Harmonic Convergence: The Disembodied Corporation
At a recent conference on the fate of Silicon Valley, futurist Alvin Toffler only half-facetiously proposed the creation of an Academy of Intangible Assets Accountants. Why? Toffler claims we are moving from a "brute force economy" to a "brain force economy."
This change presages "a revolution in culture, family, logic, causality, epistemology and civilization," says Toffler, whose track record (Future Shock, The Third Wave, Powershift) puts fellow prognosticators to shame. As a result, "No amount of tinkering will solve America's economic problems." Take unemployment. The chief problem is "not quantitative, but qualitative," according to Toffler. The issue is less one of raw numbers than of inappropriate skills; all too few of us are prepared for the brain force economy.
Toffler also took some hearty slaps at traditional organizations. "The No.1 assumption of hierarchy," he says, "is that those at the top can prespecify what those 'below' need." It's just not possible in a fast-paced, uncertain world.
Toffler was followed to the podium by Silicon Valley venture capitalist Bill Davidow, touting his and reporter Mike Malone's new book, The Virtual Corporation. It's understatement to say that Toffler and Davidow are singing from the same page of the same New Age corporate hymnal. "What will a virtual corporation look like?" Davidow and Malone write. "To the outside observer, it will appear almost edgeless, with permeable and continuously changing interfaces among company, supplier, and customers. From inside the firm the view will be no less amorphous, with traditional offices, departments and operating divisions constantly re-forming according to need."
While these ideas are not yet mainstream, there does appear to be almost harmonic convergence around the notion of a disembodied organization, ephemeral enough to deal with a disembodied ("de-massified," per Toffler) marketplace. In fact, the day before the Silicon Valley confab, I received a copy of Dartmouth Professor Brian Quinn's new book, Intelligent Enterprise. Its message Ditto Davidow/Malone/Toffler. Consider just a few of the section titles: "Intellect and Services: Restructuring Economies and Strategy," "Knowledge-based Services Revolutionize Organization Strategies," "Managing the Knowledge-based Service Enterprise." Nike, Apple, Federal Express, Intel, and Sony are featured. IBM, GM, and GE are conspicuously absent.
In fact, the Quinn and Davidow/Malone books have been anticipated by others, starting with consultant Stan Davis' brilliant Future Perfect (1987). "Matter is not all that matters!" Davis declares. "Value added will come increasingly from intangibles, 'things' whose importance does not lie in their material existence. Managers who constantly work with the 'no matter' of their businesses will ... pull ahead of their matter minded competition." Davis then describes the elusive company of the future: "The value added into the economy ... (does) not come out of giant industrial plants, even automated ones, nor out of giant offices of the future. Rather, it comes from a kind of organization that has little physical reality. ... All functions can be disaggregated and then subcontracted."
In 1990, Digital Equipment consultant Charles Savage chimed in with Fifth Generation Management. He urged us "to think of ourselves and our positions within the organization not as fixed little empires, but as resources available to others ... to see ourselves not as boxes but as nodes in a network, not as cogs in a gear but as knowledge contributors. ... In a network enterprise, each position represents a person with capabilities, skills, and experience. Instead of mutually exclusive tasks (jobs) and departmental assignments (charters), enterprises blend the talents of different people around focused tasks."
Line managers are starting to get the message. Bankers Trust's Michael Packer, the Economist recently reported, "believes that successful investment banks will eventually throw away organization structures and have a dynamic approach to deals, with teams selected deal by deal to make the most of individual skills." Writing in the Financial Times, Geoffrey Owen and Louise Kehoe cite a similar vision from Intel's chief. CEO Andy Grove compared life in the fast-moving microchip marketplace "to the theater business in New York, which has an itinerant work force of actors, directors, writers and technicians, as well as experienced financial backers. By tapping into this network," Owen and Kehoe write, "you can quickly put a production together. It might be a smash hit ... or it might be panned by the critics. Inevitably the number of long-running plays is small, but new creative ideas keep bubbling up."
If Toffler's right in claiming that we must reinvent civilization, then we're in for an exciting—and no doubt painful—ride. The pain will be suffered by ill-prepared front-line workers. And by board chairmen. As I write, GM Chairman Bob Stempel, under continuous attack from his competitors and board of directors, has announced his resignation. He is, I am told, enormously decent and talented. I wish him well. Nobody says this is going to be easy.
(C) 1992 TPG Communications.
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