The Emergent, Permissionless Organization


I was reminded of Hopper’s Law by Adam Thierer in an essay he wrote last year about permissionless innovation, a new set of principles for moving away from constraining innovation through endless coordination and approval cycles, and overly constrained decision-making.

Thierer’s definition is this:

Permissionless innovation refers to the notion that experimentation with new technologies and business models should generally be permitted by default. Unless a compelling case can be made that a new invention will bring serious harm to society, innovation should be allowed to continue unabated and problems, if any develop, can be addressed later.

Thierer argues for a set of policies and principles for a permissionless approach to innovation, which should first be based on the benefits of organizational learning through ‘continued trial-and-error experimentation, resiliency, and ongoing adaptation to technological change’.

Constraints on that learning loop should be a ‘last resort’. As he quips, ‘innovation should be innocent until proven guilty’. Policies around innovation should be fact-based, not driven by worst-case hypothetical examples.

Finally, when interventions are called for, flexible, bottom-up solutions of a responsive nature are almost always better than anticipatory, top-down edicts.

Innovation should be innocent until proven guilty. ~ Adam Theirer

Note that these principles are directed toward the organization’s approach to leadership, and run counter to a great deal of cultural tendencies in conventional, linear management.

Others have taken the notion of the permissionless organization a bit further and aligned it with the idea of distributing decision-making to the edges of an organization to the greatest extent possible.

The permissionless organization is, as Rita McGrath and Ram Charan state,

one that uses digital technologies to unleash the creative and collaborative potential of people rather than trapping them in endless reporting and coordination loops. Its structure has far fewer hierarchical layers.

What follows is largely motivated by a key insight: to get to a permissionless, continuous innovation organizational culture there has to be some fundamental rethinking about organizational structure and culture.

As much as I respect the work of McGratch and Charan regarding the permissionless organization, I am avoiding ‘layers’ — which presuppose a hierarchical organization. I use concentric circles instead, with customers and partners at the edge of the organization as a whole. And second, I place the customer-facing groups at the outer circle (‘entrepreneurial leaders’), and two other sorts of leadership in inner circles (’enabling leaders’ and ‘architecting leaders’).

I have adopted the names of the three sorts of leaders from the findings of three MIT researchers: Deborah Ancona, Elaine Backman, and Kate Isaacs. They studied several companies with a history of continuous innovation: The Xerox R&D group PARC, and the materials company W.L. Gore.

We identified three distinct types of leaders. Entrepreneurial leaders, typically concentrated at lower levels of an organization, create value for customers with new products and services; collectively, they move the organization into unexplored territory. Enabling leaders, in the middle of the organization, make sure the entrepreneurs have the resources and information they need. And architecting leaders, near the top [or center, in my version of the organizational map], keep an eye on the whole game board, monitoring culture, high-level strategy, and structure.

In an interview with Curt Nickisch, the lead researcher, Deborah Ancona, described this shift in leadership thinking as a rejection of bureaucracy:

Almost every company we see is wanting to make this move from bureaucracy, command-and-control to a more nimble distributed learning network, whatever word you want to use, kind of organization.

In my thinking, this is the emergent organization, one based on permissionless innovation and decision-making. But many executives are uncertain of their position in such an organization. Are they enabling leaders, tearing down barriers, and finding resources for entrepreneurial groups working at the edge? What does an architecting leader spend their time doing, if not making important decisions or telling others what to do? These questions, and leadership’s reluctance to answer them and move forward, holds back the transition to emergent, permissionless operations.

What is holding them back is fear.

This is in keeping with a lot of research being done now that executives feel like there are going to be major changes in their industries and in their environment in the coming three years – 76 percent of people, of executives believe this compared to 26 last year. So, the sense that there’s a speed-up of change in the environment is going to require a different kind of organization.
But with that comes incredible anxiety and actually inertia in making the move because of this fear of I don’t know what to do. I don’t know how to create this system. It’s going to mean that I lose my power as an executive who is seen to be in charge of this organization. What’s going to happen if I let go of the reins, is a big fear that we see in these executives. So, it’s scary.

But architecting leaders have to see themselves doing something very different in this new, permissionless organization.

Ancona’s metaphor is that the architects are creating a game board for the company: the culture and rules of the game, and that facilitates how everyone operates, without making others’ decisions for them. As ‘keepers of the culture’ they express the values of the organization and lay out the rules of engagement that enable others to move forward.

I am reminded of Henry Minzberg’s observation about emergent strategy:

Emergent strategy means, not chaos, but, in essence, unintended order.

In the coming years, the pace of adoption of the emergent, permissionless organization will largely be based on how quickly today’s leaders can conquer their fear of chaos arising from relaxing their chokehold on decision-making.

Facebook iconTwitter IconLinkedIn icon