In the previous century leadership was interpreted in the context of a hierarchical organization, not to say a bureaucracy, where all decisions recognized as important rose to the top. Hence, the over emphasis of the person at the top. In the knowledge intensive organizations of the future the management structure will be less hierarchical, with fewer levels, and with more emphasis on fluidity and adaptability and less on rigidity and bureaucracy. Knowledge and expertise, rather than title and position, will comprise the main sources of influence, behavior and decision-making.
In the knowledge intensive era, multibusiness, complex enterprises will of necessity, result in more decentralization and local autonomy, with leadership responsibilities diffused through the organization. In the knowledge organization this precious resource is equally distributed among the knowledge workers. Organizations will network with other in loosely coupled relationship that will integrate best of class practices to achieve success in a ferocious competitive world.
Here we confront a beautiful paradox. For the future leadership will be even more important for the new organizations than in the traditional bureaucratic structures, although of necessity it will be qualitatively different. In this context leadership will be characterized by the profoundness of knowledge management. Much more attention will be paid to crucial tasks of recruitment, selection, development, retention and reward of the intellectual capital. With respect to execution management (a huge problem in the 20th century) more emphasis will be placed on how results are achieved, as on the results themselves, and the reward (compensation) system must reflect that reality. Motivation plus competencies equals high execution and high level of results.
As the value of the companies become more and more dependent on intangible assets, the personal behavior of the leader in promoting and participating in the knowledge, creativity and innovation process, and in establishing standards for all will become correspondingly ever more important. It is also vital for leaders to act, to make knowledge based decisions. Declining organizations often decline over extended periods of time, as leaders are frozen to immobility, as they are so loaded with work that they don’t have time to think and share knowledge or as they perceive the need for change but seem unable to make decision. In this new context it is not enough to accept responsibility, but it is also necessary to spell out the thinking knowledge process that it is being followed.
Managing intangible assets means, at its core, mastering the management of human resources internally, and customers, stakeholders and suppliers externally. It is about relationships. If 80% the organization value is based on knowledge and research attributes, and we recognize that we are in the value creation era, and then 80% of the organizational tasks should be related to those issues. Of course, it is important that organizations include diversity of views and voices, but without becoming aTowerofBabel.
Finally, if change is continuous, leaders and organizations will always have to be into the learning of how to handle it better. It is dangerous to think that we have all the answers for becoming better leaders of change. Many of the characteristics of organization that we view today as variable were previously fixed: industry structures, exchange rates, even interest rates that were fixed or subject to only occasional change.
If change is unpredictable, leaders and organizations of the future must learn how to make their making reality more resilient and flexible. They should prepare people to acquire the ability to cope with such change and tolerate the ambiguities that accompanies turbulence. The challenge is to become more knowledge-astute at managing such risks.
Copyright 2007 QBS, Inc.