Idealized Design: Three Reactions

Idealized Design: Three Reactions This prĂŠcis identifies strengths and weaknesses of the idealized design approach and suggests why and how it might be used to better effect.

Olivier Serrat 12/03/2019

1 Noting that the average life expectancy of a corporation in North America had dipped well below 20 years—and that a full third of the 1970 Fortune 500 companies had been acquired, merged, or broken apart by 1983—Ackoff (1999) proposed five organizational goals of successful corporate systems: (a) plan effectively, (b) learn and adapt rapidly, (c) democratize, (d) introduce internal market economies, and (e) employ a flexible structure that will minimize the need for future restructuring. Toward the design of organizations for the 21st century, reasoning that organizations cannot formulate a vision of their future if they do not know what they want it to be now, Ackoff (1999) argued that "What an organization most wants to be now is best learned and captured in an idealized design (emphasis in original) of that organization" (p. 88).

Define: Idealized Design Idealized design is inseparable from interactive planning and interactive planning is inseparable from Ackoff (Ackoff, Magidson, & Addison, 2006). Interactive planning, as defined by Ackoff (2001), was based on the belief that "An organization's future depends at least as much on what it does between now and then, as on what is done to it" (p. 3). Thus, "[An organization] creates its future by continuously closing the gap between where it is at any moment of time and where it would most like to be" (Ackoff, 2001, p. 3).1 Specifically, interactive planning has two parts, viz., idealization and realization, that are in turn divisible into six interrelated phases: (a) formulating the mess (situational analysis),2 (b) ends planning, (c) means planning, (d) resource planning, (e) design of implementation, and (f) design of controls. Put simply, idealized design holds that the key to solving problems is to first think about the ideal solution and then work back from there.3 That said, the commonsensical requirements are that idealized design is subject to two constraints, viz., technological feasibility and operational viability, and one requirement, namely, an ability to learn and adapt rapidly and effectively. Subject to the foregoing, the idealized design process entails: (a) formulating a mission statement,4 (b) specifying the properties the designers want the designed organization to have, and (c)

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And so, interactive planning is unlike other types of planning, such as reactive planning and preactive planning. "Reactive planning is tactically oriented, bottom–up planning that consists of identifying deficiencies in an organization's performance and devising projects to remove or reduce them one by one" (Ackhof, 2001, p. 3). "Preactive planning is strategically oriented, top– down planning that consists of two major activities: prediction and preparation" (Ackhof, 2001, p.

3). The term may be an oxymoron but there is also inactive planning: this type of planning is characterized by satisfaction with the way things are (in the sense that they might not be perfect but they are good enough).

2 Formulating the mess involves preparation of a systems analysis, an obstruction analysis, reference projections, a reference scenario, and ends planning.

3 There is something here of the idea, often attributed without proof to Einstein in a host of variants, that "Without changing our patterns of thought, we will not be able to solve the problems we created with our current patterns of thought."

4 An organization's mission statement should be unique, that is, distinct from that of any other organization; it should define the business the organization wants to be in, which may not be what it is in); it should be relevant to all of the organization's stakeholders; and, it should be exciting, challenging, and inspiring (Ackhof, 2001, p. 9).

2 designing an organization that holds these properties (Ackoff, 2001, p. 8).5 Not to forget, as stipulated by Ackoff, an idealized design is a group product: decisions should be made by consensus, which means complete agreement.6 Crucially, it should also be understood that idealized design involves discontinuous change but that improvement of the design over time should be continuous.

Idealized Design: Three Reactions 1. Systems Thinking The basic managerial idea that systems thinking introduced is that—to manage a system effectively—one should focus on the interactions of component parts and not on individual behaviors. Idealized design is an approach to organizational development: it is based on the belief that a desirable future is not likely to occur unless appropriate actions are taken across an organization, thus increasing the likelihood that the desired future will eventuate. To move from treating the parts to treating the system, idealized design underscores the need to plan interactively for a desirable present [and indirectly cautions against the pitfalls of inactive (present-oriented), reactive (past-oriented), and even preactive (future-oriented) planning]. The methodology for idealization (formulation of the mess and ends planning) and realization (means planning, resource planning, design of implementation, and design of controls) is straightforward, at least conceptually. Idealized design also ascribes requisite importance to the formulation of a mission statement, that being the raison d'être of an organization's existence and the expression of its highest aspirations, by means of stakeholder participation. Taken at face value, the strength of idealized design is that it promotes understanding, transforms the concept of feasibility, simplifies the planning process, enhances creativity, and facilitates implementation.7 2. Organizational Forms Until the late 2000s, the totality of interactions by which organizations solve problems and create opportunity was framed by sharply delineated ideal types, viz., hierarchy (authority), market (price), and network (trust). Because of their omnipresent participation in the labor market, what Mintzberg (1989) termed entrepreneurial, machine (bureaucracy), professional, divisional (diversified), innovative (adhocracy), missionary, and political organizations were the

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Specifications and design would be informed by questions relating to, say, products and services; markets; distribution systems; organizational structure; internal financial structure; management style; internal functions (including marketing and sales, research and development, accounting, planning, human resources, etc.); administrative services; facilities; and industry, government, and community affairs; all of which bound idealized design (Ackhof, 1999, p. 90). The idealized design of an organization is always bounded by the nature of the system that hosts it: because the system may change, Ackoff (1999) suggested also that organizations should prepare unbounded idealized designs (but only if they would improve the performance of the organization) (p. 91).

6 Where complete agreement cannot be obtained Ackoff (2001) proposed two recourses: (a) the design of a test of the alternatives, to the results of which all agree to abide; and (b) executive decision after participants have summarized their positions on the issue (p. 14).

7 This is not to say idealized design is not open to high risk and high cost, unless low risk and low cost are part of the ideal; but, Ackoff (1999, 2001) and Ackoff, Magidson, & Addison (2006) made no mention of such issues.

3 most commonly recognized organizational form.8 But, increasingly kaleidoscopic (or hybrid) forms of organizing have appeared; as a result, what management theories—especially styles of leadership—were usually based on "corporations" and found favor yesteryear explain less and less in a world where organizations are simultaneously adopting plural forms and hollowing out and such concepts as career and job security may be dead.9 A priori, the relevance of systems thinking and the need to search for idealized design are not questioned in an increasingly volatile, uncertain, complex, and ambiguous, aka VUCA, world:10 if anything, they are more important than ever, which is a strength; but, even if the least one should say is that the methodology of idealized design deserves recurrent testing in organizations of the future, such concerns as "democratic hierarchy," "internal market economy," and "permanently structured multidimensional organization" no longer seems entirely apropos, which is a weakness (Ackoff, 1999).

3. Reconciling Integration, Differentiation, and Fragmentation Martin (2002) distinguished three perspectives on organizational culture: (a) integration—which interprets culture as what people unambiguously share, viz., the social glue that keeps them together; (b) differentiation—which perceives that culture only exists in islands of clarity, consensus, and consistency (aka subcultures) that may exist in harmony or more likely disagree with one another; and (c) fragmentation—which asserts that culture cannot be described because consensus is both transient and issue-specific and patterns shift all the time. Martin (2002) thought the three perspectives are legitimate but labors to say they are in irremediable conflict. And so, given the control the integration perspective typically exerts in traditional organizations, one may question how idealized design can arrive at the mission statement— shared by all stakeholders and so by the differentiation and fragmentation perspectives—that the approach deems essential. Today's societies are evermore interdependent yet increasingly polarized: in conflicting circumstances, building shared vision and achieving multiparty action on complex issues—such as those that idealized design aims to address—is not easy. Idealized design may be weakest with regard to how organizations can engage stakeholders: it assumes that participation will be forthcoming—a heroic assumption, this—and that conflict, for example between power structures, can ultimately be resolved by executive decision. To ensure the continuing utility of idealized design in organizations of the future, there might be value in contrasting and comparing it with Future Search conferencing, a system-wide strategic planning tool that was conceptualized expressly to enable diverse and potentially conflicting groups find common ground for constructive action (Weisbord & Janoff, 1995).

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Morgan (2006) is a perceptive investigator of the nature of metaphor and its role in understanding organization and management: he distinguishes organizations as machines, organisms, brains, cultures, political systems, psychic prisons, flux and transformation, and instruments of domination; there are profound implications from using imagery—consciously or not—because all organization and management theories are based, usually unconsciously, on which images theorists have in mind. (The image of organizations as machines is common.)

Images offer insights but unavoidably engender great distortions.

9 Handy (1989) recognized early that organizational arrangements were changing: the shamrock organization he made out is "a form of organization based around a core of essential executives and workers supported by outside contractors and part-time help" (p. 32).

10 This said, independent, empirically-based, comprehensive, and critical evaluations of applications of idealized design are hard to find.

4 Enriching Idealized Design Idealized design is an inside–out technocratic approach to complexity: it looks for interacting or interdependent elements that with a dash of democracy can be made to work better, together, in an integrated whole. In realpolitik,11 however, it is evidently not just through idealized design and the ability to imagine what does not exist that one can successfully introduce change. If it is to be more than an intellectual exercise, at any rate in a world of plural organizational forms, idealized design should accept that—except for the duration of the exercise—one cannot reasonably assume a tabula rasa from which a brave new world will be easily built: for lasting chances of success, idealized design should integrate such tools as force field analysis, organigraphs,12 participatory methods, the premortem technique,13 social network analysis, stakeholder analysis, etc., else it will miss opportunities by not being in greater dialogue with realpolitik for more outside–in.

References Ackoff, R. (1999). Re-creating the corporation: A design of organizations for the 21st century.

Oxford, UK: Oxford University Press.

Ackoff, R. (2001). A brief guide to interactive planning and idealized design. Unpublished Paper, Interact Consulting, May 31.

Ackoff, R., Magidson, J., & Addison, H. (2006). Idealized design: How to dissolve tomorrow's crisis … today. Upper Saddle River, NJ: Wharton School Publishing.

Handy, C. (1989). The age of unreason. Harvard Business School Press.

Klein, G. (2007). Performing a project premortem. Harvard Business Review, 85(9), 18–19.

Martin, J. (2002). Organizational culture: Mapping the terrain. Thousand Oaks, CA: Sage Publications.

Mintzberg, H. (1989). Mintzberg on management: Inside our strange world of organizations.

New York, NY: The Free Press.

Mintzberg, H., & Van der Heyden, L. (1999). Organigraphs: Drawing how companies really work. Harvard Business Review, 77(5), 87–94.

Morgan, G. (2006). Images of organization. Thousand Oaks, CA: Sage Publications.

Weisbord, M., & Janoff, S. (1995). Future search: An action guide to finding common ground in organizations and communities. San Francisco, CA: Berrett-Koehler.

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Realpolitik is a system of politics or principles based on practical rather than moral or ideological considerations.

12 An organigraph is a graphical representation of an organization's structure or processes— depicted with sets, chains, hubs, and webs—that does not imply the same degree of linear hierarchy found in organizational charts (Mintzberg & Van der Heyden, 1999).

13 During a premortem, a team imagines that a project or organization has failed in the future and then works backward to determine what might potentially lead to failure. By reframing, a premortem raises awareness of possibilities—including their likely consequences—to enrich planning (Klein, 2007).