1. Make it real!
Presenting the BetaCodex
Putting an End to “Command and Control”:
12 Laws to Defining the
21st Century Organization.
BetaCodex Network Associates
Niels Pflaeging – Valérya Carvalho – Silke Hermann
BetaCodex Network White Paper No. 06
New version Jan 2011

2. When Frederick Taylor published his landmark
book “The Principles of Scientific Management“,
in 1911, he suggested ”management“ as a
revolution that would solve the problems of the
industrial-age organization.
Above all, Taylor introduced, the division between
“thinking people” (managers) and “executing
people” workers – thus inventing management as
a class, and as thinking principals of the non-
thinking worker's class. Taylor also pioneered the
functional division of organizations.
Taylors methods and concepts were soon
unmasked as inhuman and non-scientific and his
consulting methods as rather ineffective. But the
concept of division did nonetheless become very
widely adopted after his death, in 1915.
Management, as we know it, is not much different
from what Taylor proposed, 100 years ago. In
today's dynamic and complex markets, however,
tayloristic command and control management is
proving more and more obsolete and toxic for
both organizational performance and human and
social advancement.
We call Tayloristic management “Alpha”.

3. The world has changed – organizations have not.
Industrial age ends: Knowledge economy advances:
high ”Supplies have the power“, ”Customers have the power“,
Evolution of mass markets: strong competition, individualized demand:
Taylorism as the superior model decentralized and adaptive model is superior!
Now, all these factors
are equally important!
Here, only efficiency Competitive
mattered, really! Characteristics success factors (CSF)
Dynamics 1. Discontinuous change - Fast response
and 2. Short life cycles - Innovation
complexity 3. Constant pressure on prices Operational excellence
-
Characteristics
• Incremental change 4. Less loyal customers - Customer intimacy
5. Choosy employees - Great place to work
• Long life cycles
• Stable prices 6. Transparency, - Effective
societal pressure governance
• Loyal customers
 High financial - Sustained superior
• Choosy employers expectations value creation/fin.perf.
• „Managed“ results
low
1890
Most organizations still use the “alpha”1990
1980 2000 2010 2020
management model that was designed 2030
for efficiency, while the problem today is complexity, requiring a “beta” model. reserved
© BBTN – All rights

4. From: To:

5. founded founded
1998 2008
Beyond Budgeting (1998-2002)
Beyond command and control (2003-2007)
Beyond incremental change (2008-)

6. The BetaCodex: The 12 new laws of Leadership
Law Beta (Do this!) Alpha (Not that!)
§1 Freedom to act Connectedness not Dependency
§2 Responsibility Cells not Departments
§3 Governance Leadership not Management
§4 Performance climate Result culture not Duty fulfillment
§5 Success Fit not Maximization
§6 Transparency Intelligence flow not Power accumulation
§7 Orientation Relative Targets not Top-down prescription
§8 Recognition Sharing not Incentives
§9 Mental presence Preparedness not Planning
§10 Decision-making Consequence not Bureaucracy
§11 Resource usage Purpose-driven not Status-oriented
§12 Coordination Market dynamics not Commands
© BBTN – All rights reserved

7. The BetaCodex is rooted in both sciences and practice
Sciences: Practice:
Thought leaders Stafford Beer Industry leaders
Margareth Wheatley
(selected) Niklas Luhmann (selected)
W. Edwards Deming
Kevin Kelly
Ross Ashby
Joseph Bragdon
…
Douglas McGregor
Chris Argyris Complexity
Jeffrey Pfeffer
Reinhard Sprenger theories Industry
Stephen Covey
Howard Gardner Social
Viktor Frankl
… sciences and
Retail
HR
Peter Drucker
Tom Peters Leadership & Services
Charles Handy change
John Kotter
Peter Senge
Thomas Davenport Strategy & Governments
Peter Block Performance & NGOs
… management
Henry Mintzberg
Gary Hamel
Jeremy Hope
Michael Hammer
Thomas Johnson
Charles Horngren
…

8. Industry
Retail
Services
Governments.
& NGOs

9. The BetaCodex:
Working
on the organizational model,
not
in the model.

10. Organizations of all kinds evolve during their lives – most have transformed
themselves model at least once, going from Pioneer phase to Differentiation
Sustaining and
deepening of the
decentralized model,
Evolution through generations
within the decentralized model Integration
(culture of empowerment phase
and trust) Beta! High degree
Transformation of decentralization/
through radical empowerment
Decentralization of decision-making
Differentiation
phase Stagnation
within the tayloristic model
Alpha! Low degree of
decentralization/ empowerment
Bureaucratization
through growing hierarchy
and functional differentiation
Pioneering
phase
Beta! High degree of
decentralization/ empowerment
Foundation Time scale: organization's age Several decades old

11. Alpha: Traditional model (supports efficiency) Beta: New model (supports complexity)
Centralized Decentralized
hierarchy, network,
“command “sense
and control” and respond“
The old model is not
aligned with today’s
Critical success factors and
it does not support ‘Theory Y’.
> We need a new Relative
strategy model to cope with performance
complexity contracts
> We must change
the whole model!
Fixed
performance
contracts Dynamic
coordination
Fixed processes Dynamic
processes
control
© BBTN – All rights reserved

12. Make it real!
www.betacodex.org
Get in touch with us for
more information about
leading transformation with
the BetaCodex and the
Double Helix Framework, or
ask us for more information Silke Hermann Niels Pflaeging Valérya Carvalho
or a workshop proposal. silke.hermann@ niels@betacodex.org valeria@betacodex.org
insights-group.de nielspflaeging.com Betaleadership.com
Wiesbaden–New York Sao Paulo-New York-Wiesbaden Sao Paulo