Hybrid organisations – solution or problem?

Guest contribution by | 03.02.2020

Some time ago, I published an article in our Corporate Democrat blog entitled Die Unvermeidbarkeit hybrider Organisationen (The inevitability of hybrid organisations). At the time, I was concerned with the inevitability mentioned in the title, which arises through the transformation of traditionally managed and structured organisations into alternative, network-like (circle) organisations. Today, I will continue to develop my thoughts of that time and examine hybrid organisations more closely.

Hybrid organisations as a logical consequence or the consequences of hybrid organisations

On the one hand, the mentioned article was generally based on common sense and my experience as a consultant in transformation processes. Both a brief reflection and the practical experiences make it unmistakably clear that the corporate law framework of corporations does not simply dissolve into a pleasurable state just because a top modern CEO comes up with the idea of swearing his team to the Holacracy constitution and signing it with his blood. Amusingly enough, in a much older German article about Holacracy, this had already caused an outcry among all the expensive certified Holacracy consultants. Just as if this alleged new management system was above the law.

In recent months, another experience has been added to this: I conducted a CultureCheck at two small Berlin based companies. Although both companies are working on the transformation with a great deal of authentic commitment and a lot of know-how is available, hybrid organisations have of course emerged there as well, challenging both companies and their workforces anew every day. One of the reasons for this challenge is the institutionalised schizophrenia of two contradictory concepts.

Andreas Ulrich, who is both an agile consultant and manager at DB Systel GmbH, summed this up very well. Thus he is forced to work more or less daily in hybrid mode: “What really causes me great problems at the moment is the constant paradigm shift. In my mind, I virtually switch back and forth between two contexts several times in one day. Both have their own frameworks, processes and, above all, very different expectations of me.”¹ Which should make it clear, at the latest, that the hybrid organisation or the “dual operating system” as an ideal, as proposed by the American professor John Kotter, is somewhat questionable. What is still comprehensible in theory in order to realise efficiency and stability on the one hand and innovation and agility on the other hand, quickly becomes a problem in lived practice that should not be underestimated.

Contradictions of the organisational concepts

Ulrich continues: “In my role as disciplinary superior, I have objectives. These objectives can be shaped, but are not initially set by or with me and my colleagues. This means that I initially only pass on objectives to my colleagues. The extent to which they can identify with the objectives or are able to pursue them is often not relevant. In my role as an Agile Coach this is different. Here, we work together as a team to create goals that are aligned with the company’s goals or with the goals of the unit (unit = an association of several teams, consisting of 7 +/- 2 people, within the transformation of DB Systel). As a team, we collect all the necessary information in advance, develop ideas, coordinate and set goals together.” (op-ed)

With this little insight it becomes clear how contradictory both concepts are in their basic principles and why the dual operating system is hardly the ideal solution. Not even if Kotter’s Well-than-All sounds somehow smarter than a radical looking either-or. In hybrid organisations, fire and water collide, bad luck and brimstone or however we want to describe it metaphorically:

Contradictions of the organisational concepts
Traditionally “Old Work” Alternatively “New Work”
Purpose: profit maximisation (Business of business is business) Individual purpose, possibly formulated in a purpose statement
Objectives: Efficiency and stability Innovation and agility
separation think/act, plan/execute Re-integration think/act, plan/execute
Topdown Self-/co-determination
Central control Decentralised control
Working mode: Competition Cooperation
Image of man X (extrinsically motivated, self-interest maximisation, rational decision-making, control, etc. Human image Y (intrinsically motivated, strives for sense coupling, ratiional-intuitive-emotional decision making, trust etc.)
Restrictive information policy Open information policy (transparency is a prerequisite for self-organisation)
Individual compensation components (upon achievement of individual goals) If so, then collective remuneration components (e.g. if the overall corporate goals are achieved …)
Minimum redundancy (siloisation) Maximum redundancy (cells / circuits with all vital functions)

The case of Andreas Ulrich illustrates common sense: How should employees, whether in management positions or not in the old working world and whatever role they play in the new working world, resolve these contradictions in their daily work? The situation quickly arises, for example, that the colleagues of an agile coach only give him or her feedback in an embellished manner, because the coach is still in the role of the disciplinary superior: “In my role as an agile coach I feel like a member of a team. I am criticized, praised and expectations are openly communicated to me. In my role as a supervisor, I am only slightly criticized. Often only when I ask for feedback directly. Whether this is then really honest or socially desired criticism is still difficult for me to distinguish.” (op-ed)

The problems of agile corporate enclaves

Now one could argue that Kotter finally meant the dual operating system in a completely different way. After all, this is where agile areas are to be formed, or in Kotter’s language “networks”, in which a start-up culture with the corresponding rules (and principles) is more likely to prevail. And that’s exactly what happens in the corporate world: hubs are founded and accelerators are set up; a few selected people are allowed or encouraged to work in fancy coworking spaces where the company rents several workshop rooms for a few months. Fine, then a few people can work totally agile in some corporate enclaves, while their colleagues have to continue to follow the topdown and all the associated aspects of the old working world.

Consequently, this leads to a lot of problems between these diametrically opposed corporate cultures. Both sides have demands on their colleagues in the other working world, which certainly generate everything but smooth, efficient communication and interaction. This is exactly the problem faced by entire companies that are consistently transforming themselves, but still want to do business with B2B partners from the old world. This is where it quickly becomes tricky if there is no longer a Sales Manager South or if former tasks of the Managing Director are distributed to several other people outside the management.

Innovations for new and old business areas

Furthermore, the innovation and continuous development of the various divisions, departments, teams, groups, etc. is not only about the invention and prototype development of new products and services, which can still be outsourced in a reasonable way. It will also continue to require process innovations and lots of other developments in the existing old working environments. And how exactly will this work, if all the old principles are still being pursued there? If the employees are not supposed to think and plan by themselves, but only act and execute? Because that is the magic formula for the desired efficiency and stability.

The need for self-determination

As if that weren’t enough problems, there is another very different aspect: the human need for self-determination. Of course, I’m not saying that all employees and managers have the absolute desire to make their own decisions on a daily basis and be responsible for the consequences. That would be obvious nonsense. Nevertheless, there is a long-established, empirically proven connection between the health of employees and their options for self-determined and co-determined work. This is not surprising. Anyone can ask himself or herself what he or she would think if the boss not only made the announcements in the company, but also determined the private life. I am reasonably sure that this would not meet with enthusiasm. In other words: most people simply make a deal, the otherwise existing need for autonomy, which every healthy person in a democracy sees as his/her right to give up in the company in return for a salary.

The organisational archetype

This strange arrangement still works today – because it is an organisational archetype. Each of us knows classical organisational structures and procedures from the cradle to the grave, but hardly any alternative forms of organisation and work. We all know the Tayloristic principle of separating thinking and acting, planning and execution. It starts in the family, where not all children are increasingly involved in family decision-making processes as they grow up. Kindergarten and schools then follow, both of which can of course almost always be depicted with a classic organisational chart. And so children and young people complain about a deficit in participation. Then follow vocational training or studies, whereby the latter has fortunately been well schooled, so that the students simply no longer have too much freedom of decision. And after 20 to 25 years we ended up with the employer, who of course is mostly structured and cultivated in the old work manner.

Does anyone wonder why many people are impregnated against autonomy and personal responsibility in the context of their work as a result of constant foreign control? It seems more than plausible to me. I wouldn’t know how it could be otherwise, unless someone, for biographically accidental reasons, had insisted on his autonomy and freedom long before a professional Old Work socialisation. To cut a long story short: this aspect of the Conditio Humana is, strangely enough, repeatedly denied, repressed or forgotten when it comes to hybrid organisations or Kotter’s dual operating system. If most of us have been socialised for at least two decades in the sense of traditional top-down thinking, it is hardly a conclusive argument that most employees don’t want to take responsibility at all, or aren’t “mature” for it. Whereby the concept of “maturity” is questionable anyway.

Problem or solution?

If we take into account the aspects and contradictions briefly reflected so far, the hybrid organisation seems to me to be more of a problem than a solution. As I mentioned at the beginning, it arises automatically from the legal framework conditions that still exist at present. We will have to live with this until the respective national company law has been reformed and adapted to the requirements of modern forms of organisation and work. In the meantime, it is important to prepare the workforce for transformations and to develop a halfway intelligent approach to them.


Notes (in Geman):

[1] Im Dialog: Transformation der DB Systel, Teil 1

Dr. Andreas Zeuch has published several articles in the t2informatik Blog, including

t2informatik Blog: Intuition in Project Management

Intuition in Project Management

t2informatik Blog: What's New Work?

What’s New Work?

t2informatik Blog: Democracy in strategic decisions

Democracy in strategic decisions

Dr. Andreas Zeuch
Dr. Andreas Zeuch

Dr. Andreas Zeuch works as a freelance consultant, trainer, speaker and author. He accompanies companies on their way to more empowerment and corporate democracy. His books “Alle Macht für niemand. Aufbruch der Unternehmensdemokraten” and “Feel it!: So viel Intuition verträgt Ihr Unternehmen” are bestsellers and provide many practical examples.