The dynamism demanded by volatile, uncertain and complex markets and environments brings great challenges to organizations and, in particular, to traditional family business. Agile responsiveness guided by uncertain decisions becomes part of the corporate daily life previously guided by the old idea of ​​control that was reflected, in the past, by rigid goals, fixed long-term plans and the logic of power. This old logic still exists nowadays and it produces workers that cannot self-organize or be proactive: people that wait for the boss telling them what to do.

With globalization, the high level of connectiveness and the speed of technological evolution, strategic adaptation to the windows of opportunities that open up in dynamic markets also requires a new dynamic among people. Anyone who has read a little of the ideas of Rita McGrath and Gary Hamel does not reach another conclusion.

The old command-control logic was embed into the foundations of management studies as seen from authors such as Taylor, Ford and Fayol. The ideas that workers should accomplish and repeat the known best practices for their routines and that they should be monitored to keep doing that shaped power relations in organizations.

This is especially true for traditional family business, as the businesses culture have developed under that old knowledge. But, beyond their age, family business have one more ingredient to be added to that reality: power relationships guaranteed from family roles comes directly from the top and tend to influence all levels of the management layers.

This article lays on the argument that, for agile and innovative responses to a fast changing environment, family businesses need to go through a deep change. In fact this change is already taking place for several actual companies: a new logic of making business and a new logic of relationship with collaborators is rising. I call it the competence-confidence culture.

On this new culture, the development of increasingly autonomous and integrated teams around efficiency and innovation (you can read about ambidexterity) is the main function of leadership, instead of simply checking the fulfillment of the work. Teams that seek to innovate and respond quickly to market opportunities do create and collaborate and people are motivated to continuous learning. This new reality is incompatible with the command-control logic, as it also requires dealing with some new kinds of risks.

On the competence-confidence logic, to bring superior results and adaptation, new individual competencies must be promoted and related to each other within teams of increased knowledge and advanced authority – authority to perceive, propose solutions and act together. In this new logic, people do not need to act as predictable cogs of a pseudo mechanic system, waiting for the next command.

On the contrary, people must be able to perceive opportunities, reflect critically on the processes and continuously develop themselves, increasing efficiency and safety. In multidisciplinary teams, the level of knowledge is higher and, therefore, the level of authority can also rise, producing agility to solve problems. On these competent and committed groups, leaders can trust and may have the time for looking at more strategic issues.

And your family company? Is more on the command-control logic or on the competence-confidence one? Isn’t it about the time to make this shift?

PS: you can read more about the competence-confidence logic in here:

Books from David Marquet are also recommended for those who wish to think about this way of dealing with people and organizations.

About the Author

BRAZIL - Renata Barcelos is the founder of Inovagencia Consultant, a firm that is oriented to the development of ambidexterity and dynamic innovative cultures in traditional companies, especially family business. She develops transformation consulting projects for companies in different sectors, including the use of agile methodologies, OKRs and business modeling. Renata serves a mentor to startups and family successors who seek to develop innovative skills. 

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