Complexity Management through

Structural Change
By Alfonso Cornejo Author of the Book
Complexity and Chaos: A Guide for XXI Century Management

©

Structure-Process

Model
some characteristics
September 2007 Alfonso Cornejo CM~SC © 2

Environment

Environment

Structures

Struct

Proc

Processes

System frontier

September 2007

Alfonso Cornejo CM~SC ©

3

Some Structure-Process Model principles
• You can use S-P Model as a tool to understand organizational behavior • Processes (behaviors) are structures in movement • Complex organizational behaviors are the result of structures and its interactions • Responsibility of managers is to create structures for the emergence of fundamental processes: Operation, Maintenance, Learning, Adaptation and Growth (a systemic perspective for viability).
September 2007 Alfonso Cornejo CM~SC © 4

Some Structure-Process Model principles
• If leaders want to create a lasting change over organizational behaviors, they must change structures • Based on a systemic perspective, Structures are present at different levels:
– – – – Organizational Cultural Groups / Teams Individual

September 2007

Alfonso Cornejo CM~SC ©

5

Some Structure-Process Model principles
• Working with S-P Model is also a Design perspective: Every organization is perfectly designed to the results it gets. • Time and absence of structure care (towards fundamental processes) could carry system degradation and as a result ineffective and inefficient processes (complexity increase and that derives in organizational entropy).

September 2007

Alfonso Cornejo CM~SC ©

6

Some Structure-Process Model principles
• Organizations must maintain a dynamic balance between its components to reach synergy and to cope effectively to environment • Organizations must use resources efficiently and justified by assignation to support fundamental processes. • Increasingly organizational complexity means and increase of resources • Organizational structure should reflect its learning over time.
September 2007 Alfonso Cornejo CM~SC © 7

Structure and Process Model and its interactions
13 11

4
10
E 7 P 9

16 6

1
15

S
5

8

12

3

P
14

2

September 2007

Alfonso Cornejo CM~SC ©

8

Structure and Process Model and its interactions
1.- Structures 2.- Structures that generate processes 3.- Processes 4.- Processes that affect Structures 5.- Structures that influence Cultural Processes 6.- Processes that affect Cultural Structures 7.- Cultural Structures 8.- Cultural Structures that generate Cultural Processes 9.- Cultural Processes 10.- Cultural Processes that affect Cultural Structures 11.- Cultural Processes that affect Structures 12.- Cultural Structures that influence Processes 13.- Structures that influence environment processes 14.- Processes that affect environment structures 15.- Environment Processes that affect Structures 16.- Processes that affect environment Structures

September 2007

Alfonso Cornejo CM~SC ©

9

Fundamental Processes: ACrOMA
September 2007 Alfonso Cornejo CM~SC © 10

The need of Fundamental Processes
We need to create, modify and align organizational structures … but what kind of processes should organizations maintain in order to survive and success in a turbulent and increasingly demanding environment?

September 2007

Alfonso Cornejo CM~SC ©

11

ACrOMA

• Adaptación: • Crecimiento: • Operación: • Mantenimiento: • Aprendizaje:
September 2007

Adaptation
Growth Operation

Maintenance
Learning
12

Alfonso Cornejo CM~SC ©

Five Fundamental Processes

1. Adaptation
Organizational evolution. Indicators and mechanisms to ear the weakest environment changes and transform them in changes on inner structure in order to fit to accordingly to environment.

D

t
September 2007 Alfonso Cornejo CM~SC © 13

Five Fundamental Processes

2. Growth
Quantitative business increase: Ordered, balanced and stable in size, systems and departments but obeying market size participation. New entities creation capitalizing learning.

D

t
September 2007 Alfonso Cornejo CM~SC © 14

Five Fundamental Processes

3. Operation
Fundamental transformation from raw materials to finished goods. Support activities (direct and indirect) to reach the fundamental business transformation. Value added generation from organization to society.

D

t
September 2007 Alfonso Cornejo CM~SC © 15

Five Fundamental Processes

4. Maintenance
Caring of components and systems performance state. Homeostasis. Wear off repairing over operation components. Ensuring optimal system operation.

D

t
September 2007 Alfonso Cornejo CM~SC © 16

Five Fundamental Processes

5. Learning
Knowledge and experience acquired and its use over vital systems for organizational performance. Level in which organization make of every event an opportunity to improve performance.

D

t
September 2007 Alfonso Cornejo CM~SC © 17

Effective Structural Change
September 2007 Alfonso Cornejo CM~SC © 18

Most transformation programs satisfy themselves with shifting the same old furniture about in the same old room. Some seek to throw some of the furniture away. But real transformation requires that we redesign the room itself. Perhaps even blow up the old room. It requires that we change the thinking behind our thinking—literally, that we learn to rewire our corporate brains.
Danah Zohar Rewiring the Corporate Brain
September 2007 Alfonso Cornejo CM~SC © 19

Learning imply
Structural Change

Structural Change

Imply Learning
September 2007 Alfonso Cornejo CM~SC © 20

Leadership and its impact to Organizational Structures
September 2007 Alfonso Cornejo CM~SC © 21

Leader contribute to Structure the Organization
Environment Environment

Structures

Struct

Proc

Processes

System frontier

Leaders have the power (conscious or unconscious) to modify organization through structural change, although we have never consider it in this way.
September 2007 Alfonso Cornejo CM~SC © 22

New Leader s Role
• Observant of organization structures to ensure that they can support fundamental processes • Live processes that can create the right values (structures) to establish behavior patterns to individual and groups • Carefully observes Culture and ensure positive effect in people • Help to create or modify structures in order to facilitate the fundamental processes
September 2007 Alfonso Cornejo CM~SC © 23

Velvet globe but Iron Hand

with an

Leaders without authority permit gradual degradation of structures that matter most to organization. To put it Simply…he is allowing structural modification by any person, but in a direction not congruent with organizational structures (vision, mission, values) Leaders always need to be caring about organizational structures, and their best indicators are people behavior.
September 2007 Alfonso Cornejo CM~SC © 24

If You Build It (S),

P

They Will Come (P)
September 2007 Alfonso Cornejo CM~SC © 25

The Book
Complejidad y Caos: Guía para la Administración del Siglo XXI Complexity and Chaos: Guide for XXI Century Management You can download or read the book here:
www.structural-change.com http://www.eumed.net/cursecon/libreria/2004/aca/aca.htm

September 2007

Alfonso Cornejo CM~SC ©

26

Alfonso Cornejo tektology@yahoo.com www.structural-change.com www.structural-change.jimdo.com

September 2007

Alfonso Cornejo CM~SC ©

27