in Strategy

The Intelligence of Companies

Do companies demonstrate self-awareness? I contend that they do.

Companies exist as a consciousness shared among individual agents. The feelings associated with employment, and the thoughts and images that accompany those feelings, make “going to work” a very real thing, even if it means only a glance at a mobile phone.

Companies operate as political entities ordered by legal documentation. Such order creates habits of thought and action that seed and sustain a culture. That culture then reinforces habits of mind to form a mental map that circulates among individual agents, and is continuously refined so long as the company exists.

Good companies understand the limits of control for inspiring knowledge work—the dominant form of work in today’s economy—and so offer substantive wiggle room for individual agency.

In contrast, companies that prioritize structures of command and control locate the firm as the primary actor rather than the employee, and so shared consciousness becomes false in the sense that it does not necessarily reflect the reality of circumstance for the individual. False shared consciousness at its most extreme corrupts agency, distorts perception, and manifests as totalitarianism, whereby the individual disappears in the service of a delusional politic.

Organizations cannot simply will themselves into greatness by virtue of the actions of the few. Rigid structure tries to limit what biologists call emergence, a condition in which local interactions between agents reorder a complex adaptive system not unlike that of a business. To companies and leaders that want more control, things like dialogue, creativity, and innovation, which all accelerate emergence, are anathema to them because they disrupt the status quo, and make it incredibly difficult to influence what people will do.

Self-aware companies embrace this paradox. Institute too many measures of control and you lose in the modern digital economy. Institute too few and you plunge into chaos and disorder; people still want to know that someone is driving the bus.

A middle path offers what John Locke envisioned in his Two Treatises: An organization that operates in accordance with and complements human nature, both the good and the bad, and channels it in the service of collective betterment. Self-aware companies, interestingly, defy easy comparison as each embraces individually claimed threads of distinction.

Leaders looking to increase the aperture of their organizational lens, and thereby heighten the absolute level of awareness within their organizations, can promote diversity of thought and heterogeneity through their hiring practices and their reinforcing the primacy of employee contribution.

Engaging workers and investing in them as future leaders of the company generates a certain kind of momentum that fosters emergence. When employees feel like leaders, they act like leaders, and as self-aware individuals will contribute to the growing self-awareness of the organization by simple virtue of their being present.

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