Opportunities and limits of self-organisation

Recently, it can be observed that more and more companies are showing interest in self-organisation. It is often listed together with New Work or agile transformation. But what exactly is self-organisation? When is it helpful and when is it not? What are the prerequisites and where does it reach its limits?

What is self-organisation?

Self-organisation means that an organisational unit determines its structures itself. It is therefore not controlled by an external authority or person. No instructions are distributed, but problems are.¹ In concrete terms, self-organisation thus affects numerous areas such as the division of labour, dealing with emerging problems and new issues, internal rules, communication with each other and with the outside world, but also the way decisions are made.

In everyday work, a multitude of issues arise that have to be dealt with or clarified independently. A kind of decision-making vacuum forms. In a classic hierarchical organisation, the structural decision-making authority is formally assigned to a manager. The latter can quickly resolve the vacuum by making announcements. The conclusion is that this is the more efficient way. So where does the benefit of self-organisation lie? The answer lies in the nature of the problem to be solved.

Adaptability to the outside world

The very high market dynamics that prevail today require companies to react quickly to new customer problems and market changes. Freedom for ideas and experimentation is crucial for long-term success. The greatest potential of self-organised teams lies in the speed and inventiveness with which they can respond to such changes. For this, it is necessary that the self-organised units are directly confronted with customer problems and the competition on the market. If, for example, a new or changed customer problem arises, action can be taken immediately and the problems solved where they occur. Long consultations with superiors are avoided. There, the danger of worse decisions even lurks, as they often do not have the necessary concrete operational expertise. The unit can use its experience of the problem to adapt structures and establish new approaches. All by itself. In this way, a company can gain a real competitive advantage.

Classic hierarchical structures have a significant disadvantage here: decisions always have to go through the executive or, in many cases, through several levels of the company before changes are legitimised and approved. By that time, the customer may have already moved on to the competition.

Control for efficiency

However, self-organisation is not suitable for all problems. The dynamics of the market affect only 10 to 40 per cent of all activities in a company.² It makes perfect sense to counter tasks for which there are already proven and established solutions with control logics in order to guarantee clear procedures, rules and decision-making paths as well as control and optimisation of processes. Organisational structures or processes can in these cases be adapted and controlled from the outside via the hierarchy in order to achieve maximum efficiency gains.

A company today is thus primarily faced with the challenge of recognising which problems can and should be solved through control and which through self-organisation.

Motivation through self-organisation

Self-organisation in companies is often mentioned as a measure for more motivation and satisfaction of employees. However, self-organised teams are not the appropriate means to make employees happy or to bring a little “new work feeling” into the company.

Employees are particularly motivated and satisfied when they experience effectiveness in their work. When they see that what they do has an effect. Employees feel pride when they make the company successful through their work.

A lot of frustration arises, among other things, when employees experience control by a manager where they themselves are the experts and already have an idea for solving the customer’s problem. If these ideas are first subjected to a preliminary check, the process is not only slowed down. Such a check also leads to ideas no longer being oriented towards the customer problem or the competing market, but being adapted to the expectations of superiors. In many cases, it even leads to no ideas being put forward at all. Ideas need space and companies are wise to grant and protect this space.

In areas of activity where control and efficiency are appropriate, the opposite is true. If there are too few appropriate structures and rules, recurring problems have to be discussed and dealt with again and again. This can also overburden an organisation and have a negative impact on its perceived effectiveness. After all, satisfaction also arises when recurring tasks can be completed well and quickly. Here, too, the solution must fit the problem.

Introduce self-organisation

Self-organisation in a corporate context always needs hierarchical legitimisation. Its success depends on whether the executive, the managing director, the owners support it and, to a certain extent, allow it. Without a clear commitment to this, there can be no real self-organisation and the potentials from it cannot be used.

Self-organised work in the corporate context must be (re)learned. The maturity of the organisation, not of the individuals, is important. Because self-organisation as such is deeply ingrained in us humans. We are used to working together in changing constellations, generating and negotiating ideas, making decisions every day and adapting plans to a wide variety of events. But it is precisely this ability that is often eroded in the corporate context. In order to regain it, support from internal or external experts makes a great deal of sense. Not least to promote self-reflection and to train the analytical skills of one’s own structures and thought patterns.

Without a clear framework of legitimacy, an orientation towards real customer and market problems and the opportunity to try things out and practice, self-organisation can quickly turn into self-abandonment.

The role of the leader of a self-organised team also changes. The manager’s main task is to maintain this space of self-organisation and to protect it against external influences. They must provide advice and supply the team with the necessary knowledge and information in all transparency. However, exerting a controlling influence is no longer one of the tasks.

Threats to self-organisation

In addition to the threats already mentioned, so-called control reflexes should be observed. They occur especially when uncertainties or difficulties arise, when disruption and crises influence the market or when individual projects fail. Companies then often experience a perceived loss of control and react with control reflexes. Any self-organisation is seen as an impulse and subordinated to hierarchical decision-making structures. But it is precisely in situations of high complexity and dynamics that freedom for unconventional ideas and creative solutions is needed.

Although the impulse of control in difficult situations is understandable and feels logical, it is often not the answer to a problem, but rather reinforces it. Especially in these challenging situations, a quick reaction to market dynamics and the testing of new ideas is essential.

Conclusion

Self-organisation can release huge potentials – but only if it is used for the right problems and directly serves the company’s value creation. Introduced as an end in itself to supposedly increase motivation or as a misunderstood New Work measure, success will fail to materialise. Greater satisfaction may well be a by-product of self-organisation, but only if it serves to enable people to do meaningful and effective work.

The strength of self-organised teams lies in the coping skills they develop in direct contact with customers and the market, as well as the speed with which they adapt to changes in the market. Control reflexes must be noticed, questioned and counteracted. Self-organisation requires the freedom to try things out and also to fail. It is important to learn from this. Reflection is essential for this.

If a company manages to use self-organisation in the right places and to continue to use control where efficiency is in the foreground, it has a good chance of being successful in the long term. The limits must be regularly observed and re-evaluated. Then the full potential of the employees can be used.

Notes (partially in German):

[1] cf. Denkzettel 4: Zentrum und Peripherie – ungewollte Struktur von Unternehmen
[2] cf. Denkzettel 5: Steuerung und Führung – die zwei Seiten dynamikrobusten Managements

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