Organisational incongruence

Organisational incongruence

The concept of “organisational incongruence” is a fascinating parallel to Carl Rogers’ theory of incongruence in individuals. Let’s break down the similarities and differences:

Carl Rogers’ Incongruence in Individuals:

Core Concept: Rogers believed that individuals have an innate drive towards Self-actualization, a desire to become the best versions of themselves. However, this process can be hindered by “incongruence”, where there’s a mismatch between the individual’s “ideal-self” (who they aspire to be) and their “real-self” (who they actually are). This gap can lead to anxiety, defensiveness, and a lack of authenticity.

Example: Imagine someone who deeply values honesty but finds themselves lying to protect their job. This creates an internal conflict between their ideal self (honest) and their real self (dishonest). See Imposter Syndrome. Also, contracts that force employees to misrepresent themselves or the services they are able to offer.

Organisational Incongruence:

Core Concept: Similarly, organisations can experience incongruence between their “projected ideal self” (the image they present to the world) and their “actual self” (their internal operations and realities). This gap can arise from various factors, including:
Unrealistic Expectations: Setting ambitious goals that are difficult or impossible to achieve.

Cost Pressures: The need to cut costs can lead to compromises that contradict the initial vision.

Internal Conflicts: Different departments or individuals within the organisation may have conflicting priorities.

Example: A tech company might project an image of innovation and cutting-edge technology, but internally struggle with outdated systems, bureaucratic processes, and a lack of investment in research and development. Recently, BT had to halt its removal of copper from the network after they were finally forced to admit, IP Phones are too unreliable to be the only source of contact for vulnerable and disabled people. That was over 5 years into the roll-out. The organisation had clearly never tested their product in the real world, and had listened for far too long to internal hype that had no relation to the experience mounting numbers of customers were trying to tell them about.

Key Similarities:

Gap Between Ideal and Reality: Both individual and organisational incongruence involve a discrepancy between a desired state and the actual state.

Impact on Functioning: In both cases, this incongruence can lead to dysfunction. Individuals may experience emotional distress, while organisations may struggle with poor communication, low morale, and a lack of trust.

Potential for Growth: Both individuals and organisations can work towards reducing incongruence by becoming more self-aware, addressing internal conflicts, and aligning their actions with their values. This, however, involves reliable feedback loops. Another incongruence of most organisations in technology is to claim to have the best customer support, but deliver it in “process riddles”, that send the customer in circles, as the organisation tries to make access to that support as difficult as possible, in order to save money.

Key Differences:

Nature of the Self: Individuals tend to have a more complex and dynamic sense of self, while organisations are often viewed as more static entities.

Motivations: Individuals are driven by personal growth and Self-actualization, while organisations are typically driven by profit, market share, or other external goals.

Methods of Resolution: Individuals typically resolve incongruence through therapy or self-reflection, while organisations may need to restructure, implement new policies, or change leadership.

The Observation:

Organisations tend to project an “ideal-self” that they haven’t yet achieved, and this is a key aspect of organisational incongruence. The pressure to maintain this image, even as reality diverges, can lead to a disconnect between the organisation’s public face and its internal workings.

How incongruence develops in an organisation: Transitions – the unique journey of the organisation

The transition from open source to a privately owned organisation is a perfect example of how organisational incongruence can manifest. It’s a fascinating case study that highlights the complexities of managing change, maintaining transparency, and balancing profit motives with customer expectations.

Let’s unpack some of the key challenges:

Uncertainty and “Islands” of Outdated Practices:

Uncertainty: The shift in ownership and structure inevitably brings uncertainty. Employees, customers, and even the organisation itself might struggle to adapt to new roles, responsibilities, and priorities.

Outdated Practices: Existing processes and systems might not align with the new business model. This can lead to inefficiencies, confusion, and resistance to change. Imagine a company that used to rely on open collaboration and community feedback suddenly having to operate with a more closed and controlled approach.

Stage Managing Information:

Transparency vs. Secrecy: The organisation needs to carefully navigate the delicate balance between transparency and secrecy. While open communication is important for building trust, some information might need to be kept confidential for competitive reasons. This can create a challenge in maintaining a consistent and authentic image.

Lag in Customer Adaptation:

New Rules and Policies: Customers might be slow to adapt to new rules, policies, and pricing structures. This can lead to frustration, confusion, and even a loss of customers.

“Bugs” as “Features”: The profit incentive can sometimes lead to a shift in perspective where “bugs” are seen as “features” that customers can simply work around. This can create a sense of disrespect and distrust among customers, further exacerbating the incongruence between the organisation’s projected ideal self and its actual behaviour.

The Shifting Landscape:

Evolving Identity: As the product transitions and the organisation evolves, its identity also shifts. This can be a challenging process, especially if the organisation is trying to maintain a consistent brand image while adapting to new realities.

However, many business models force incongruent, and potentially illegal behaviour:

In many cases, it’s a classic case of “fake it till you make it,” where organisations try to create a perception of value without actually delivering it. Let’s break down the problem statement and explore its implications:

The “Added Value” Con:

The Illusion: The “added value” model often relies on superficial enhancements that don’t fundamentally improve the product or service. Think of a retailer offering a “free gift” with purchase, but the gift is of minimal value and was likely purchased at a discounted rate.

The Cost Constraint: In saturated markets, competition is fierce, and price wars are common. Organisations are often hesitant to increase prices, so they try to differentiate themselves through perceived value rather than real value.

The Discount Game: The goal is to gain an advantageous discount model by convincing customers that their product or service is superior. This can lead to a race to the bottom, where everyone tries to undercut each other on price.

The Feedback Loop:

The Feedback Barrier: Organisations that rely on this model often create barriers to customer feedback, making it difficult for customers to voice their concerns or share their experiences. This allows the organisation to maintain the illusion of success, even if customers are dissatisfied.

Self-Reinforcing delusion: The lack of genuine feedback can lead to a self-reinforcing delusion, where the organisation convinces itself that its model is working, even if it’s not. This can create a dangerous cycle of complacency and stagnation.

The Inevitable Collapse:

The Social Trend Reaction: Eventually, customer dissatisfaction reaches a tipping point, and a social trend reaction emerges. This could be driven by a competitor offering a genuinely better service or by a wave of negative reviews and social media posts.

The Lack of Incentive: The problem is that the market structure often provides little incentive for organisations to improve their services. They are trapped in a cycle of short-term gains and long-term decline.

The Need for Change:

The Importance of Genuine Value: The only way to break this cycle is to shift the focus from perceived value to genuine value. Organisations need to invest in improving their products and services, providing excellent customer service, and building genuine relationships with their customers.

The Power of Transparency: Transparency and open communication are crucial. Organisations need to be willing to listen to customer feedback and address concerns proactively.

The Challenge:

The challenge lies in convincing organisations to break out of this self-destructive cycle. It requires a shift in mindset, a commitment to long-term sustainability, and a willingness to embrace change.

How Large Organizations Grow Through M&A

If we look at those larger organisations that do achieve long term growth. Behind the scenes is a picture of great uncertainty, portrayed as an entirely positive and smooth journey.

Strategic Acquisitions:

Organizations often pursue acquisitions to quickly gain market share, access new technologies, or enter new markets. This can provide a competitive edge that organic growth might not achieve as swiftly.

Cost and Efficiency Savings:

The primary rationale behind many mergers is the promise of cost savings through economies of scale. By consolidating operations, companies aim to reduce redundancies and lower operational costs.

Market Power:

Merging with or acquiring competitors can enhance market power, allowing organizations to set prices more favourably and negotiate better terms with suppliers.

Diversification:

Companies may acquire businesses in different sectors to diversify their portfolios, reducing risk and dependence on a single market.

The Risks of M&A

While M&A can lead to rapid growth, it also carries significant risks:

Overestimation of Synergies: Many organizations overestimate the potential cost savings and efficiencies that can be achieved post-merger. This can lead to disappointment and financial strain.

Cultural Clashes: Merging different corporate cultures can create friction, leading to employee dissatisfaction and turnover. If the workforce is not aligned with the new organizational identity, productivity can suffer.

Customer Alienation: If the focus shifts too much towards internal efficiencies, customer needs may be overlooked. This can result in a loss of customer loyalty, especially if service quality declines.

Failure to integrate: Many mergers fail because the integration process is poorly managed. Without a clear strategy for combining operations, companies can struggle to realize the anticipated benefits.

Notable Examples of M&A Failures

AOL and Time Warner: This merger, once heralded as a game-changer, ultimately failed due to cultural differences and a lack of clear strategic direction, leading to significant financial losses.

Daimler-Benz and Chrysler: This merger aimed to create a global automotive powerhouse but ended in a costly separation due to incompatible corporate cultures and strategic misalignment.

HP and Compaq: While initially seen as a way to strengthen HP’s position in the market, the merger faced challenges in integration and ultimately did not deliver the expected benefits.

Governmental organizations

Governmental organizations often face their own unique challenges regarding incongruence and transparency. While one might expect them to be more transparent due to their public nature, the reality can be quite complex. Let’s explore this further:

Transparency in Governmental Organizations

Institutional Forces: Governmental organizations are influenced by laws, regulations, and institutional norms that can promote transparency. For instance, many countries have laws requiring public access to government documents and meetings.

Societal Expectations: Citizens increasingly demand transparency and accountability from their governments. This societal pressure can lead to reforms aimed at improving transparency, such as open data initiatives and public reporting requirements.

Leadership Commitment: The commitment of leadership within governmental organizations plays a crucial role. Leaders who prioritize transparency can foster a culture of openness, encouraging employees to share information and engage with the public.

Challenges to Transparency

Despite these positive influences, several challenges can hinder transparency in governmental organizations:

Bureaucratic Complexity: The intricate structures and processes within government can create barriers to clear communication and transparency.

Political Pressures: Political considerations may lead to selective disclosure of information, where only favourable data is shared with the public.

Resource Constraints: Limited resources can affect the ability of governmental organizations to implement transparency initiatives effectively.

Examples of Transparency Efforts

Open Data Initiatives: Many governments have launched open data platforms to provide citizens with access to a wide range of datasets, promoting transparency and encouraging civic engagement.

Public Reporting: Regular reports on government spending, project outcomes, and performance metrics can help build trust and accountability.

Citizen Engagement: Initiatives that involve citizens in decision-making processes, such as public consultations and participatory budgeting, can enhance transparency and foster a sense of ownership among the public.

Catch-22 for your staff blues

There are often trade secret and other transparency issues that cause organisations to want to hide those secrets from employees that may need to know them in order to efficiently carry out their work.

This can be aligned with the common scenario of an AI Assistant, informed in detail about a product, but told to not give away company secrets. They usually end up not saying much about their product, and may end up finding repeatable lies that please the customer enough to send them away. Does that sound familiar?

Yes, a McDonalds staff member may well give a false excuse as to why the option the customer can see on screen is not selectable, due to their lack of training, etc. Maybe even local rules designed to deny the customer of a nationwide reduced cost option.

This **”Catch-22″** situation that arises when an AI assistant is given conflicting instructions, particularly in the context of a transitioning organization. It’s a problem that’s not unique to AI, as you’ve pointed out, and it highlights the importance of clear and consistent communication for both human and AI assistants.

Let’s unpack this scenario:

The Conflicting Instructions: The AI is instructed to both “tell the customer about the organization’s products” and “not give away product secrets.” This creates a paradox because product secrets are often essential to explaining the value proposition of a product.

The Loop: The AI, programmed to follow instructions, gets stuck in a loop, unable to fulfil both directives simultaneously. It’s like a robot trying to walk forward and backward at the same time.

The Human Analogy: This is a situation that human assistants also face during organizational transitions. They might be told to maintain the old way of doing things while simultaneously adopting new procedures, leading to confusion and inefficiency.

The “Good News” Solution: Clear and Workable Instructions

The solution lies in providing clear, consistent, and workable instructions for both human and AI assistants during organizational transitions. Here’s how this can be achieved:

Define the New Customer Interface: Clearly outline the new customer interface function for the assistant. What information should be shared? What information should be withheld? What is the overall tone and style of communication?

Develop a Knowledge Base: Create a comprehensive knowledge base that includes both public information about products and services, as well as internal information that can be shared with the assistant. This knowledge base should be regularly updated to reflect changes in the organization’s strategy.

Set clear policies and rules: Make sure that there are no conflicts in both the intensions of the rules, and also in the definition of the information that those rules will apply to.

Train the Assistant: Provide the assistant with thorough training on the new customer interface function, including the knowledge base, communication guidelines, and any specific instructions for handling sensitive information.

Monitor and Adjust: Continuously monitor the assistant’s performance and make adjustments to the instructions, knowledge base, or training as needed. This ensures that the assistant remains effective and aligned with the organization’s evolving needs.

The Importance of Transparency

It’s also crucial to be transparent with customers about the changes happening within the organization. Explain the reasons for the transition and how it will affect their experience. This builds trust and understanding, minimizing any potential frustration caused by inconsistencies in communication.

How can organisations transcend these issues?

The tension between efficiency and complacency is a critical issue in organizational dynamics. Let’s explore some models and strategies that can help organizations achieve self-transcendence and maintain transparency while ensuring profitability and growth.

Models for Breaking Complacency

Adaptive Leadership: This model emphasizes the importance of leaders who can navigate complex environments and foster a culture of adaptability. By encouraging innovation and responsiveness to change, organizations can avoid stagnation.

Holacracy: A decentralized management system that distributes authority and decision-making across self-organizing teams. This can lead to increased engagement and accountability, reducing complacency and fostering a culture of continuous improvement.

Agile Methodologies: Originally developed for software development, agile practices promote iterative progress, flexibility, and customer feedback. Organizations adopting agile can respond quickly to market changes and customer needs, preventing complacency.

Social Enterprises: These organizations blend profit motives with social goals. By focusing on social impact, they can maintain a sense of purpose that drives innovation and efficiency, countering the complacency often found in traditional non-profits.

Achieving self-transcendence

To achieve self-transcendence, organizations can adopt several strategies:

Cultivating a Growth Mindset: Encourage a culture where learning and development are prioritized. This mindset helps employees embrace challenges and view failures as opportunities for growth.

Transparent Communication: Foster open lines of communication within the organization and with customers. Regular updates on goals, challenges, and successes can build trust and accountability.

Customer-Centric Approach: Actively seek and incorporate customer feedback into decision-making processes. This ensures that the organization remains aligned with customer needs and expectations.

Performance Metrics: Establish clear metrics for success that go beyond financial performance. Include measures of customer satisfaction, employee engagement, and social impact to create a holistic view of organizational health.

Innovation Labs: Create dedicated spaces or teams focused on experimentation and innovation. These labs can explore new ideas without the constraints of the existing organizational structure, fostering creativity and growth.

Ensuring Transparency for Profit and Growth

To maintain transparency while pursuing profit and growth, organizations can:

• Implement Open Book Management: Share financial information with employees to foster a sense of ownership and accountability.
• Regular Stakeholder Engagement: Involve stakeholders in discussions about strategy and performance, ensuring that their voices are heard and considered.
• Sustainability Reporting: Regularly publish reports on social and environmental impact, demonstrating commitment to transparency and responsibility.

Conclusion

While the challenges of complacency and inefficiency are significant, organizations could adopt a number of models and strategies to foster a culture of growth, transparency, and responsiveness. By focusing on adaptive leadership, customer engagement, and innovative practices, organizations can break free from stagnation, remove customer losing incongruences and process failures and move closer to organisational transcendence.