Beyond Organizations and Back

Speaker A Organizations. As many of us know, Elliot went, in his thinking, far beyond just improving organizations. His book, Fair Employment, Free Society is a very good example of that when he goes deeply into how to improve society at large. And in one of his last book, which is a supporting substance for this presentation, which is the life and behavior of living organisms, he goes into this at length. So I want to show some of the implications it has for the future and for us, going beyond organizations. It means in two ways. It goes beyond organizations in time, because in this book he goes millions of years into the past and places the organizational phenomenon in the context of the evolution of life on Earth and into the future. Because I think there are strong implications about the future which go beyond just improving organizations. And also he touches upon, or how could I say comes to the frontier, to other fields such as economics, evolutionary biology and lawmaking. So that's what this is about, phil Fairpey in this book, Jack says, I made this discovery decades ago, and it's been published, it's been explained, and it has been read by Thunderous Silence. Those are his words. Thunderous silence. Why is this? Well, what does prevailing economic theory tell us? What we all know. Why do people come to work? Because they need money. And what are they out to do? Get as much money as they can, infinitely. I mean, it's never enough, and they're indifferent to what happens around them. Well, Feldford theory says, no, people know what fair pay is, and they do care very deeply about what goes around. And work is not a commodity. Jax used to say, for instance, olive oil does not care whether the price of vinegar goes up or down, but people do care deeply about what others around them make. So this is one thing, economics this is a bit too long for a slide, I know, but every worth is worth reading. So I'm going to give you a minute to read this. Well, basically it says two thing. It says economy is all wrong. It's not a science. And second, the foundations for true economic science have to be found in behavioral science, not in economics itself. Just well, the analogy with the engineering theory makes a point very well. Now, I heard this phrase a few months ago, and I found it beautiful. This is from a Nobel Prize Martia San, and I heard it quoted by this Argentina economist in a presentation in which he told this he was in a seminar about social responsibility of enterprise. And during a coffee break, he was speaking with one of the big business guys in Argentina. And this man told him, well, when I go back in the evening to my family and I tell them about this, they look up at me, they think I'm a hero if I just tell them that we have a few millions more. They just shrug. They don't care. Well, this is a point that another Nobel Prize, which is Mohammed Eunus last year's Nobel Prize in economics, makes his points very well. He says, the way the economy exists now, it discourages people with social interests from going into business, because that's only for greedy people. This should not be that way. And he says, in similar terms, we have to go back to the drawing board. We have to reformulate economics. Well, and this very interesting quote is from John Kenneth Calbra, which says, the future of economics is the inside workings of organizations. It's about using the intelligence and experience of workers. MMM. Well, so that's one thing that's about economics. I'll take this up again briefly as we go on. Now, we know about strata workstrata. Worksta were discovered in the 50s. They knew they existed. Why? That was a question that remained unanswered for almost 30 years, and which was finally clarified in the 80s. In the mid 80s. It has to do with differential analysis of processing information. It has to do with mental processing, a word that Jacks later changed to organical processing. So we have strata one to four. That's where it all started. Then it moved to the upper strata, and then it moved up into the world of universals and the world of genius and down. And this is very interesting. The point is, it's not just humans at work. The point is that all form of lives use these organical processes, which are four and only four. This is an amoeba. Does the Amoeba use this question? Well, amoeba feeds on bacteria and there's a tetrahymene tetrahymana, and there's a copramana. And the Amoeba would rather eat the copramana sorry, tetrahymana. So he does. So it does. Now, suppose there are only copramonas around. Then it feeds on copramonas, and there are two tetrahymines at similar distance. It cannot go for both at once. So which decision is this one near enough, or is it too far to reach out for decision? Discretion. Now, think of a CEO of a financial holding planning whether or not to make a hostile acquisition of a company. That is, reach out a pseudopod and swallow it. Does it have anything to do? Well, it's the same process. It has everything to do. It uses discretion. Now, of course, you may want to tell me now, hold on. A CEO is not an amoeba. It analyzes. He uses discretion, he uses reason, he calculates. Yes, but all this work, all this analyzing and calculating work and so on, what it does is circumscribe the field within which discretion is used. And once he has done this, he's just like the amoeba. So this may sound weird at the beginning, but this is not me. This is Jack's. And I think this is useful for understanding what discretion is about. The Amoeba does one thing at a time, right? Only one action. At a time. That's what we call it, a declarative processor, one at a time. Now, you know about the dance of the bees. It has certain duration and a certain pointing, and all those data put together makes sense to the other bees as to where to go to get the flowers, right? Not just one thing, several things simultaneously. Think of a systems analyst presenting a system. We have this resources and this need and this people and so on. Therefore, taking all this into account, I think this is a good answer to that problem. Well, that's cumulative processing. And there's a hunting animal, a cheetah. He's going after prey. The prey changes courses. The cheetah has to plan its movements, not just the next movement, like an insect group do, but two, three, four in advance. And it's changing all the time. So that's a stride on three manager chasing a goal which moves in time. And he has readjusted Merplants for the following months, all the time. So there's Trident Three. Okay? Now, once I was visiting a zoo with my family, and this is a spontaneous reference to parallel processing. The guide says, you know what these animals do? One of them makes a lot of noise and distracts the attention of the farmer. Meanwhile, the other one creeps into a henpen and gets a hen, right? So for this, who gets into the henpen? Its behavior, its serial behavior only makes sense by taking into account what the other serial processes is. So that's an example of parallel processing, okay? And so on. This is humans are in this stage from birth to age four. Why age four? Because that's when children really learn to speak and not just to use words as signals. Now, what is the significance of this? All these pretty animals that you see may vary in skill, but they are all use the same processes. I mean, all fish are serial and all collective hamters are parallel and all single cell creatures are declarative and so on. And then when we get to humans, we get this kind of situation. I mean, multicapacity, as far as we know, exists only in humans and in no other species. And why is this significant? Because one would have to assume, and now I'm moving into hypothesis making and speculation, but a very fruitful one. I think the multicapacity fans out to how many different processing forms of processing, we don't know. Certainly more than nine. But how much it goes up, we don't know. Now, the interesting thing is, if this exists, then one would have to assume that there are some evolutionary advantage in this. That is that only human can work together at different levels, right? A different level of words with an adaptative advantage. And that tells something about leadership. This is a very well known phrase by Einstein, which is to the point. I mean, we get socially bigger groups all the time, all along history now, what is as thick as globalization? Is there such a thing as global government? There isn't. But there's little question that there are several aspects of the modern world that have to be governed globally. And that takes high stress, that takes high level. So as time passes well, I think Angela tells the whole story in this phrase. Wow. So that's one thing about leadership. This will lead to the conclusion that leadership is an exclusively human phenomenon. I mean, we see hierarchies within some animal species, but they seem to be of a different nature. Okay, I'll get back to this. Well, this is an awfully interesting phrase that is repeated in many writing by Jacks, mostly in a theory of the life and behavior. And there's a very fine article in the web in the ROI site called on the Wings of a Song short article where he uses this notion. And what does he say? He says animals or all living features have inborn constraints as to their behavior. In humans, this is completely less structured, it's more open. There are much fewer internal constraints. So to create a good society, we need our genes plus a good system of constructive constraints. I think one way to look at our theory is to say that it's a theory of constructive constraints within organizations. Now, this has to do with lawmaking. Now we face resistance and people are hard to convince. And this is a phrase by Max Planck which I find in full coincidence with something I heard Jax once say, that some people will never be convinced. It's well, Herb, I believe, would put this in term of anacletic depression. Now, back to organizations. When I was preparing this presentation, my feeling was this part is not structured enough, it's not conclusive enough, it's too open. But then I thought, well, that's why it should be. After all, this is the most complex. These are things Jax himself was grappling with in the last part of his life. So please take it as a stimulus for thought rather than conclusions. And it's completely partial and imperfect. One thing is social responsibility. We are used to think of corporate social responsibility in terms of being a good corporate citizen that is, paying taxes, obeying the laws and so on and on and filling certain responsibility with employees. I mean, you have to provide regional work conditions and health and so on and on. And that's just fine, that's essential. But it's merely laying the foundation. The bulk, the substance of social responsibility is not there. The bulk of social responsibility is in having good systems, in having people evaluated correctly, in having jobs correctly evaluated, in promotion systems, in compensation systems and so on and on. All the things that we already know. That's where real corporate responsible social responsibility lies. Well, I heard this from Jax in 1997 and at that time my thinking was what is this guy talking about? What is this it's a weird idea. Now, over the years, it has ceased to become weird and it has actually become obvious. It is a very special responsibility to have the right to employ others because your decisions impact very strongly on the creation of wealth and on the welfare of many people. Well, another thing is one conclusion would be organizations are not just something that human can contrive in order to do useful things. One would be led to think that organizations are such an essential human phenomenon as the bypass condition or the existence of language. So this has something to say about all the anti hierarchical tendencies that were suboyant in the past and not so much now, right? Well, what I said, human leadership is a unique phenomenon. It's about working in differentiated vertical levels. And why is that? Well, again, we're going to speculation and hypothesis. One thing I would like to mention I should have said it before, but it's a very pleasant anecdote to me anyway, that when discussing all these things about organical processing in non human species, I once sent Jax an email with some ideas, some hypothesis that I had thought up. And his initial response was, harold, what a marvelous Christmas present this was. December, what a marvelous Christmas present you have sent me. That was extremely rewarding. Well, so human leadership is unique. You cannot understand it by looking at what happens in animals and leadership in accountability hierarchy that is precisely unique. There are other types of leadership among humans, but we're dealing with a unique phenomenon and we know how to make it come about. We know how to make it come about. That's great. Well, we have discussed this, why we're saying this. And this is one thing I remember Ken Craddock say about Deming, that he held his seminars and Deming said about 2% will get it. That's what I heard from Ken. Right. And some will never get it. And we have to work in this kind of world last. This is beyond improving organizations. That is can we think of a word? Let me put it this way. Right now, the CEO of a corporation has full discretion to use whatever method he or she wants to evaluate roles, whatever method he or she chooses to use to compensate people, and so on and on and on. Now, these things are of such a strong social impact that they should not be left to the discretion of individuals. If one of you says I want to have a slave because I want to be free to have a slave, two centuries ago, it would have been quite ordinary, right? What more, natural slaves are needed societies like that. It's a natural situation of things. And now they would tell you, no, that you can't do that doesn't curb your freedom. On the contrary, that's in favor of freedom, not against freedom. That does not restrict your freedom. Well, in the same way I can think of some time in the still distant future when there will be this kind of social constraints. And this, of course, like all bodies of laws, this should start by building some consensus about what some work systems are now, to finish, this is a beautiful word. Sorry, paragraph also from Jax, which points in the direction of what I have been trying to convey to you. The let us square our shoulders and have a try.