Management paradigms for the new millennium

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March 2000 Thomas Clarke and Stewart Clegg are from the School of Management, Faculty of Business, University of Technology, Sydney, P.O. Box 123, Broadway, NSW 2007, Australia. ß Blackwell Publishers Ltd 2000, 108 Cowley Road, Oxford OX4 1JF, UK and 350 Main Street, Malden, MA 02148, USA Management paradigms for the new millennium Thomas Clarke and Stewart Clegg A proliferation of paradigms is occurring in management thought and practice, defining paradigms as means of understanding the world and a basis for informing action. Frequent paradigm shifts are essential for survival in a business context of constant innovation. While the idea of paradigms has been widely received in management, it has been so more as a contested than a settled domain. Management paradigms are far more numerous than those of the natural sciences that Kuhn studied. Kuhn expected the long periods of normality to be marked by an absence of paradigmatic questioning and strife. In management, at any time, there are a number of competing paradigms available. Kuhn was concerned to chart how changing realities of investigation were tied up with changing perceptions. In business the focus has been much more on the changing realities rather than changing perspectives. In any system that is ecologically interdependent, if you change any paradigmatic part then you change the whole. When there is sufficient change and fluidity in a system then we can speak of a ‘paradigm shift’: that period when a shift occurs from one paradigm set to another, the transition from one wave to the next. In these conditions uncertainty and ambiguity will apply. Discontinuous change is a step shift in the rate of change that invalidates existing assumptions and begins to transform the rules of competition. Introduction Accelerating economic change and the compounding complexity of the business world are reflected in and stimulated by the rapid emergence and transcendence of new management ideas and values. A proliferation of management paradigms is occurring, defin- ing paradigms as means of understanding the world and a basis for informing action. Aban- doning the certainties of an ideology formed during industrialization and based on classical management orthodoxies concerning business objectives, performance measures, organiza- tion and control is not easy. But the contem- porary fast-fusion of management thinking is fuelled by the transformation of technology, markets, industries and products. Multiple technological breakthroughs, shortening prod- uct life-cycles, and rapidly changing markets are forcing the pace of paradigm shifts in management. The capacity for learning becomes the most critical managerial attribute, enabling mana- gers to adapt quickly to the unknown, and to anticipate changes in the business environ- ment. The knowledge-based economy has arrived in which creativity, intelligence and ideas are the core capability for sustainable business. Frequent paradigm shifts are essen- International Journal of Management Reviews Volume 2 Issue 1 pp. 4564 45

Transcript of Management paradigms for the new millennium

March 2000

Thomas Clarke andStewart Clegg are fromthe School ofManagement, Faculty ofBusiness, University ofTechnology, Sydney, P.O.Box 123, Broadway, NSW2007, Australia.

ßBlackwell Publishers Ltd 2000,108 Cowley Road, Oxford OX41JF, UK and 350 Main Street,Malden, MA 02148, USA

Management paradigmsfor the newmillenniumThomas Clarke and Stewart Clegg

A proliferation of paradigms is occurring in management thought and practice, definingparadigms as means of understanding the world and a basis for informing action. Frequentparadigm shifts are essential for survival in a business context of constant innovation. Whilethe idea of paradigms has been widely received in management, it has been so more as acontested than a settleddomain.Managementparadigms are farmorenumerous than thoseof the natural sciences that Kuhn studied. Kuhn expected the long periods of normality to bemarked by an absence of paradigmatic questioning and strife. In management, at any time,there are a number of competing paradigms available.Kuhn was concerned to chart how changing realities of investigation were tied up with

changing perceptions. In business the focus has been much more on the changing realitiesrather than changing perspectives. In any system that is ecologically interdependent, if youchange any paradigmatic part then you change the whole. When there is sufficient changeandfluidity ina systemthenwecanspeakofa `paradigmshift': thatperiodwhenashiftoccursfrom one paradigm set to another, the transition from one wave to the next. In theseconditions uncertainty and ambiguity will apply. Discontinuous change is a step shift in therate of change that invalidates existing assumptions and begins to transform the rules ofcompetition.

Introduction

Accelerating economic change and thecompounding complexity of the businessworld are reflected in and stimulated by therapid emergence and transcendence of newmanagement ideas and values. A proliferationof management paradigms is occurring, defin-ing paradigms as means of understanding theworld and a basis for informing action. Aban-doning the certainties of an ideology formedduring industrialization and based on classicalmanagement orthodoxies concerning businessobjectives, performance measures, organiza-tion and control is not easy. But the contem-

porary fast-fusion of management thinking isfuelled by the transformation of technology,markets, industries and products. Multipletechnological breakthroughs, shortening prod-uct life-cycles, and rapidly changing marketsare forcing the pace of paradigm shifts inmanagement.

The capacity for learning becomes the mostcritical managerial attribute, enabling mana-gers to adapt quickly to the unknown, and toanticipate changes in the business environ-ment. The knowledge-based economy hasarrived in which creativity, intelligence andideas are the core capability for sustainablebusiness. Frequent paradigm shifts are essen-

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tial for survival in this context of constantinnovation. Information and communicationtechnologies have facilitated the globalizationof production, and are transforming conceptsof time and space. Intelligent, networkedforms of organization are emerging, capableof responding quickly and creatively to newmarket opportunities. Reciprocity and partner-ship increasingly typify business relationshipswith a wide constituency of stakeholders.Sustainability is becoming a key business im-perative, as the eternal search for dominationover nature is replaced by the challenge ofachieving environmental balance.

Paradigms

The concept of paradigm is at once ancientand contemporary. Its name derived from theancient Greekparadeigma. Classically, itmeant model, framework, pattern or example,and this meaning has survived to the presentday. Different concepts of managementparadigms have been at the centre of criticaldebate in recent years, and the notion ofchanging paradigms captures the flux oforganizational transformation resulting fromthe surging changes in the business environ-ment.

It was a historian of science, Thomas Kuhn,who pioneered the idea of changing para-digms in The Structure of Scientific Revolu-tions (1970). For Kuhn, science wascharacterized by the dominance of succeedingparadigms, asmodels for thinking, or as heput it, ‘‘a constellation of concepts, values,perceptions and practices shared by com-munity which forms a particular vision ofreality that is the way a community organizesitself.’’ A paradigm is a systematic set ofideas and values, methods and problem fields,as well as standard solutions, that explain theworld and inform action. ‘‘It’s the way we seethe world – not in terms of our visual sense ofsight, but in terms of perceiving, under-standing, interpreting’’ (Covey 1989: 23).

The use of the term paradigm hasproliferated greatly since Kuhn first

popularized it. Within academic circles, andincreasingly among practicing managers, twodistinct areas of usage have crystallized. Thefirst we might refer to as that of the paradigmpolice; the second as the paradigm warriors:

On the one hand it has come to mean a singleunifying approach in which theory, method, theinterpretation of findings and the way researchshould develop are all laid out and agreed by acommunity of scholars . . . On the other hand, thereare members of another group who see things verydifferently where paradigms are concerned. Theydo not see before them a single unifying paradigmbut many – or at least several paradigms lyingalongside each other in a relationship characterizedby hostility and conflict . . . engaged in a strugglefor survival. (Burrell 1997: 34)

While the idea of paradigms has beenwidely received in management, it has beenso more as a contested than a settled domain(Clarke and Clegg 1998). Management para-digms are far more numerous than those of thenatural sciences that Kuhn studied. Kuhnexpected the long periods of normality to bemarked by an absence of paradigmaticquestioning and strife. One paradigm wouldhold unquestioned sway for some years.

In management, at any time, there are anumber of competing paradigms available.One popular view is that paradigms are a kindof Platonist form: eternal in their mutationsand variation. Different paradigms (sometimesthey are termed metaphors or frames ofreference) reveal different facets of ourunderstanding of management (Morgan1985; Bolman and Deal 1992). Today, manyMBA and Executive Management programsuse such a method of ‘switching frames’ as alearning device: re-framing encourages theability to see things, situations, or people inother ways, to put them in another perspective.In different eras managers typically see theworld through one overarching paradigmwithin which the separate frames, metaphorsand perspectives that they use, stand in somecoherence to each other, but differ radicallyfrom those in use in preceding and succeeding

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eras. Using new frames or seeing through theassumptions of different forms means that themanagerial and organizational world not onlylooks different; it becomes different, becauseit is the way that we see it (sometimespresented as the social construction of reality).

Management Paradigms

You manage within a paradigm.You lead between paradigms.(Barker 1992: 164)

Paradigms are what allow us to see certainthings as some thing in particular, but theyalso make it difficult to see certain otherthings that do not ‘belong’ within the para-digm. We cling to our paradigms and see onlywhat they enable us to see, even when theirassumptions are not clearly or strongly stated.Indeed, the more implicit the paradigm, insome ways the stronger it is, because it is lessevident to us on the surface of our thinking.This is one of the dimensions of paradigms ofparticular significance for managers: aparadigm can be a set of unwritten regulationsor practices that establishes or definesboundaries, and tells you how to behaveinside the boundaries. Being locked into aparadigm at its worst can become a form ofconceptual imprisonment. Most large businessorganizations have multiple. paradigms, mul-tiple rules, applying to multiple games. Dif-ferent paradigms may help us see better whereto go, what questions to ask, what evidence toseek, what to deny. However every paradigmeventually encounters new problems it cannotsolve. Unnsolvable problems provide thecatalyst for triggering a paradigm revolution(Barker 1992: 51–2).

Why do Paradigms Change?

Kuhn was concerned to chart how changingrealities of investigation were tied up withchanging perceptions. In business the focushas been much more on the changing realitiesrather than changing perspectives. Kuhn

(1970) stressed the political nature ofparadigms, but did not really tell us why theadherents of subordinated paradigms suddenlytriumphed when they did, other than to saythat the anomalies were becoming anembarrassment for the powerful adherents ofthe existing paradigm. Burrell and Morgan(1979) never really answer this questioneither, because, for them, the paradigms neverreally change: there is simply a circulation ofelites and their adherents through them asspaces in which the politics of careers playout. As the existing dominant paradigmbecomes overcrowded, a few pioneers willbuild intellectual capital in other paradigms.

Paradigm Shifts

In any system that is ecologically inter-dependent, if you change any paradigmaticpart, then you change the whole. When thereis sufficient change and fluidity in a system,then we can speak of a ‘paradigm shift’: thatperiod when a shift occurs from one paradigmset to another, the transition from one wave tothe next. When the rules change across theboard, all changes. When we have such aparadigm shift, we have a widespread shift inthe rules, a shift to a new set of games. Inthese conditions uncertainty and ambiguitywill apply. People won’t be sure how to go on.‘‘Discontinuities change the rules of com-petition – both existing and new competition.Don’t try to deal with them by applying theold rules faster or better. Rather, startchallenging assumptions in order to drivestrategic process change. The first questionto ask is which elements of environmentalchange signal an impending discontinuity?’’(Keen and Knapp 1996: 89). In these circum-stances, the champions will be those who canread the new game, and master its rules,quickly and successfully. Literally, they willbe those who can master the next wave.

Change can be viewed as a curve where theslope, whether steep or gentle, is continuousand driven by economic trends, rates ofgrowth, technological advance, and competi-

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tion (Keen and Knapp 1996: 88). Discon-tinuous change is a step shift in the rate ofchange that invalidates existing assumptionsand begins to transform the rules of com-petition. Examples of discontinuous changeinclude the breakdown of the communist blocin Eastern Europe; the formation of theregional economic blocs of the EuropeanUnion, NAFTA and ASEAN and the resultingderegulation between borders; the converg-ence of computers and telecommunications tocreate the information superhighway, and thefurther convergence with the information andentertainment’s industries to create multi-media. In this way paradigm shifts aretriggered by significant political, economicor technological breakthroughs that enable awhole new frame of reference.

Such discontinuities invalidate oldparadigms, including those which may havebeen the basis of a firm’s success, strategy andculture. Company characteristics that werekey attributes suddenly become liabilities.There are three potential responses todiscontinuity:

• Sustained effort within existing methods tocarry the company up a steeper changecurve.

• Transforming the organization’s methodswith a step shift that will get ahead of thechange curve.

• Establishing new operating paradigms andorganizational infrastructure.

An illustration of a company that pursuedthe third option is Direct Line, whichresponded to the deregulation of the financialservices industry in the UK by establishing atelephone sales and service, capturing 10% ofthe car insurance market in less than twoyears. This feat has now been replicated manytimes as telephone call centres have becomeone of the most rapidly growing businesses,and tele-sales and tele-services have replacedface to face transactions in a variety ofindustries. Another dramatic illustration wasthe remarkable success Marc Andreessen had

with the Netscape Navigator web browser,which he originally launched as Mosaic, agiveaway software that created the market, ofwhich he then captured 80%. The strategy wasto have Netscape products running on 500million machines by the year 2000, potentiallyachievable if the paradigmatic domination ofMicrosoft did not prevent it. However, themeteoric rise of Netscape faltered whenMicrosoft began including a web browser inits standard package.

Paradigm shifts are today more challengingbecause the pace of economic and techno-logical change has accelerated beyond belief.The central processing unit (CPU) ofcomputers used to execute instructions in asequential manner, the basis of the vonNeumann electronic digital computer. Butcomputer scientists developed parallelcomputers by the late 1980s, in whichhundreds or thousands of CPUs operate inparallel and in cooperation with one another.This explosive increase in the power andspeed of computers is a metaphor for what isoccurring in many other fields of technologyand commerce (partly as a result of themassive processing power that is now widelyavailable). Suddenly, instead of beingachieved sequentially and gradually, every-thing is being done rapidly and simul-taneously: the simultaneous accomplishmentof what used to occur in sequence. Theimplications of this for people and forcompanies, is that continual multi-learningand life-long learning are essential to keep up.

Constant innovation is necessary forsurvival. The model life of products in theJapanese consumer electronics industry hadreached less than a year by the late 1980s, atthe same time as the cumulative total numberof products on offer had increased by morethan five times in less than five years.Multiple technological breakthroughs,shortening product life cycles, and rapidlychanging markets are together forcing thepace of paradigm shifts. Breathless com-mentators on the latest series of paradigmshifts add to the excitement.

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Desperately Seeking Newness

The sense of urgency about stimulating anddeveloping the management knowledgenecessary to deal with accelerating paradigmshifts has precipitated a rapidly growingprofusion of management ideas, books andgurus. The desperate search for newness, tobecome excellent, leading-edge, high perf-orming, innovativecan be a distraction fromthe practical, and lead us to misunderstand thepast, and undervalue what is important in thepresent. Eccles and Nohria inBeyond theHype: Rediscovering the Essence of Manage-ment make an impassioned, and probablyforlorn appeal for reason:

The desperate search for quick solutions to eternalmanagement challenges – combined with theopportunities this has created for managers,academics, consultants and journalists who proffersolutions to these problems – has resulted in animpressive proliferation of nostrums, techniques,and philosophies of management. Typically these‘new’ ideas are presented as universally applicablequick-fix solutions – along with the obligatory andexplicit caution that their recommendations arenotquick fixes and will require substantialmanagement understanding and commitment. Asmany mangers will attest, the result has been adazzling array of what are often perceived asmanagement fads – fads that frequently becomediscredited soon after they have been widelypropagated. (1992: 7)

The beginning of the willingness ofcompanies to frequently experiment withnew ideas is associated with the saggingfortunes of Western companies in the 1970saccording to Richard Pascale. InManagingOn the Edge(1990) he takes the consumptionrate and shelf life of management fads as anindicator of managerial panic. Pascalleidentifies several dozen management fads inthe post-war period and suggests that, whilethere are valid aspects of most of these ideas,what is wrong is the piecemeal fashion inwhich they are implemented and the impatientshift from one to another without any sense of

the context in which they must be embedded.The mass marketing of managerial techniquesas a packaged goods industry has fosteredsuperficiality as it became legitimate to acceptand utilize management ideas without an in-depth grasp of their underlying foundation,and without the commitment necessary tosustain them. ‘‘Not surprisingly, ideas ac-quired with ease are discarded with ease. Fadsebb, flow – and even change by 180 degrees’’(1990: 20).

Paradigms define substantial shifts in theknowledge and practice of management, butthe concept is frequently applied wrongly tothe most trivial matters: the managementliterature is replete with references to newparadigms, applied in every discipline, everyfunctional area, every industry. All that isusually meant here is a slight change from thenormal. Paradigms are factured into countless,fairly meaningless fashions.

More pugnaciously, Micklethwaite andWooldridge argue inThe Witch Doctors(1997) that, like economics a century ago,management theory today is an immaturediscipline, lacks ‘canonical texts and definingmethodologies’ and is ‘bedeviled by contra-dictions that would not be allowed in morerigorous disciplines’. Acknowledging thatmanagement education is now a multi-billiondollar industry in the United States alone, theyconclude their damning critique of contem-porary management gurus with sympathy for‘‘the fate of managers and their pitifulpredilection for magic cures’’. Eileen Shapiro(1996) suggests a more satirical view ofmanagement fads, and concludes it is up tomanagers themselves whether they use newtheories and practice in a positive way or tocreate havoc:

It’s the managers who test-drive the theories andoften create them themselves by virtue of the ideasthey invent, borrow, steal, and transform, based onwhat they read, think, hear, and just dream up . . .Without question, striving for management theoryto attain the status of a serious intellectualdiscipline, unfettered by internal contradictions,

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is an honourable goal. But aiming for an economyin which managers are willing to make decisionswithout the benefit of complete information orcoherent theory – and are able to learn from theresults – is more important by far (1996: 147).

The Importance of Innovation

Accepting that there is an important role formanagement theory and research, virtuallyevery major management thinker in the lasttwenty years has been drawn into the searchfor coherent new paradigms that mightcomprehend the exponential changes occur-ring in the economy and industry. MichaelPorter, in The Competitive Advantage ofNations, addresses the ‘‘need for a newparadigm’’ of national competitive advantage:

The long-dominant paradigm for why nationssucceed internationally in particular industries isshowing signs of strain . . . A new theory must startfrom the premise that competition is dynamic andevolving. Much traditional thinking has embodiedan essentially static view focusing on costefficiency due to factor or scale advantages.Technical change is viewed as exogenous, oroutside the purview of the theory. As JosephSchumpeter recognised many decades ago,however, there is noequilibrium in competition.Competition is a constantly changing landscape inwhich new products, new ways of marketing, newproduction processes, and whole new marketsegments emerge. Static efficiency at a point intime is overtaken by a faster rate of progress . . . Anew theory must make improvement andinnovation in methods and technology a centralelement. We must explain the role of the nation inthe innovation process. Since innovation requiressustained investment in research, physical capitaland human resources, we must also explain whythe rate of such investments are more vigorous insome nations and not others. The question is how anation provides an environment in which its firmsare able to improve and innovate faster thanforeign rivals in a particular industry. This will befundamental in explaining how entire nationaleconomies progress, because technological changein the broad sense of the term, accounts for muchof economic growth. (1990: 2, 20)

In one way or another practically all of themanagement writers who have engaged in thesearch for new paradigms have beenaddressing the fundamental questions posedby Porter. Peter Drucker, the most outspokenmanagement theorist of the 20th centurystressedThe Age of Discontinuity(1969),and the importance of theknowledge economyin Managing for the Future(1992) andconsistently examined the implications ofpost-industrialism for management practice,most recently inManagement Challenges forthe 21st Century(1999).

The Age of Unreason(1989) andThe Age ofParadox (The Empty Raincoat)(1994) byCharles Handy commented more sensitivelythan most management strategists on thedilemmas to be faced. ‘‘We are entering anage of unreason, a time when the future, in somany areas, is to be shaped by us and for us; atime when the only prediction that will holdtrue is that no prediction will hold true; a time,therefore, for bold imagining in private life aswell as public; for thinking the unlikely anddoing the unreasonable’’ (1989). For Handy itis a period of upheaval in which only ‘upside-down’ thinking will connect: ‘‘Organizationsused to be perceived as gigantic pieces ofengineering, with largely interchangeablehuman parts. We talked of their structuresand their systems, of inputs and outputs, ofcontrol devices and of managing them, as ifthe whole was one large factory. Today thelanguage is not that of engineering but ofpolitics, with talk of cultures and networks, ofteams and coalitions, of influence or powerrather than control, of leadership notmanagement’’ (1989).

People, creativity, the excitement ofchange, technology, and speed of responseare at the center of Tom Peters startlingcontribution to management knowledge inLiberation Management(1992), The Pursuitof Wow! (1994) andThe Circle of Innovation(1997).

In his hyperactive typography Petershighlights the counterproductive effect ofstandardized corporate responses which bring

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a blight of sameness to products and services –functional, timely, customer-friendly thingswhich are basically just boring commodities.Peter’s reaction is that commoditization is notinevitable, and that companies should create‘waves of lust’ for the aesthetic qualities ofproducts and services (Schmitt and Simonson1997). Of course a customer-focused strategybecomes a wish list if it is not backed up withstrong core processes, which deliver con-tinuuous innovation, effective operations,and efficient customer service and support.

Rosabeth Moss Kanter entices lethargiccompanies to break free of the last vestiges ofcorporatism and learn to be nimble inTheChange Masters(1983),When Giants Learn toDance (1989), andWorld Class (1995). Tosucceed in the customer-driven global economybusinesses must meet best-in-the-world stan-dards, pioneer the best ideas and technologies,invest in their people, act as partners tosuppliers and customers, and connect tonetworks adding reach and resources. ‘‘Worldclass companies are rich in the three goldenintangible assets, the three Cs of concepts,competence, and connections’’ (1995: 331).

Most management writers have attemptedto convey the overwhelming sense ofmovement and and action which people inindustry were experiencing as they tried tocome to terms with markets, technology andorganizations that were transforming allaround them. Alvin Toffler inThe Third Wavewas the first to discuss the widening impactthe convergence of telecommunications andcomputer technology would have on everyaspect of work and society. Peter Senge inTheFifth Discipline and inThe Dance of Change(1999) demonstrated the intelligent responseto such constant, complex and dramaticchange in peoples’ existence in creatinglearning organizations: ‘‘organizations wherepeople continually expand their capacity tocreate the results they truly desire, where newand expansive patterns of thinking arenurtured, where collective aspiration is setfree and where people are continually learninghow to learn together’’ (1992: 3).

Many other management theorists beforeand after Senge wrestled with the problem ofhow organizations can continually adapt,change, innovate, create, and network in orderto survive and succeed in market environ-ments that are quickly becoming more unpre-dictable, with technologies that are becomingmore pervasive and integrative, with organiza-tions that have become pliable and porous,and with people who are questioning, assertiveand independent.

Though most theorists refer to the neworganization with different names andemphases, a common pattern may be dis-cerned: unlocking the mystery of organiza-tional self-renewal (Pascale 1990). To beviable in the changing and demandingbusiness environment of today organizationsmust be able to improve themselves con-tinually as part of their normal functioning; tobe intelligent, critical and open; and to becreative and capable of eternally transformingthemselves while sustaining a sense ofpurpose and direction (Table 1). These writersfocused upon particular, constructive waysorganizations could respond to changingdemands, other management writers concen-trated on surfing the waves of change.

Surfing theWaves

The uncrowned king of paradigm surfers isRobert Naisbitt whose originalMegatrends(1982) proved a remarkably prescient identifi-cation of the main patterns in shifting societaltrends, for which he was rewarded with salesof eight million copies of his book worldwide.The trends he noted, including the move todecentralized, networked, high-tech infor-mation society, were surprising at the time,but now seem commonplace (Table 2). Theworld has moved on, and so has Naisbitt, whohas turned East.Asian Megatrendsidentifiesthe burgeoning influence in Asia of the ethnicChinese business network, which is poised totake the commercial lead from Japan. Alongwith that will come the largest middle classmarket in the world in Asia, which will retain

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distinctive characteristics. Asian marketeconomies will fuel an explosion of growthand urbanization in supercities that willbecome economic powerhouses of high tech-nology. Women will capture a central place inAsian enterprise, as Asia itself will once againbecome the center of the world (Table 3).Naisbitt must be kicking himself that he didnot get his Asian thesis published a few yearsearlier, before the gloss began to chip off theAsian economic miracle with the majorcollapse of currencies, stock markets and theproperty market in a series of South EastAsian countries in the autumn of 1997.However, the trends he has observed will nodoubt revive.

Another futurist, Ian Morrison urgescompanies to have the courage to jump fromthe first curve of their traditional businessbase, existing organization and currentrevenues toThe Second Curve(1996). Thesecond curve is defined by adoptingbreakthrough technologies, offering newproducts and services, and searching out newemerging markets wherever they may be. Thiswill involve a transformation of corporatemarketing, organization, and individuals(Table 4). As with all great leaps, the trick isto know the right moment to make it, orwhether, and how long, it is possible to keep afoot on both curves at once. Reaching the

second curve means learning to live withparadox, and conflicting goals and techno-logies, and absorbing new business rules andmethods. There are great risks in making thisjump, and comfort in staying with what youknow, but ultimately this leads to stagnationand obsolescence.

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Table 1. Typology of the new organization

A. Wildavsky (1972) The Self-Evaluating OrganizationM. Landau (1973) The Self-Correcting OrganizationKarl E. Weick (1976 The Self-Designing OrganizationB. Staw (1977) The Experimenting OrganizationPeter Drucker (1988) The Networked OrganizationCharles Handy (1989) The Shamrock OrganizationPeter Senge (1992) The Learning OrganizationPeter Keen (1991) The Relational OrganizationD. Quinn Mills (1991) The Cluster OrganizationJames Brian Quinn (1992) The Intelligent EnterpriseW. Davidlow and M.Malone (1992) The Virtual CorporationM. Hammer and J. Champy (1994) The Reengineered CorporationRussell L. Ackoff (1994) The Democratic OrganizationTom Peters (1992) The Crazy OrganizationRichard D. Hames (1994) The Appreciative OrganizationIkujiro Nonaka and Hirotaka Takeuchi (1995) The Knowledge Creating CompanyArie de Geus (1997) The Living CompanyD. Matheson and J. Matheson (1998) The Smart Organization

Table 2. Naisbitt (1982) original megatrends

From To

Industrial Society Information SocietyForced Technology High Tech/High TouchNational Economy World EconomyShort Term Long TermCentralization DecentralizationInstitutional Help Self helpRepresentative Democracy Participatory DemocracyHierarchies NetworkingNorth SouthEither/Or Multiple options

Table 3. Naisbitt (1997) Asian megatrends

From To

Nation States NetworksExport Led Consumer LedWestern Influence AsianWayGovernment-controlled Market DrivenVillages SupercitiesLabour Intensive High TechnologyMale Dominance Emergence of WomenWest East

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The Evolution of Management

Other theorists, while concerned with theeconomic and technological changes sweepingthrough society, have focused in upon culturalchanges in management and organization, andthe resulting paradigm shifts. Benniset al.

(1994) in a brave attempt to balance eco-nomics, ethics and ecology, identifynorthern,western and easternparadigms of manage-ment, and suggest the elements of a path ofcultural evolution to a new global paradigm(Table 5). Northern management is thedominant paradigm of Europe and America,of Peter Drucker, and his early work onplanning and directing; Rensis Likert onteamwork and participation; Alfred Chandleron the visible hand of hierarchical organiza-tions; and George Steiner on the socialresponsibility of business.

However northern rationalism is being over-turned by a western style of entrepreneurismespoused by Tom Peters; the emotively orientedshared values discussed by Deal and Kennedyare supplanting formal teamwork; Handysuggests how vertical organizations arebecoming lateral; and George Gilder reawakensthe spirit of enterprise. Eastern management,being part of a more corporate philosophy isrepresented by companies rather than indivi-duals, with the TQM of Toyota; the qualitycircles of Shigeru Kobayashi at Sony; and theconcept of lean manufacturing at Honda.Finally, Robert Ozaki has emerged with aninterpretation of human capitalism. ‘‘While thewesterly based management concepts remaintoo strongly vested with old-style capitalism, at

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Table 4. From first curve to second curve(Morrison 1996: 15)

First Curve Second Curve

MarketCapital KnowledgeProducer ConsumerAtlantic PacificJapan ChinaInternational Trade Electronic CommerceComputers InternetMoney People

OrganizationMechanistic OrganicEngineering EcologyCorporations Individuals and NetworksHorizontal and Virtual IntegrationVertical IntegrationBusiness Processes Culture

The individualHardWork HypereffectivenessSecurity UncertaintyCurrent Career Future CareerFaith HopeLoyalty Courage

Table 5. The evolution of management (Bennis et al. 1994: 9)

Old paradigms Newglobal

Northern Western Eastern paradigm

Individual Effective Entrepreneurial Total Quality Self-MasteryManager Management Management Management

(Drucker) (Peters) (Toyota)

Social Group Effective Shared Values Quality Circles Social SynergyTeamwork (Deal/Kennedy) (Sony)(Likert)

Organization As Hierarchical Networked Lean Organization OrganizationalAWhole Organization Organization Organization Learning

(Chandler) (Handy) (Honda)

Economy and Society Corporate Free Enterprise Human Capitalism SustainableResponsibility (Gilder) (Ozaka) Development(Steiner)

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least at a societal level, the easterly basedapproach remains too Japanese in form andcontent to become more widely spread, It is theglobally based approaches that transcend thelimits posed by particular cultures . . . The newparadigm-manager is by definition transculturalin his or her approach to developing self-mastery within him or herself; in generatingsocial synergy across a group; in engenderingorganizational learning within institutions, andin fostering sustainable development across theglobe’’ (Benniset al. 1994: 4–8).

Continuing with the exploration of a newphilosophy of management, Richard Hallcontrasts the old hierarchical spirit with anew,Soul of the Enterprise(1993). Instead ofcompanies which preach teamwork betweenemployees, customers and suppliers, whilemanagement make decisions that profit onlythe owners, ‘‘We need a more challenging,holistic view of the purposes of enterprise,something beyond balancing the conflictsbetween fiduciary duties for profitability,customer satisfaction, purifying the environ-ment and the like . . . which . . . cannot copewith holistic considerations’’ (1993: 24). Hallrecognises that all of the elements within aliving system are integral to the entiresystem’s well-being (Table 6). Such principlesare particularly resonant in knowledge-basedorganizations, where organizational partici-pants are inevitably more questioning anddemanding, as Bartlett and Ghoshal argue,‘‘unlike capital, knowledge is more valuable

when those on the front line control and useit’’ (1995). The failure of Anglo-US corpora-tions to accept and internalize this perspectiveleads some to doubt their long-term com-petitiveness, including Konusuke Matsushita,founder of the Matsushita Electrical IndustrialCorporation with a turnover of US $61 billionin 1996 and 265,000 employees:

Your firms are built on the Taylor model, and evenworse, so are your heads. With your bosses doingthe thinking while the workers wield screwdrivers,you’re convinced deep down that this is the rightway to run a business. For you the essence ofmanagement is getting ideas out of the heads ofmanagers and into the hands of labour. We havegone beyond the Taylor model. We realise thatbusiness has become so complex, the survival offirms so precarious, and our environmentincreasingly unpredictable, competitive, anddangerous that firms’ continuing existencedepends on their day to day mobilisation of everyounce of intelligence. (Cannon 1996: 44)

Cannon addresses the critical choicesconfronting managers inWelcome to theRevolution, ‘‘Some will survive by affirmingcore strengths and concentrating their effortsaround a specialism. The role of managementis to establish a framework within which theoptions are understood and decisions made.For managers the options are clear. Innovativebusiness and business leaders have absorbedthese choices and opted for change’’ (Table 7,Cannon 1996: 18).

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Table 6. The old and new soul of the enterprise (Hall 1993: 281)

Old New

Profit first priority Customer satisfaction first priorityAssets are things Assets are peopleThinkers are separated from doers Doers and thinkers are the sameMass production Lean productionSeparated marketing with suppliers and Integrated marketing with partnership basedcustomers at arm's length relationships with suppliers and customers

Organizations controlled by hierarchies, Organizations based on teamwork, numerousfunctional departments separated cross-teams

Performance measurement for control, Performance measurement for improvement,financially dominated broader measures

Scale economies important Time economies important

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The Implications of InformationTechnology

Most management writers take a multi-factorial view of emerging paradigms. Somewriters are more likely to attribute most causalinfluence to a single variable, and the mostfrequently singled-out factor is informationtechnology (IT). R.D. Hames (1994), forinstance, looking at the essence of futureorganization, saw the shift from the industrialto the information age in terms of its impacton the design of organizations, particularlyfrom an IT perspective. One of the keyemergent trends is a shift from organizationalenvelopes as a container of business activity tonetworks linking between organizations.

As organizations seek value through thestrength of their ties to – and networks with –other organizations, attempts at imperativemanagerial control become intrusive andinappropriate. Control through networks,particularly where there is considerablecomplexity and short span of product life-cycles, means that emergent ‘windows ofopportunity’ require rapid and widespreadsharing of knowledge. Older paradigms ofmanagement tradition and practice becomeincreasingly obsolete. Fulk and DeSanctis(1995) provide an overview of the researchthat has begun to address issues of electroniccommunication and its impact upon, andchange of, organizational forms.

Hames (1994) stresses the emergence of theinformation organization centered on

‘appreciative systems’ which are open andadaptive, premised on learning, cooperationand flexibility, on networks of individualsrather than either individuals alone orstructures alone. The vision of the emergentorganization that Hames advances is one thatregards the drivers of change as essentiallytechnological: it is the innovations opened upby the micro-chip that lead the way. Hence,for Hames the ‘rational’, ‘technological’driver at the heart of new paradigms isinformation technology (Table 8).

Recurrent to almost all accounts is anemphasis on the role of information tech-nology providing the infrastructural meanswhereby new paradigms may be developed.The impact of IT is everywhere. Informationtechnology specialists, Tapscott and Caston(1993), identify a number of recurringbusiness themes inParadigm Shiftstressingthe contribution that information technologyplays in enabling hierarchies to be supersededby open networked organizations. Networkorganization puts a different perspective onstrategic learning. It improves immeasurablythe probability that understanding is maxim-ized through learning by doing in the networkthat disseminates widely. The network can bea mechanism for fast-tracking organizationlearning about markets, applications, andsuppliers, through collaborative and openforms of decision making that eliminate theinefficiency of traditional hierarchical styles.Instead, decisions can be based uponexpertise, openly elicited and listened to in

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Table 7.Management choices (Cannon 1996: 18)

Pre-revolution Post-revolution

Lifelong employment Lifelong employabilityMinimize risks from change Maximize opportunities for changeAdversarial management Collaborative managementNarrow view of main stakeholders Extensive view of main stakeholdersConcentrate rewards Distribute rewardsEmphasize administrative expertise Emphasize technical expertiseFocus on continuity Focus on continuous discontinuitySeparation and specialization key to success Holistic approach to organizationFragmented view of work and enterprise Integrated view of work and enterpriseStick by the old rules Search out new rules

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the organization, and to everyone more or lessimmediately by email.

Changing Competitive Milieus

Other writers concentrate on the impact ofchanging competitive milieu upon new para-digm formation. In a special edition of theStrategic Management Journalon The Searchfor New Paradigms. Prahalad and Hamal(1994) define substantial paradigm shifts instrategic management in response to thedriving elements of the new competitivemilieu including deregulation, decentral-ization, excess capacity and the rise of newcompetitors, increased merger and acquisitionactivity, increased accounting for the environ-ment, new forms of customer sovereignty,new digital technologies and products, theconstitution of regional trading blocs, and thearrival of global competition. Among thestructural consequences for businesses are:

Disintermediation

The combination of the pervasiveness ofinformation technology and consumer

demands for better value means new playerscan enter the market with ease. Existingbusinesses and organizations such as therelationships between travel agencies andairline ticketing are no longer fixed.

Disintegration

The breakdown of vertically integrated struc-tures and the emergence of virtual corporat-ions (Davidow and Malone 1992). Long-termrelationships and agreements can providecompanies with an alternative to verticalintegration as transaction costs undergodramatic change.

Convergence

The fusion of hitherto separate industries suchas chemical and photo imaging (e.g. photoCD, computers, communications and con-sumer electronics). The convergence oftechnologies and businesses represents abreakdown of clearly demarcated boundaries.

Industry structures are no longer ‘givens’:they are variables to be managed by thestrategic choices that senior executive

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Table 8. Transition from industrial to information age organizations (Hames 1994)

Industrial age organization Information age organization

Focus on measurable outcomes Focus on strategic issues using participation andempowerment

Highly specialized knowledge base resulting in Interdisciplinary knowledge base resulting insingle-skilling multi-skillingIndividual accountability Team accountabilityClearly differentiated and segmented organizational Matrix arrangement ± flexible positions, roles andpositions, roles and responsibilities responsibilitiesLinear input-output thinking about programs Holistic perspective on programmingReactive in solving problems as they emerge ± a Proactive: anticipate issues before they become crises;short-term focus dominated by the' bottom-line' achieving balance between short-term pragmatism and

long-term purposeLocal perspective informs programming Global perspective informs local actionHierarchical, linear information flows Multiple interface, `boundaryless' information

networkingAttention to quantitative differences Attention to qualitative differencesPlant and equipment targeted for investment Development of people targeted for investmentAchieving effectiveness through methods Achieving superior performance underpinned by shared

valuesInitiatives for improvement emanate from a Initiatives for improvement emanate from all directionsmanagement elitePresent-oriented, doing what is known now Future-oriented, operating at the cutting edge

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management make. What were ‘dominantlogics’ of the firm in the past will not remainso in the future as business paradigms changeand managers must recognize these changesand act on them. The focus of competitionbecomes more diffuse and can come frommany directions: products, product lines,business units, clusters of business unitswithin a firm, clusters of firms, a globalnetwork of firms.

Governments and companies of allcountries have become increasingly concernedwith the competitiveness of their industriesand how to facilitate the most productiveresponse to the new challenges. Official andbusiness-led inquiries into the sources ofcomparative advantage and the future shapeof successful industries have proliferated.Three of the most inspiring and influentialrecent inquiries were, in the United States, theTomorrow’s Corporation(1992–1994) seriesof conferences sponsored by the PolaroidCorporation in Aspen, Colorado, whichbrought together academics and industrialiststo explore the dimensions of the newstructures and operating forms of industry,which included consideration of the wideadoption of employee share ownership in UScorporations. In the UK, theTomorrow’sCompany(1992–1995) Inquiry was launchedby the Royal Society for the Encouragementof Arts, Manufactures and Commerce (RSA)and funded by 25 leading internationalcompanies to inquire into ‘‘the sources ofsustainable business success’’. The conclusionof the Inquiry was to stress the need for theinclusive company, to reflect more fully theinterests of all stakeholders.

The third inquiry was a major Australiangovernment project, published asEnterprisingNation: Renewing Australia’s Managers tomeet the Challenge of the Asia-PacificCentury (Industry Task Force on Leadershipand Management Skills, 1995). The TaskForce membership represented seniorexecutives from the Australian corporatesector, academia and the public sector. The

terms of reference of this Task Force were to‘‘advise on measures to strengthen manage-ment development and business leadershipwithin Australian enterprises. To identifyeffective management practices in a range ofareas, to raise awareness of the need forimproved leadership and management skillsand to foster enterprise commitment tomanagement development’’ addressing ‘‘Anew paradigm for management development’’(Karpin Industry Task Force on Leadershipand Management Skills, 1995: 4).

Disorganized Capitalism

Limerick and Cunnington (1993) paint avision of the organization future driven bythe emergence of a far less-regulated politicaleconomy. The term that Limerick andCunnington adopt from Lash and Urry(1987) is the era of ‘disorganized capitalism’,where economic relations are more globallycompetitive and less organized as an adjunctof state-craft than once they were. Also, theysee the emergence of a ‘post-modern’ societydistinctively different from the mass society ofmodernity. Its chief difference is a decline inthe assumptions of mass society, mass market,and mass production. People no longeridentify themselves as part of the mass: theywant to express their difference. They basetheir difference from the mass conceptionthrough identity with sub-sets of the oncehomogenous conception. Now there are plural,multiple and niche-based sources of identityavailable to people, such as their sexuality,their culture, their ethnicity. Niche-basedmarkets sustain these sources of identity.Flexible production systems mean that firmscan deliver many different adaptations of aproduct to different markets, rather thanpresume or create a mass-market.

It is not just markets and productionsystems, Limerick and Cunnington suggest.They see boundaryless organizations, basedon network structures, characterized bycultures of collaborative individualism, entre-preneurship and action learning, as the new

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order (Table 9). Management becomes muchless concerned with the imperatives of control,and more with meaning and symbolicbehaviour, reflecting the shift to networks.These are less conducive to imperative controlbecause they are not subject to managementprerogative vested in unique organizationalrights of command. Consequently, skills suchas team-building, negotiation and the manage-ment of politics become the central tasks asthe internal economy of the firm shifts fromeconomies of scale to economies of time,premised on ‘lean manufacturing’. Flexibilityabout changing needs, threats and oppor-tunities goes together with a non-hierarchicalstructure and a free flow of information up aswell down the organization (also see Rothwell1992). Leadership becomes more collective,more distributed. Rather than being theprerequisite of a charismatic leader, leadershipmay well be something that is best nurtured bygroup processes. All managers may needleadership skills and vision in flattenedorganization structures. Leadership, as the‘new leadership studies’ (Bryman 1992) sug-gests, requires the importance of a compellingvision; a ‘climate of trust’ based on com-petence, congruity and constancy; the creationof meaning and the ability to learn frommistakes; the importance of a healthy andempowering environment; the strategicimportance of flatter, flexible, adaptive,decentralized and learning systems and

organizations (Bennis 1993; Benniset al.1994).

Intelligent Sustainable Organizations

According to James Collins and Jerry Porras(1996) inBuilt to Last – The Successful Habitsof Visionary Companies, companies thatsurvive and succeed do not oppress them-selves with the ‘‘ ‘Tyranny of the OR’ – therational view that cannot easily acceptparadox, that cannot live with two seeminglycontradictory forces or ideas at the same time.The ‘Tyranny of the OR’ pushes people tobelieve that things must be either AORB, butnot both. It makes such proclamations as:

• ‘You can have changeOR stability.’• ‘You can be conservativeOR bold.’• ‘You can have low costOR high quality.’• ‘You can have creative autonomyOR

consistency and control.’• ‘You can invest for the futureOR do well

in the short term.’• ‘You can make progress by mechanical

planningOR by opportunistic groping.’• ‘You can create wealth for your

shareholdersOR do good for the world.’• ‘You can be idealistic (values-driven)OR

pragmatic (profit-driven)’(Collins and Porras 1996: 43–44)

As demonstrated in their detailed case

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Table 9. The essential elements of the new organization (adapted from Limerick and Cunnington 1993)

Discontinuous Organizational Newmanagerial Newmanagerialchange change focus competencies

Economic change Structure: Metastrategic `Soft' competencies:Disorganized Networks management empathycapitalism ! Boundaryless ! Identity, vision ! trust

Postmodernism organizations and operating managing symbolsInterpersonal Culture: systems of `Hard' competencies:change collaborative management negotiating

Neo-humanism individualism Management of politickingStrategy: meaning, especially contractingentrepreneurship during periods ofalliances discontinuityinventionaction learning

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studies of leading US corporations that seemto have captured the secret of considerablecommercial success and longevity, it ispossible for organizations to liberate them-selves with the ‘Genius of theAND’: theability to embrace both extremes of a numberof dimensions at the same time, to pursue Aand B simultaneously and successfully, notbalancebut creative genius (Table 10).

Some writers would maintain that an intel-ligent organization in essence is a sustainableone. Sustainability has two meanings: onestresses the ability to keep on going, to sustainsomething for a long period of time, as in along-lived business enterprise. The otherstresses sustainability in the sense of renewal,for instance where an environment exists thatsustains all other activities, thus making thempossible. The two uses are not disconnected,any sustainable enterprise requires access tokey resources. Historically, the definition ofwhat is key has changed over time. de Geus(1997: 22) regards the significant paradigmshift being from a world of business‘dominated by capital to one dominated byknowledge.’ The argument is represented in asin Table 11.

The transition from feudalism to capitalismis familiar enough from many historicalstudies (e.g., Anderson 1979). The transitionfrom a capitalist society, one where access tocapital has the highest value, to one whereaccess to knowledge is more prized, is arelatively recent trend. Through building alearning organization, enterprises are able to

develop what de Geus (1977) terms ‘tools forforesight’. What characterizes farsighted,long-lived enterprises? Four key factors func-tion as the characteristic ‘family resemb-lances’ of sustainable enterprises in the senseof being long-lived. According to de Geus(1997: 12–14), long-lived companies are:

• Sensitive to their environment: they havethe ability to change and to adapt.

• Cohesive, with a strong sense of identity:they have the ability to build a communityof committed people in and around thefirm, and to develop their own persona.

• Tolerant and decentralized, thus permittingmarginal experimentation through beingable to build constructive relationships withother entities, both intra-organizationallyand extra-organizationally.

• Conservative in financing: they have theability to govern their own growth andevolution, and thus control their sense ofdirection.

It is also interesting to consider what theyare not:

The ability to return investment to shareholdersseemed to have nothing to do with longevity. Theprofitability of a company was asymptomofcorporate health, but not apredictor or deter-minant of corporate health . . . Nor did longevityseem to have anything to do with a company’smaterial assets, its particular industry or productline or its country of origin. (de Geus 1997: 14)

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Table 10. The `Genius of the AND' (Collins and Porras 1996: 44)

On the one hand AND yet, on the other handpurpose beyond profit AND pragmatic pursuit of profita relatively fixed core ideology AND vigorous change and movementconservatism around the core AND bold, committing, risky movesclear vision and sense of direction AND opportunistic groping and experimentationBig Hairy Audacious Goals AND incremental evolutionary progressselection of managers steeped in the core AND selection of managers that induce changeideological control AND operational autonomyextremely tight culture (almost cult-like) AND ability to change, move, and adaptinvestment for the long-term AND demands for short-term performancephilosophical, visionary, futuristic AND superb daily execution, `nuts and bolts'organization aligned with a core ideology AND organization adapted to its environment

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The findings that de Geus (1997) reportscame from an internal study conducted for theShell organization, but find corroboration inthe research conducted by Collins and Porras(1996), which also found that visionary com-panies, most of which had survived for over60 years or so, put a lower priority onmaximizing shareholder wealth or profits,were sensitive to the environment, whether itwas conceived as a natural, social or businessenvironment, and had a strong sense ofidentity. These findings may seem paradoxicalto managers who, of necessity, have tomanage the future from the here-and-now.Here-and-now they are responsible toshareholders who demand immediate andbigger returns on investments; but, if theyattend exclusively to these short-termdemands, then they may well threaten thelong-term viability of their companies,investor profits and their own careers.However, de Geus (1997: 21) suggests thatthis paradox only occurs within a paradigmthat is by now obsolete, suboptimal anddestructive: ‘‘Corporate success and longevityare fundamentally interwoven, in a way that,nowadays, is qualitatively different from therelationship between success and longevity inthe economic environment of five decadesago.’’

With regard to the second definition ofsustainability Maynard and Mehrtens (1996)offer in The Fourth Wave Business in the 21stCenturya highly optimistic view that just asthe first wave of agriculture was superseded

by the second wave of industrialisation, whichcovered much of the earth and continues tospread, while a new, post-industrial third waveis gathering force in the modern industrialcountries, a fourth wave is apparent. Thesecond wave was rooted in materialism andthe mastery of man over the natural world, thethird wave manifests growing concerns forbalance and sustainability. ‘‘By the time of thefourth wave, integration of all dimensions oflife and responsibility for the whole will havebecome the central foci.’’ Social accountingincluding the universalization of capitalownership, internalization of the social andenvironmental costs of doing business, andcapitalization of natural resources, will drivecorporations towards embracing social andenvironmental responsibility (1996: 6, Table12).

Hames (1997: 35, 41) presents a similarparadigm shift from a less to a moresustainable organizational world, envisagedin terms that extend the learning organization.Securing the temporal sustainabilty of thecorporation to the anchor of a ‘‘self-organizingsystem able to ‘learn’ its way into preferredfutures, in ethical reciprocity with its environ-ment, and in ways that are ‘appreciative’ of allstakeholders needs, expectations and desires’’(Hames 1997: xiv). The ‘appreciative para-digm’ begins with a familiar critique of‘modernism’ (in terms of its hierarchical,exploitative, destructive qualities), beforemoving to an affirmation of ‘appreciativepraxis’ premised on:

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Table 11. The historically changing priorities of management

Era Key resource Exploitation of:

Feudal society Access to land Natural fertility, and technologies that allowed for the production,appropriation and trade in surplus produce

Capitalist society Access to capital Human labour power, and technologies that harnessed, extendedand appropriated the surplus value that could be extracted frompeople as commodities working with other assets

Knowledge society Access to knowledge Systematic ingenuity, innovation and knowledge, that adds valueto companies through the optimization of people as sources ofcreativity that develop the consistent knowledge-base of theenterprise.

Source: de Geus (1997)

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• diversity or variety which nurtures survival• optimization rather than maximization of

energy usage• cooperation which appears to be more

conspicuous than competition in many naturalsystems

• self-regulation rather than externally imposedor controlled direction

• collaborative learning from experience – thisis the way the young of all species develop toremain healthy and adaptive

• transformative change which is continuous inhealthy systems

• connectedness – all parts of a system areinterrelated in some way to all other parts

• equivalence – all of the roles that exist innatural systems are basically comparable.

(Hames 1997: 39–40)

The preferred organizational model forHames’Burying the 20th Centuryis networkorganization: ‘‘What hierarchy was to the 20thcentury, the distributed network will be to the21st . . . [because] the network is the onlyorganizational type capable of unguided, orunprejudiced growth . . . the network is theleast structured organization that can be saidto have any structure at all’’ (1997: 141). Thusit is digitalization that is driving development,but on this occasion, digitalization connected

to a networked ecological consciousness.Collaborative technologies are paralleled bycollaborative learning as a process of culturalevolution.

To explore what we are becoming requiresaddressing questions such as:

• What are the key drivers for the future?• Should they remain the same as in the past

or could other possibilities be explored? Ifso, what are they likely to be?

• Will these engage all stakeholders’ interestand commitment in the long term?

• How will the new possibilities changechoices about how the organization doeswhat it presently does and how it will dowhat it will do in the future?

• What will the organization end up lookinglike if the driving forces change?

Such questions enable organizations toidentify their key strategic determinants forfuture visions. Once these are determined,then new principles and priorities will needaffirming to ensure that the organization’scompetencies and protocols are consistentwith the changed strategic intent, and that itsdesign, symbolic, aesthetic and structural,corresponds with these changes.

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Table 12. Characteristics of second, third and fourth wave corporations (Maynard and Mehrtens 1996:164)

Second wave Third wave Fourth wave

Goals Maximize profits Create value Serve as global stewardMotivation Make money Make money and help Leave valuable legacy for the

solve societal problems futureValues Profit, growth, control Creating value, trust, Responsibility for the whole

learning service, personal fulfillmentStakeholders Owners of business, Stockholders, employees, Stockholders, employees,

stockholders families, suppliers, families, suppliers, customers,customers, communities, communities, government,government ecosystem, Gaia

Outlook Self-preservation, business Co-operation; business as Unity; business as a means toas a way to make a living a way for people to grow actively promote economic and

and serve social justiceDomain National and local; 5 to 10 International; share Global; share leadership in

years into the future responsibility for the local, national, and globalwelfare of local, national, affairs; generations into theand global communities; futuredecades into the future

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At the heart of the paradigms of 21stcentury business will be virtual, intelligent,organization networks, competing in a global,open economy, in ecologically sustainableways, appreciative of the many stakeholderswith an interest in its performance.

Conclusions

We have reviewed the origins of the conceptof paradigm, and different uses of the conceptof ‘paradigm’ in business and managementand key drivers of current paradigm shifts:

• Paradigm shifts as strategic responses tochanging competitive milieus.

• Information technology as the technicalcore of current paradigm shifts.

• Innovation and learning as the centralrational of new paradigms.

• The importance of wider conceptions ofstakeholders to new paradigms.

• The overwhelming need for new businessparadigms to be based on sustainability.

Finally the future possibilities for intel-ligent, sustainable, stakeholder organizationswere explored. The business world ischanging in fundamental ways, but this doesnot mean that one worn-out set of businessbeliefs and objectives should be exchanged foranother universally acceptable managementparadigm. New management paradigms arenot simply a fixed template of criteria for acompany to fulfil, nor a checklist or ten-stepprogramme. Increasingly, new paradigms ofmanagement will be about an intelligent andcreative engagement in an increasinglycomplex and changing world.

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