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(From a new book, ‘Prediction’ to ‘Emergence’—"Rewiring Organizations for the Networked Economy" edited by Stan Herman (Jossey-Bass)

Emergence. Predictive strategies are being replaced by emergent strategies. Emergence requires expanding the functions and styles of leadership and management significantly.

Leading Edge Views

In "New Rules for the New Economy", Kevin Kelly says, ". . .unlike the industrial era’s relatively simple environment, in which it was fairly clear what an optimal product looked like and where on the stable horizon a company should place itself, it is increasingly difficult in the network economy to discern what hills are highest and which summits are false. . .(and) Trails are riddled with dead ends, lead to false summits, and made impassable by big-time discontinuities."

As if in response, in "Business @ the Speed of Thought", Bill Gates adds, "The goal is to make business reflex nearly instantaneous and to make strategic thought an ongoing, iterative process—not something done every twelve to eighteen months, separate from the daily flow of business."

In the industrial economy, with which we are most familiar, leaders and managers (and OD consultants) attempted to come as close as possible to making their businesses predictable. We have prized careful planning and gradual development of programs and products. Analytical business forecasting, and programs like TQM and other quality-oriented efforts concentrated on avoiding or reducing errors. But the new economy favors speed over certainty. Kirby Dyess, VP for Business Development at Intel cites "Fail fast and re-invent" as Intel’s slogan. Thorough analysis and preparation gives way to Gates’ aim to make information and reaction, "nearly Instantaneous".

In the industrial economy we viewed strategic planning as a logical and linear process, an exercise of reasoning and will. The five-year plan was to take us to our pre-planned future in prescribed steps. But in the new economy we recognize that a 5-year-out destination, even if we could reach it, would probably be the wrong place to be by the time we got there. In a world as turbulent as ours, a company CEO in the real estate industry may wake up one morning to find that his principal competition is not coming from within his industry. It’s coming from a software company (who is now providing programs that automate most of the services the CEO’s company provides—and can do it faster and more thoroughly. ‘Plan Ahead’ is still a slogan of some use but it is not sufficient. Organizations need the capacity for continual adaptation to changes in their total ‘ecologies’—not just in their industries. ‘Strategic navigation’—the ability to steer the organization as it moves through unpredictable waters is more functional than prediction-based planning. As Carol Willett, a long-experienced consultant to virtual teams, says, "It’s like the trim tab on a rudder—we adjust it to reinforce what’s desirable in our course and steer away from what’s not."

If the key strategic concepts of the old economy were prediction (of the future) and prescription (of the discrete steps for reaching the objective), the new economy’s keys involve being prepared for the emergence (of the future) and convergence (of the required person-power, technology, and resources to respond fast and well). In our planning we need to cultivate a breadth of view that enables us to access multiple paths, choose from among them and to keep open as many options as we can manage, but not more than that.

Speaking to those consultants and leaders who are responsible for change management, I have earlier suggested the following as an underlying guide:

"Change is a continual and inescapable fact of organization existence. The character of change is inevitably the result of the intersection of preparatory intentions (planning) and unanticipated events (reality). The core competency of change consultants is not so much planning change, but rather, facilitating human interaction around a targeted effort, within an ever-changing universe." (Herman)

We have traditionally and in a deep cultural sense, made the assumption that equilibrium and stability in organizations were the rule, and turbulence and discontinuity were the dysfunctional exceptions. The classic model for managing organization change involved first, deliberately ‘unfreezing’ the system, second, accomplishing our planned revisions and third, ‘re-freezing’ the system. But, in this new era, those assumptions do not seem to apply. The new economy model would seem better described in the metaphor of a surfer: "Catch the wave, ride it, catch another one." As Gates puts it, "Punctuated chaos" rather than "punctuated equilibrium" is now the rule. Strategic navigation (StratNav^©) is a NELA approach to developing and maintaining a genuinely functional strategy.