This post is the 2nd in our series of free excerpts to celebrate the launch of Andrew Wallas’s new book Business Alchemy, which is out today, 8th June 2017. You can buy this book on Amazon here. In this chapter, Andrew discusses the nature of flow in an organisation. Do you recognise some of these states in your own business – independence, dependence and interdependence?
Every business and organisation is like a river. When a river is flowing, it is full of vitality, vibrant and healthy. In this buoyant natural state, a river creates an eco system where everything is interdependent. Interdependence is an important and desirable state of being. Most individuals and most businesses spend their lives oscillating between a state of dependency and independence, neither of which is effective. If a river gets blocked for any reason then it stagnates and becomes smelly quickly. Many businesses operate within a dynamic of dependency. They are in a dependent relationship with clients and other stakeholders and they foster dependent relationships within the organisation. Middle management is overly fearful of taking decisions and owning responsibility, as they are too dependent upon the level of management above them. Dependency is based on neediness and creates anxiety.
At the other end of the spectrum, many businesses operate from a dynamic of independence. They are distant and aloof from clients and other stakeholders and foster a culture where individual and teams operate as silos and do not communicate with each other. The battle cry of independence is “I don’t need you. I can do it better myself.” The dynamic of interdependence is the nature of partnership; i.e. we are in this together. Clients rely upon their service provider and the service provider relies upon the client. It is a mutually beneficial relationship. A chief executive relies upon a board of directors and a board of directors relies upon a chief executive. Management rely upon employees and employees rely upon management. Sales rely on marketing, marketing on sales. The front office relies upon the back office and the back office relies upon the front office and so it goes on throughout the organisation.
With both dependence and independence there is a serious restriction to the natural flow. Individuals and departments become stuck in an unhealthy relationship with each other. For example, in most organisations the front office is superior and becomes independent and the back office is seen as inferior and becomes dependent. This is an unhealthy dynamic – it keeps both parties stuck. Where there is a genuine appreciation of mutual reliance and respect – i.e. partnership – the output is significantly increased.
Flow is both the natural and essential part of all life. The universe around us is in a constant state of flow. Leaves grow on the trees, mature, fall off and become compost, then the cycle begins again with new buds. The oceans ebb and flow. The planets, including the earth, are in a state of interdependent motion. In the same way, each human being is an embodiment of many systems; we too are in a constant state of flow. We have a cardiovascular/circulatory system which sends blood around the body via the heart, arteries and veins delivering oxygen and nutrients to organs and cells. We have a digestive / excretory system which provides nutrients for the stomach and intestines and eliminates waste from the body. We have endocrine system which provides chemical communications throughout the body using hormones. We have an autonomic nervous system (the parasympathetic system and the sympathetic nervous system) which collects and processes information from the senses via nerves and the brain and tells our muscles to contract to create physical actions. We have many more systems including but not limited to the integumentary system, exocrine system, lymphatic system, immune system, reproductive system and respiratory system.
The circulatory system is synonymous with the way the universe is. The circulatory system is a closed system; everything that goes out has to come back. The universe works in exactly the same way. The heart is a pump and with every beat of the heart, blood is pushed out to approximately seventy trillion cells and travels approximately sixty thousand miles (more than twice around the earth) before returning to its source. Exactly the same amount of blood that is pushed out, returns. If there is a minor block in the system, then high blood pressure results. If there is a serious block then a heart attack will occur. All ill health essentially arises from an impediment to the natural flow of the systems of the body. It is exactly the same within a business.
It has been suggested that 150 years ago 93 % of all money in issue was in circulation, whereas 20 years ago, 92 % of all money in issue was not in circulation. If true, this means that only 8% of all money circulates. I have no idea what the criteria for this assertion might have been but we know that at the height of the recent global financial crisis, the peak of the crisis came when interbank lending dried up. Banks stopped lending to each other and the global financial system would have collapsed if governments – i.e. central banks – had not stepped in. The most obvious catalyst of global financial collapse, which could still occur, is a complete lack of liquidity. Flow is essential in the financial system as with all other systems.
Every business operates in the same way. Where there is optimum flow between the different parts of the business and a dynamic of interdependence is created, the business will thrive. Where there is a lack of flow, and individuals and departments become quite literally stuck in their ways, the business will, soon or later, fall apart. A major part of Business Alchemy is diagnosing and releasing the blocks within the business. Many of these obstacles are readily identifiable. However it is important to appreciate that although there is an awareness of these blocks, they are not being cleared by the business because they are still limiting potential. Other obstacles are less easy to identify and require an exploration of the hidden dynamics of the business.
