4 Key Pillars of Liquid Organizations

Have you ever heard the term liquid organization? Derived from lean management principles, Liquid organizations do not possess rigid structures. They are not based on rules and control, but rather on the principles and values that generate rules. Stelio Verzera, Co-founder at Cocoon Projects describes the problems that firms can face from being inflexible:

“Rigidly structured organizations cannot cope with the current pace of innovation and its complexity, let alone exploit it. On one hand hierarchies are a sound bottleneck both for decision making and for competences evolution. Too many info to process in order to succeed. It’s crazy today to think that whatever kind of manager, as an individual, can collect, process and use all the info that is produced in a single day in her domain of management!”

liquid organization

Liquid companies are different in thought process. Liquid organizations do not see change as separate events but think that the different functions of the organization are flowing in a constant stream affected by change. If your global outlook followed this ‘liquid’ pattern, then this would naturally affects the way change is led and communicated in your organisation. Peter Drucker said every couple of centuries in Western history, when there comes a period of sharp transformation, society effectively rearranges itself. Half a century later emerges a new world and the second generation cannot even imagine the world or experiences in which the first generation lived. Peter Drucker thinks we are living through such a period of transformation. Think about your own company are you more about empowerment or control?

The 4 pillars for the open-governance of a liquid organization are as follows:
  1. Collaborative working board
  2. Credits accounting system
  3. Decision making support
  4. Reputation tracing

What are the challenges for liquid organizations? Well, the world may not ready for this new concept also rigid thinkers may not readily accept change and it’s not easy for people to understand. In this Google Hangout, Happy Melly interviewed Jacopo Romei and Stelio Verzera from Cocoon Projects about their unique views on management and business organization. Interesting stuff check it out:

Image credit via Olga Zielinska.