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Funky Business

By Jonas Ridderstrale & Kjelle Nordstrom

Reviewed by Jane Sunley

This is about the funky world in which we live, with stimulating thoughts on a manifesto for the new world of business. The top line: man is still the most extraordinary computer of all.

Funky business examines how best to utilise talent to allow uniqueness and innovation; to win in the constant search for differentiation. In one section of the book, the authors provide seven principles for organising the organisation. The trick is to get them all working in harmony:

Smaller - the optimum size of a company is a much debated topic. Richard Branson, no stranger to big business, is quoted in the book as believing that 50 to 60 people is about enough and that anything larger should be broken down into smaller parts. Small teams can be more creative, more personal and connected.

Flatter - the book looks at the two main ways of making a company flatter (i) to tear out the middle (ii) to hit the organisation at the top whilst simultaneously raising the lower levels via training and education. In the West, we tend to favour the former though Ridderstrale & Nordstrom issue a word of caution that often the best and most critical people sit in the middle.

Temporary - by this the authors mean working in projects and groups, combining talents and assets as appropriate to the job in hand and instituting a culture of daring and sharing. Under this principle, in funky firms, people have many jobs.

Horizontal - The authors challenge that in a vertical organisation the assumption is that the smart people are at the top and the not so smart ones are at the bottom. As in the real world most opportunities and problems occur horizontally i.e. across functions, business areas, divisions, areas it makes sense to tackle them horizontally too.

Circular - all really fast systems, such as the brain, use circular design yet when making decisions and appointments, we tend to use the top down approach. In universities however, fellow professors will appoint the dean, in a large firm of consultants, the other partners will probably appoint the head. Ridderstrale & Nordstrom suggest the use of a more circular approach. They run a simple experiment with their audiences: they ask them to clap their hands in rhythm. It only takes three or four claps before they're all clapping in time. This makes the point that people are good at spontaneous coordination without a leader, as long as there is shared language and a clear statement of what is required - critical for managing without hierarchies.

Open - the network, rather than the individual is becoming increasingly more vital. There will be more strategic alliances, partnerships, joint ventures. The necessity is to cooperate with customers, are suppliers and competitors.

Measured - control freaks of the world do not despair, control will not disappear in the funky firm. It will become less direct via the greater use of IT to measure and monitor. People will be finding ways to measure innovation, people stuff, and environmental impact and so on. How many companies measure their ROK (return on knowledge), or ROP (return on people)? Ridderstrale & Nordstrom say it will come. Through measuring must come appropriate goals and new ways to achieve those goals with less people, breaking free form the logic of the past and rethinking basic assumptions.

Funky huh?!

25 September 2007