Tag Archives: C3

Knowledge Workers in the British Raj

Note: This is the second part of a longer series on how social media is affecting management. You can find the first post – The future of (knowledge) work – and subsequent posts – The north-south divide, Working in Hollywood, World of Warcraft in the workplace and Problems and the people who solve them – elsewhere on this blog.

Prior to the industrial revolution, most folk, apart from apprentices and other people in training, worked for themselves. Home wasn’t here and work wasn’t there: they were in the same place and tightly intertwined. For the last few decades though, we’ve all become used to working in the large bureaucracies that most modern companies use to manage their workforces. For many pundits the shift to a more social business – driven by Enterprise 2.0 and Social Business Design – is the chance to humanize these bureaucracies that we’ve created, bringing back some of the more personal experiences we used to enjoy. However, this ignores the fact that while we’ve used technology to change business, business has also evolved to the point that it’s changing how we think about and use technology.

Tomorrow’s more social companies will not simply be our existing bureaucracies humanised. They’ll be something more compact and collaborative, extremely flat organisations where the executive is responsible for steering the boat while handing responsibility for operations over to the frontline. Rather than enabling a more human bureaucracy, one where the power structures are inverted or middle management empowered, Enterprise 2.0 is returning us to an earlier time, more akin to the British Raj in India, when the world was more uncertain and communication within a bureaucracy was slow (when compared to the pace of business). We’re returning to a time when self initiative, the ability to collaborate with your peers, and a focus on bringing whatever skills and tools you can to bear on the problem in front of you, is more important than deep specialisation and formal communication and career structures.

Our companies are not what they used to be

The template for our large, vertically integrated enterprises was stamped out for us by the likes of Cornelius Vanderbilt{{1}} during through the development of the transcontinental railroads in the U.S., and perfected by the conglomerates and multinationals in the sixties and seventies. Our organisations were seen as vast machines, machines staffed and operated by an army of people.

[[1]]Born the son of an impoverished farmer and boatman, Cornelius Vanderbilt (May 27, 1794 — January 4, 1877), died the wealthiest man in the United States and probably the greatest of the nineteenth century railroad barons. Starting with money he borrowed from his parents to buy a boat which he used to ferry passengers between Staten Island and New Your City, he became a American shipping and railroad magnate who acquired a personal fortune of more than $100,000,000.[[1]]

For a long time a company’s workforce was considered just one of three factors of production{{2}}, and a fungible factor at that – homogeneous and easily interchangeable. Recently companies have taken a more humanistic approach, with many human-resources departments proclaiming “people are our organisation’s most important asset,” and driving companies to construct ever more complex career management, renumeration strategies, and recognition and reward schemes to make the most of each employee’s individual skills and foibles.

[[2]]The other factors of production are stocks (including land) and capital goods.[[2]]

A factory in the industrial revolution, where the key to scaling a business was to employ more workers, and then employ an additional layer of management to manage the workers you hired in the first place
A factory in the industrial revolution, where the key to scaling a business was to employ more workers, and then employ an additional layer of management to manage the workers you hired in the first place

Our organisations, however, have been shrinking over the last couple of decades. Initially this was from automation on the factory shop floor, where repetitive tasks were replicated in technology, man replaced with machine. Overtime we’re used technology to chipped away at increasingly complex problems, working our way from simple manual tasks such as swinging a hammer on command, through to today’s modern, automated production line marvels.

At LEGO HQ in Billund, Denmark, where raw plastic is transformed into finished bricks (including stormtrooper helmets), and packaged into sets, with very little human intervention other than to fix machines when they breakdown.
At LEGO HQ in Billund, Denmark, where raw plastic is transformed into finished bricks (including stormtrooper helmets), and packaged into sets, with very little human intervention other than to fix machines when they breakdown.

A similar journey has occurred inside the office: computers (the teams of people computing ballistics tables and payrolls by hand) have been replace by computers (the electronic gizmos prone to bugs), the typing pool was phased out in favour of management using word processors to automate the creation their own documents, and a large chunk of the customer service team has been replaced by self-service kiosks and web sites which allow customers to attend to their own needs. Most recently, the midlevel management responsible for command and control – both between teams, and between teams and the C-suite – is being replaced by software{{3}} as social media tools automate the communication and information aggregation tasks that have traditionally been the domain of middle management.

[[3]]The future of knowledge work @ PEG[[3]]

Our vast, vertically integrated enterprises have been flattened and hollowed out, creating a new generation of organisations which have a large workforce at the coal face working under the direction of a with smaller and more focused team of executives. The frontline is interacting directly with customers and suppliers or managing production, responsible for the day-to-day operation of the business. The executive is looking into the future, responsible for placing bets on where to deploy the organisation’s resources most efficiently to meets tomorrows challenges.

The provincial civil service

The emerging organisational structure we see today is of a different nature to the monolithic institutions required to run the train networks in the 1800s or multinational conglomerates of the more recent past. The impact of the latest wave of automation – the move to social business – is not to simply take the existing organisation and applying a new style of command and control, one based on bottom-up empowerment and where middle management use these new media tools to streamline motivating and managing the teams under their guidance. It’s more akin to the extremely flat structures used by organisations such as the British civil service in India during the 1800s.

As a colonial power, Britain built an administrative centre in India (initially under the monopoly of the East India Company, but later under direct government rule{{4}}), staffed with highly competent expatriate civil servants who had signed on for a tour of duty. This tour of duty was usually seen as the route to wealth and influence, as it was easy to tap-off a little of the money – the vast sums of money – which flowed past these civil servants as it made its way back to the home country. (It wasn’t uncommon for senior members of the British Raj to return to Britain at the end of their tour with suspiciously large collections of expensive trinkets and locked boxes.) A complex bureaucracy developed, constructed around the Governor-General based in Calcutta, with Mandarins gathering staff and wealth as they fed their own feeling of self importance.

[[4]]John W. Kaye (1853), The Administration of the East India Company, Richard Bentley[[4]]

Managing the provinces, however, was a completely different problem. Covering a vast, populated area, and with little incentive for senior civil servants to get directly involved, the provincial civil service had to make do with a very flat organisational structure, one where every manager was responsible for roughly one hundred direct reports. Such a high management ratio naturally precluded many of the practices we take for granted into our large matrix-managed organisations. A manager couldn’t afford to spend more than a few minutes with each of their direct reports in the course of a month, and even those few minutes might not occur as transport and communication were much more expensive than they were today. The high-touch style of management we are familiar with in recent history wouldn’t work.

The expanse of the British empire in India in 1909
The expanse of the British empire in India in 1909

From demand-side to supply-side

The strategy which enabled the provincial civil service to function – and to function very effectively – was clear objectives. Field staff were engaged for their ability and interest in taking on responsibility for a problem on behalf of the management (usually this problem was the collection of the taxes, duties and excises required by the British crown in a specific province). A set of policies and procedures were put in place to ensure that they conducted themselves in a fit and proper manner, however, generally, the field staff were provided with a great deal of discretion in how they achieved their goals, collaborating with their peers were needed.

Behind this flat organisational structure was a hiring and training process designed to find candidates who were focused on solving the right class problem, rather than candidates who specialised in a discipline or process. All candidates had to sit an extensive test covering a broad range of topics, and were then trained in the skills and processes they might need in the field. Their induction was finished off with and apprenticeship under the guidance of an experienced worker. The civil service was looking for those individuals who had the kit bag of skills and the aptitude needed to find their way to their goal on their own. Those selected were then train in the business processes and policies they needed, and provided them with the time they needed to integrate into the community of front line workers. Much like today’s emerging workplaces, the team at the front line was empowered to collaborate as they worked toward their respective objectives, rather than micromanaged.

We like to think that we’re all hired for our unique skills and paid according to the value we bring to the business. Unfortunately this is not generally true. Our large company legacy means that most managers need to think in terms of roles, cogs in a machine that they need to assemble. Measuring each employee by their contribution is a complex and laborious task which does not scale well, so companies manage large populations of employees by defining standard roles tied to specific skill sets, and then measure each employee by their ability to fulfil the role. Hiring then becomes the easier supply side challenge of finding and evaluating people with the requisite skills.

As companies flatten it is becoming less important to assemble large teams with specialised skills. Teams have shrunk as technology has replaced specialists with potent technological tools: the skilled printer replaced by the printing press, the complex task of computing ballistics tables moved from people to machines, the distributed computing specialist made redundant by an open source framework, and your procurement specialist replaced by the on-demand SaaS fulfilment solution.

Our focus has shifted from the capabilities we need to the outcomes we need to deliver. We’re swapped from the supply side problem of finding enough people who have the specialist skills we need to staff our business, to the demand side problem of finding the people who we can delegate some of our problems to. One of the organising principles behind business is changing, driven, most recently by a shift to more social businesses.

The future of our business – post Enterprise 2.0 and Social Business Design – is not in applying a new human-resources paradigm to our existing workforce. Much like the British Raj in provincial India, our businesses need to adapt to an environment where we don’t have the time or resources to micromanage every task. The workforce which staffed our bureaucracy in the past is not the same workforce we need in the future. The future of our business is with a smaller, more dynamic workforce of self-starters, built around flat organisational structures and more general skills which devolve responsibility for operational problems to the front line and empower them to work together and solve these problems under their own direction, while freeing the executive team to focus on steering the organisation through the challenging environment we operate in today.

Continued in The north-south divide.

The future of (knowledge) work

Note: This is the first part of a longer series on how social media is affecting management. I started writing the following to explore a vague idea and see where it might take me, and first stopped writing when it was roughly three thousand words. At that length it was quite a bit weightier than the average blog post – and far too long to read in a lunch break – so I’ve decided to break it into a number of smaller. The first is below, and you can find the other issues – Knowledge workers in the British Raj, The north-south divide, Working in Hollywood, World of Warcraft in the workplace and Problems and the people who solve them – elsewhere on this blog.

What impact will social media have on how you run your business? It’s being touted as everything from a better form of groupware or the next step in the evolution of work management — a new layer on the technology stack that’s starting to be called human interaction management{{1}} (HIM), sitting on top of, and bringing together, BPM, workflow and case management — through to a wholesale transformation of the way your business operates and is organized. Reality (as usual) rests somewhere between the two extremes.

[[1]]Human Interaction Management[[1]]

Are the inmates taking over the asylum?

Social media (Web 2.0, Enterprise 2.0, Social Business Design, and so on) seem to be triggering a change in the command and control structures that we have traditionally used to manage our companies. There is an ongoing discussion within the human resources community concerning what form our future organizations will take{{2}}. The key drivers are streamlined communication from social media, both within and without the organization, and the empowerment of the frontline and delegation of authority due to the increasing need to solve problems promptly within a local context.

[[2]]“Social” is now HR’s baby (sorry Marketing Department) @ Fistful of Talent[[2]]

Old power structures seem – in some cases – to be in the process of being inverted as the people at the front line find that they are now better informed and equipped than their management to solve the majority of the problems confronting the business. If people are your most important asset, then we might just be standing at the start of a revolution as the workers realize that they really do control the means of production.

Wholesale revolution is unlikely though. While employees might be an important asset, and one that has a significant impact on the overall performance of your organization, they are not the asset a business is built to support{{3}}. For many organizations the best result is usually to remove the people, such as with lights-out factories, or some of the new SaaS plays which are replacing people-driven BPO with automated self-service solutions. The dirty secret of Enterprise 2.0 is that it’s being used the same way as every other technology to date: it’s being used to remove people from the equation.

[[3]]Why Enterprise 2.0 and Social Business Design might be of marginal utility for most of us @ PEG[[3]]

On the other hand, it has become obvious that social media is having an effect on our organizations. A key assumption behind most organizational structures is that information is rare and expensive to obtain, pushing us to create organizations that gather information from the front line and aggregate it up to the CEO. This also means that information is the currency of company politics. However, with social media and the Internet information is now – on the whole – cheap and easily obtainable. Controlling the flow of information is no longer possible, leading us to think some amount of disruption of the current order is inevitable as the old power dynamics are destroyed and new ones formed.

One thing is clear though: we need to think about work – and the teams and organizations we construct to support it – differently. The formal, siloed structures we find in many organizations don’t map well to the more dynamic environment that social media is bringing to business. Many businesses now have more in common with the British Civil Service in India – flat structures where the people at the coal face work largely under their own direction, collaborating with others as required – than the vertically integrated titans of industry from recent time.

Computer: an electronic device for storing and processing data

Companies have changed dramatically since the days when the term computer referred to someone who manually computed mathematical functions. Technology has slashed the number of people required to support most, if not all, tasks in the enterprise, making today’s companies dramatically smaller and more agile than their forebears. What used to take rooms full of people now needs – at the most – a small team. This is true across the full depth and breadth of our organizations, from the mailroom and typing pool, finance calculating the payroll through to the production floor in the factory.

Williamina Fleming (standing) with her computers in the late 1800s
Williamina Fleming (May 15, 1857 – May 21, 1911, standing) with her computers in the astronomy department at Harvard in the late 1800s, hired to carry out the mathematical calculations required to classify stars.

Not only has the volume of manual work changed, but the nature of that work has also changed with it. We used to deploy our employees to run the business, focused on the carrying out the plethora of operational tasks required to keep the wheels of commerce turning. Automation through technology has largely taken care of this.

With payroll and the shop floor dealt with, our employees are now more concerned with improving and guiding the business. For many companies the center of gravity of their workforce has shifted away from operations, moving to roles more concerned with the performance of the business: supervisory, design, business improvement and customer engagement.

Supermarkets, for example, have been hollowed out by modern management practices. In the past, store managers were masters of their own domain, held accountable for profit-and-loss and not much else. Today, the only real freedom many store managers have is in hiring the team who staff the checkouts, and keeping them motivated. The vast majority of decisions required to run the store have either been pulled up to head office (such as store layout and pricing moving to a centralized category management team{{4}}) or delegated to suppliers or the staff at the front line{{5}} (determining when to restock, for example).

[[4]]What is Category Management @ Category Management Association[[4]]
[[5]]What we’re doing today is not what we did yesterday @ PEG[[5]]

This makes projects the focus of many modern workplaces: projects to improve systems and processes, projects to bring new products to market, projects to expand into new territories, projects to optimize our product portfolio, and so on. One of the main short-term drivers for adopting social media in the enterprise is supporting work in these projects by providing the workers within them with a better way collaborating and searching for answers to the problems they have.

However, while the demand for work on projects has grown, the size of the teams required to deliver our projects has shrunk. Initiatives which required one hundred people and a billion dollar investments in the fifties, sixties and seventies, can now be delivered by team sizes in the low double digits, if not less than ten people.

The number and variety of careers – the professional community – supported by these projects has shrunk in response. This started with the specialists, but soon moved on to more general disciplines. For example IT platforms and frameworks used in the enterprise today have eliminated much of the need for specific technical specialists (there’s not much requirement for a distributed transaction specialist on most projects now). Some of the new frameworks eliminate the need for even quite common skills, as with databases and Ruby on Rails.

Flat, but not quite flat as it could be

Social media – as with many of the technologies preceding it – streamlines previously manual tasks by capturing knowledge in a form where it is easily reusable, shareable and transferable. What is different this time is that social media is focused on the communication between individuals, rather than the tasks these individuals work on. By simplifying the process of staying in touch and collaborating with a large number of people it enables us to flatten our organizations even further, putting the C-suite directly in contact with the front line.

This is having the obvious effect on companies, eliminating the need for many of the bureaucrats in our organizations; people whose main role is to manage communication (or communication, command and control, C3, in military parlance{{6}}). The big winners from social media will not be, as we first thought, those white-collar knowledge workers who spend their days herding those at the coalface, crafting policies, and worrying about organizational dynamics. The winners will be the team at the frontline and C-suite, as they both bypass the (soon to be removed) mid-level functionaries and engage with each other directly{{7}}.

[[6]]C3 defined @ Wikipedia[[6]]
[[7]]Rise of the task-worker 2.0 @ PEG[[7]]

The net effect of all this is that our organizations and teams are being hollowed out as the middle layers are replaced with software{{8}}. To some extent the chickens have come home to roost; technologies that replaced the people at the operational coalface are now being used to replace the people in the project teams that brought these technologies to the enterprise in the first instance.

[[8]]The IT department we have today is not the IT department we’ll have tomorrow @ PEG[[8]]

Continued in Knowledge workers in the British Raj.