Innovating Within A Non-Hierarchical, Self-Organizing Enterprise


Since I’ve been working with entrepreneurs in the innovation space, I have come in contact with a slew of approaches to product and business development, many borrowing from Lean and Agile methodologies, or user testing and customer feedback loops described in The Mom Test. Others assimilate equity models and bootstrapping principles out of Slicing Pie, or steps for boosting productivity, courtesy of David Allen’s Getting Things Done.

Clearly, there’s no right way to innovate. But there is an environment (and an attitude) that increases your chances of success. You don’t need to have Apple- or Google-sized budgets, either. Resource allocation is not enough, nor is it sustainable. And it’s not about throwing something at a wall until it sticks.

That sort of determination is admirable, but let’s be smart about it.

At VSE, to boost quality and synergistic effects of our innovation attempts, we have designed an ever-evolving innovative ecosystem: creating pathways between work-time and innovation-time, integrating flat and rigorous governance structures, and delineating autonomous workspace.

The goal is to cultivate and perpetuate organizational dynamics that feed into and expand our current products and business models. What’s consistent is the culture and people making it happen. Below are the steps and challenges to innovating within a non-hierarchical and self-organizing enterprise. 

How A Non-Hierarchical Organization Works

We use Holacracy. If VSE is the “established container” that holds the people and brands within our enterprise, then Holacracy is the “rails” we run on. You can get more information on how Holacracy brings “structure and discipline to a peer-to-peer workplace” at HolacracyOne’s website. Holacracy is our method for sustaining an environment with distributed authority, clear purpose and accountability, and transparency. However, making the leap to innovation requires a bit more in terms of framework and strategy.

Developing A Consumer Product Strategy

This is the low-hanging fruit, but you’d be kicking yourself without it. A clear meaningful consumer product strategy helps you deliver stellar product(s) in the first place, bringing in reliable value for your business, and presenting potential branching-off points and springboards for process improvements or whole new lines of business.

To spark this within your organization, you can create or revamp your existing customer journey maps. Customer journey maps illustrate personas of customer types, with developed journey maps addressing each customer type’s pain points. See examples of customer journey maps. Does your own map match your customer’s experience or are there discrepancies? Are there process improvement opportunities, or ways for you to design, test, and shift or pivot your product/operation?

Get Analytical

Like all innovation efforts, valuable learning is only as valuable as your data. All data can be valuable; you just need to discern the pattern (think big data and machine learning algorithms). Look at the data you’ve collected–from customers as well as internally. Do you have measurement mechanisms in place? If so, do you have a clear analytics strategy? Are there conversion gaps? Drop-offs? Are you using responsive design (77 percent of Americans own smartphones, and 60 percent of all internet access is mobile)? It’s important to maintain open communication, access, and tracking of customer behavior, as these data streams might yield valuable insights.

Identifying Strategic Heuristics

Now that you have a framework for daily operations and strategic product development, you want to ask questions that help increase efficiency and introduce process improvements. Besides refining your existing methodology, actively asking yourself the following questions will give you space to create and foster an innovative mindset:  

  • How do you prioritize work? 
  • Are you fulfilling your accountabilities? If you need additional resource, ask.
  • Do you leverage agile frameworks? You can learn more about the value of agile approaches and Scrum as tools for product development.
  • Have you identified a problem’s root cause(s)? Ask lots of questions, from the obvious to the unorthodox. If possible, solve it once.
  • Are you maintaining varied and active feedback loops? Do you see qualitative and quantitative measures in place? Audits, retrospectives, surveys?

Knowing your priorities will prescribe how you spend your time at work. For example, if you need to balance daily operations (existing functionality and business demands) with enterprise requests and innovation time, you could prioritize like this:

  1. Production
  2. Technical Debt and Learning
  3. Innovation Time & Integration
  4. New Business Functionality

Innovation Time at VSE accounts for up to 20 percent of total work time, in addition to which we offer the following support:

  • Internal grants
  • Innovation sprints
  • Graduated teams to jump-start and develop your idea
  • Organized learning (e.g. Innovation bootcamps, Agile workshops)

Note: There are unique challenges of innovating in a non-hierarchical, self-organizing enterprise. If purpose and accountabilities are clearly defined and bound within roles, then where is the freedom? The individuality?

Apart from designated work and innovation space (what we call “Role Space”) we also have/are evolving Association Space, where people interact outside of their roles, and more loosely, though with equal spontaneity.

It’s important to recognize that you can always be “yourself.” Being in one type of space versus another just helps you determine what actions (e.g. accountabilities, tasks, or deliverables) are appropriate, useful, and expected by coworkers.

The Role space / Association space distinction is just one example. Other adaptations at VSE include: alternative employee compensation; development of a badging system to facilitate promotion to more advanced roles and greater involvement; and governance bodies designed to promote and protect our tribe space, or create and sustain VSE’s intentional culture.

The possibilities are endless. Our passions, whims, and curiosity continue to drive and excite us, while the rigor and flexibility of a non-hierarchical, self-organizing system keeps us clear, focused, and accountable to each other. Together, these two components are the fuel and unifying force that help us to navigate uncertainty and iterate into the future.

Have you successfully tapped into the innovative potential of self-organizing enterprises? Tell us what you think or share your experience below!

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