As business grows, understanding fractals helps

Published 10:40 am Friday, November 27, 2009

Once you have more than one person involved in an enterprise you have an organization — for better or for worse. At its best, the organization focuses the power of collective, team effort. But, as we all know, an organization can sometimes seem to have a mind of its own.

If as an entrepreneur or manager your organization seems to be resisting your every move rather than supporting you, it might be time for a different perspective on how business organizations grow and take shape.

In theory, organizations develop to handle work efficiently. As a practical matter, as we all know, efficiency is only one of many factors that determine the size and shape of a business.

One of the things that shape the growth of an organization and the workplace is a force which seems to be built in to human nature, just as it seems to be built into many other living things. One way to describe it is with something mathematicians call a “fractal.” It is the reality underneath the buzzword of “relationships” in the workplace.

Fortunately, we don’t have to be mathematicians to understand and make use of fractals. The key aspect from our standpoint is a characteristic called “self-similarity.” Essentially, this means that many structures which occur in nature — snowflakes, ferns, and even some trees — are made up of smaller parts, each of which is markedly similar to the whole.

The classic illustration of how fractals work involves taking three identical, short, straight lines. forming them into a simple Y-shape, and repeating that to create a credible representation of a deciduous tree. Kids in school have been treated to this particular illustrated math lesson for years and there are now software programs that take fractals further into more complex shapes.

We don’t want to confuse the math or the model with real life, but there is value in thinking about business organizations this way. They are built up from very small structures that are repeated to create the whole.

These small structures define and describe the relationships among a few people, most typically from three to five individuals, but in some cases a few more. And, if not always precisely identical, the relationship patterns are strikingly similar throughout organizations, even large, complex ones.

Understanding this pattern within the organization allows a good leader, whether Chief Executive Officer (CEO) or manager, to ensure that he or she plays a part in each and every one of those relationships. In many cases the resistance, “push-back,” and sabotage – conscious or unintentional – of a leader’s efforts to steer or change the organization can be traced to his or her not being part of the fundamental relationships.

In smaller, entrepreneurial companies the structure and the relationships are usually very visible. Like the leaves on a tree, each individual and each sub-structure, like a branch, is seeking mutual support, and also sunlight in the form of visibility and recognition.

The leader of an entrepreneurial business can insert himself or herself into each relationship by providing that sunlight; first by his or her own visibility, and then by staying in touch with what people do all day. Recognizing effort and achievement, and, yes, even frustration and failure, is the key to imprinting each of the relationships that make up the business.

As the business grows, some of this personal contact and visibility has to be delegated in order for it to be effective. The entrepreneur cannot simply reduce the frequency of contact and recognition and expect that somehow “quality time” can make up for it. A leaf, a branch, or a tree that needs 60 hours of sunlight a week isn’t going to be satisfied with 10, no matter how high its quality might be.

A growing business organization, then, has to be planned so that each of the sub-structures, or groups, includes at least some reflection of the firm’s leadership.

For an entrepreneur or manager, then, as your business grows and changes your responsibilities change, too. As it becomes more difficult to find time to make contact with each member of the organization every day, you spend at least some time with a member of each group, making sure that that the group leader is carrying the message and spending the time on visibility and recognition that you cannot any longer provide. When it becomes impossible to talk with each person each day, it becomes possible, and necessary, to talk with each group.

People are not fractals or leaves on trees. For managers, though, the advantage of understanding the group similarities within your organization allows leadership visibility, purpose, and energy to be communicated effectively — even if there are only just so many hours in a day.

James McCusker, a Bothell economist, educator and small-business consultant, writes “Your Business” in The Herald each Sunday. He can be reached by sending e-mail to otisrep@aol.com.