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Controlling Chaos and the Necessity of Order in High-Performance Organisations

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Organisations are chaotic systems and employe behaviour is often difficult to predict. Controlling variables that impact an organisation requires attention to both chaos and order. Not only can they co-exist, but both are necessary for sustainable growth.

But first, let's talk about the weather. Why is it with all the sophisticated technology we have now, the evolution of artificial intelligence, machine learning, and more data than at any time in the history of the world, meteorologists still struggle to create an accurate forecast — especially when it comes to extreme weather events?

Research at the University of California showed that some weather extremes simply lie beyond standard distribution models. Weather is influenced by so many parameters that systems are often too complex to efficiently predict behaviour in both the short term and the long term.

That’s why climate is called a chaotic system. They are complex systems that make order difficult to recognise despite all of the available data we have on organisations and patterns.

Like weather and climate, organisations are also characterised as chaotic systems. They are made up of complex networks of people whose behaviour cannot always be predicted accurately or directed to take the necessary actions for success. Yet, the collective behaviour of the individuals in the organisation has a major impact on results.

Multiple companies can have the same goal and hire people with the same level of experience and have vastly different results. One company might succeed while many others fail.

Same Goal, Different Results

In the past, businesses have been driven mostly by changes in structure or process. Leaders are now realising that this does not always lead to the desired and predicted results because of the complexity of organisations, outside influences, and individual behaviour. For example, raising commissions doesn’t always incentivise sales teams to sell more. Offering bonuses for job completion doesn’t necessarily improve timelines. The same incentives can influence two workers in vastly different ways.

Properly managing the complexity of an organisation and motivating individuals requires recognising and stimulating individual behavioural patterns.

Like weather systems, organisations often show signs of both chaos and order. Founder and former CEO of VISA Dee Hock coined the term for this as chaordic.

What is a Chaordic Organsation?

Hock defined a chaordic organisation as one that is simultaneously orderly and chaotic and where neither dominates. It is neither good nor bad and, managed properly, can still yield significant results.

Meteorologists applied this chaordic thinking as a better way to make climate predictions in the 1960s. Decades later, these ideas were translated into a team dynamics model to guide their actions. These include three distinct parameters to produce better outcomes:

  1. Clear, inspiring goals that all team members can relate to
  2. An understanding that all members within an organisation are connected with each other and have a role to play in success.
  3. Create a dialog culture rather than a culture of debate

Using these parameters, researchers felt that they could use these parameters to proactively guide the organisation and provide a bit more order to the chaos and predict organisational behaviour more accurately.

The concept itself is simple and few (if any) business leaders will argue that these aren’t good concepts to implement, yet few companies actively use these parameters to guide their organisation. Why? Because it’s often difficult to translate these parameters into hard business indicators.

Improving Organisational Efficiency

The first step in solving any problem is gaining an understanding of the problem itself.

This requires a thorough analysis of the organisation itself. This organisational profile forms the basis for improving efficiency.

Here’s an example. In one case, we looked at an organisation and found deficits in discipline and engagement. That’s not uncommon. A Gallup report showed that 85% of global employees are not engaged at work. 18% of those surveyed said they are actively disengaged. That leaves another two-thirds of employees — the majority — who said they were indifferent to meeting organisational goals.

For this organisation suffering from a lack of engagement and discipline, leadership needed to take active steps to direct individual behaviour within the group. Discipline can be strengthened by increasing process and procedural focus. However, as we know, this alone doesn’t directly lead to improvements in results.

By focussing on behaviour and culture, however, team members could be given a better framework in which they could feel more comfortable engaging and confident about making their own decisions. To achieve this framework, organisational leaders needed to:

  • Create company goals and priorities
  • Communicate these goals and priorities consistently and frequently
  • Tie individual roles and tasks to company goals
  • Make consistent decisions in accordance with these goals and priorities

By strengthening the connectedness between teams and individuals, all working towards the same guiding principles and goals, we increased engagement. For example, we combined several module-based projects into one larger programme focussed on the end goal. This helped a large number of employees feel more connected to the final result rather than just their step in their process.

This re-enforced the pivotal importance of how each stage helped create a finished product and create a more team spirit to work collaboratively for success. This simple step helped the group engage and cooperate to address and resolve problems more quickly.

In this particular case, the final product improved greatly and employees said they felt like they were truly a team. The results also showed in the numbers: the average product slip was reduced from 10% to less than 7.5% and average project costs decreased from € 850,000 to € 600,000 per year.

Creating High-Performance Organisations

Like weather patterns and climate, organisations are chaotic systems. Behaviour is often difficult to predict. Controlling variables that impact an organisation and directing activities requires the use of similar complex models.

Companies that adopt and actively use these models can make significant improvements — much greater than those that focus on structure and process to achieve their goals. Apple is a good example here. Steve Jobs made the company's priority a fusion of design and technology. This attracted consumers and talent to build a high-performance organisation. Tim Cook, now at the helm of Apple, has rallied the team and tech industry in much the same way around what he calls the basic human right of privacy.

These clear goals help everyone understand the company’s mission, how and why it makes certain decisions, and attract high-performing talent. When you can link complex behavioural patterns within organisations to business-critical process indicators, you also get more out of their teams. They succeed in realising complex organisational dynamics that are essential for a competitive advantage.

Finally, there are other significant advantages here. When organisations create the right culture and get people to rally around a goal, employees often go beyond being engaged to becoming passionate about the company's mission. And, this passion also becomes self-sustaining.