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9 Flexing and Flexibility

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9.1 The Fishnet Organization

Since 1994 the tools for growing fishnet organizations have improved dramatically. The fishnet organization is becoming the basic medium for organizational innovation and strategic leadership. Leaders must now develop their own abilities to flex and to create organizations that can flex with them. (See Figure 9.1 for a graphical representation of the fishnet organization.)

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DEVELOPING YOUR ABILITY TO FLEX

Flexing is like the freedom that a musician has to improvise within the rhythmic structure of a particular song. Music in most genres is more structured than it sounds: there are clear patterns within which improvisation can happen. Usually, there is a clear direction, as well as someone (usually the drummer) who is setting the beat. But there can be lots of room for improvisation, even in highly structured arrangements. In music, what I call “flexing” might be called “riffing” or “going on a ride.”

In most organizations, there are distinct values and legal requirements. Organizational structures and responsibilities are both explicit and implicit. The outside world, however, is not necessarily governed by the same principles. Organizations cannot assume that their ways of working will be followed by others. Often, organizations—particularly those with high values—have to struggle to sustain a responsible and orderly practice in a chaotic world. Flexing skills need to be tempered by an organization’s sense of direction, similar to the way that musical improvisation happens within a melodic direction of keys, chords, and progressions.

In a corporation, people have at least some mandatory direction that comes from the corporation’s legal responsibilities, its principles, and its management. Individuals often have great flexibility, however, with regard to how their daily work is conducted within the firm’s direction and intent. The more senior an individual is, the more freedom he is likely to have to set direction and interpret the way that direction applies in a particular situation.

How can we help one another be more successful—to tune for the world of mixed generation dilemmas, to move from problem solving to engagement with the dilemmas of our marketplace and society?

Institute for the Future’s ongoing research on cooperative systems has yielded a useful set of “tuning levers” that can be used to design and evaluate organizational structures.³ Each of the seven tuning levers is employed below to help understand flexing and flexibility:

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STRUCTURE. Like the cord on a fishnet, network structures are strong but they are flexible. The number and pattern of the nodes on the net are critical to its strength and flexibility. Insurgents in Iraq, for example, use loosely structured networks that are like fishnets and are extremely resistant to attack. “Attack any single part of it, and the rest carries on largely untouched. It cannot be decapitated, because the insurgency, for the most part, has no head.”⁴ Paul Baran is an engineer who helped develop packet switching, the core technology of the Internet. Curiously, Baran’s initial assignment at Rand Corporation was to develop a network architecture that would resist nuclear attack. At the time, telecommunications networks were centralized so that if any part of the network was attacked, the entire network would go down. Packet switching, still the core technology of the Internet, is an architecture that continues to live even if parts of the network are destroyed. The Internet has no center, and it grows from the edges. Network organizations—especially those that make heavy use of the Internet—reflect a similar networked structure.

RULES. Flexible firms work best with only a few rules, but those rules must be followed religiously. Principles, rather than rules, work best in the context of network organizations, since they provide both clarity of direction and intent and are delivered with flexibility. The most successful networked organizations are principles-based, but they do have a few strong rules. In Dee Hock’s “chaordic” organizational structure (part chaos, part order), principles provide the primary glue that holds the network together, but there can be a small number of central rules that can never be violated.⁵ The small number of rules are firm, but the principles allow for flexing.

RESOURCES. The key resource need in network organizational structures is for dependable, strong, and flexible infrastructure — to make communication possible across the network. Typically, information technologies and electronic networks provide the (usually virtual) “cord” that connects the nodes on the network together. The Forecast Map inside the book jacket highlights the wide range of cooperative technologies now available for use by network organizations. I first used what was then called “computer conferencing” in the early1970s, in the early days of the Internet, back when it was called the ARPANET. For more than thirty years, scientists, and now others, have developed, tested, and redesigned a wide range of tools to link interpersonal networks across wide distances. What we used to call “computer conferencing” is similar to what is now called a wiki. Electronic networking tools, while still challenging, are more powerful, easier to use, and cheaper than when these networking experiments began.

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THRESHOLDS. Scale thresholds are critical in the life of network organizations, since small groups are typically more cohesive than large ones. Thresholds of organizational scale allow networks to grow and amplify their impacts, but they also create critical challenges as the network grows. Wikipedia is now breaking new ground in terms of global network scalability.

FEEDBACK. Network organizations need feedback to learn what is working and what is not. Feedback often comes informally by word of mouth, but the lessons need to be shared across the network in order for organizational learning to occur. Networks often extend over the boundaries between work and private life, and individuals need feedback to set those boundaries. Ellen Galinsky, president of the Families and Work Institute, has concluded that work life balance is an impossible goal. Instead, she coaches people to develop their navigation skills, to find their way through the fixed and variable forces all around us, within the firm and outside it.⁶ Feedback should contribute to navigation for network members, just as navigation instruments guide a sailor through an archipelago.

MEMORY. Network organizations are challenged to know what they know, to remember and share what someone in the network has learned. Memory in network organizations is often decentralized, and formal methods for organizational memory (like databases) often do not capture the vitality of the knowledge being stored. Memory needs to be fluid in a network organizational structure. The army and some nonmilitary agencies use After Action Reviews (more on AARs in Chapter 11) as a discipline for learning from experience, but a key finding from that long experience is that informal exchange of lessons learned is much more effective than a formal central database.

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IDENTITY. Network members may or may not have shared collective identities: some networks are formal, with a clear collective identity; others are informal with dispersed identities. Sometimes, group identities are present but decentralized in network nodes or patterns of nodes. Identity can leverage and magnify growth of the overall network, however, as well as provide a sense of meaning and belonging for the network members. “Cellular churches,” for example, are network-style organizations with a religious purpose. Evangelist Rick Warren uses small groups to nurture a large network-style organizational structure from the bottom up “to create a church out of a network of lots of little church cells—exclusive, tightly knit groups of six or seven who meet in one another’s homes during the week or worship and pray.”⁷ These small groups become nodes on the larger network, but the vitality is sustained at both the small-group and large-group levels. Although his approach is controversial, Warren offers a clear identity for members, apparently without the sense of self-righteousness that is sometimes found in conservative religious groups. He also provides the direction of a “purpose-driven life.” The energy starts and is sustained at the level of the small-group network cells. The sense of identity comes from personal, small-group, and large-group experiences. In a chaotic world, a purpose-driven life is attractive but difficult to sustain.

FLEXIBLE PLACES

Flexing and flexibility emerge from answers to these questions:

• Where does the real work of network organizations get done?
• What is the role of our offices and other physical places?
• When are we “working” and when are we “not working”?
• How might we work in the future, and how can we prepare ourselves for network flexibility?

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Organizing, nurturing, and sustaining a network requires basic skills that begin with deciding which medium is best for the situation. In-person, face-to-face meetings in the office (or the church or the home or the community center or any other physical place) are only one option, and the array of alternatives is growing increasingly rich and attractive. Indeed, our definition of office is changing within the firm—and in the world around the firm. As the firm becomes more flexible, the role of the office is likely to change. Gradually, organizations are coming to think of office as a flexible array of activities—not necessarily a fixed place.

Perhaps we need to change office from a noun to a gerund: officing is perhaps a better word for the activities that are necessary to create a strong organization.⁸ Officing is flexibility. A fixed office—especially an expensive office with permanent walls and a long lease—has little flexibility. Officing is all about connectivity and culture. An office reflects the culture of an organization, but it also shapes that culture. Offices provide a place for in-person communication, which can be great, but they also have limitations.

Many organizational cultures still implicitly assume that most work gets done “at the office,” which is either a physical office location or a client’s office location. Many senior managers still think they know that their employees are working because they see them working. There are new models, however. An extreme example is the consulting firm Accenture, with more than 100,000 people but no operational headquarters and no formal branch offices. The chief executive has neither a permanent desk nor a permanent office.⁹

Offices tell a story in subtle and explicit ways: traditional offices in prestigious downtown locations used to be clear statements that your company was successful and that you were in it for the long run. But office stories are changing. Will the next generation of workers be less anchored to offices and more committed to flexibility? Will next-generation clients be less concerned about where the work gets done and more concerned about different measures of success?

Might some customers decide against any firm that “wastes” its resources on what they perceive as fancy offices in high-rent districts? Rising real estate costs are bringing this issue to a head, but so are the increasingly viable and proven options for virtual work. Network flexibility is now becoming both attractive and affordable. Expensive property and elaborate physical offices are becoming increasingly hard to justify for many organizations. It is much easier to get there early and compete if you can be flexible regarding where you work.

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Sometimes, external events force a change in how organizations consider their own in-person and virtual identities. In the 9/11 attack, Deloitte suddenly lost use of a New York office, a major location, for more than one year. The resulting period of forced virtual work is having major effects on how Deloitte now chooses to work with clients, effects it is only now beginning to realize. It is learning new ways of working virtually and at client sites, and it is reconsidering what would constitute the ideal Deloitte office. Now it has new office designs—none of which look much like a traditional office. Deloitte recognizes several dilemmas regarding virtual and physical work identities, and each has its own challenges:

• It is difficult yet extremely important to find optimal mixes of media to connect people in useful ways, both in person and through virtual media, for a variety of different tasks.
• Managers need to focus on ways—other than physically seeing them working—of evaluating output from employees as they work in a variety of different media.
• Managers must recognize that the way works get done is as important as what work gets done. Especially in a regulated industry, it does matter how work gets done, so output cannot be an exclusive measure.
• The firm needs to develop people in an ongoing way using a variety of media, with the choice of media depending on personal lifestyles and needs—in addition to regulatory requirements for in-class training.

Deloitte does not require workers to choose whether to work in an office or through virtual media. Rather, it assumes that most workers will work through both in-person and virtual media using firm-approved criteria for choosing which medium is best for a particular business application. Deloitte communicates its principles of flexibility and choice as well as the tools that it offers to help people work that way.

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One external factor that could accelerate the growth of flexible places is the discomfort of travel. In the VUCA world airline travel is much less convenient and is sometimes downright uncomfortable. How much worse does travel need to get before companies say “enough!” and start to emphasize alternatives for at least some of their travel. Of course, many people will still want to meet in person, but online media offer many new possibilities to be present without being there.

FLEXIBLE MEDIA

IFTF first developed an early version of Figure 9.2 more than twenty years ago, when teleconferencing and groupware were just becoming practical. This simple map displays the basic options of place (same place or designated place) and time (same time or different time). A physical office is a place where face-to-face meetings (same time, same place) are possible. This foursquare model summarizes our basic choices, which are richer, more reasonable, and less expensive than just a few years ago. Figure 9.2 illustrates the basic options for working in a network organization in terms of place, time, and tools.

Our research suggests that most executives travel more than they need to, and they often travel at the wrong times. This chapter will suggest rules of thumb for deciding which tools are best for the purpose, including one of the most important decisions a leader must make: when do I travel to go there in person? Leaders today (and even more so tomorrow) must be able to nurture and sustain trust through multiple media— not relying only on in-person presence (although both will still be useful on occasion).

Place plays an important role in this media mix. What does place offer? What does place constrain? Adjacency is a scarce resource in physical architecture, since space limitations don’t allow everyone to be adjacent to all the good things they would like to be near. In a seamlessly mobile world, however, more flexible adjacencies are possible, since wireless connectivity can allow people to be “next to” resources, even if the resources are physically distant.

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9.2 Options for Communicating in a Networked Organization

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DEFINITIONS

blog short for “Web log,” where one individual puts his or her views out and invites others to read or sometimes comment on them.

wiki a group version of a blog.

IM short for instant messaging, which allows simultaneous text messages in a corner of your screen.

video chat a sort of video IM, where you can see someone on your screen and talk with him or her.

VoIP short for “Voice over Internet Protocol,” audio (like a telephone) carried over the Internet and increasingly easy and high quality.

seamless mobility a concept developed by Motorola to describe the vision of wireless interconnection in a seamless and painless way.

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Most people older than thirty still assume that face-to-face is the medium of choice whenever possible. As media richness has improved and the difficulties of in-person contact have increased (especially with globally scattered workforces), the unexamined assumption that face-to-face is best is being called into question.

The workforce of the next decade will be a rich and challenging mix of backgrounds and styles of work. Three needs are likely, all of which will affect choices regarding which medium to use in what situations:

• Workers will need meaningful face-to-face engagement, in parallel to intense virtual communications. Paradoxically, the more time we spend communicating with others by way of machines (such as the phone, computer, or handheld), the more important face-to- face experiences become. In more than thirty years of research on travel/telecommunications tradeoffs, I have found little evidence that virtual media replace the need for in-person meetings—unless there is an intervening crisis or policy mandate. In short, the more people are linked electronically, the more they want to communicate in person. Electronic media extend human communications, but they rarely if ever replace the need for in-person exchange. In addition, the more time we spend working with distributed global colleagues, the more important local connections become.
• The workforce will be characterized by deep diversity, on many dimensions. Most organizations will have an increasingly heterogeneous workforce in terms of age, nationality, race or ethnicity, and lifestyle. Immigration is changing the ethnic composition of the country, particularly the western and southern regions. Women are having children later in life, and the number of “traditional” households is declining. The aged live and work longer and more independently.
• Network communication skills will become critical for leaders to master. Most of today’s leaders lead through their abilities to communicate in person. Many have charisma and great ability to bring people together—if they can be there in person. In a networked world, leaders need to present themselves electronically, through interactive media (in addition to mass media), and engage with their network members in a compelling fashion. These are not just new technologies; they are new media, and they require new communications skills.

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9.3 Face-to-Face Remains Key for Orientation, Trust Building, and Renewal (Source: IFTF, IFTF Team Performance Model, Alan Drexler and David Sibbett, 1999)

A more peoplecentric office strategy can be designed to promote communication, engagement, and community among a company’s workers. The challenge is to design the strategy for a labor force with increasingly diverse needs, expectations, and demands—from incoming digital youth to returning senior alumni.

Certainly, in-person meetings have great value for orientation, trust building, and renewal, as we summarize in Figure 9.3, a graphic that was first developed when we studied high-performance cross-cultural teams for the IFTF book GlobalWork and updated based on our recent research.¹⁰ Electronic alternatives are improving rapidly, and it is becoming apparent that many forms of productive work can happen without people being together in person or in an office. The key decision is which medium (including face-to-face) is good for what purpose. Do you really need to be in an office to do this work? Is it desirable to be in an office to do this work, even if you would like to do so? Making intelligent choices like this is key to flexibility.

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IFTF research, from across all our research domains, suggests an emerging transformation of work practices over the coming decade:

• The way workers will relate to space and place will be enabled by mobility, connectivity, and location-based services.
• The way workers will relate to one another and to clients will be shaped by increased collaboration, multilayered communication environments, and globally distributed work and talent.
• The ways we learn and create knowledge will be augmented by social software and collective intelligence.

Motorola’s concept of “seamless mobility” is an inspirational vision of what anytime, anyplace work will be like in the future—perhaps the near future if everything comes together the way the Motorola and other providers are advocating.

The new Stata Center at MIT is an example of reimagining work space to include the notion of seamless mobility. William Mitchell, the dean of the MIT architectural school, describes the Stata Center this way:

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All of these shifts will take place within the context of a larger economic move toward the “sharing economy.”¹² The growth of the sharing economy portends new ways of supporting network organizations.

In most organizations, it is not clear who “owns” media choice. Who decides which media are available for whom, in what situations? Several organizations are likely to be involved, and everyone has a stake in media choice. The information technology (IT) organization provides IT support. Real estate provides office space. Human resources (HR) organizations provide people and organizational development expertise— both of which are critical to media choice. And the organization’s strategy implies media choice, because particular media configurations are best suited to particular strategic choices. Ideally, the choice ought to be made on criteria roughly in this order:

1. Strategy. Given the organization’s strategy, which media mixes will provide optimal support for execution of the strategy? Strategy should be most important in guiding media choice.
2. People. Which mix of people can best carry out the strategy, and which media do those people prefer in order to perform at their best? HR should be involved in choosing people who can support the strategy.
3. Media. What physical and virtual media resources should be provided in order to support the people who will carry out the corporate strategy? In this sense, information technology and real estate should work together (ideally, they should be part of the same organization, reporting to the same executive) to decide on the appropriate media mix to provide. Office space is just one medium in an array of electronic and in-person possibilities.

Of course, in most organizations, Strategy, HR, IT, and real estate exist separately and rarely work together. The expanding powers of the new media give organizations a chance to rethink how they are organized.

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DIGITAL YOUTH ARE TUNED FOR FLEXING

Baby boomers tend to see technology as either tools or toys or both. Digital youth see technology as an extension of themselves, and they often don’t see technology much at all, they just assume it as a part of their being. Three underlying trends will shape the American workplace in the next decade, with the next generation of workers who are just now beginning to enter the workforce:

• The digital youth are different. After more than a decade of widespread Internet use, studies indicate that youth are developing a wide attention range and a short attention span. That is, these youth are accustomed to a multimedia and multichannel learning style with frequent interruptions. On the positive side, they are skilled at sharing knowledge and creating social networks online. These skills are the basis for new forms of business practices and client services.
• Many organizations will experience a shortage of young, skilled workers who are willing to work at wages they are willing to pay.¹³ Demand for a smaller pool of top talent will intensify at the same time that youth will bring new ways of working and learning into the workplace—challenging old models of work.
• All players will have access to an increasingly robust infrastructure for support of virtual organizations on a global scale. Network organizations can be created easily now, with options for participation from all over the world. The technology is functional, proven, and cheap. Differentiation will come from the organizational skills with which these new media are used. Anyone can now go virtual, but the challenge is in how you go virtual, with what results.

Digital Youth	Impact on Flexing and Flexibility
Workers have multimedia, multitasking, and flexible work styles.
The younger the employee, the more likely he or she is to favor a flexible work style. Percent who do an activity all or most of the time while doing routine homework: Go online . . . . . . . . . . . . . . 60 Listen to music . . . . . . . . . 42 Watch TV . . . . . . . . . . . . . . 32 Chat via phone calls, IM, or e-mail . . . . . . . . . . . . 27 Work with friends/ classmates . . . . . . . . . . . . . 23 Play video/online games. . . 7	These workers will do best in lively, multifaceted workspaces that provide multiple channels of communication, including face-to-face. Spaces are needed for real-time collaboration, both impromptu and planned. Quiet spaces are needed, spaces that support focused work as well as private phone conversations. The best spaces will highlight the presence of colleagues. Examples include open work environments and glass walls to enhance visual proximity. Ubiquitous wireless Internet and phone access are needed. Places are needed where television and music are appropriate, with and without headsets.

Workers want to set their own schedules, even if they have to work more.¹⁴

Most workers (58 percent) prefer a flexible work schedule, even if it exceeds forty hours a week, while only 42 percent say they would prefer a regular nine-to-six job. Younger students (those eighteen to twenty-one) are even more likely to favor flexibility. Deloitte’s internal research findings suggest that a flexible work schedule is a key factor in employee retention, especially of women.	Work happens at all hours, in different places. The office is only one choice among several. Office must leverage its key advantage over other workplaces: it is the only place where colleagues congregate frequently. Systems are needed that signal the presence of colleagues so that people know where others are - in or out of the office. Spaces are needed that highlight the work community, with places for socializing, human warmth, and central meeting places.
Workers are more ethnically diverse and youth-oriented than before.
	Physical environments should communicate diversity of the workforce and work processes; for example, spaces are needed that can be repurposed for different work needs and staff configurations. Spaces should communicate the collaborative nature of the work process; for example, shared space rather than private space should be emphasized.
Family and private life is important, and workers have a commitment to making time for both work and fun.
	Organizations should provide diverse spaces with zones for informal, ad hoc social interactions as well as zones for quiet, focused work. Support is needed for work/life navigation decisions.

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Today’s young people are indeed growing up with distinctly different formative media and technology experiences from those of previous generations. Their influence, in combination with other social and economic factors, will shape their workplace demands in the next decade. Corporations have the choice to be a step ahead in providing next-generation workers with the spaces and tools for productive flexibility and engagement. For example, the chart to the left and above summarizes recent research that Lyn Jeffery has done on the characteristics of entry-level professional services employees in the near future:

How might a firm become more flexibly firm, using physical offices as just one focal point among many possible focal points? Certainly the places where work gets done are already changing, as are the times at which work gets done. Leaders and managers will still supervise the outcomes of an individual’s work, but seeing their employees working is not likely to be either possible or important.

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Navigation of work and private life boundaries is becoming more difficult, especially since we have crossed the Blackberry Threshold— where the reach of “the office” is anyplace, anytime. Starbucks is a vivid example: it has created a “third place” (not home, not office) that reflects important elements of both work and leisure. One of the most provocative alliances in the past five years was the joint venture between Hewlett-Packard, T-Mobile, and Starbucks to create WiFi hot zones at most Starbucks locations. Now, a Starbucks café can for some customers be a mobile office, a flexible yet comforting and functional place. You can order your favorite drink and be relatively sure it will be prepared the way you like it while you connect to the WiFi world.

Of course, unintended consequences are lurking. For example, there has been a series of laptop robberies in San Francisco coffee shops. Thieves innovate, too, and they’ve learned that someone concentrating on a screen—often a very expensive screen—on an unattached device is a very tempting soft target. One San Francisco laptop theft occurred in a total of fifteen seconds, and when the surprised laptop owner stood up instinctively, he was stabbed. The thief was out of the coffee house before anyone noticed him, and he was never caught. We live in a world that is often threatening, even in—maybe especially in—our comfort zones.

Comfort zones can be virtual, and sometimes the virtual will be safer than the physical. Leaders of network organizations can create islands of coherence: bases for flexible and sensible action, with a feeling of comfort. Place plays an important role in coherence, but a fixed place— a comfortable fixed office that reflects success—is only one kind of comfort.

Will corporate offices become more like Starbucks cafés and less like the formal offices that still dominate our office landscape? Next-generation workers are certainly more likely to be comfortable and productive in a café atmosphere than an office atmosphere. Is there an alternative to “offices”? Cafés or play spaces perhaps? Something else we have yet to imagine?

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The new flexibility clearly involves space, technology, and protocols for working. It exists at the functional intersection of real estate, IT, and HR—all linked by business strategy and customer needs. Leadership development will be played out at this intersection, since this is where we will work, where we will learn, and where we will grow. A critical element of leadership development is workspace design to optimize the ways in which that learning occurs, as well as the way in which our work is performed.

Network organizational structures are now being employed by a wide range of organizations, from corporations to NGOs to churches to terrorist networks to national and insurgent military organizations. Which are most advanced? Although performance is difficult to measure in this network world where many networks are invisible or only partially visible from the outside, it seems to me that the extreme groups are more network savvy than the moderate groups. This result makes sense because commitment provides the shared values, purpose, and meaning that can hold a network structure together. Without commitment from members, networks become limp.

As I argued earlier in this book, the VUCA world requires that we learn to be comfortable being uncomfortable. Offices as we know them are part of our current comfort zone, but the ground is shifting beneath our offices. We are already in an anytime, anyplace world.

Great leaders can make things look easy, but things rarely are. Leadership flexing is tough work—with a fun element on the good days. The mother of all flexing dilemmas is how to lead a network organization without getting tangled up in it.