Excerpts Organizational Intelligence The World of Theory Intelligence by Design The Learning Loop Hearts and Minds New Attributes of Behavior Preludes Questions Sections

Preludes for the chapters of The Intelligence Advantage Prelude for chapter: 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 Prelude for chapter 1 Organizational intelligence refers to the capacity of a corporation as a whole to gather information, to innovate, to generate knowledge, and to act effectively based on the knowledge it has generated. This capacity is the basis of success in a rapidly changing or highly competitive environment. Organizational intelligence refers to a capacity which is inherent in a system of organization. It is greater than the sum of the intelligence, information, and knowledge of each individual in that organization. Organizational intelligence includes the historical knowledge that has been "wired in" to the design. It also includes the generative possibility of dialogue between individual intelligent agents -- this includes each and every human being. Organizational intelligence refers to the source of marketplace advantage which can be developed intentionally but cannot be copied successfully by others. It is the source of contact with the world as well as the source of the contribution of value made to the world. It is the source of being unique in the marketplace, evolving with the marketplace, and having something to say about the shape of the marketplace. |to top| Prelude for chapter 2 It is time that we claim theory for ordinary people -- people like you and me. Scientists and philosophers are a special case; they have more or less rigorous operational definitions of theory. These definitions and the mystique that goes with them keep theory out of our reach and prevent us from using theory as a tool in our productive conversations. We can claim the use of theory by creating operational definitions for ordinary life, organizational life, and social understanding. We operate from theory whether we are aware of it or not. So, it looks as though our only choice is between being unconscious or aware; and that choice determines whether or not we have something to say about what we do. We are all scientific in our approach. We have theories about everything because we live in an age of science. We have a "because" for everything, even if we aren't aware of it. Even though these theories continue to go unnoticed and unquestioned, they are still determining our approach to everything and our general effectiveness. What becomes possible as we learn to reshape the theories determining our actions is generative learning, profound exploration, and exciting new approaches. We are freed to explore the world of possibility itself. This is as true in the arenas of welding, sewing, and paperwork as it is for strategy and management. |to top| Prelude for chapter 3 It is said that "there are three mysteries in the universe: air to a bird, water to a fish, and language to a human being." Things that are transparent to us, or remain in the background of our lives, remain mysteries to us. They do so not because of their nature, but because of our nature; we usually fail to explore and question something that is always present. To become an engineer, a mathematician, or a doctor you must learn a different language. To become a master in any of these or other fields, you must develop further distinctions. Masters speak differently from anyone else in their field. When people reach a level of mastery, it is not merely their words that are different, but also the meaning of their words, and their understanding of the world. To begin to change anything, we must change the way we speak about it. And as we begin to alter the way in which we speak about something, we begin to change our experience of it. The process is an interactive loop. A language rooted in a linear, mechanistic view of the universe creates different actions and opportunities from a language that emerges from a complex intelligent view of the universe. A linear perspective compels us to use language in a rigid and dehumanizing way; the purpose of language in this approach is to describe reality. But when a complex open-ended perspective is seen as the source of our language, there is room for expression, creativity and freedom; the role of language in this approach is to bring forth reality. |to top| Prelude for chapter 4 The past is always with us. There is no escape from it. The challenge is to achieve the freedom to invent a future that is not merely an extension of the past. We have the ability to choose to go beyond that past -- but only when we are fully aware of its nature. The future is open to choice and to design. This openness is a dangerous thing when viewed from the perspective of continuation and survival. The existing patterns seem to be the source of our survival. Any change may lead to destruction. To go beyond the past, we cannot forget or reject it; we must use it instead of being used by it. We must keep the past firmly in the past without attempting to lose it or deny it. Any such attempts will fail. The past will reassert itself if denied. For human beings and their institutions, the past is kept alive in language and by physical structure. Physical structure makes concrete the thinking and action of the past. Language provides meaning for those physical structures and keeps them protected. It is the ability to give new meaning through new language (words, meanings, uses, combinations and patterns) that gives us our power to create a future. When we realize this power in language, we become free to use the past for its information value without being trapped by that past. We can expect to be free and to use this freedom intelligently and profitably when we are aware of its nature. |to top| Prelude for chapter 5 To be a good architect requires that you understand design principles at a profound level. To understand architectural design at the level of design principles, one must be able to consider an entire context -- and at the same time understand countless relationships between material and non- material elements within that context. Included in this broad gamut of elements are steel, wood, glass, electricity, light, temperature, culture, aesthetics, and life style -- to name only a few. Changes in technology, education and life itself are constantly creating new principles and transforming old ones. Developing an understanding of the design principles of corporations is not part of a traditional education. Their understanding may not include the most fundamental level -- that out of which the principles of design emerge. Rapidly occurring changes are altering the context of the world in which we live and work. We are now being asked to take on the challenge of redesigning our corporations to meet the onslaught of new demands. The executives and management of our corporations are poorly positioned to do so because they have grown up with an automatic competence in a design that is no longer workable. Unless they are able to get at the very source of organizational design, it will remain next to impossible to alter the course of what is occurring. |to top| Prelude for chapter 6 What is leadership in the context of a complex intelligent system? In a linear command-and-control system, the personal qualities necessary for leadership and the nature of the process are clear to us because we are so familiar with them. In a complex intelligent system, however, the exercise of these qualities might actually do more harm than good. A system with its own intelligence is not missing leadership in the ordinary sense -- so providing it may prove detrimental. What is leadership in a complex system? What is leadership when everything is connected to everything else? What is leadership when co-evolution is the order of things? When what occurs is a matter of emergence, unfolding, or becoming, then the nature of leadership is transformed. Exploring the issues of leadership in an environment of complex systems will engage us for decades to come. |to top| Prelude for chapter 7 We have organized our companies for maximum productive capacity. Our orientation has been to create the simple loop of transforming input into more valuable output which in turn generates revenue that is returned to the corporation. This loop perpetuates a self-recreating game, thereby leaving itself only with itself as a scorekeeping measure for the game. For decades the name of the game has been production, measured in money, and we have organized ourselves and our corporations to succeed at that particular game. As we leave behind one era and begin the process of transforming into another, the rules of the game change. The shift from Machine Age to Information Age brings with it one particular change that is of utmost importance: intelligence, both of an individual and a system, will move to the forefront and assume greater value because it is becoming the key to success. As this shift occurs, the production loop must be expanded: what must be integrated into the loop is not only the intelligence of the people of the system, but the intelligence of the system itself. The result of this integration is what we will refer to as the learning loop. The rules, methods, practices and structures for this loop are unique because they are based on information, communication and the theory of complex intelligent systems. In the learning loop, knowledge is the name of the game: its accumulation, its use and its unique way of keeping score. |to top| Prelude for chapter 8 Every living thing is a complex adaptive system. Such a system is self- organizing and self-generating. No outside force or source of energy can make a living thing live or function. At the same time, every living thing is influenced to a greater or lesser degree by its environment, its community and other living things. To the extent that the existence of a thing is dependent on its organization as a complex adaptive system, that part of its existence must be free to operate. What requires freedom are the operations that are complex and adaptive. Because of their linguistic ability, human beings have the maximum need for freedom. The linguistic ability and the particular range of intelligence that is part of it means that almost every area of life operates more effectively in a condition of freedom. When control is applied in areas where the intelligence of a complex adaptive system is intended, the results are negative. Our job is to determine how to allow freedom to operate effectively where it is being restrained. In this chapter we will consider the meaning of freedom as well as determine its methods of operation. |to top| Prelude for chapter 9 When change is slow within an environment, when conservative forces predominate and when we are secure in our predictions, strategy is reduced to planning. The fundamental issues have been effectively determined. During such times goals are clear, targets are easily defined, and the actions required for their accomplishment are predictable. In contrast, when change is happening at an accelerated rate, when technology and its applications are unpredictable and when competition appears around every corner, strategy takes on a major role; there is an unprecedented demand for thinking in new ways and distinguishing new levels of abstraction. The fundamental issues of the times have not yet been determined. When rapid changes are occurring everywhere in areas seemingly unconnected to us, we can be certain that they will soon affect us. When well-informed, intelligent people are being surprised by new developments, we can be certain that it is time for a new level of strategic thinking. The longer that we rely on inherited strategies that are mere technical functions, the more we will have to learn when it is time for new depth in strategic thinking. It is time now (for some it may be too late) to take on the challenge of discovering what strategic thinking really can be. |to top| Prelude for chapter 10 Animals, human beings, corporations and society all exhibit some degree of flexibility, adaptability and innovation. These qualities are not brought in from the outside or added on, but can be found within the design of the entity itself. If you see innovation and flexibility as gateways to marketplace advantage, then the exploration of the natural phenomena from which they arise will provide rich rewards. High levels of innovation and creativity are at once exciting and dangerous in their possibilities. Exciting . . . because of the potential of leaping into a future far beyond what our current circumstances seem to allow. Dangerous . . . because our survival is at stake. How can we ensure that successful and adaptive innovation emerges? And how do we recognize adverse innovations before they endanger us? How can we ensure that the structures that minimize the danger of innovation, creativity and flexibility do not suppress the very thing we want? Human beings have a unique capacity for creativity. We can form organizations that have a far greater capacity for creativity than our individual activities. This capacity is the source of great possibility for social well-being. |to top| Prelude for chapter 11 What is possible? When asked this question, we tend to look immediately at our recent history and then begin to consider what's likely, what's probable and what's predictable. We consider the options that we might pursue and consider the most likely scenarios. We then proceed by extending the past into the future. The question "What is possible?" is a question about the future, yet it is not about prediction. It is about the present and our capacity for imagination and development. What's possible is anchored in the past and in some way is an extension of the past, but what's possible is not determined by our understanding of the past, present, or future. Our interpretations of what's possible are staggeringly small compared to the space of possibility. Only a handful of people in the generations before us have managed to come close to imagining what we now take for granted. Even after people were told about these possibilities, very few were actually able to imagine them. Yet these once unimaginable things have become an integral part of our lives. The field of possibility is so vast that we cannot begin to explore it all. Our greatest challenge will be to explore it with others, in dialogue, so that we can begin to move beyond the historical limits of our current interpretations. The level of development in the language abilities of our companies, teams and groups does not come close to what is needed for engaging in satisfying and productive conversation. Yet our future depends on that ability. |to top| Prelude for chapter 12 Visible structures emerge from invisible structures. When we see the beauty, order and functionality of a building, we are looking at its surface structure. When we look beneath the surface, we find structures of steel, electronics and plumbing. When we go one step further and look behind those, we find the structures of design, plans and instruction that made all of that possible. And from an even more refined perspective, we see that there are languages of design, construction and use, which we tend not to think of as structure because we cannot see them. Yet it is these very patterns, information and practices that allow for all the visible and physical structures to occur. During the Industrial Era, the understanding of nonmaterial structures was not considered important. Production appeared to be a physical and material domain. But in the dawn of the Information Era, information is the foundation, rendering the physical merely a result. To meet current demands, organizational structure must leave behind a focus on specific forms and develop an understanding of the principles of theory, possibility and relationship. Out of these principles will emerge forms appropriate to today's rapidly changing environment. |to top| Prelude for chapter 13 When we are passionate about something in life, it is a great challenge to be able to engage in dialogue with others in ways that allow ourselves to be changed, while at the same time enabling others to generate their own passions. It is not our job in life to sell others on our ideas, or to get others to believe in something; but perhaps our responsibility lies in being able to express ourselves in ways that contribute to the possibility for all of us. Within an organizational environment based on control, direction and authority, the challenge of engaging others remains beyond our capabilities. In our attempts to engage others, we delve into our own resources and those of the corporation. What we find, among other things, are force and manipulation -- and we use them. Any effort to suppress forcefulness and manipulation constricts our potential for full expression and power. Any use of force or manipulation undermines our attempts at engagement. To engage the hearts and minds of others, we must begin by recognizing every human being's ability and right to choose. This recognition is the source of our own ability to be engaged and of our ability to engage others. In the area of engagement, there is nothing to do but forge ahead. Being responsible begins with our own full expression. The cost of doing so should fall on us. The benefit of doing so should fall to everyone. Such a process of expression and responsibility is the greatest source of growth and development available to us. |to top| Prelude for chapter 14 The accelerating rate of change in the world and the escalating competitive pressures call for the use of new strategies and new descriptives. Now, one of the most common words connected with any corporate initiative -- whether it is re-engineering, TQM, time-based, or teams -- is transformation. Executives know their organizations need to transform, but what do they mean when they say that? All organizations are in a process of becoming. The process of transformation is also a process of becoming. Transformation means to become something that has a new form, but at the same time is still recognizable as a realization of the original. The term transformation implies a major change and at the same time it implies continuation. When viewed from the outside, a transformation is the kind of change that appears to alter dramatically the structure and even the nature of an entity, yet the results of this change can be seen as a continuation of the original entity. What seem to be missing in almost all initiatives of transformation are sensible well-grounded details for accomplishing the process of transformation. The processes for chemical or biological transformation are well formulated, but this is not so for transformations that involve complex intelligent systems. What is unique about the transformation of complex systems is that the intelligence of the complex system must be involved in its own transformation. To do this effectively, an interactive process based on information and communication must be an instrumental part of the process. |to top| Prelude for chapter 15 Our competence is measured by how quickly and effortlessly we can produce results. It is especially measured by how effectively we overcome interruptions, breakdowns and problems in performance of our promises. People who are considered to be the most competent are those who can still make things happen, even when confronted with extremely difficult circumstances. The ultimate measure of competence is that we can accomplish automatically, unconsciously and with a sense of grace whatever the circumstances demand of us. And then there is learning, growth and life itself. When we challenge our competence, either intentionally or as a result of circumstances, and go beyond what we are already competent at, it threatens our self-image. If we intend to grow and develop at more than an ordinary pace, we must look more carefully into the nature of self-esteem and begin to redefine what it means for us. Our new definition will have to include the idea that the source of self-esteem lies in the ability to grow, develop and handle circumstances beyond our existing competence. This same challenge awaits us at an organizational level. We must be able to redefine the nature of organizational competence and create an environment that builds and recognizes that. |to top| Prelude for chapter 16 Does organizational transformation occur as a result of personal transformation taking place in all the people who are a part of that entity? Or must all the structures of a corporation go through a process of transformation, thus transforming the people in it? The debate rages on and fails to reveal any useful information because it uses a linear approach, suggesting that it is a matter of one or the other. Transformation is not a linear one-comes-first phenomenon. In any transformational effort, we can count on the fact that many different things are going to change. The challenge for each of us personally will be to let go of the behaviors that we have found comfortable and relied on in the past. Most of us see our past behavior as the source of our success to date. Given we have that relationship to our behaviors, we aren't going to give any of them up in a hurry -- particularly when we are under pressure. What behaviors will be best suited for a corporation whose design principles are aimed at the emergence of intelligence? Where will we begin in our approach to shape these new behaviors? If we have not explicitly undertaken an initiative of transformation, what new behaviors will be demanded of us merely because of the dramatic changes that are occurring globally? If we declare our intentions for intelligent organization or any kind of transformation, that declaration will generate valid expectations from others that our behavior will change in some way. |to top| Prelude for chapter 17 No matter where we look in our lives, whether it is a day, a period that spans a year or two, our career, or our own body -- we are always in transition. Anything that is alive is in a state of becoming and therefore constantly in transition. Transition is so much a part of everything that it remains transparent, unless there is a jarring major shift, such as leaving a comfortable situation and not yet settling into something new. We have grown up in a culture where we are always supposed to know where we are and where we're going. Yet life is a process of constant changing, shifting and becoming. The more awake we are in our lives, the less fixed we are about exactly where we are and exactly where we're going and the more open we are to what's possible. How many times have you heard someone ask, "How are we supposed to know what to do if we aren't clear about the goal?" A powerful answer to that might be, "We'll discover where we're going as we go. Simply take the action that most fully engages with the world." If you are about to enter a process of transformation, then you know that most people will be disrupted in their comfort and familiarity with existing operations. This is the kind of period when a declaration of a "state of transition" might be useful. Such a declaration will remind not only others, but also those who made the declaration, that normal expectations, actions and ways of being will not be sufficient to the times. |to top|