Part 2: Creating Adaptive Space for Organizational Innovation
Leveraging Organizational Network Dynamics for Adaptability
Intro to Adaptive Space
In the first part of this innovation series, we explored a key concept discovered by a team of researchers, which is essential for organizational effectiveness: fostering adaptive space and enabling leadership. Part two of this series focuses on how to build adaptive space. Key to doing this is creating conditions that are rich in complexity. Ideas, resources, and people that are interconnected in such spaces can create novelty, which leads to new solutions, processes, and systems that increase function and effectiveness and become a breeding ground for innovation.
Navigating Hierarchies, Bureaucracies, and The “Old Ways of Doing Things” Mindsets
A harsh reality though is that often when new approaches are introduced, it creates uncertainty and a sense of fear. Such emotions lead people to crave order and revert back to old systems, hierarchies, and ways of doing things to recover a sense of safety. The purpose of part two is to guide leaders through the research and offer steps to create adaptive space where innovation can thrive. In doing so, it is important that leaders acknowledge and devote resources to protect the psychological safety of the organization and its talent.
The Role of Psychological Safety
Skipping this critical step will not only diminish the conditions necessary for innovation to thrive, it will hamper any future efforts by standing as a stark reminder of why the old ways are the “right" ways of doing things. There are a lot of helpful resources available on how to assess psychological safety that I recommend and have written about. For starters, behaviors such as risk taking, expressing dissent, and exercising independence are common in organizations where psychological safety exists and can aid in doing pulse checks to find out the degree to which it is present. Check out those resources for more help.
Leading Adaptive Organizations
The next question is how to lead an adaptive organization within a long-established hierarchical (bureaucratic) system. Adaptive space allows these organizations to overcome the limitations of bureaucratic structures. It helps leaders resist the urge to impose strict order, enabling self-organizing systems instead. To create adaptive space, two key systems within the organization must be identified and evaluated: the operational system and the entrepreneurial system.
Operational vs. Entrepreneurial Systems
The operational systems are found in formal, bureaucratic systems that seek order and standards and are responsible for productivity, efficiency, outcomes, and results. Entrepreneurial systems occur in informal systems and structures that seek change and require new systems, opportunities, products, or services. They are responsible for growth, development, and innovation.
Balancing Operational and Entrepreneurial Systems
At times, these two systems may go into battle wherein operational pushes for rules and control while entrepreneurial pushes for discovery, experimentation, and novelty. More often than not, operational beats entrepreneurial because the deck is stacked in its favor. Leaders and managers are traditionally trained and make decisions based on established rules and standards. Talent are trained to push decision-making up, allowing managers to make decisions that return the system to the status quo.
Dynamics in Adaptive Organizations
In adaptive organizations, the dynamics are totally different. Leaders in such spaces do not privilege the operational and accept that everything cannot be controlled, planned, or structured. They recognize that adaptability is in the rich interconnectivity of networked systems and agents. In doing so, such leaders capitalize on the tension created between operational and entrepreneurial systems to generate innovation, new ways of thinking, acting, and doing things. “Adaptive space is contexts and conditions that enable networked interactions to foster the generation and linking up of novel ideas, innovation and learning in a system.”
Facilitating Idea Movement and Emergence
Leaders in adaptive organizations enable adaptive space by facilitating the creation and movement of ideas and information across a system, creating conditions of emergence. To do this, they must capitalize on two network structures within the organization: brokerage and group cohesion. Brokerage connects one group to another; it helps create conditions to facilitate discovery, the introduction of novel ideas, and helps amplify them. Group cohesion is how connected an agent is with others. It provides a safe environment for pressure testing and iterating ideas to make them more impactful.
Brokers and Group Cohesion
Brokerage enables agents, or brokers, to think more boldly about what is possible by creating a richer set of possibilities. Brokerage creates greater access to novel ideas and enhances diffusion of the ideas. Take the example of a large pharmaceutical company whose drug-developing process was traced back to a few key scientists who had brokered relationships with outside academics. When two of the most connected brokers left, these relationships were lost and the innovation rate for the company significantly decreased.
Group cohesion is only possible because of the degree of trust that exists among the team members. When trust is present, information is shared, ideas are adopted, and solutions are created faster. This is why trust and culture are so important to adaptability. High levels of trust enhance group positivity, learning, and risk-taking (which creates a virtuous cycle by further enhancing psychological safety).
The Importance of Conflicting and Linking Up
Leaders who accept and understand these dynamics—how network structures like brokerage and cohesion foster adaptive spaces–also understand two key dynamics that make complex systems adaptive: conflicting and linking up.
Conflicting arises when diverse needs and values collide creating tension that drives change and innovation. This is crucial in cohesive groups and broader networks. Brokerage connects diverse groups, facilitating conflicts that lead to problem-solving and innovation. Linking up occurs when agents with shared goals or values unite, driving novelty, and change. This is evident in social movements and collaborative platforms.
The Complexity Leadership Model
The dynamics of conflicting and linking up converge in the complexity leadership model, helping leaders enable their organizations to function as complex adaptive systems. This model emphasizes the need for leaders to create and sustain adaptive spaces, fostering dynamic, networked systems that evolve with changing environments.
Conclusion
Building adaptive spaces within organizations is essential for fostering innovation and maintaining effectiveness. By understanding and leveraging the interplay between operational and entrepreneurial systems, as well as nurturing network structures like brokerage and group cohesion, leaders can create the conditions necessary for adaptability. Protecting psychological safety and recognizing the value of conflicting and linking dynamics are critical to this process. Leaders who embrace these principles will enable their organizations to thrive as complex adaptive systems, capable of continuous evolution and improvement.
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Note about the research used for these posts: All sources are peer-reviewed research journals, articles, or white papers. They’re not accessible without a Harvard login but if you’d like to read any of the sources I reference, feel free to reach out to me.