the future direction of a company, to communicate, model, and enforce this vision to create an energetic focus with all stakeholders to move the organization in the desired direction. The future and the proper direction are needs based on the vision created by leadership.

The design and approach of the new labyrinth systems thinking theory is based on existing concepts and emerging empirical evidence.  A set of logical, empirical, and/or epistemological processes are created to allow for flexible strategic approaches in all areas of an organization.   Dispersed leadership is a product of a virtual organization. A flexible streamlined process of virtual leadership analyzes technology, communication, community, relationships, and culture. The issue of meaning is significant in business.  Leadership encompasses motivating and empowering employees.  Business leaders need strong people skills to listen actively   and communicate strategy.  As Kuhn (1996) discusses, gestalt experiments provide the nature of perceptual transformations, not previous patterns of information. Social media interventions thus merge experimentation with information obtained from obsolete paradigms as well as existing knowledge.

Conclusion

My consulting firm divisions are website development, consulting for e-commerce companies, leadership development, and instructional design for universities. Following trends in social media daily by reading industry newsletters, blogs, webinars, Internet radio, and Internet TV allow me to determine tactics for clients based on ideas, innovations, and the experiences of others. Knowledge capture is integrally tied to discovery, as I analyze performance to tactics practiced by clients and combine this information with cultural influence.  Entrepreneurship allows integration of values such as inclusion, fairness, openness, integrity, critical thinking, growth, and transformational leadership.

An example of community dynamics is the Internet. To compete effectively in the current business environment, especially in technology-based businesses such as online universities and e-commerce companies, access to timely and reliable information is crucial.  Several critical challenges must be overcome.  These challenges include the timeliness of information, the accuracy of information in a global marketplace, and viable critical thinking skills to create and execute strategy. E-Commerce business success is dependent on strong practice and leadership. Though information gained through tacit knowledge is difficult to measure with respect to cost/benefit, the opportunity to create tangible result from intangible pursuits effectively allow companies to compete and lay the groundwork for a competitive edge technology allows business to use emerging media in which there is no reliable blueprint for profitability and success.

References

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Goldsmith, M. (2008, Sept). E-tools that help teach leadership. Businessweek Online, 15. Retrieved from: http://www.businessweek.com/.

Jones, G. R. (2010). Organizational theory, design, and change. Upper Saddle River, NJ: Prentice-Hall.

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Kanterman, R. (2008, Oct.). Leadership excellence: balancing management with leadership. Fire Engineering, 161(10), 113. Retrieved from: http://www.fireengineering.com.

Kaplan-Leiserson, E. (2005). Virtual work: It’s not just for members of the jedi council. T+ D, 59(8), 12 -13. Retrieved from: http://www.astd.org/content/publications/

Kuhn, T. (1996). The structure of scientific revolutions (3rd ed.). Chicago: University of Chicago Press.

Lyotard, J. (1979). The postmodern condition: A report on knowledge (Theory and history of

literature, volume 10) University of Minnesota Press.

Lojeski, K. (2010). Leading the virtual workforce: How great leaders transform organizations in the 21st century. Retrieved from: http://www.wiley.com/WileyCDA/Section/id-350044.html

McAuley, J., Duberley, J., & Johnson, P. (2007).Organization theory: Challenges and perspectives. Upper Saddle River, NJ: Prentice Hall.

McCallum, S. O’Connell, D. (2009, Jan.). Social capital and leadership development: building stronger leadership through enhanced relational skills. Leadership & Organization Development Journal, 30(2), Retrieved from: http://www.emeraldinsight.com/products/journals/journals.htm?id=lodj.

Morganson, V., Major, D., Oborn, K., Verive, J., & Heelan, M. (2010). Comparing telework locations and traditional work arrangements. Journal of Managerial Psychology, 25, 578-595. doi: 10.1108/02683941011056941

Quan, J. (2008). Evaluating e-business leadership and its links to firm performance. . Journal of Global Information Management, 16(2), 81. Retrieved from: https://www.irma-international.org/journals/details.asp?id=99

Senge, P. (1990). The fifth discipline: The art and practice of the learning organization. New York:  Doubleday.

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