order vs chaos & who will win the recession
Imagine two hypothetical companies,
Spick & Span
This company is organized to the maximum efficiency
Their data is in the most normalized form (no one piece of data is repeated)
Their process are perfectly efficient and no task is ever repeated.
They do have redundancy in their system but this again is perfectly sized.
Their people are hardworking, intelligent and enjoy their jobs.
Splat&O’Messy
This company is not organized in any way nothing is written down
There are no job titles, roles and responsibilities or appraisals.
Their data is literally strewn around the office.
Loads of tasks are repeated, there are teams that are entire duplicates.
Their people are hardworking, intelligent and enjoy their jobs.
If you place these two companies in a stable environment then Spick and Span will naturally be the most profitable where as Splat and O’Messy could make loads more profit if they were organized, but they are all so busy they never get round to it.
Now imagine moving these two companies into an unstable environment. Suddenly Splat and O’Messy comes into its own, its own instability allows it to react faster than Spick and Span, also because information and resource is strewn around the whole company, vast parts can be cut off or become inaccessible and it can still function.
Companies are made up of lots of different types of people, during stability the organizers (project manager types) bubble up and start to run the company. On your P&L this will look great, but you must be aware that every process they implement or orgchart they publish is a nail in the coffin of your agility. You must balance this type of person with the type of person who is not well rounded, and who sometimes goes against the flow.
In short, a little mess is a good thing,
10 Responses to “order vs chaos & who will win the recession”
Andy Howell
Spick & Span and Splat & Messy sound like descriptions of each side of that ground floor room in Balmoral hall all those years ago…..
simon
Its funny that you should say that 
It was our experiences “back in the good old days” that really helped me form this opinion. I recently worked on a very large project which was run by an excellent program manager. I was the architect, it was just like our old room.
The tecno bit was … just a little messy … the organization of the teams was way tidy.
The compromise worked really well, we were agile in response, but disciplined in execution.
when the group dynamic changed (due to external forces) it all went wrong.
Unfortunately it was not like the old days and we could not settle the whole thing over some pints and game of pool. Productivity and motivation plummeted, and eventually the whole thing became a nonsense.
If only we had computers back in bal !!!
(p.s. have you seen the Balmoral Hall face book group )
Greg Stewart
Simon – you asked me: In the recession, who will make it through?It’s probably too easy to arbitrarily pick one or the other. I think the romantic answer is that Splat & O’Messy would be the clear winner – because they’ll have the kind of environment that can allow the sheer brilliance of some enthusiastic entrepreneurial soul to shine through, gleaming like a sparkling diamond in the grey stone of the supportive chaos underneath, un-obstructed by un-necessarily rigid creativity-killing Spick & Span bureaucracy. Romantic in the same way it’s the romantic answer to say that Theory Y management is always superior to Theory X. However, I think the reality (as I suspect you suspect) is a bit more shaded grey. They could both die in the recession, thoug perhaps in different fashions: Spic & Span might slowly run out of money and get caught in a cash-flow pinch. Equally, underfunded R&D might mean they run out of revenue production and slowly grind to a halt before the economy picks up.Splat & O’Messy though might not be the romantic winner. They might just blow themselves up even quicker than Spic & Span did in an orgy of spiralling R&D costs that aren’t measured or controlled, which might, in a better economy, have been covered by their healthy revenue stream and shrugged off as a normal cost of doing business. Not every dig produces a diamond after all, and they could be romantic but dead – telling each other stories over beers and foosball in the Redundancy Bar about how fun it was to work at their old firm that had the same kind of foosball table…Another scenario is they both limp through the rough patch, but if ‘hunkering down’ through the recession is the survival tactic they both choose, Spick & Span is more likely to win that Pyrric victory through its inherent measurement, control and discipline. While the romantic scenario does have Spic and Span getting eft in Splat’s dust once the economy turns back around and Splat is so much better positioned to stretch out a lead thanks to the breakthrough their unfettered creativity allowed. The question is – is there anything about Spic&Span that Splat & O’Messy can apply to increase the chance they last long enough that their inherent creativity yields them the diamond they need? Likewise, could Spic & Span take a page out of Splat & O’Messy’s book?Is there such a thing as controlled chaos?There are plenty of examples. Two that spring to mind are 3M and Apple. 3M has it worked into their DNA that all their people have to devote a targeted, substantial percentage of their time on ‘anything’ projects of their own devising. Apple is happy to ring-fence certain divisions that get to play by their own rules… They both seem to be in pretty good nick, as companies.Is that a fluke, or can it work? Can you create an environment of controlled chaos, or is operating counter-culture from the inside just a pipe dream?
simon
I Just Love that comment !
What an Intelligent and witty response.
A friend of mine (who is clever as a stick) looked at this another way, he said its not about chaos and order but about being a risk taker in comparison to being risk adverse.
So …
If a company is most profitable when it operating at the maximum acceptable level of risk then then such a company is one that invites the maximum amount of counter culture in through its doors without actually exploding.
I guess that Boo.com is an example of too much counter culture, can you think of any other examples of companies that have gone too far?
Scott McArthur
Reminds me of a conversation I once had with a jet fighter designer. ”Scott….” he said “its like this. A jet fighter aircraft is always moving (indeed shaking)and never stable which means that when it faces a threat it has an increased chance of avoiding the danger than it would if it were flying in a straight line….”
simon
Thats a really interesting point of view,
My Kendo sensi (see http://www.shinbukankendo.com) said the same thing,
He said,
“Simon, you keep putting your bloody feet too far apart !, your so planted you cant move fast. If you want to react quickly you must be less stable”
simon
Here is a great reply from James .. (who is a freaking awsome architect)
I think that in a product development organisation where innovation is
important it is necessary to manage ‘radical’ thinkers in a way that
does not stifle their creativity. ‘Radical’ individuals will be in the
minority in any organisation, yet they will be responsible for most of
the innovation and will be burdened with the responsibility of bringing
their ideas into the mainstream of the company.
I would guess that innovation is possible across the whole spectrum
from order to chaos. Extreme measures had to be taken at Xerox Parc in
Palo Alto where they invented things like GUIs, laser printing,
Ethernet, the mouse, fully formed Object Oriented programming, the
first IDE and much more, all in a relatively short period of time. The
teams there were given very unusual creative freedom.
If all a company is manufacturing something according to a defined process, then you probably don’t need radical thinking.
I get a feeling that I concur with James … its simply a horses for courses kind of thing
So overall things have come out of this,
1) radical thinking vs mainstream
2) risk taking vs risk mitigation
3) chaos vs order
4) stability vs unstability
all these 4 forces are in balance in a healthy company.
Oscar
Simon,I have to disagree with your conclusion, even if it is only because it is one of my favourite things to do.One of the errors you make is to not distinguish between skill and information. Information is the data you need to base a decision, skill allows you to make the best decision based on this information. In economically in-stable times a companies cost base is typically reduced in resources. Maintaining skill is expensive but maintaining information is almost free. Reduction of resources ofcourse impacts the decision making process qualitatively and quantitatively.Spick and Span will be impacted less as they have decoupled skill from information to the max. So a resource reduction impacts the decision process effectiveness, but not the basis where the decision is made on (the information).Where in Splat, loosing resources will always mean the loss of significant information, as these are not decoupled. Hence impacting the basis on which decisions are made, which means that outcome will be always worse in my eyes.I think that the agility of a company, especially in mid to large size, individuals are not the key factor. The effectiveness of the decision making process is what determines it market adaptation capability and therefor it’s agility.’OscarPS I think it is cute that you promote your own character in this article 
simon
CUTE ! lol
okay, so now we are getting to the nitty gritty two things are going to happen in the recession.
Firstly companies are not going to have access to credit, so the only way to maintain profit is by cost reduction.
Secondly these very same cut backs will cause new opportunities for companies who can offer products and services at lower cost.
Oscar following your logic … the same event happens to both Spick and Span and Splat and OMessy, which causes them to both loose 1/3 of their work force.
>Spick and Span loose 1/3 of their business process but dont loose any information.
>Splat and OMessy loose 1/3 of their work force and 1/3 of their information (they will simply never find it).
thus Spick and Span have the advantage ?
Lets consider this event on two aspects of the buisness
1>keeping the business going
simon
Francis Cook has left a great reply on his blog, Ive copied it in here so that you all get pinged and can see his cracking ideas on the subject.
Now I think for most people, the company they have been working at
will be a mixture of both ideas. Simon’s conclusion is that in an
unstable environment, Splat & O’Messy will react better because
they won’t be caught in the usual resource/decision making deadlock
that happens when things change.
I have another two observations which is that Spick & Span is
what every large corporation aspires to, but ends up being Splat &
O’Messy, and Splat & O’Messy is what a start-up is, and tries to
become Spick & Span.
I think the idea of a fully “normalised” (i.e. one function does one
thing) company is unrealistic. Any company that works in multiple
territories cannot realistically do this sensibly. Consider HR. Local
regulations are different and a homogenised approach is an aspiration
but not reality, take Paid Sick Leave as an example. You don’t get this
in some territories, but do in others.
Another aspect is when the company has a very diversified product
line. Is the sales and product management function the same for all ?
Hardly, similar, but not the same.
There are many use cases where you need duplication of resource in
order to fulfil the company’s function, it can never be perfectly sized
because we aren’t fortune-tellers, but you can help things along:
- Every business has a certain amount of unavoidable complexity, the
important thing to find out is what it is and ensure you are as close
to is as possible and not increasing it. - Over regulation of the information in a business can be counter
productive, there should be a core set of structures but units can act
autonomously beyond those. (The spirit of the information). - Don’t mistake Pillars of Information for efficiency, ultimately it will cost the business too much to fix.
- Ultimately time is the most valuable resource, it can be wasted, invested or saved, how that happens is down to an intimate
understanding of the company’s business. The measurement of the effects
can take far longer then the process, so look as far ahead as you can,
up to 5 years if you can do it. - If a worker’s desk is a mess but they know where everything is,
then you won’t notice a problem until you give the desk to someone
else. Same with the department/team/company. Plan for change, and
manage the mess.
In conclusion, yes a little “mess” is going to happen, but with a
little time, you can manage that, and still be reactive. Frankly there
is no substitute for hard-work and planning, how you do that planning
is up to your company as a whole as this is part of the character of
the company. If Spick & Span have done all this, then they’ll
out-perform Splat & O’Messy… until they buy them…
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