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Despite the limitations in our knowledge, we still must act. We will never have enough knowledge to eliminate uncertainty and risk, so we must learn to live with uncertainty and risk. Action requires us to make choices. Often, those choices involve tradeoffs that we may not fully understand.[1]
When operating in environments of uncertainty and risk, the most successful groups can proceed with a spirit of experimentation. They can try something, gather feedback, and adapt. Through this approach, groups can deepen their understanding of tradeoffs and move forward during uncertainty.[2][3][4]
One way to facilitate this spirit of experimentation is to set minimum specifications (min specs), as the previous section described. By establishing minimum requirements rather than rules that restrict action, people are free to try different ways to achieve goals.
Another way to facilitate experimentation is to adopt an action-reflection cycle. Through this process, groups act, reflect on results, reflect on values appropriate for the situation, and then adapt.[5]
This advice comes with a word of caution, though. Many organizations are risk-averse. They fear failure. People who participate in failed projects can, at times, find their career negatively affected, especially if the failure led to the loss of money or customers.
You must use your contextual (cultural) and bureaucratic rationality of your organization to act to protect you and your group from any fallout that might occur if your plans fail. If you are in a leadership position, then it is incumbent upon you to protect your team from the dangers of failure so that they may innovate in safety.
That said, if you are indeed operating in an environment of uncertainty, then any action you take will, in effect, be an experiment regardless of whether you intended it as such. Rather than pretend you operate with certainty, you will achieve better long-term success if you acknowledge up front that you are experimenting and explicitly plan that you will learn and adapt as you go.
The previous sections considered ways to create organizations capable of handling the unknown. These ways included developing the ability to engage in collective reasoning, appreciative inquiry, and experimentation. This text now contemplates how to create structures with the organization that facilitates the development of wisdom.
Key Takeaways
- Deal with uncertainty by proceeding in a spirit of experimentation
- Develop min specs rather than maximum rules
- Adopt the action-reflection cycle
- Use your contextual (cultural) rationality to protect yourself from the risks of failure within your organization.
- Nussbaum, M. C. (1990). Love’s Knowledge: Essays on Philosophy and Literature. Oxford: Oxford University Press. ↵
- De Meyer, A. (2007). Strategic Epistemology--Innovation and Organizational Wisdom. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 357–374). Thousand Oaks, CA: Sage Publications Inc. ↵
- Romme, A. G. L. (2003). Making a Difference: Organization as Design. Organization Science, 14(5), 558–573. ↵
- van Aken, J. E. (2004). Management Research Based on the Paradigm of the Design Sciences: The Quest for Field-Tested and Grounded Technological Rules. Journal of Management Studies, 41(2), 219–246. ↵
- Freeman, R. E., Dunham, L., & McVea, J. (2007). Strategic Ethics--Strategy, Wisdom, and Stakeholder Theory: A Pragmatic and Entrepreneurial View of Stakeholder Strategy. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 151–177). Thousand Oaks, CA: Sage Publications Inc. ↵
A form of embedded rationality. Contextual (cultural) rationality presumes that what is rational can only be determined from within the social context (that is, culture) in which it occurs.
Bureaucratic rationality controls how individuals in organizations perform activities by defining and controlling knowledge through documentation, boundaries, rules, processes, and procedures/roles. It is a form of disembedded rationality.