“Living organisations” grown out of the Swedish soil

“Living organisations” grown out of the Swedish soil

Today we value higher meaning, freedom and well-being at work, and more and more people want to take responsibility for their impact in the world. A country that has proved to be successful in adapting to this new paradigm is Sweden, where there are several key elements that shape the country’s organizational culture.  

Most organizations are now facing the necessity to adapt their culture and ways of working to our fast-changing world by developing new ways of doing and being. Many have come to the realization that today’s complexity requires a new level of maturity. This has given way to a movement, one that strives towards more “living organizations”, where the organization is more of an organism than a hierarchical system.

This is not just a trend but a paradigm shift. A pioneer in the field is the Belgian writer Frederic Laloux, who in his book Reinventing Organizations (2014), launched the idea of a completely new type of organization. The “Teal” organization, as it’s called, is built upon the three pillars of self-organization, evolutionary purpose, and wholeness.

Laloux, who is inspired by other thinkers, believes that humans are currently in a shift toward the next stage of development which is characterized, among other things, by a higher degree of awareness. In this respect, we lead and organize our companies with greater consideration for people and for the needs of the planet. This way, employees feel that they can be their true selves at work and that they can genuinely contribute to the company’s higher purpose, as it is in line with their own values.

This new organizational form, in which the model of the “agile organization” is related, is poised to take over on a broad front. In fact, it already has, and in a number of extremely successful companies that all have something in common: they come from Sweden.

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Companies like Spotify, Klarna, Skype, King and iZettle are among the most innovative and have largely applied a Teal organization model to their work, with self-organization primarily cited as a chief factor in their success. Earlier world-renowned Swedish export successes like IKEA, Volvo, H&M, SAS, Ericsson and Scania—remarkably many for such a small country—have paved the way for the younger generation of agile start-ups with global reach. These “young” companies are more adapted to a changing and complex world. Fast-moving and digitalized, they are mainly interested in making a difference in the world and positioning their employees’ well-being as a focus of their work.

The types of classical Swedish leadership that have received international recognition possess the key similarities of having a democratic leadership style, delegated responsibility, equality and a great deal of trust in employees.

One of its figureheads is the former CEO of Scandinavian Airlines (SAS) Group Jan Carlzon, whose book The Moment of Truth (1985), constantly attracts new readers and is still used at Harvard Business School. The transformation that he carried out in SAS in the 1980s was unprecedented in the Swedish business world. By moving large parts of the company’s decision-making bodies from upper-level management to those who interacted with customers, he changed the definition of the manager’s role in the organization. “We used to fly airplanes, now we fly people,” is one of his famous quotes, which contributed to changing the organization’s view on its business.

Thirty-five years after his book was published, one of the things Carlzon still emphasizes is the importance of having a loving leadership. “I know that a loving culture in a company creates much better conditions for competitiveness and long-term profitability and development than a culture where you spread fear in people, which in general means that the organization stops and does not develop. That it worked so well in Sweden is based on the fact that we have that culture in our society. If we see each other as equal, we need not be afraid of each other,” he says. (Photo: Morten Juhl)

As Global HR Manager at Spotify, Katarina Berg spreads this form of Scandinavian leadership across the world. For her organization, which, among other things, groups itself in “squads”, “tribes” and “chapters”, this has become an important competitive tool when it comes to attracting talent. She believes that Spotify’s methods and organizational model are based on values that are very Swedish, and this is one of company’s success factors.

Katarina Berg, Spotify

“There is a lot of Swedish equality at the bottom that permeates everything we do, for example we have the same benefits for everyone, not special treatment for managers and management groups,” says Berg.

Openness to information and participation, combined with its non-hierarchical approach and autonomy are organizational success factors for Spotify. Much attention has been paid to Spotify for applying Swedish rules on parental leave throughout the company worldwide. Parents are given the option to take up to a total of 480 days of leave, and it is up to the parents themselves to decide how to divide the days between them. This has made it easier for women to enter the labor market. Basically, it is a matter of trust, says Berg. “We simply trust the employees, and give them room to succeed and grow. Then confidence grows throughout the company.”

Among the most notable Swedish companies, both for earning several awards for organization and leadership, as well as for their rapid growth, are the consulting companies Netlight and Tenant & Partner. They, too, challenge the traditional hierarchical pyramid structure of organization.

Netlight, an IT and management consulting company, compares its structure to a flock of birds, or a “boid”, where the employees navigate on their own without a traditional leader, but also jointly as a large organism. In this respect, all employees are both “leaders” and “followers”. “Authentic” and “responsive” are key words in Netlight’s vocabulary; employees are firmly anchored in themselves and their values but are always attentive and responsive to each other. They are convinced that by having trust in themselves and their values, they can, without any problems, go wholeheartedly into relationships with others and be role models.

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At Tenant & Partner, with the mission to create performing workplaces, the company is moved forward by the employees’ internal driving forces. A great deal of faith is put in the mindset of the individual and what controls his/her behavior. Here it goes without saying that each employee asks herself how she can live aligned with her values and grow as a person, while at the same time contribute to the company’s goals. Individual salary is set in relation to the total value the individual contributed to all of the company’s stakeholders—customers, employees, the company, and the planet. At Tenant & Partner, there is also full transparency of information as employees are welcome to attend strategy meetings regarding the company’s future.

What is it in Sweden’s “soil” (i.e. history and culture) that creates the right conditions in which living organisations can grow?

“The soil is better in Sweden than in other countries. That is my feeling,” says Christopher Kummelstedt, a researcher in self-organization at Stockholm School of Economics. “We in Sweden have invested in the individual in a completely different way than other countries. We have received more support and have had the space to be in a way that most countries have not allowed,” he says.

The fact that Sweden has not been involved in war for more than 200 years is one of the reasons why its organizations have had good conditions for their development. In addition to being favorable for economic growth, it has also created trust for other people and the environment around them. In Sweden, citizens trust their communities, the authorities, the law and companies.

“Evolutionarily, it’s not that strange,” says Torbjörn Eriksson, founder of Tenant & Partner. “It is about basic physical needs as in Maslow’s Hierarchy of Needs. It has been a safe society in Sweden, it is the security that makes this kind of initiative, like Teal, evolve.”

Erik Ringertz, CEO of Netlight, points out that Sweden has lacked a noble class, one which, for example, existed in France. “There have never been such unfair hierarchies here; we were barbarians so long that they did not develop. We have never been corrupted by power through the ages and have therefore been able to trust each other. More sophisticated countries had a thousand years to develop hierarchies. In Sweden, we did not really have a ‘sun king’. We were a very poor country until the turn of the century. We got a head start because we did not participate in two world wars; in a short time we could reach a world status that we had never had otherwise,” he says.

Another important factor that’s enabled this type of organizational culture to be so successful in Sweden is gender equality. While the hierarchical organization has been classically controlled by an authoritarian leader, often a male, there is more room in the agile organization to integrate both “feminine” and “masculine” leadership style, and thereby create a more multidimensional culture. Gender equality has created a working climate that is less characterized by machismo or bravado.

“Sweden is the most feminine country in the world”, says Kummelstedt, referring to the Dutch social psychologist Geert Hofstede’s Cultural Dimension Theory, which identifies dimensions in what can be called “national cultural values” that, in turn, affect values in a nation’s workplaces and organizations. Feminine cultures place greater value on relationships, cooperation, modesty, caring for the weak, and quality of life than masculine cultures, where achievement, heroism, assertiveness and material rewards for success are more highly valued.

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“In Sweden we are more in receiving and listening mode; we have an intaking energy. If you want to create what we call a ‘living organization’, or Teal, the organization must have the ability to be both in touch with its feminine and masculine qualities,” he says.

Sweden’s education system is also characterized by equality, which gives the majority of Swedes the opportunity to get a solid basic education—for free.

Carlzon sees his own success as the result of this. “I believe that myself and some others in my generation were the first in the country to have the opportunity, based on the development of Folkhemmet [literally People’s Home, a poetic name for the Swedish welfare state] and the horizontal structure it created, to take the lead in a large business,” he says. “These are perhaps the basic conditions that will enable the Scandinavian leadership. Then there is almost no space for authoritarian leadership,” he says.

A crucial aspect that has affected Sweden’s business climate, and on which Ringertz, Eriksson and Kummelstedt all agree, is the nation’s lack of a state religion as part of its culture. Sweden is one of the most secular countries in the world, and this permeates the whole of society, including its workplaces.

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However, lack of a state religion in Sweden may have contributed to the individual’s search for purpose, meaning and context in the workplace, since it has not been automatically assumed possible to retrieve such meaning through the Church. Being a “Netlighter” or “Spotifyer” feels important, and it is in this context, that the person can find her/his higher purpose and sense of belonging.

The search for meaning and development is not something new to Sweden. From the 1870s and onwards, the Folk high schools initiative may have influenced the current level of development in the form of greater self-awareness, and thus a greater degree of maturity, in organizations. A group of researchers and politicians, including the Social Democratic Prime Minister Hjalmar Branting, was inspired by German poet Johann Wolfgang von Goethe, along with many others, and the term Bildung (education in cultural and personal development). The idea of Folk high schools was that citizens should be educated in personal development by spending three to six months in education programs where purpose, meaning and self-reflection were included in the curricula.

Folk high schools still exist today with other central foci. Danish philosopher Lene RachelAndersen and social entrepreneur Tomas Björkman give an in-depth study of the subject in their book The Nordic Secret: A European Story of Beauty and Freedom (2018).

What role does the leadership play in this new type of organization that thrives so well in the Scandinavian soil?

In those organizations, the new role of a manager has been to; 1) keep the company’s purpose alive, 2) to provide the conditions for all employees to be able to contribute to that purpose in line with their own values, 3) to create an open, authentic and trusting environment where employees feel they can be themselves, 4) and take on the role as a coach or facilitator.

Eriksson talks about being a role model and coach, and integrating “wholeness” into company structures. “I like to say that it is ok to be our whole selves at work and that it is desirable. This reflects in our ways of working, such as systematic check-in, mindfulness and feedback. All our systems and processes are supported by awareness, authentic presence and self-reflection.”

Video with Frederic Laloux – “Your roles in this new world

The idea for this article was born during our Learning Expeditions in Stockholm where we experienced a specific culture in the Swedish companies that we visited. 

 

Marielle BehrmannOrganizer of Learning Expeditions, Conscious Leadership consultant & Coach, Co-Owner at FABRIC  

Fredrik EmdénJournalist and author

Erin Henk Editing