Realisation Shifts before Mindset Shifts for Organisational Transformation

I came across a diagram created by Aaron Sachs and Anupam Kundu from Thoughtworks.

Their Mindset Shifts diagram got me thinking how I would represent my thoughts on organisational transformation. My take on this is that Realisation needs to come before Mindset Shift. You have to have the light bulb moment before you can change your mindset. So here are the realisations I think are needed.

Realisation 1. Organisations are predominantly complex rather than complicated. [1]

Realisation 2. As organisations are complex you cannot rely on experts using Good Practice to get the behaviour you want. You need to apply experimentation. [2]

Realisation 3. In this 4th knowledge revolution we are part of, the vast majority of employees have become, at least in part, Knowledge Workers. They are not doing purely unthinking, robotic manual Work. They are expected to use their intellect to be creative, solve problems, innovate, share knowledge and collaborate. Carrot and stick (the second human motivational drive) has been shown to have a detrimental effect on knowledge work. Up to a point it is good at motivating Manual Workers, but for knowledge work it reduces creativity, innovation and problem solving, and can encourage illicit behaviour. The best intellectual work is done when the person is motivated by the 3rd human drive - intrinsic motivation - that feeling of self-satisfaction you get when you solve a puzzle or create something pleasing. [2]

Realisation 4. Following on from Realisation 3, if you are trying to motivate Knowledge Workers, rather than Manual Workers, intrinsic motivation becomes far more important. That will need to be reflected in the driving force behind the organisation. So the Profit motivation (carrot) changes to Purpose or Why (intrinsic motivation), which hopefully your Knowledge Workers and customers will buy into. [2]

Realisation 5. Hierarchies work well when a small number of Knowledge Workers control a labour force of Manual Workers. Those sort of companies can be run more like a machine. But with an organisation of Knowledge Workers networks naturally develop. The organisation is far more complex. The difficulty for the leadership is that they can lose control of the networks, formal and informal (if they know they even exist). And the more leadership tries to impose a network structure and hierarchy the less control it has, because this is a complex system that adapts to new stimuli producing new, unexpected behaviours. But there is a network, or nest of networks, that can provide some form of controlled infrastructure - a market. [2]

For example organisations with first-class knowledge systems develop them via an internal knowledge market. The market is used to encourage Knowledge Workers to participate - be active members of the network. They are attracted to use the market rather than setting up their own networks. The Knowledge Managers (really Knowledge Market Managers) experiment with stimuli, attractors and boundaries, within the market framework, to encourage the knowledge sharing and creation behaviour they want. They do this using both intrinsic and extrinsic motivation. In addition to knowledge you can set up markets for a variety of business goals such as innovation, thought leadership, professional learning and development, employee retention, productivity, customer service, etc.

So organisational transformation comes through realisation.

[1] An Alternative Future for Knowledge Management
[2] The 4th Knowledge Revolution