As an alternative to traditional management and its historical methods, many innovative forms of governance models have developed and new ones continue to emerge.
These new models are based on different schools of thoughts and initiatives. They offer techniques, approaches or tools for improved or sometimes completely redesigned management practices.
These models are value creation vehicles for the business enterprises.
They build new ways of evaluating companies’ efficiency. These modes of governance are applied in all sectors and in all types of organisations. They are applied in project management, industrial companies, service companies, associations, foundations etc.
The following article is an introduction to some of the most significant management methods.
Distinguish philosophies, managerial practices and application tools
The declaration of current management’s obsolescence is the result of an extremely broad consideration that combines human, biological and cognitive sciences.
This long consideration has slowly matured into the practical tools that are available to managers today, such as Agile methods (Scrum, eXtreme Programming etc.), the Holacracy constitution and the Sociocracy framework 3.0.
Behind these tools are the principles and practices of governance that have been developed by many management theorists. These theorists were nourished by older philosophical and scientific trends, that often stood far from any managerial consideration.
The toolkits for new governance methods are therefore the end result of a broader process, during which researchers borrowed thoughts and concepts in order to gather new management principles from them. Later, these principles generated the concrete means of their application.
The philosophies behind current thinking on tomorrow's management are as numerous as the ideas of the future of management.
The purpose of this article, without claiming to go back to the origin of each of the main current theories on the subject is to provide a distinction between philosophies, managerial practices and governance tools.
The concept of philosophy that will be discussed here is vast. These will be abstract thoughts, reflections on man and his behaviour, or sociological models.
After philosophies and before tools, management principles form the second category that will be discussed in this classification approach. They bring together managerial practices, i.e. models that some management theorists will develop to offer managers the best possible method of governance.
These practices usually revolve around fundamental maxims. The application of these practices will lead to the development of a number of concrete tools. These tools integrate these considerations that precede them without trying to demonstrate them. They propose methods for implementing them within organisations.
The following diagram brings together some of these philosophies, practices or toolboxes that have influenced, built or sought to apply the management theories of tomorrow.
The nature of each concept (philosophy, managerial practice or tool) can be identified by the background colour of the frame in which it is inserted.
The dark blue frames correspond to the philosophies. They represent the schools of thoughts that existed before all the considerations on the replacement of traditional management, but which have influenced them.
The light blue frames, on the other hand, make it possible to identify the applications of these abstract philosophies within the framework of companies and their governance. These are the managerial practices and the major organisation theories.
Finally, the tools used to support these principles are distinguished by their light green frames.
Complexity and System Theory
Among the philosophical trends, there is one in particular that has immensely contributed to contemporary thinking and the vision of tomorrow's governance: the systemic approach. This movement brings together an incalculable number of scientific disciplines. It has revolutionized the way human interactions are understood. It was actually conceptualized in the middle of the 20th century, as part of a series of conferences organized in the United States - the Macy conferences, from 1942 to 1953.
The systems theory brings together biologists, philosophers, psychiatrists, psychotherapists, sociologists, etc. Its approach is opposed to the Cartesian vision that traditionally is prevailing in the study of organisations. Historically, an organisation was studied through the elements that compose it. These elements were studied separately, and it is their simple aggregation that defines the system to which they belong to.
On the contrary, this new theory will consider each system as a whole, an autonomous entity that goes beyond the simple sum of its parts. This new whole cannot be studied exclusively through its parts, since their combination - made up of infinitely complex interactions - has led to the creation of a single system with its own identity.
This approach therefore pays particular attention to the interactions that are formed at the heart of an organisation. It is these interactions, these communications, that will indeed dictate the dynamics of the entire system, that will determine its evolution, its trends, its identity, again, that will itself determine the behaviours and reactions that will manifest themselves in return within the system.
This revelation has profoundly influenced recent management theories.
Indeed, a vast majority of innovative practices in this field build their modernity on a number of key concepts. One of them is complexity. Its integration into managerial models is the new challenge that these emerging theories aim to address.
The complexity they tackle obviously stems from the countless flows, interactions, communications and exchanges that are created, developed and multiplied around an organisation: within the organisation, in its environment, or precisely between the organisation and its environment. It is all these factors of complexity that systems theory wants to reveal to the observer who adopts its approach.
The systemic approach is heavily influenced by the work of individual researchers, who themselves were influenced by cybernetics. In addition, this approach was also influenced by the work of the Palo Alto school (a research institute to which we owe the social, sociological and therapeutic applications of systems theory).
Sociocracy and Inclusive Governance
Systems theory has therefore shaped the concept of complexity that we are currently experiencing. Most of tomorrow's management models are based on two other central concepts. Among these central ideas is the need for the company to build an inclusive governance, and to reverse the traditional vertical patterns.
The urgency of this need to reunite collaborators, maintain or renew employee engagement in companies around the world is the result of a growing general awareness. According Gallup's 2016 State of the Global Workplace, 85% of employees are not engaged or are actively disengaged at work. Among this percentage, 15% admitted to being actively disengaged.
Management theorists quickly integrated this critically important issue into their proposals. To solve it, many have been inspired by the sociocratic thinking.
Sociocracy is a broad concept, whose main contributors are probably Kees Boeke and Gerald Endenburg. Facing heavy disengagement, in reaction to the traditional model inherited from Frederick Taylor's division of labour, these two men developed a new theory of management. This model has since been enriched and fed with contributions of many other researchers.
Frederick Taylor, in his principles of scientific management, introduced the systematic separation of decision-making and execution functions in companies. According to him, the decision-makers (white-collar workers, or engineers) were responsible for imagining, designing and organising the production chain of organisations. The blue-collar workers were then responsible for implementing and executing the engineers' plans.
Breaking Away From the Vertical Structure Model
Conventional management hierarchy in organisations is vertical in structure. This traditional top-down approach is precisely what Kees Boeke wanted to break away from.
Holacracy or Sociocracy 3.0 – contemporary results of this philosopher researches – are perfect examples of this. They are two models where power is distributed throughout the organisation, giving individuals and teams more freedom to self-manage, while staying aligned to the organisation’ purpose. Sociocracy 3.0 wants to shorten decision-making chains as much as possible, simplify their processes by reconciling decision and execution functions.
This is the second main axis around which modern thinking is articulated. On the diagram, this axis brings together sociocracy ideas, the Quaker approach with its inspiring, participatory and horizontal governance. This is in total contrast to Taylorism which is precisely opposed to this current school of thought.
Also included are the contributions of Frédéric Laloux, and his work Reinventing Organisations. This book which is much more than a simple collection of managerial practices. It is an opportunity through which the author retraces a broad history of human organisation patterns and also points out the characteristics of all societies that have structured humanity. Laloux follows Don Beck and Chris Cowan's line of thinking found in their Spiral Dynamics theory book.
Agility and Lean Thinking
As mentioned above, the alternatives to traditional governance methods that are developing today are built around three issues. First, rediscover the complexity that structurally surrounds each organisation. Second, regain competitive efficiency in the organization by completely renewing governance systems. If this second issue makes it possible to meet both human concerns and efficiency requirements, the last challenge then concerns competitiveness.
Faced with increasingly dynamic markets, today's companies are forced to constantly prove and demonstrate their responsiveness and adaptability.
This is the third major part of the graph that brings together all the methods that give organisations the means to develop this crucial agility. This "section" is much less philosophical than the previous ones which introduced new management systems and the vast notion of organisational systems’ complexity. Indeed, agility for all business enterprises is universally recognized as responding faster based on the customers needs. That is why agility, through its methods and operating tools, provides concrete solutions to organisations, project management etc.
The theoretical outlines of agility can be found in the work of Deming and his Lean Management, incorporated by Womack and Jones and then by Kelley, and quickly applied by the Japanese automotive industry.
To apply these principles, the tools designed by management technicians are numerous, including Scrum, eXtreme programming, Lean startup, Safe method, LeSS and others.
Three Approaches Responding to Three Challenges
This diagram can finally be divided into three main schools of thought.
The first – complexity – is the growing awareness of complexity that structurally characterizes any organisational system.
The second – inclusion – develops the idea of renewing traditional management in favour of a new, more horizontal governance, less marked by bureaucratic processes and pyramidal hierarchies.
Finally, the third lesson of this diagram – agility – focuses on the urgency and absolute necessity for today's companies to demonstrate responsiveness in their daily operation.
These philosophical movements are there to respond to the three challenges organizations are facing:
1- the explosion of interactions and exchanges that are taking place within and around markets,
2- the need for companies around the world to re-mobilize their employees, to unlock talents and potentials of a stifling historical governance, and
3- to build organisations capable of the flexibility that markets demand.
Meeting these challenges is an absolute imperative. Theories and tools designed for this purpose bring out three main lessons that form the pillars of ideal governance, i.e. the awareness of its complexity, inclusivity, and agility.