Organizational Physics: The Science of Growing a Business
Physical Copy:
Audiobook:
By: Lex Sisney
Rating: B-
I didn’t love this one. It lacked clarity. BUT there were definitely some nuggets in there to wrestle with as you grow your business.
Running a business is a dance between art and science. It is a balance of people and process. The main point of this book was to understand what personality types you need in various roles in your business. There are roles like accounting that are very structured and need to follow a specific process. But roles like sales often do not. It is energizing to certain personality types to do certain things. By pairing people with their natural gifts and passions, you unlock an untapped energy. The book did a great job of describing what type of personalities need to be in each seat.
Next the book went over what type of personality needs to lead the organization in different life cycles of the business. The leadership style in a startup needs to be different than when you are scaling up your business. That was fascinating to read.
Summary of The 4 Laws of Organizational Physics
Success:
Success is a function of integration over entropy.
Entropy: a lack of order or predictability; gradual decline into disorder.
An organization is a system. To survive and thrive, it must keep internal entropy low and get new energy from the external environment. The lower the entropy and the higher the integration, the greater the probability of success.
How to apply this: To have more success, minimize energy drains and maximize energy gains. Organize the roles you need fulfilled and the strengths needed in the individual to fulfill them.
Management:
Management is the skillful application of force.
When an organization shapes or responds to the environment, it needs to leverage the right management styles based on the life cycle of the business and the needs of the situation.
Much of the book described a personality test they use to determine how to communicate with and what type of work their people thrive with.
The PSIU Assessment. There are 4 main management styles:
P: The Producer. (Psiu) Has high drive to shape the environment, moves at a fast pace, takes short-term view, is results-oriented, and follows a structured approach.
S: The Stabilizer. (pSiu) Has high drive to respond to the environment, moves at a slower pace, takes a short-term view, is process-oriented.
I: The Innovator. (psIu) Has high drive to shape the environment, moves at a fast pace, results-oriented, takes a long view and operates in an unstructured way.
U: The Unifier.(psiU) Has high drive to respond to the environment, moves at a measured pace, is process-oriented, takes an unstructured approach and a long view of change.
How to apply this: To be a better manager, know the forces at play and give each force what it needs. GET THE RIGHT PEOPLE IN THE RIGHT SEATS ON YOUR BUS!
Strategy:
Strategy is the process of integrating unique capabilities with growing opportunities in the marketplace.
What is your team uniquely capable of doing? Where does that align with the upcoming opportunities in the marketplace?
The goal of strategy is to get new energy from the environment. To get new energy, you align your team with the roles they excel at and are energized by. You identify opportunities that your team is uniquely capable of doing. Pursue it!
To grow in a changing environment, the strategy must always evolve. Keep working to keep the right people in the right seats and identify new opportunities.
Business Life Cycle Stages and the Management Styles needed:
Birth: Innovator and Unifier
Early Growth: Producer
Growth: Producer and Stabilizer
Maturity: Producer, Stabilizer, and Innovator
Decline: Producer, Stabilizer, and Unifier
Aging: Stabilizer
Death: No one!
Execution:
For fast execution, you must first gather the organizational mass (M) into a cohesive whole.
Mass is resistance to change. If the organizational mass remains scattered about, you won’t have cohesive action and momentum.
This is how the author recommended to build an organization. This was the most fascinating piece in the book. This is what it looks like to get the right people in the right seats.
Right People: Management Style
Right Seat: Role that aligns with the person’s skill set and management style.
Decentralized Autonomy: Self-governing or controlled locally at the department level. Certain roles need to be able to make decisions on their own like Sales.
Centralized Control: Controlled by a single authority. Certain roles need to follow strict processes without much autonomy like Accounting.
How to apply this: Does your organizational chart look anything like this? Do the people in charge of each of these have the right management style?
Next Action:
Look at your organizational chart. What are the personalities in your departments? How can you make a change to get the right people in the right seats?
