Towards Human Centered Organizations (Part 2)

This week’s newsletter brings episode 17 of the Cyb3rSyn Labs Podcast, featuring Alidad Hamidi, the co-founder of Desirable Futures.

I had an absolute mind-bender of a conversation with Alidad that could truly reshape how you think about organizations, leadership, and the future of work. If you've ever felt like your company is stuck in old ways, or if you're a manager constantly firefighting instead of truly enabling your team, this episode is for you.

We dove deep into Open Systems Theory and its profound implications, backed by real-world examples that are nothing short of revolutionary.

Members of the Cyb3rSyn Community can watch/discuss the podcast episode on the www.cyb3rsynlabs.com portal or the mobile app (iOS and Android).

In this episode, Alidad explores the insights from Open Systems Theory (OST), emphasizing its application in organizational design. He argues for moving away from traditional hierarchical, optimization-focused management towards models that prioritize active adaptation, co-creation with all stakeholders, and employee autonomy.

The discussion highlights the importance of designing conditions that foster productive behavior, rather than solely focusing on individual coaching. Practical examples like Haier and Buurtzorg are presented as successful implementations of OST principles, demonstrating how large organizations can thrive by replacing bureaucracy with enabling platforms and fostering self-managing teams.

Ultimately, Alidad advocates for a paradigm shift in organizational thinking, urging leaders to embrace a more flexible, ecosystem-like approach to achieve sustainable growth and innovation.

When I first asked Alidad to explain Open Systems Theory, he shared a brilliant anecdote about Merrelyn Emery, a key figure in the field. Her simple, yet profound, answer was: "Don't explain it. Tell them what it does". And what it does, she said, is "a way of bringing people together so they can start having more control over their own affairs, their own life, their own communities". It’s about people gaining control to create their own culture, their own way of working, and continuously adapting while also shaping their environment.

Alidad expanded on this, explaining that OST is a coherent social and system thinking theory that helps human systems function and adapt in today's fast-changing, uncertain, and interconnected environments. It teaches us to see organizations not as rigid machines, but as "purposeful socio-ecological systems" deeply connected to their environment, capable of what's called "active adaptation". Think of it like this: instead of just reacting to market shifts, you're actively scanning, making collective sense of the environment, and then redesigning how you work to shape it yourself. A prime example of this? Apple under Steve Jobs. They weren't just responding to competitors; they "changed the game entirely," shaping the environment so that everyone else had to adapt to them.

One of Alidad's most compelling points was how deeply ingrained and often flawed our traditional management mindset is. We're conditioned to "optimize and remove waste", treating organizations like factories where every "widget" should look the same, and "defects" or "waiting time" are always waste. This works for manufacturing, where predictability is key.

However, this mindset falls apart in "dynamic creative human organizations". As Alidad vividly illustrated, in a Pixar studio, "waiting time is not waste" because it's crucial for thinking and creative exploration. You might draw a character a hundred times or even scrap an entire scenario after showing it to people. Applying predictive metrics to such creative, knowledge-based work is fundamentally flawed because it operates on "the wrong assumptions that humans are replaceable parts and the world is predictable". Humans are purposeful beings with their own agency and intelligence, not cogs in a machine that can be forced into a system.

Alidad provocatively stated that "most of our western enterprises now, they are run like a communist centrally planned enterprise rather than a free market economy". He argued that large organizations simply cannot be centrally optimized. This challenges the traditional system thinking of needing a "holistic view of the system" as if we are "gods" who can see everything.

So, if the old ways are failing, what's the solution? Open Systems Theory posits that the only way to genuinely adapt to our environment, like a thriving ecosystem, is to "create conditions for people within the system to take control". This means designing organizations where individuals are truly "in control of their fate".

This isn't just about empowering your internal team. It's about radical co-creation with all stakeholders: "your partners," "your vendors," "the community as well as people within the organization". This broad co-creation, Alidad emphasized, is what "will vastly give you productivity and adaptability".

OST offers practical approaches to facilitate this, like the "Search Conference" and the "Participative Design Workshop," where they design an "active adaptive organization" together. This stands in stark contrast to the common failure of Lean and Agile, where experts design systems for others. Instead of static "value stream mapping" that becomes obsolete the moment it's finished, we need "dynamic value streams" that constantly shift and optimize through both market forces and human interaction.

Alidad brought these abstract concepts to life with incredible case studies, particularly Haier. This Chinese company, which started as a failed state enterprise making faulty fridges, transformed under CEO Zhang Ruimin by focusing on quality and decentralization. Today, Haier is the world's biggest appliance maker, owning brands like GE Appliances, and is valued at $60 billion.

How did they do it? Through their "RenDanHeYi" model, they broke down their 80,000-person enterprise into "4,000 self-managing teams" or "microenterprises" – essentially 4,000 startups. These teams have three radical "rights":

This completely eliminates traditional performance management and budgeting cycles. They use digital platforms to connect these micro-enterprises, allowing them to buy parts from external vendors - even competitors - if it's more efficient. This creates a truly dynamic value stream, optimized by market forces and human purpose. Alidad confirmed that Haier meets the six minimum psychological criteria for productive work, including autonomy, continuous learning, and meaningfulness. The results speak for themselves: GE Appliances saw 20% year-on-year growth after being acquired by Haier and adopting their principles, without being forced to copy their specific model.

Another powerful example is Buurtzorg in the Netherlands, a 10,000-employee company with "zero managers" and about 900 self-managing nursing teams. They replaced hierarchy with "a network of self-managing teams" and bureaucracy with “enabling platforms," using digital dashboards for tracking and communication, without layers of management. These stories prove that these aren't just theoretical ideas; there are living, breathing examples of highly productive and growing organizations.

My conversation with Alidad is another indicator that we are slowly moving towards a profound paradigm shift in how we organize and manage. The old models are no longer sufficient. It's not about copying models like Spotify; it's about understanding the underlying principles and applying them to your unique context.

Alidad’s journey and commitment to going beyond the mainstream is truly inspiring. I encourage all of you, whether you're a manager, an executive, or an entrepreneur, to reflect on the insights from the conversation.

For premium-tier subscribers, I’ll now discuss the key advice for executives/managers and entrepreneurs. I’ll also provide handy links to books, papers and videos discussed in the podcast 👇🏾