Observations from an Exchange of Regenerative Management Ideas

Recently the Executive Director of an education company engaged me to help his board members understand the needs for his organization. To do this, the Director and I provided the board a Regenerative Management perspective of both his personal and his organization's development over time. For years his organization thrived in pursuit of its mission by creating value with writings and coursework developed over the years. But more recently, despite ongoing success, this founding leader felt something was missing from the mix - that somehow the ongoing vitality of the organization was not being effectively addressed.

Upon seeing the Regenerative Management framework nearly a year ago, the Director felt he had found what he needed to make sense of what was going on... and not going on. In the months that followed, he employed the defining template - with its framing organizational activities as exploration or exploitation - as a lens to observe and reflect on himself and his organization.

What he saw was the dynamic juxtaposition of exploration and exploitation as illustrated in Figure 1 that is essential to the vitality and persistence of organizations. Understanding exploration as learning focused on new possibilities with uncertain returns and exploitation as learning focused on old certainties with positive returns, he contemplate the past three decades of his life and his organization. What he saw was a healthy pattern of exploration and exploitation over the years. Both were done simultaneously, but whatever the current exploitation was at any given time, it had been preceded by years of exploration that defined the opportunity to be exploited. As the Director said to me, "What you said was very helpful. It has given me a way of communicating with the board the value of an activity that "appears" to be "wasting time and resources".

Figure 1 - Regenerative Management Imperatives

The Director's first video and study courses were first exploited in the late 1980s after more than a decade of exploration. The next stage of exploration resulted in a 32-lesson course released in the mid-1990s. Successive explorations and exploitations have resulted in the current mix of product offerings. So today, what creates value for its customers and captures value for the organization came about from multiple successive explorations throughout the intervening time.

Particularly revealing though - these explorations were not done with a particular outcome in mind, but were guided by this leader's personal interests and the organization's purpose. In fact, the very notion of seeking a particular outcome, an ROI target, or specific product offering would not only have been impossible but would have made the exploration process itself ineffective.

During the discussion, the board developed an appreciation for their role in assuring that the organization achieves the right levels and balance of exploration and exploitation through the orchestration of the two illustrated in Figure 1. But beyond just understanding the general notion of this need, they went on to see that conventional management - geared towards operational effectiveness and suitable for exploitation - does not lend itself to the management of exploration nor orchestration. Its left-brained analytical orientation seeking mastery stifles the right-brained free-association and creativity needed to discover new possibilities and shape them into new opportunities.

Going well beyond merely coordinating and integrating exploration and exploitation, orchestration even steps in to bring about the destructive re-creation of the organization by guiding the organization to abandon aging non-competitive exploitations and speeding the discovery and deployment of new value creation opportunities to be exploited in their place. Orchestration therefore drives the evolution of the organization to regenerate itself with the objective of thriving indefinitely. And this organization innovation and evolution churns through not only the offerings to the customers, but also the business models deployed and the methods of managing the organization.

The discussion brought home the three imperatives - sets of acts - leaders must attend to that drive the regeneration of their business organization:

• The imperative to explore to discover opportunities for organization-environment coherence.
• The imperative to exploit to deploy these opportunities to provide for the rejuvenescence of the organization that revitalizes the organization while creating new customer value.
• The imperative to orchestrate to bring about exploration-exploitation's congruence in order to achieve an ongoing cycle of origination and execution.

With these insights, a healthy discussion ensued regarding the longevity of the organization's current offerings and the organization's current capabilities to thrive indefinitely. Having been a natural explorer and entrepreneur all of his life, the Director had achieved a natural congruence between exploration and exploitation without explicitly thinking about it most of his career. But over time, as the organization grew and sustained its success, something started to bother him - the ongoing exploration was not sufficient to ensure the organization's thriving into the next decade with clearly superior new and greater value creation for its clientele. The board recognized this and was also concerned that the organization as a whole depended primarily on this one leader for its regeneration to date. One board member noted that he was tending to push exploration to go too fast. They realized that deep exploration and understanding precedes great value creation. Finally, the board members noted their new challenge in keeping an eye on "this" - the organization's regenerative needs and processes.

Once seeing exploration and exploitation as the two fundamental and essential activities of an organization, if not an individual, this organization had defined the issues to be dealt with. Their next step - address the organization's vitality and longevity by adopting Regenerative principles and practices not only for the leader but for the organization as a whole in order that it might thrive indefinitely in pursuit of its purpose.