Editor's Note: Take a look at our featured best practice, Organization Design Toolkit (103-slide PowerPoint presentation). Recent McKinsey research surveyed a large set of global executives and suggests that many companies, these days, are in a nearly permanent state of organizational flux. A rise in efforts in Organizational Design is attributed to the accelerating pace of structural change generated by market [read more]
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Organizational Development has matured hand in hand with the stages of human societal development. Anthropological studies have observed a minimum of 5 clear organizational models in human history.
This development has been described in several ways by different experts. Frederic Laloux, in 2014, started analyzing emerging organizations that were setting themselves apart from the established companies in their style of management.
Philosopher Ken Wilbur’s technique of using colors to describe the non-linear growth of human societies was borrowed by Laloux for convenience to name the sequential stages of management evolution.
The colors red, amber, orange, green, and teal have been used to identify the 5 distinct stages in organizational evolution corresponding to the evolution of human society.
Primary aim of forming the concept of Teal Management was to take advantage of employee talents that complement each other, by consolidating their knowledge and integrating it at all levels.
Teal color is used to classify a category of organizations that shuns hierarchical and Organizational Structures and welcomes modern-day social and employment developments. Teal Organizations are self-managing and perceived as living entities with focus on achieving their complete potential.
Frederic Laloux discovered that the new Teal Management organizational concept had 3 key pillars:
- Self-Management
- Evolutionary Purpose
- Wholeness
Leaders in the Teal Organization are wary of their own aspirations—to regulate their surroundings, to be successful, to appear clean, or even to achieve good work. Disallowing anxiety, leaders pay attention to the wisdom of other, profounder elements of their selves, cultivating an ethic of shared trust and assumed copiousness.
Let us delve a little deeper into the details of the 3 key pillars.
Self-Management
Teal Organizations do not operate in hierarchies like traditional organizations. They adopt decentralization—which indicates order and clear direction. Teal Organizations function successfully, even at grander levels, with a system established on peer relationships.
Duty for Decision-making is common, as faith is put in employees’ individual and combined intelligence. Structures and practices are put in place where employees have greater independence in their domain, and they are answerable for coordinating with others.
Wholeness
Teal Organizations have an atmosphere where employees are at liberty to completely express themselves. Such atmosphere raises employee devotion, feeling of belonging, proactivity, and creativity, amplifying their ability to the fullest, in the process.
Evolutionary Purpose
Teal Organizations are persistently adjusting and endeavoring to progress. Endeavor to evolve is through a process of scrutiny, search, and discovery in which all employees take part.
Although none of the Teal Organizations studied have the scale of Orange or Green Organizations yet, still the success they are having suggests that a new era in Organizational Management is taking shape.
Every phase of organizational evolution is more developed and effectual compared to the preceding phase, due to the intrinsic approach towards power.
Teal Organizations have 3 primary advantages compared to any other form of organization:
- Human Factor
- Integrated View of Success
- Learning
Research indicates that there are only 2 essential stipulations for evolving into a Teal Organization:
- Executive Leadership
- Ownership
Interested in learning more about Teal Management, its primary advantages, and essential stipulations? You can download an editable PowerPoint presentation on Teal Management here on the Flevy documents marketplace.
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31-slide PowerPoint presentation
Organizational Design involves the creation of roles, processes, and structures to ensure that the organization's goals can be realized. Organizational Design span across various levels of the organization. This framework focuses on the following 3 initial steps of the full 10-step Organizational
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Organizational Design (AKA Organizational Re-design) involves the creation of roles, processes, and structures to ensure that the organization's goals can be realized. Organizational Design span across various levels of the organization. It includes:
1. The overall organizational "architecture" (e.g. decentralized vs. centralized model).
2. The design of business areas and business units within a larger organization.
3. The design of departments and other sub-units within a business unit.
4. The design of individual roles.
In the current Digital Age, there is an accelerating pace of strategic change driven by the disruption of industries. As a result, to remain competitive, Organizational Design efforts are becoming more frequent and pervasive—with the majority of organizations having experienced redesign within the past 3 years. This has only been exacerbated by COVID-19.
Frustratingly, only less than a quarter of these Organizational Design efforts are successful. Most organizations lack the best practice know-how to guide them through these Transformations effectively.
Learn about our Organizational Design (OD) Best Practice Frameworks here.
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