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Organizing and leading in the agile organizations of the future: The idea that managers should motivate and direct other people to do the work will slowly but surely be replaced by people rallying and allowing themselves to be guided by a common purpose.

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This is the story of how two brave companies have challenged the way to lead and organize -- and produced remarkable results. At the same time, Resonans CEO Thomas Gedde Højland, based on his meeting with radical management principles at SAS in Scandinavia and Morning Star in California, gives his take on where the key to the organization and leadership of the future may lie.

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Over 30 years ago, I read Tear down the pyramids by SAS Director Jan Carlzon. The book set the direction for what I've been doing for the past 20 years as a consultant in public and private companies. Similarly, a recent visit to Morning Star in California will set the stage for those next Many years of consulting, I am convinced.

Both SAS and Morning Star are examples of companies that dare to challenge the way we lead and organize — and that will be much more needed in the future: organizations that tear down the pyramids and set leadership free.

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Perhaps it is this link that we have been missing: the link between the company's overall purpose and core task and the individual's 100% self-defined contribution to this purpose aligned with the necessary colleagues for optimal coordination.

Need for new ways of organizing and leading

Tear down the pyramids is still a fascinating book and an example of a company that at the time reinvented itself and challenged the conventional way of managing and organizing. The middle managers lost power and influence, and front-line employees became the new stars with a short distance to the top management. The traditional chains of command were short-circuited, and employees had to make their own decisions based on only one common guiding star -- happy and satisfied passengers. Jan Carlzon was willing to look at how the traditional style of management and organisation stood in the way of achieving the desired ambitions, and he had the courage to do something about it.

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A great many organizations, managers and employees still struggle with heavy hierarchies, bureaucratic decision-making, lack of responsibility, motivation, power of action and trust between the silos within the organization and across management layers and employees.

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I see it every day as a consultant — and perhaps more clearly than ever now, when a number of new agendas are hitting the table in the form of digitalization, disruption, etc., where the ability to change is challenged and where the few are no longer able to find the right answers for the many in the organization.

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That is why we are also in a time of disintegration, where there is a great openness and a great courage to look at new ways of organizing and leading — because it is necessary.

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And for the same reason it is seen here today 30 years later Tear down the pyramids More and more organizations are fundamentally changing the way they run and run their organizations — they are putting an old model behind them and daring to experiment with a new one. Just like Carlzon, who tore down the hierarchy and pyramids of much of the SAS organization and unleashed a tremendous energy and drive — and where the results followed.

Who is your boss?

How will the most successful companies be managed and organized in 3, 5 and 10 years? What management innovative leaps will they take? What do the leaders of these organizations spend their time on? What have they given up spending time on? Are there leaders, as we know them, in the organization of the future?

Gary Hamel distinguishes four forms of innovation, ranked thus:

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• Operational innovation
• product/service innovation
• strategic innovation
• management innovation

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All four forms of innovation contribute to value creation, but Hamel puts management innovation at the top as a higher level of value creation and as a key ability to remain competitive. He defines management innovation as anything that significantly changes the way management is practiced, or significantly alters the traditional organizational forms and in so doing advances the organization's goals. Management innovation is changing the way leaders do things, and this is done in a way that strengthens the performance of the organization. However:

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• What should the new look like?
• Who can we be inspired by?
• Who can we learn from?
• How to do it in practice?
• What pitfalls are there?
• What should be paid attention to?

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Around the same time that Jan Carlzon was tearing down the pyramids at SAS, the American Chris Rufer was building a factory in California to process tomatoes. Today, Morning Star is the world's largest producer of processed tomato products, with 40% of the U.S. market. Morning Star has a turnover of over $350 million a year and has 2400 employees per season.

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Morning Star is, in Gary Hamel's optics, management innovative, and even radically so. Why? Because there are no managers at Morning Star. You read that right; no leaders. Or you could say that there is nothing else — because everyone is a leader!

At Morning Star, one took it a step further than Carlzon. They did not just tear down the pyramids, they also removed the formal managers and instead left leadership free from all employees in the company — or “colleagues” as they call each other. In a Harvard Business Review cover article, Gary Hamel named Morning Star as one of the most innovative organizations in the world.

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When I visited the Morning Star a few years ago, I saw how things were going in practice.

We met Doug Kirkpatrick, one of the first “colleagues” at Morning Star and later co-founder of the Self-Management Institute. Doug told us about the basic principles behind the radically self-managing organization and showed us around the factory. Here we greeted the operator John, and I couldn't help but ask him: “Who is your boss?” Granted, it was a trick question, but there was nothing tricky about the answer! John looked at me as if I had fallen from the moon, and then answered icily:

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“The factory is my boss.” Genius answer!

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The factory is my boss: it tells me what needs to be done -- I don't need a manager to do that.

People come together for a common purpose

The idea that managers should motivate and direct other people to do the work will slowly but surely be replaced by people who rally around and allow themselves to be led by a common purpose.

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Morning Star has been guided by two very simple principles throughout the years — because as the Morning Star says: “We deal with great complexity through great simplicity”. The two principles are:

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• No human being can exercise power over another human being
• What we promise each other, we keep

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There are no leaders at Morning Star.

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There are no titles — everyone is a colleague who negotiates responsibilities and roles with the other colleagues. Each colleague formulates a so-called CLOU every year — Colleague Letter of Understanding. CLOU is the primary tool for ensuring coordination and organization of work, and in many ways CLOU replaces what managers in other organizations would spend a great deal of time on, but which here is organized 100% by the individual in collaboration with colleagues. A CLOU helps to ensure a much higher level of ownership and a much higher sense of responsibility, since it is the individual himself who articulates it.

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The core of a CLOU is:

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• ‍Your personal commercial mission: Here the individual formulates his own purpose in the company. It is the individual's own guiding star that should guide the individual's commercial activity in the company.

• Activities: Here, the individual formulates the activities that he or she decides to pursue in order to achieve his personal commercial mission.
• Stepping stones: It identifies the key objectives against which the individual's performance is held.
• Time: Here describes the time that the individual commits to use in order to achieve his goals and his mission.
• CLOU colleagues: This identifies the colleagues to whom the individual makes his commitment. It is the colleagues who challenge your CLOU and who are co-signatories to it.

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This approach is interesting compared to the book Motivation — The Surprising Truth About What Motivates Us by Daniel Pink. According to Pink, the secret of high performance and satisfaction is an entrenched human need to self-manage life, to learn and create new things and do something good for ourselves and our world. Thus, the manager must motivate employees by focusing on:

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• Autonomy: The desire to manage your own life. People want to have as much self-determination as possible. Herein self-determination about what they do (tasks), when they do it (time), who they do it with (team) and how they do it (technique).
• Mastery: The urge to constantly get better at something that matters. People want to be better at what they do. Mastery begins with “flow”; and it comes when the challenges we are posed fit in the most intense way to our abilities.
• Purpose: It is in human nature to always look for a purpose — something greater and more enduring than oneself. In the context of work, the work must therefore have a greater purpose.

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Inspired by Morning Star's work with CLOU, however, it is not certain that in the organization of the future it will be the leader who must motivate the employees through the three measures, but rather the individual employee himself, who is given the freedom to be able to set his own direction and purpose in relation to the organization's purpose.

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Perhaps it is this link that we have been missing: the link between the company's overall purpose and core task and the individual's 100% self-defined contribution to this purpose aligned with the necessary colleagues for optimal coordination.

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As Jan Carlzon wrote in Tear down the pyramids: Every human being wants to be treated as an independent individual. When a free human being has to take responsibility, resources are freed up that are otherwise unavailable.

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I believe that in the years to come we will see much more interest in creating real management innovation. Perhaps even with as radical an approach as at Morning Star. But the leaders have been sitting on the same thick and solid branch for many years -- and it takes time to get it sawed over...