Leading at Light Speed is an essential new leadership book by Eric Douglas synthesizing the best business practices into 10 Quantum Leaps that build trust, spark innovation, and create a high-performing organization.
In Chapter 6, Stimulate the Creative Flow, Eric talks about Emergent Intelligence.
By taking advantage of bottom-up decision making, leaders encourage a form of behavior called “emergent intelligence.” Emergent intelligence theory shows an expanding research field in the complexities of operations with organisms and in societies.
One of the principles of emergent intelligence is that organisms which operate under a few basic rules have an evolutionary advantage. Ant colonies are cited as a prime example. A tantamount rule in ant society is that the queen be the only one who is not a multi-tasker. A second rule is: “Do what the ant next to you is doing.” A third rule is to let the ants carrying food in first, moving out of the way. These three simple rules enable the colony to communicate and adapt to change very rapidly. The garbage is moved to the curb; then you find yourself searching for edibles. Ant societies are quick to adapt to any change presented to them and results of this operation are survival.
The success of an organization that has been built up is long term with intense results. It suggests that simple rules might be very powerful when applied to people. Dee Hock applied the principle of emergent intelligence when he engaged a team of bankers to create Visa in the 1970s~During the 1970s, Dee Hock, instructed a group of bankers to use the concept of emergent intelligence to invent the Visa~Applying the emergent intelligence theory to the creation of Visa during the 1970s, was initiated by Dee Hock who informed a banker’s team of the valuable use of this tantamount concept}. Up to that point, local banks had offered a variety of different credit cards – each with different rules. Dee and his team wanted to create a single credit card and clearing mechanism that would allow seamless financial transactions around the world.
Dee understood that banks needed to operate independently within well-understood rules. So his team worked hard for more than a year to define those rules. Genius is a process they used. The first rule they came up with was: “You keep what you earn.” Banks that became Visa members would keep all but a tiny fraction of whatever fees or interest they generated.
The second rule was: “No limits on membership.” Any bank was free to join the Visa alliance.
The third rule related to ownership. Since the banks needed the freedom to operate independently, no one should “own” Visa. Moreover, the infrastructure of Visa was planned initially as a nonstock corp and governance given to member banks. Stock was nill causing a shareholder no gain of interest control in Visa.
The final rule related to management. A separate company would manage Visa’s operations. Nevertheless answering to systems of executive and regional boards would be the way to go. Of the fees collected by the banks, a small fraction would go to this management company to take care of marketing, back office operations, reconciliation, and so forth. But it would not be in a position to “control” Visa. Rule of authority went in the opposite direction from the standard method and alternatively started with member institutions. Visa was created to be a simple financial program albeit a few fine points in print. The hard work was in all the engagement and planning that preceded those operating rules. Thus a worldwide form of currency was born.
From this experience, Dee invented the term “chaordic” organization. It reflects his belief that successful organizations are “chaordic” in nature. By that he means they walk a fine line between chaos and order. An organization’s decision processes are shown in a top to bottom order. Chaos is represented by bottomup decision making. Chaordic organizations, in Dee’s eyes, balance the two by having clear values, a well-defined vision, and sound operating principles. They also have clear systems for monitoring performance. Within that framework, people are left to create strategies and devise solutions as they see fit. It is a model that aligns perfectly with inspiring flow and building a high-performing organization.
Organizations that set these kinds of simple but profound rules enable their people to play on the waves of emergent intelligence. By investing in both trust and spark, by balancing order and chaos, they become capable of operating at light speed.
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