Organizational Energy
How leaders can adjust organizational energy
One of the primary outputs of leadership is energy. In any complex endeavor requiring more than a single human, organizational energy is required. As a leader, you must be keenly aware of the energy state of the organization and understand how to adjust it. Organizations, just like the people who comprise them, can exist in a variety of energy states. They can be low energy where work seems to have frozen, high energy with frenzied activity, stuck in local maxima seemingly drawn to a gravitational well of mediocrity, or suddenly transformative and accelerating in performance.
Energy Concepts
The three main energy concepts we will concern ourselves with are:
potential energy - stored energy that can perform work
kinetic energy - energy that is actively performing the work
activation energy - the energy needed to transition an organization from one state to another state
In the context of an organization, potential energy is a build up of stored energy that can perform great work. Startups are filled with potential energy; they do not actively produce nearly as much as a large company, but they are brimming with a promise that excites all the members.
Kinetic energy, on the other hand, is the energy generated from actually performing the work. High functioning large companies are filled with kinetic energy. So much work is being produced across so many areas and surfaces. The execution activities are highly scaled and the output is massive.
Activation energy is a concept that is specific to organizational state transitions. At any point in time, an organization exists in a certain state. For example, a large company having won most of the market, may rest on its laurels and start to calcify. Suddenly, the winds of change start blowing and it faces true competitive pressure. The company just can’t seem to execute despite having superior resources because its culture and structure also need to evolve. A state change must happen. The energy required to produce this state change is activation energy. The less activation energy required, the faster we can induce this state change. The more activation energy required, the slower. And if the activation energy is ultimately too high for us to create — we simply will not be capable of making the state change.
Leadership Styles
Creating a certain energy requires a certain leadership style.
vision: leading through an exciting vision that generates potential energy
outcomes: leading through disciplined outcomes that generates kinetic energy
organization: leading through structure and culture that reduces the amount of activation energy required
Leadership through vision primarily entails the use of narrative and emotion to craft a sense of excitement and direction. Its primary currency is attention. The more people talk about a vision, reference it, discuss it — the better it does. It also relies heavily on positive emotions like inspiration and optimism. It has hints of utopia replete with a fulfilling narrative and a sense of excitement. Its output is an increase in potential energy.
Leadership through outcomes primarily entails the use of discipline and results to create a sense of progress. This style is not overly concerned with the use of narrative or emotion, instead relying on the grounded truth of reality and providing concrete, measurable results. It produces a deep attachment to results with clear success criteria and generates a sense of discipline from actually getting things done. Its output is an increase in kinetic energy.
Leadership through organization entails the use of organizational design and culture to create a sense of ownership. Perhaps the most nuanced of the three, this style is primarily concerned with changing the environment and the dynamics between parties. There is an old adage — culture eats strategy for breakfast. This is because this style produces improved environments and synergies between individuals. Its output is a reduction in required activation energy.
Balance Requires a Team
You may read all of this and think great, leaders just need to read the energy state and then apply the style that generates what’s required. In practice, it’s just not that easy. Typically reading the energy state is relatively easy. But the difficulty lies in leadership styles. Very few leaders are capable of all three styles. And if the situation is dire enough — baseline capability isn’t enough; you may need someone simply stellar.
Most leaders are good at just one style. This is a feature, not a bug. As any leader advances, they need to develop a particular strength that makes them unique and gives them an edge so they can contribute to the organization with high leverage. By necessity, superior performance in a single style is more useful than being average at all three.
This reality makes it difficult for an organization that happens to be in an energy state that is a mismatch to the current leader’s style. Because the leader cannot simply turn on a dime and switch styles, it often takes a long time for the organization to obtain whatever energy it’s missing. For example, if an organization actually desperately needs lowered activation energy but the leaders are primarily outcome leaders, very little change will happen and people will just burn out. Likewise if an organization needed potential energy, but its leaders were organizational ones then there isn’t enough inspiration to go around and people may not aim high enough to ward off competition.
Organizations that do succeed at all energy states therefore must have a bench of leaders with different styles, operating as a team. Because no single leader will be a master of all styles, it is more prudent to develop a high functioning team of leaders with a diverse bench of styles and then the operational discipline to listen and give greater range to the leader that is needed for the state at hand.