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Critique of Cycan in the light of contemporary views of management theories

Christopher J. Wheeler 920402233

Date of Submission 11 April 2007

Lecturer: Mrs. Rene Benecke


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1. INTRODUCTION Today organizations have to adjust too many dramatic changes, ranging from fundamental restructuring to revolutionary shifts in traditional values. These required changes are largely attributed to drastic changes in the way in which organizations respond to the environment in which they operate. Globalization and the resultant advancements in information technology are the two main contributors of modern organizational structuring, both of which pertain to highly complex communication activities and considerations that have become part of the organizations enactment with micro (i.e. inter-organizational activities) as well as the macro systems (i.e. transnational synergies, strategic geographic positioning, etc.). This reflects a paradigm shift from traditionally ‘closed’ operating procedures (characterized by one-way hierarchical inter-organizational communication) to highly flexible and innovative contemporary organizations which. The paradox here is that organizations need existing paradigms in order to make sense of the current situations and this can trap organizations in current paradigms (Verwey & Du Plooy-Cillers, 2003:2). However, it is important to consider the premise on which contemporary management theories are based. Contemporary theories, such as that of Karl Weick, reflect a deep restructuring of core competencies that values an organizations’ sense-making processes when they are dealing with environmental equivocality. Contemporary management theories place emphasis on the interaction process between all components concerned with the organization, as well as adopting a more holistic orientation towards that way in which organizations function and are structured. Cycan is an example of such an approach in that the manner in which they conduct business is reflective of contemporary managerial concerns. This assignment will critically discuss contemporary views of management and organization theories to Cycan’s current company structuring and operating, focusing on the role of the CEO (Bryan Hattingh); the state of their internal communication structures; and the holistic manner in which the organization approaches the decision-making process. Furthermore, the role of technology and communication within Cycan will also be analyzed in terms of how it contributes too and affects the three areas to be discussed.

2. CYCAN: AN OVERVIEW Cycan’s primary focus is to assist companies in optimizing risk, increasing performance and profitability, and ultimately achieving sustainable business and competitive advantage. This is achieved through a holistic set of complementary leadership appointment, development and transformation services. The organizations focuses on executive coaching, which emphasizes the neuro-semantics self actualization model derived from the works of Maslow, May, Rogers and others in the human potential movement and it was developed by Dr. Michael Hall (Hattingh, 2000). Cycan tackles the challenges of attracting, retaining, developing and maximizing talented leaders, this approach acknowledges the importance of human resources in the development of successful organizational culture of individuals working towards a collective goal. Areas such as life-planning, decision-making, goal setting and strategic thinking are their primary focus. Cycan’s experience in the industry is extensive and the holistic manner in which they approach business, as well as individuals within the organization, has proven to be rewarding and enduring. Cycan’s extensive network comprises of highly capable and accomplished executives who are deployed within organizations on a project or assignment basis. Through this, companies are able to engage the best possible talent to complete a wide array of challenges (Hattingh, 2000). Cycan acknowledges that organizations now operate in an age where there are scientifically based mechanism and instruments for not only assessing and measuring competency and capacity but for developing it, Furthermore they believe that companies must be proactive in building a cohesive leadership team and ethos, and developing their people (Hattingh, 2000) The essences of Cycan’s organizational values are formed by relationships and the development of their own personnel and leadership teams. In terms of contemporary management, Cycan exists as a successful organization that has adopted many of the managerial perspectives outlined by modern theorist for a prospective and long-term organizational culture of diversity, synergies and innovative and personalized strategies.

3. THE PREMISE OF CONTEMPOARY MANAGEMENT THEORIES Contemporary management theories recognize the importance of communication in creating and maintaining a successful organization. Through aligning communication and organizational goals we are now able to better interact with all levels of a company and the context in which they exist. This section will cover three main areas of contemporary management including Weick’s theory of organizing; the role of technology in contemporary organizations and knowledge management. 3.1. WEICK AND THE PROCESS OF ORGANISING ‘Communication’ has been defined in a number of specific schools of thought and its conceptualization as a term has proven to be contextual as opposed to an all-encompassing explanation, in this vein ‘communication’ will be defined as a “mode of exchange and a mode of knowledge production” (Taylor & Van Every in McPhee, 2000: 328-329). The notions of ‘exchange’ and ‘production’ are evolutionary terms used to describe the transference and creation of information in order to assess environmental interaction and the process of sense making in organizations. Therefore, organizations are a process of communication activity in which they are formed and reformed by communication discourse between the context in which they operate (i.e. the global economy) and the resultant organizational texts and culture. This dialogic process represents the double interact that lead Karl Weick to reformulate the notion of the ‘organization’ to that of ‘organizing’. Weick’s ‘organizing’ highlights the paradigmatic nature of organizations, as they are “something that people accomplish through a continual process of communication” and not defined by the positions and roles the members occupy (Littlejohn & Foss, 2005:245). The question of dualism between communication and organizations represents latter as a “symbolically realized construction” produced by interactional process of the organizations members and the macro system they occupy (Taylor & Robichaud, 2004). These ‘symbolically realized constructions’ emphasis the importance of interlocked behaviors as they create, maintain, and are adjusted in accordance with the normative competencies necessary to reduce uncertainty or ‘equivocality’ (Weick in Littlejohn & Foss, 2005: 246).

3.1.1. Basic components of Weick’s theory In order for organizing to occur it is necessary that there is some form of basic statement that individuals produce. Weick refers to this primary unit as an ‘act’ and it is symbolically loaded with meaning, but in does not get recognized as meaningful until a response is supplied. Hence an ‘interact’ must follow in order for the ‘act’ to have value. However, in order for equivocally to be reduced or managed a dual process must take place that allows for adjustment or correction (called the ‘double interact’). Consider the relationship between a director and the cameraman as an example. The director asks the cameraman to frame a specific shot (act); the cameraman then asks for clarification (interact); and the director elaborates (double interact). This basic examples shows how interaction created understanding which results in a dually create meaning. It is important to recognize that all information from human interaction (as well as the environment) is equivocal or ambiguous to some degree, and organizing activities are designed to reduce this lack of certainty (Littlejohn & Foss, 2005: 246). Taylor’s approach to communication and organizing focuses on collective action, dialogue between partners, the context, and on micro and macro processes (Taylor & Robichaud, 2004: 396). This challenges the traditional ontological assumptions of organizations being concrete structures; instead they see communication, as does Weick, as boundaryless social structures formed and maintained by communication interaction. The theories of Taylor and colleagues also explore the terrain of what constitutes organizational structures and functioning. Similarly to Weick, Taylor deconstructs the notion of ‘organizing’ and identified two core components: the conversation and the text (the content and ideas embedded in language) and communication. Communication, according to Taylor, is a circular process that makes use of conversation and text in the production of shared meaning. However it should be noted that the text and the conversation cannot be functionally separated, instead a double translation is constantly present that acknowledges the duality of these two interdependent components (Littlejohn & Foss, 2005). These basic terms used by Taylor act as the foundation for his multilayered conception of communication as both a mode of exchange and of knowledge production that emphasizes “shared meaning and interpretations that are constructed within the networks” (Littlejohn & Foss, 2005: 249). Similarly Weick’s approach explores how these networks are created and maintained through communication within these networks but his emphasis is on role of sense-making in reducing environmental equivocality.

3.1.2. Sense-making and organizing The equivocality experienced in the process of organizing results in the organization explicitly comprehending problematic circumstances into words that serves as the basis for action, a process know as sense-making (Weick & Sutcliffe, 2005: 409). Sense-making starts with chaos, and an organization’s ability to create systems for meaningful action (in response to chaos) acts as a precursor to its adaptability. ‘Adaptability’ is determined by the nature of communication held by its members as they attempt to order the “intrinsic flux of human action to channel it towards certain ends (Tsoukas & Chia in Weick & Sutcliffe, 2005: 410). This highlights the role of the communicative individual within the system of organizing as he/she contributes towards the shared understanding that permits collective response to equivocality. Organizational members first become aware of the events they are experiencing (be it environmental or relational) and then begin to ‘bracket’ these experiences according to something that has already occurred within the organizing process, but which does not yet have a name (Weick & Sutcliffe, 2005: 411). This act of ‘bracketing’ is intrinsic to sense-making because equivocal information cannot be dealt with until it has been acknowledged and labeled within organizing structures. Therefore the organization must produce a system for ‘functional deployment’. In organizational terms ‘functional deployment refers to “imposing labels on independent events that suggest a plausible acts of managing, coordinating, and distribution” (Weick & Sutcliffe, 2005: 411), hence by initially ‘bracketing’ empirical information the organization is able to commence with the classification of that event/situation. This creates a socially constructed form (the label) that offers the organizational members a communal term that acts as the catalyst for meaningful action. This is because once uncertainty can be labeled within the organizing structures the original threat of equivocality is reduced due to the mere labeling of that uncertain event. Communication is a central component of sense-making and organizing. The importance of creating channels for the transference of information in order to create knowledge is what allows organizations to both challenge and rely on past events and courses of action. Strategies that are based on past experiences are only as useful as the degree of connectiveness between the then and the now, and they may often act as the source of inaccurate labeling that will ultimately impede developments. This is largely due to failure to become aware that the events being observed are not concrete in existence, instead they are in the process of becoming.

The paradox here is that even if zero-based planning is offered as an alternative, the speed at which uncertainty is labeled (and then action is taken) is hindered by the this continual information ‘ground-zero’, whereby knowledge production is hindered and information is overwhelming. Therefore the channels and mediums through which an organization is able to transfer meaningful information should consist of progressive approximations, which would allow for a better linkage between the concrete (organizational norms) and the abstract (current and future equivocality). The question of sense-making raised here are placed into a conceptual framework through Weick’s position of organizing being an evolutionary process that involves enactment, selection, and retention as they relate to organizational members cognitive understanding of equivocality and meaningful action. 3.1.3. The nature of organizing sense making Donald Campbell’s application of evolutionary epistemology to social life proposes that sense making can be “treated as reciprocal exchanges between actors (Enactment) and their environment that are made meaningful (Selection) and preserved (Retention)” (Campbell in Weick & Sutcliffe, 2005). Firstly, enactment involves defining current equivocal information from the environment. This step is dependent on ecological change and hence must be acknowledged as part of the larger (or macro) system in which the organization is involved. The constant and reciprocal feedback cycles that occurs between the environment and the enacting organizing emerges from the need to ‘label’ events in order to progress and evolve the organizations core competency of adaptability. The second process is selection. This involves reducing the quantity of possible meanings, derived from ecological change, into tentative and provisional units of meaning to be acted upon (Littlejohn & Foss, 2005). The selection process is a direct result of enactment and is hence dependent on it. What the organization considers of high or low priority is determined by how the organization is designed to achieved its goals as well as what situations would possibly destabilize and threaten the organizations ability to function in its environment. Thirdly, the ‘stock’ of information selected is then stored for possible future use; this process in the evolutionary process of organizing is called retention (Littlejohn & Foss, 2005). Here the organization face a choice point is which organizational members must decide whether they should reenact the environment in order to approach a particular problem from a different course of possible action or to acknowledge an area that was previously considered of less importance

(Littlejohn & Foss, 2005). This choice point is what acts as an adaptive measure that allows organizational structures to constantly create a bank of knowledge for the creation, and revision, of possible strategies for approaching ecological change as well as inter-organizational routines. Organizational routines, or behavioral cycles, are a collective understanding of a series of procedures that serve as a unified modus operandi for dealing with equivocality (Littlejohn & Foss, 2005). Furthermore, the member’s actions are governed by assembly rules that “guide the choice of routines used to accomplish the process being conducted [enactment, selection, retention]” (Littlejohn & Foss, 2005). These rules prescribe to members what is considered plausible when dealing with the intrinsic flux of information from within the organizations communication structures as well as from the environment. For example, previous organizational perspectives view the decision-making process as a function carried out by elitist managers, hence these assembly rules de-emphasized the importance of collective efforts in achieving collective goals and instead reduced lower-level workers to functional position instead of knowledgably participants. This basic example highlights the difference between a ‘learning organization’ and ‘organizational learning’ (Ortenblad, 2001) and both of which, however, are embedded in the state of technological communication structures within the organization. 3.2. TECHNOLOGY AND KNOWLEDGE MANGEMENT The processing of organizing is defined by communication. This communication is constantly undergoing change and reformation due to increased connectivity and the emergence of ecommerce. With businesses becoming more and more innovative with their technological solutions, it has emerged that having access to information technology is not sufficient. Instead, there has to be structures that allow employees to obtain, interpret, weigh, and utilize information. Hence, information is a component of knowledge management, but it is not knowledge itself (Verwey & Du Plooy-Cillers, 2003) because knowledge management involves internalizing information obtained and then communicating that knowledge within the organization in order to enhance organizational performance. Knowledge, according to Verwey & Du Plooy-Cillers, involves sense-making and, as Weick indicated, it is a core competency of any contemporary organization. This is because the rate and accessibility of information available to organization members is disjointed and ambiguous, and in

order to channel information for practical purposes technological communication has to be integrated in all levels of the organization. Communication structures offer an effective medium for inter-organizational connectivity, and the more decentralized the organization is (i.e. less hierarchical) the more adaptable the organization will be in response to environmental equivocality itself (Verwey & Du Plooy-Cillers, 2003). Furthermore, the move from a mechanistic organization to a more organic one allows organizational members to participate in the decision-making processes. This is because the parameters of the organization all have different experiences of organization’s operations and interactions, hence in order to maintain maximum adaptability in a constantly changing world, the more feedback leaders have about their organizations interaction with the environment, the more pragmatic in nature the organization will become. With the emergence of the new economy, utilizing technology is not enough to ensure successful organizational operations. What is required is that businesses incorporate technological readiness as a long and short-term strategy (e.g. Technology planning and forecasting; technology management; social impact assessment; and technologies impact on the organizations environment). According Bahouth (1994), Technology can be defined as “recent knowledge embodied in tools”; these tools are in turn used to perform some human tasks. However, contemporary organizations need to factor in possible future tends in information technology in order to ensure sustain success. By doing so they develop an organizational culture that values change instead of resisting it. Interestingly, with the development of advanced technology and cyber-interactions organizations are able to transcend time and space in order to maximize productivity. This has resulted in the development of virtual teams that emerge as a direct result of communication technology. This has a problematic effect on the role of leaders and managers within the organization. Managers have traditionally occupied a role that was generally authoritarian in nature, however since the employee-employer relationship has changed their as been a shift and empowerment of organizational members. Instead, organizational leaders are now considered to be architects of organizational strategy. In other words, the communication of goals, visions, and values as core competencies has fallen upon these organizational leaders, and as a result employees are entrusted with task-orientated responsibility that is more satisfying and self-actualizing. This holistic approach to business typifies the modern approach to organizations and their relationship not only with their environment, but also with their own employees. The following section will indicate how

Cycan implements holistic management solutions through innovative leadership, communication technology and inclusive decision-making procedures. 4. CRITICAL OVERVIEW OF CYCAN AS A CONTEMPORARY ORGANIZATION Cycan’s approach to business is based upon the humanistic movement made famous by Carl Rogers and other humanistic psychologists and philosophers. Basically, through humanizing the communication networks Cycan is able to create and maintain open and meaningful dialogue within the company as they collectively move towards achieving their goals (Hattingh, 2000). Holistic management and facilitated employee learning is core to Cycan’s structuring and Bryan Hattingh’s (CEO of Cycan) attitude and perspectives on business reflects this. 4.1. THE ROLE OF THE CEO IN CONTEMPORARY ORGANIZATIONS: CYCAN The world today is experiencing change on a scale and at a rate that is in excess of all previous measures. Consequently, businesses now need to approach ‘order’ within the organization from a seemingly radical perspective that encompasses an endless range of possible points of impact within the company. Bryan Hattingh has developed an approach to business that is able to seamlessly function as well as promote and support the individual as they contribute towards the totality of the company’s being. One of the premises involved in achieving such a system is to have unambiguous company goals and competencies, a component of Cycan’s business strategy that originates from the CEO. In order to understand the role of the CEO in Cycan it is first necessary to elaborate on the structure of Cycan. Cycan functions as a series of teams that interact accordingly depending on each unique client, from coaching to research, Cycan’s teams are interdependent and self-regulating. Bryan Hattingh’s role is not an authoritarian one, but rather one of guidance, direction, and support. This comprises of facilitating team learning and holistic support (e.g. team building exercises), as well as communicating the values and state of the company. In addition, the quality of feedback from within the organization is meaningful, honest and respectful, a result of Hattingh’s strategy and attitude.

According to Weick (1992), when formal structures fail only communication is left, therefore the better quality of communication accruing amongst organizational members, the more effective the organization will be in times of chaos. Through adopting humanistic principles, Hattingh has identified that organizations are communication phenomena that exists because of communication, and that the interpersonal relationships that exist within Cycan are to be values and honored. Hattingh (2000) states: “Individuals at any level who continually review, refine and crystallize their dreams, goals and objectives and pursue them to fulfillment automatically assume the status of leader. When the managers and executives within the organization embrace this practice, profound impact takes place on the organization as a whole” It is evident that Hattingh as the CEO encourages the individual to achieve and grow, and he does so primarily by encouraging respectful and meaningful interaction within Cycan’s internal communication structures. 4.2. CYCAN”S INTERNAL COMMUNICATION STRUCTURES In the previous section the role of communication technology was discussed as it pertains to knowledge management and information flow. Weick (1994) indicates that organizations need to develop ‘resilient groups’ that are capable of four things: improvisation, wisdom, respectful interaction and communication. By improvisation Weick refers to “bringing to the surface, testing, and restructuring one’s intuitive understanding of phenomena on the spot, at a time when action can still make a difference” (Weick, 1994). This is related to the process of enactment discussed earlier and it highlights Cycan’s self-regulating and interdependent nature, a process built on their internal communication networks. This process is formed by communication technology in the form of a utilized intranet, e-mail and telecommunications. Furthermore, the head office of Cycan is a hub of communication activity characterized by constant communication. Increasing the speed and frequency of communication (according to Weick, 1994) increases an organizations ability to coordinate meaningful action in complex systems that are susceptible to disaster. It is fitting then that the core and most tangible part of Cycan reflects this principle, however it is necessary to develop the next component of Weick’s function of resilient teams that of respectful interaction, describe very simply below:

“Respect for the reports of others and being willing to base beliefs and actions on them (trust); report so that others may use your observations in coming to valid beliefs (honesty); and respect your own perceptions and beliefs and integrate them with the reports of others” This approach is part of Hattingh’s belief that the organizational culture must encourage selfactualization amongst Cycan’s employees through communication and leaning. This process becomes fruitful when wisdom is obtained through such interaction and sharing of perspectives. Consider Cycan’s most recent team building exercise, individuals within the companies head office will switch roles at random and they will have to function from that person’s position for a month. This allows employees to learn about the daily happenings of another individual and, according to Hattingh, increases the cohesiveness and appreciation of other individuals’ contributions. One of the effects such internal communication has on Cycan is that the decision-making process is inclusive and collective. 4.3. CYCAN’S DECISION-MAKING STRUCTURE Decision-making within organizations has traditional fallen upon upper and middle management and the results of these decisions were then issued down to lower level employees. The problem with this is that although management has a better overview of the organization, it is the employees functioning within specific areas that are exposed to areas that management would not be aware of. For example, the coaching team at Cycan is involved with specific cliental and their communication with Cycan is primarily through this team. Hence, if Cycan wanted to improve their relationships with future clients it would be logical to assume that the individuals involved in the coaching section would have the most accurate and readily available information in this regard. Cycan’s is able too incorporate the opinions and perspectives of its employee’s through management’s gradual exposure to specific feedback from each team on any given client. This allows the CEO to have the information available of areas of concern continually. In other words, when a decision has to be made the information impacting on any possible outcome is consistently made available prior to the point at which the Cycan undergoes its decision-making process. Therefore, the speed at which decisions are addressed is increased due to the internal communication networks established by the organization.

Although issues around corporate values and organizational core competencies are still largely left to the CEO, Cycan appreciates and encourage its members to actively take part in decisions that affect the teams in which they operate. This correlates with Weick’s (1994) notion of respectful interaction describe in the previous section. Furthermore, with employees being more involve in the decision-making process, they are inclined to feel more apart of the organization and, hence, feel more positively about their involvement in it. 5. CONCLUSION Today organizations have to adjust too many dramatic changes, ranging from fundamental restructuring to revolutionary shifts in traditional values. These required changes are largely attributed to drastic changes in the way in which organizations respond to the environment in which they operate. Contemporary management involves acknowledging the role of communication in achieving organizational success, as well sustaining it placement in the marketplace. Globalization and the resultant advancements in information technology are the two main contributors of modern organizational structuring, both of which pertain to highly complex communication activities and considerations that have become part of the organizations enactment with micro (i.e. inter-organizational activities) as well as the macro systems (i.e. transnational synergies, strategic geographic positioning, etc.). This reflects a paradigm shift from traditionally ‘closed’ operating procedures (characterized by one-way hierarchical inter-organizational communication) to highly flexible and innovative contemporary organizations which. The paradox here is that organizations need existing paradigms in order to make sense of the current situations and this can trap organizations in current paradigms (Verwey & Du Plooy-Cillers, 2003:2). Cycan illustrates how humanistic communication paradigms can be used to enhance not only the achievements of the organization but as well as to the benefit of the organizational members. By allowing employees to form an active part of Cycan and its equity, the organizational culture created is able to achieve an open and flexible communication flow that has been theorized by contemporary system thinkers such as Weick and Taylor. Furthermore, the role of technology in creating and sustaining these open communication systems is vital in creating communication channels that are becoming increasingly user-friendly and integrated with the organizations core competencies. Furthermore, the ability of organizations to create internal structures that promote

the conversion of information to viable knowledge is becoming critical in creating informed employees that can actively contribute towards the organizations functioning.

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