Book SummaryReinventing Organizations, by Frédéric Laloux

1-Page Summary1-Page Book Summary of Reinventing Organizations

Modern organizations—governments, religions, major corporations—have produced social and technological advances that have lifted humanity into an age of abundance. However, those same organizations restrict individual growth and have led to rampant consumption of resources. Recognizing this, some emerging organizations now operate from a new set of rules that veer away from hierarchical structures based on power and achievement and instead embody self-direction, authenticity, and a collective higher purpose.

In Reinventing Organizations, Frédéric Laloux traces the history of organizational structures to show that each leap forward in how we build our institutions corresponds to an equivalent shift in how we view ourselves and the world. Laloux argues that these advances are...

Reinventing Organizations Summary The Stages of Organizational Development

In order to understand the future shape of organizations, it’s important to look at how they’ve developed. Laloux traces a series of paradigm shifts in organizational structure over the past 10,000 years, arguing that each transition goes hand in hand with a change in how we think about the world. These changes can be traced from our nomadic forebears to modern-day companies and nonprofit groups that function as part of a wider, global whole.

(Shortform note: Other business experts recognize several more types of organizational structures than Laloux does, including functional structures, matrix structures, and network structures. Though technically more varied than the ones Laloux describes, the majority of structural options share a top-down chain of command.)

Laloux doesn’t imply that certain types of organizations are superior to others, only that certain stages embrace more complex worldviews. Each type of organization evolved to fill a niche and may still be the best option...

Reinventing Organizations Summary How Visionary Organizations Work

In order to establish a better view of visionary organizations, Laloux surveyed successful companies that embody the mindset he believes will epitomize the next stage of human evolution. Though the companies he researched developed in isolation, Laloux identified a common thread of practices and philosophies that unites these groups in outlook and approach. These include new assumptions about how people work, fluid power structures, self-management, peer-driven performance, and healthy techniques for conflict resolution.

Fundamental Assumptions

Underlying the way visionary organizations operate is a change in our basic attitude toward how humans behave in the workplace. Ever since the days of autocratic monarchs, leaders have assumed that people need the heavy hand of authoritarian rule in order to behave and get anything done. Visionary systems reject this idea in favor of the less cynical view that people are generally reasonable and can be trusted to make good decisions. (Shortform note: This sentiment is backed up by historian Rutger Bregman, who writes in Humankind that our species evolved to be...

Reinventing Organizations Summary The Culture of Visionary Organizations

The practices that define visionary organizations—flexible roles, self-directed decision making, a non-hierarchical sharing of power, and team-centered feedback and conflict resolution—can only be maintained within a certain kind of culture. Though cultures are unique to every organization, Laloux identifies many commonalities among the companies included in his research. These include placing a meaningful purpose at the core of the company’s mission, encouraging all employees to be their authentic selves at work, and building an air of transparency and trust that permeates the whole organization.

(Shortform note: Marcus Buckingham and Ashley Goodall offer a contrary view in Nine Lies About Work. They argue that overemphasizing a company’s culture can be harmful, especially if the culture only addresses surface-level issues and makes employees feel the need to conform. Instead, Buckingham and Goodall place more value on healthy, supportive teams.)

Organizational Purpose

The strongest driver of the company’s culture...

Reinventing Organizations Summary Implementing Visionary Practices

While many people, especially business leaders and managers, may find these organizational concepts to be intimidating, impractical, or even naive, others may see ways these practices and ideas can benefit their own workplace. Laloux concludes by suggesting ways that visionary concepts can take root in organizations. Leaders can build visionary companies from the ground up or transition them from older management paradigms.

Visionary Leadership

First, Laloux addresses the topic of upper management. For an organization to function from a visionary perspective, it’s vital that the CEO, the board, and principal investors buy into the concept. If that commitment can be established, then the CEO can create and maintain the space for visionary processes to develop, while holding back the pressures that will try to fit the company into a top-down hierarchical structure. (Shortform note: In Good to Great, Jim Collins expands this idea to include everyone on the management team. He argues that the right people have to be in place...

Shortform Exercise: Get Ready to Manage Yourself

Laloux asserts that employee self-management will be an essential part of the next stage of organizational development. If you’re self-employed or have ever worked from home, you’ve already experienced self-management to some extent. Compare self-management as described in this book to jobs in which you’ve worked under direct supervision.

Do you feel more comfortable managing yourself or receiving direction from others? Describe a situation in which making a crucial decision about your job either caused you stress, made you feel empowered, or both at the same time.

Shortform Exercise: Determine Your Business’s Overriding Purpose

Laloux says that visionary organizations have a defining purpose beyond making profits and providing value for shareholders. This may be true of many organizations that have not yet adopted a visionary mindset.

Consider an organization that you contribute time to, either as an employee or volunteer. Outside of financial gain, what does that organization hope to accomplish? What tangible effect on the world does it hope to achieve?