Strategy Meets Reality Podcast

Antifragile by Design: Janka Krings-Klebe on Governance, Autonomy, and Building Ecosystem Organisations

• Mike Jones • Season 1 • Episode 25

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Antifragile is more than a buzzword—it’s a design principle.

In this episode of Strategy Meets Reality, Mike Jones sits down with Janka Krings-Klebe—author of The Antifragile Organization—to explore what it means to design organisations that thrive under stress. They unpack why most governance systems constrain innovation, how financial incentives can block adaptability, and why autonomy and accountability must go hand in hand.

From ecosystem design to cultural enablers, this is a practical look at what it takes to shift from hierarchies to ecosystems—where learning, change, and resilience are not afterthoughts, but built into the DNA.

🔍 In this episode:

  • Why fragility is baked into most governance and budgeting models
  • How antifragile organisations navigate market disruption
  • Designing autonomy and accountability together
  • What value stream thinking means in practice
  • The role of learning, culture, and failure in adaptability
  • Why the shift is from stability to direction, not control

🎧 Keywords: Antifragility, ecosystem organisation, governance, budgeting, innovation, adaptability, autonomy, learning, organisational design

📘 Learn more about Janka’s work: https://www.co-shift.com/

 📕 Read her book: The Antifragile Organization (Amazon)

📬 Connect with Janka: LinkedIn

Send Mike a Message

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🔗 Full episodes, show notes, and resources: https://www.lbiconsulting.com/strategymeetsreality-podcast

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🎧 Listen on Spotify, Apple Podcasts, and Buzzsprout

💬 Connect with host Mike Jones → https://www.linkedin.com/in/mike-h-jones/

Janka Krings-Klebe (00:00)
you could have the most innovative people in your company that are only innovative when they leave the company. ⁓ Because your rigid rules and structure won't allow them to be innovative within the company.

Mike Jones (00:07)
Yeah, yeah.

Janka Krings-Klebe (00:16)
learn from those impacts. And antifragile organizations not only learn from those impacts, but they use that to train their muscles to become stronger, more capable.

Mike Jones (00:18)
Yes.

Janka Krings-Klebe (00:29)
Assume you have an employee with a good idea. How hard is it for this employee to explore this idea further, to get resources, to try things out

If it's not that easy, like a one click buy on Amazon, you have a problem.

Mike Jones (00:56)
Welcome back to Strategy Meets Reality podcast. It's great to be joined by Janka Krings-Klebe It's great to have you on the show. Yeah, so thank you for joining me.

Janka Krings-Klebe (01:08)
Yeah, thanks a lot for having me.

Mike Jones (01:09)
Just for our listeners, do mind giving a bit of background about yourself and context about what you've been up to lately?

Janka Krings-Klebe (01:14)
I founded my own company about seven years ago. That's Co-Shift. And what we do is we are kind of personal trainers for organizations and for executives to help them to transform their organizations. So we're working with individuals as well as teams.

And well, what qualifies for that is that we have all a background of more than 20 years in business and industry and different kind of industries from automotive to special machinery, et cetera. And we also led transformation initiatives by ourselves. So we have lots of hands-on experience and

Our goal is to provide this experience, what works, what doesn't work, where maybe some hidden traps. We provide those information and the context to our clients and to help them to accelerate their learning curve. ⁓ beside that,

Mike Jones (02:31)
Nice.

Janka Krings-Klebe (02:33)
We do trainings, executive trainings as well as giving lectures for master classes. yeah, that all culminates in a new book we wrote, The Antifragile Organizations from Hierarchies to Ecosystems. And that is exactly that one. And it's result.

from many clients and students asking us where can we dive deeper into these topics and we didn't found a book that covers it all and so the demand was getting higher and higher so we decided okay we need to write that by ourselves.

Mike Jones (03:13)
Yeah, I think that's great because I'm seeing it as well as the thirst for alternative views, I reckon, about how organisations should and could exist and be created rather than sort of the traditional view that we've always had which is quite mechanistic, that the organisation is a machine. Yeah, so think...

Janka Krings-Klebe (03:39)
Yeah, yeah, exactly.

Mike Jones (03:42)
when we look into this, I've gone through your book and it really does highlight some fantastic and interesting things, but when someone says to you, well, know, what is a antiphilology, antiphilology organization? What do you say?

Janka Krings-Klebe (03:58)
That's quite easy. It's an organization that learns from all those surprises that happen in the market and that come from outside. So learning from all the threats, all the surprises, all the internal failures you did, all the success you have. Learn to enhance your capabilities. So to become better. That's the same like

Mike Jones (04:07)
Hehehe.

Janka Krings-Klebe (04:26)
muscle. If you're an athlete you know what I mean by that. If you're doing a workout your goal is to become stronger or to run half the mile in faster pace and so what you are relying on is that your your muscles learn from the stress and that they become hopefully stronger.

Mike Jones (04:34)
Yeah

Janka Krings-Klebe (04:51)
It would be a pity if they wouldn't. So could train and train and train and nothing would happen. and that but that is what we have in traditional organizations. are facing threats, surprises from the market, changes and all what they are doing is trying to...

Mike Jones (04:54)
Yeah, yeah, yeah.

Yes.

Janka Krings-Klebe (05:12)
to cope with it somehow and then get back to normal. They don't learn from those impacts. And antifragile organizations not only learn from those impacts, but they use that to train their muscles to become stronger, more capable.

Mike Jones (05:16)
Yes.

Yes.

Janka Krings-Klebe (05:29)
And that's biggest strength of them.

Mike Jones (05:30)
Yeah,

I like that analogy of training your body, your muscles, because you know, an athlete when they're trying to train, they don't just do the same thing all the time because they're just not going to get any results. They're just going to be very good at doing one thing where actually an athlete is really in tune to their body. They're really in tune to...

Janka Krings-Klebe (05:41)
Yeah.

Mike Jones (05:54)
what it needs, how it needs to be fueled. It's in tune to the actual metrics of how the body's actually working rather than probably arguing organizations are just attuned to what people are saying on the KPIs. But athletes also are really in tune to their competitors and what they're doing. What's the demand of the course that they're gonna go through? What are the options?

Janka Krings-Klebe (06:13)
Yeah.

Mike Jones (06:19)
So yeah, I really like that analogy to think about a learning organisation, antifagile organisation. So what, sorry, what you gonna say? yeah, I was gonna say, what is the challenge then for organisations going from this sort of traditional view into embracing a more antifagile learning organisation?

Janka Krings-Klebe (06:28)
She's good.

Okay, well there are several challenges and it strongly depends on where you currently are. So it's not the same journey for each and every company. It's really quite different. It depends on where you are. So...

Mike Jones (06:56)
Hmm.

Janka Krings-Klebe (07:00)
If you're in a business where you were facing very strictly on optimizing your internal processes and value chains and working on efficiency to become more more efficient, then the hardest part would be to

work on your business processes to allow for innovation for example, to allow for different kind of value creation because sometimes those companies are really trapped in an efficiency trap. They just can't do anything new and I saw that again and again when I was coaching clients.

Mike Jones (07:29)
Hmm.

Janka Krings-Klebe (07:47)
that they were so in their tunnel. For example, could for an innovation team, they needed an RFID scanner for one setting to test an MVP. One for their test environment. And the purchasing said, yeah, you can get thousands over the next two years.

Mike Jones (08:01)
Yeah.

Janka Krings-Klebe (08:11)
and we get a good price and I said hey guys we need one but two weeks please ⁓ it wasn't possible because all the processes were so streamlined they were not able to purchase one RFID scanner for a test environment to build an MVP for a new innovative product that's crazy and they had to circumvent the whole process

Mike Jones (08:15)
Hahaha, ok. Yeah, yeah.

Yeah.

Yeah.

Janka Krings-Klebe (08:38)
They bought it on Amazon, paid it with a credit card of their department leader and got reimbursed by the travel expenses. But that is crazy. You're just getting the energy, this entrepreneurial energy. You use that to circumvent those rigid processes. So that could be one part. If you are in a business that is used to have several

Mike Jones (08:47)
Yeah.

Janka Krings-Klebe (09:02)
products running parallel, then this is mostly not your problem. But it could be that you still have this rigid decision-making processes, this pyramid that no one, only managers decide on the top of the pyramid. And the more risk is combined with that decision, the higher the one who needs to decide it gets.

So you might need to work on giving decision-making rights to the edges. Others need to start maybe with some cultural issues because they have a really bad culture regarding failure acceptance. Others don't even listen to their customers. So there are different starting points. ⁓

Mike Jones (09:48)
You

Yes.

Janka Krings-Klebe (09:53)
In the end everything... it doesn't matter where you start because you will come across all topics over time. And the most important issue here is you can't use a blueprint. It's about this path is made by walking because it's not adapting another method. It is completely

Mike Jones (10:00)
Yeah.

Yes.

Janka Krings-Klebe (10:16)
completely rethinking how your company works, how it creates value, how it interacts with their customers.

Mike Jones (10:27)
Yeah, I think that's good. That last point was really interesting around that because too, I think there's too many what we call context free solutions. Like they'll come in and go, ⁓ you you want to be anti-fragile and they'll like, right, yeah, you've got to follow this step-by-step method. it did, yeah, yeah, yeah, yeah, yeah. It doesn't work, it's, love to sell easy, easy products. And then the first one you talked about was

Janka Krings-Klebe (10:43)
Yeah, St. ⁓

Mike Jones (10:54)
was really interesting. see this a lot where they're trying to innovate. They're trying to handle that challenge between being efficient and getting things done, but also trying to innovate. And no doubt in that company, you've got people and leaders saying, ⁓ we need to be more innovative. We need to be this. I want you to push the boundaries. But then all the internal processes, eternal inertia incentivize

anything but innovation and then people just get, people lose the will and want to do it because it becomes so hard to try and do anything that they'll just sit back and live with the state's quote.

Janka Krings-Klebe (11:33)
Yeah, you're absolutely right. And that is what I experienced when I led projects at Bosch or later on was a business coach at Bosch for transformation issues. that was exactly what we were facing. We had innovative products that were developed. had

customers coming to us asking for a new kind of products within half the time being being ready to to be built into the cars and When you do that as a kind of pilot you need to be aware that these teams when they start Working in different kinds working on new products they will face

hurdles, barriers all the time when they were expecting that there is a door but they've just find a wall. so coaching those teams means also means you need to become their hurdle remover. There are of course hurdles that they can deal by their own by themselves, but there are hurdles that are systemic.

Mike Jones (12:22)
Mmm. Yeah.

Yeah, okay.

Janka Krings-Klebe (12:47)
like the procurement topic or just imagine a company like Bosch with 4,000 employees mainly driven by automotive and then you have this mass production and then you have this tiny innovation team and you have all the regulations from this big corporate

Mike Jones (13:00)
Yes. ⁓

Janka Krings-Klebe (13:09)
when you throw all those rules and regulations on this one team, they never would. So you need to define a different kind of regulations.

Mike Jones (13:16)
No. Yeah, and that's that

Yes, I think that's a great point you're making because there is a lot in sort of literature and people talk about strict alignment. So we must be aligned and definitely when they talk about culture and stuff like it's almost like culture is a whole system thing where when you've got organizations like Bosch that's not going to work because they've got one

main part of their business, which is rightly so. It's there for manufacturing, it's there for efficiency, it's to get minimal errors, products out the door, quickly possible. But then you've got this other element that is the future looking, is the innovation piece. Errors are a thing of practice. They want errors, they want failure, they want to rapid change. And the two just don't...

work together, they can't work together, but we try and treat them all as one entity and wonder why then we suffocate the one element that is gonna help us innovate and get to the future. So yeah, it's definitely a different challenge for a leader to realize that certain entities need different rules and that's a good thing.

Janka Krings-Klebe (14:31)
Exactly.

Bosch also recognized that. So they defined a kind of basic rule set for those early or starting entities. And they also defined a kind of multi-lane system for the business processes. And you can just think about having legal blocks. So...

When you come with your as an innovation team and you are flagged as being the innovation team, you can circumvent certain process modules by default. you don't have to have this, let's say, negotiating for best prices, because what matters for you is speed.

Mike Jones (15:21)
Mm.

Janka Krings-Klebe (15:22)
But that goes down to also incentivizing those who work, who are responsible for those processes in a different way. Because if you incentivize those employees in the purchasing department, that they need to negotiate 5 % bonus.

Mike Jones (15:33)
Yeah.

Janka Krings-Klebe (15:48)
and then there comes this innovation team that doesn't have to have this negotiation, then that will be negative for your incentives. So you need to incentivize them in a different way. So maybe the pace you have. So it all comes down to having the governance system of the organization built to not only accept

Mike Jones (16:01)
Yes.

Janka Krings-Klebe (16:12)
those innovative teams but to change completely the mindset of how the organization works because alignment doesn't mean that everyone needs to walk into the same direction with the same tools alignment can also be coherence it can also be

Mike Jones (16:29)
Yeah, yeah,

Yes.

Janka Krings-Klebe (16:38)
being aligned to a certain purpose but going different ways. This allows to also diversify your governance framework so that you are able to have always teams or entities that are in a let's say startup phase, some that are close to market entry, some that are quite mature.

Mike Jones (16:44)
Yes.

Yes.

Janka Krings-Klebe (17:06)
with a well established product and some that are well whether they reinvent their or have a follow-up invention for their product or they are going to phase out.

Mike Jones (17:19)
Yes, yeah and that's good. I like the term coherence. It makes more sense in this sort of environment about coherence that it's not chaos. People are coherent towards a common purpose like you said but I also like the fact that you mentioned around changing the governance and incentives to make it work and

And that's what we want to see. We want to see organizations that will look at it and go, well, this is what we're trying to get. What do we need to do structurally, such as governance, policies, processes, to help emerge that behavior? But what you tend to see is people just go, oh, it's all about mindset. It's all behavioral. And they just focus on the behavioral element, probably produce some values, tell people to be more innovative or, you know,

fail fast and all this stuff, but then they're not changing the structure in which their people work in, which will not emerge that behavior that they want so that they won't be congruent with each other. So it's good that you're highlighting the fact about the intricacies of the structure of the organization for that. Yeah.

Janka Krings-Klebe (18:26)
Yeah, exactly. the problem is if your system is kind of still alignment through control and you ask those teams to be innovative, think outside the box, but you still have this controlling in place and

Mike Jones (18:42)
Mm.

⁓ yeah.

Janka Krings-Klebe (18:49)
they can even decide on they always need to go up the hierarchy to get the decision. Then you're slowing things down. And next topic is opportunities in the market. They usually don't show up when it's time for the business plan.

Mike Jones (18:58)
Yeah.

Yeah, yeah, Great.

Janka Krings-Klebe (19:08)
So they come

along by surprise at any time in the year. unless you have... When you still have this rigid budget planning cycles for a year, what would you do? Come again next year, try again next year. Won't be the solution because then other competitors may have stepped in or the opportunity is just gone.

Mike Jones (19:22)
Mm.

Yes.

Janka Krings-Klebe (19:33)
and honestly the annual budget planning cycle is not a natural law.

Mike Jones (19:42)
Yeah, yeah

Janka Krings-Klebe (19:43)
it was okay when the markets behaved slower they moved on slower but now you can't if you still stick on this one year planning you are you are losing because you can't act on opportunities that come up within the year

Mike Jones (20:04)
Yes. And that's a good point with the same strategy. Strategy is a one year event or we plan for five years. And then the budget comes in with that as well. But it's almost like we treat finance and we treat strategy as an output, a product, rather than not a way of being. And strategy is a way of being. And you need to

constantly sense and understand what's happening, what changes, what threats, what opportunities, and protect your ability to act and respond to those changes. But if you're constrained so much by finance, then you can have people that can spot all these opportunities, but if they've got no resources to wield towards it, then you're gonna miss the opportunity. how would you suggest organizations...

look at finance and also are there organisations that do this really well?

Janka Krings-Klebe (20:59)
⁓ Yeah, yeah, of course. So regarding budget planning cycles, as I said, not a law of nature that this has to be annually. That is a relict from the second industrial revolution where this was made with pen and paper. You had to do this manually because you didn't have a computer.

Mike Jones (21:04)
Mm.

Mmm, yeah, yeah.

Janka Krings-Klebe (21:22)
the effort was so high that it was only done annually. You can do that in a much shorter cycle. And of course there are companies that already recognize that the annual budget planning slows them down. And a good example, for example, is Bayer.

Mike Jones (21:27)
Yeah, yeah, that makes sense.

yeah, yeah, bye, yeah.

Janka Krings-Klebe (21:47)
They just started roughly two years ago and they switched from annual budget planning to a 90-day cycle. ⁓ Then there are size digital, for example. They also do, I think, also three months cycle for their budgeting.

Mike Jones (21:59)
Okay, that's interesting.

Janka Krings-Klebe (22:13)
So you have a rolling budget cycle. And of course there are others going up to companies like Hire, where you have thousands of autonomous teams who are completely profit and loss responsible.

Mike Jones (22:17)
Okay.

Mm.

Janka Krings-Klebe (22:35)
who can act on new opportunities. I heard a nice example from my friend Kevin Nolan, who CEO of GE Appliances in the US. He said there was a team that came up with an idea of having an indoor smoker. He said, guys, you're crazy. That would never work.

Mike Jones (22:56)
hehe

Janka Krings-Klebe (22:58)
He told me he is not the one to decide whether this product idea matches customers needs, desires, expectations. They let the customer decide whether this is a product that resonates. And so they get a kind of like you would say in a startup.

Mike Jones (23:14)
Mmm, yeah, yeah.

Janka Krings-Klebe (23:21)
Accelerator they get kind of venture capital they can test out their idea and Let's see whether the market responds to it in a positive way or not and If it misses to match the mark the market demands then well, yeah, you have learned a lot and But if it matches the market demands you have another product in a niche

Mike Jones (23:39)
Yeah, yeah, yeah.

Janka Krings-Klebe (23:47)
that earns money.

Mike Jones (23:49)
It's great you're talking about autonomous self-organizing teams because when you look at stuff we've been talking about so far, people think, it's chaos because the whole organization's doing different things, but it's not because we're just creating self-organizing autonomous teams that are coherent and they're coordinated so they're not going to disrupt each other, but they're still coherent towards a common aim.

but it gives that flexibility. Yeah, and people will convince themselves that they've got autonomous teams, but then like you said, they don't have profit and loss responsibilities. They have none of the resources to be autonomous, but actually when you said they had all the profit and loss things, they had all the resources that they needed to and the decision rights, then they could be flexible and test these things out without

Janka Krings-Klebe (24:16)
Exactly.

Mike Jones (24:40)
creating chaos.

Janka Krings-Klebe (24:42)
Yeah, exactly. I would agree. Yes, you get chaos when you don't have accountability. You can't give the decision rights to a team but not holding them accountable for the outcomes. The good, the bad, the intended, the unintended. And that is the major point. If you give them the rights, the autonomy,

Mike Jones (24:45)
Yeah. Yes, yeah, yeah, yeah.

Yes.

Mm.

Janka Krings-Klebe (25:08)
you also need to say okay you need to you own the decisions and you own the outcomes and that is the problem when people say okay autonomy is chaos because they forget that you not only delegate the decision rights but also delegate the responsibility

Mike Jones (25:16)
Yes.

Yeah.

Janka Krings-Klebe (25:33)
and unless you do that I agree it would end in chaos ⁓ but it works when you give them the rights and the responsibility and there are so many companies showing for decades that this works so Morningstar for example, Morningstar Tomatoes in California they don't have any any manager

Mike Jones (25:38)
Yeah.

Yes, yeah, yeah, yeah.

Janka Krings-Klebe (25:59)
and they are really doing well. And they have just several rules and one of them is keep your commitments.

Mike Jones (26:07)
Mmm. Yeah, yeah, like that.

Janka Krings-Klebe (26:09)
⁓ what

you commit that you're doing or what you are delivering and you keep your promises that is a commitment and you need that and then you won't get chaos and the other thing is we have this increasingly hyper dynamic in in the markets they it's it's the markets are accelerating in speed

Mike Jones (26:21)
Yes.

Janka Krings-Klebe (26:36)
dynamic in complexity and you can't control everything from the top in a hierarchy system because market is moving faster than this coordination system can react so you are losing pace you're falling behind and what you can do is ⁓

Mike Jones (26:53)
Yes.

Mm.

Janka Krings-Klebe (27:01)
thinking of legal blocks, modularize your company with having all those little teams with autonomy but also with responsibility. And they can act, you multiply your options regarding products and teams that could respond to new market opportunities. And then you also make the risk.

Mike Jones (27:11)
Yes.

Yes.

Janka Krings-Klebe (27:27)
low because if one team fails it doesn't mean the whole company fails it's just one team.

Mike Jones (27:33)
Yes.

Yes. Yeah, you're right. And there's the viability principle that we always live by, which is that you must be able to move as fast or faster than your external environment or your competitors, otherwise you cease to exist. And that's where you see that real control, lot of bureaucracy, many decision layers, slow that down. So it's not your people.

that can't move quick. It's their inability or not due to own fault, but to deal with the layers of decision-making, the bureaucracy, the internal inertia that slows them down. And I really like that visual around the autonomous teams. And actually, that's what gives you that anti-fragile because as soon as hear it, you see a disruption, it's not affecting the whole company.

is affecting the team. And not only is it just affecting that one team, but that team has all the resources to adapt hopefully to that situation as quick as possible. with that, gives you better, it sounds counterintuitive to people, but when you have that, it gives you better oversight of what's going on.

Janka Krings-Klebe (28:28)
Yeah, excellent.

Mike Jones (28:50)
rather than what you think if in a traditional hierarchy you would have greater oversight, but you don't because it's too much information and too much decision rights at one point.

Janka Krings-Klebe (28:58)
Yeah, and it's filtered

in each layer. It's aggregated or filtered. So those at the top won't get those information you have at the front line because it went through so many filtering layers. You only get a very brief abstract of it. Yeah, that's right.

Mike Jones (29:11)
Mmm.

Yeah, yeah, yeah, I like it

Janka Krings-Klebe (29:24)
and

another as you mentioned this disruption even if that one team fails. If you don't learn from that or if the organization doesn't learn from that then yeah okay missed chance but if you learn why this team failed and or why it couldn't cope with the disruption

Mike Jones (29:37)
Mm.

Janka Krings-Klebe (29:47)
When the organization learns that, that makes you stronger because in the next time you see those early signs coming up, you're better prepared.

Mike Jones (29:57)
I mean that learning's important. When you look at the face of it, we say, we're be a learning organisation. It seems obvious. It's like everyone's like, yeah, of course. But they don't take into account what the organisation behaves like. And I've said this, when you have real high sort of control,

and policies and processes, you tend to find that the organization's communication is more about compliance and failure. And when it's like that, learning goes out the window. Because people, when people's team fails, they're not going, I wonder what happened with that team and how can we learn? They're going, ⁓ I'm glad that's not me.

Janka Krings-Klebe (30:36)
Thanks

Mike Jones (30:47)
finally the heat's off me and my team now and it's on them for a bit so I'm going to rest until it's back on me and it's the counter-learning organisation that that creates rather than one that sees those opportunities learning and they balance the rules or principles of the organisation against being curious and learning about what's happening and what could we do and what could we learn and take forward in the future.

Janka Krings-Klebe (31:13)
Yeah, you're absolutely right. And the main problem is, so if you think all those components of a company, don't exist in silos. So ⁓ when you think of a startup, it starts with a product and maybe let's assume it's successful in the market. So the first topic after knowing what is my business model, what is my product,

Mike Jones (31:24)
Hmm.

Janka Krings-Klebe (31:39)
who's my customer is that you design the value stream and for designing the value stream you need to think of okay how do we what capabilities do we need to produce this product what resources do we need what processes do we need how do we organize so what's what should be first you think when

you have a strategy from how to bring your business model to life is how do we organize that? And that's the governance. And from that you should derive the processes, the structure, so hierarchy or anything else. And also what kind of capability you need and on and on.

In fact, what you usually do today is because everyone thinks hierarchy is the state to go to. That that you say, okay, we need to organize in a hierarchy. And then we need somehow organize the rest around it. So.

Mike Jones (32:36)
Yeah,

Yeah, yeah, yeah. Yeah.

Janka Krings-Klebe (32:48)
you don't even you don't think that much of how do we how do we organize how do we organize decision-making etc because In the moment you have a kind of hierarchy You take that as default and you have this decision-making hierarchy as a kind of shadow hierarchy again, so it's

Mike Jones (32:59)
Mm.

Yeah.

Janka Krings-Klebe (33:12)
it's becoming more about compliance and who is going to decide. And from that point, teams, team members are not allowed to decide.

Mike Jones (33:16)
Yes.

Yeah, no, agree.

Janka Krings-Klebe (33:25)
And

then over time, when the company gets more and more money too, what happens is you put more and more rules and compliance topics and topics that come from outside, legal stuff on top. so over time, your governance is getting...

Mike Jones (33:44)
Yeah.

Janka Krings-Klebe (33:49)
heavier and more and more about compliance. And that kills everything that doesn't follow the rules of your predominant business.

Mike Jones (33:53)
Yes.

You see that all the time. You see when organizations, even now more mature organizations, when they go for restructure, they still make the same mistake as you talk about hierarchy. They go, well, I've got this leader on top and they want these people because it's just orthodoxies that we have these people. And then it sort of goes down. Well, they need direct reports and it goes down where...

as you highlighted there and we talked about being closer to the customer, it's about, well, that's the backward way. But really what you need to do is think about, well, what is the value that we need to produce? And how do you produce that value to the operating model? Then it's about how do we need to coordinate what decision, like what information flows, handovers need to happen? Then we think about decision rights and it's decision rights that...

enable that, I suppose, what our view of traditional structure is. I think that helps us where I think people are still trapped in this way where we need to start at the top and work our way down and forgetting that the value is produced at the edge of the organization, the closest to the customer. Yeah, we're still backward.

Janka Krings-Klebe (35:10)
Exactly,

Yeah, and what management has learned over the time, for roughly 100 years since the second industrial revolution is, it was all about keeping or becoming better in stability, in forecasting. Or as Peter Drucker said, it's like driving on a country road at night without light by looking out of the back window.

Mike Jones (35:21)
Yeah, yeah.

Yes, yeah,

Janka Krings-Klebe (35:37)
⁓ So the problem is the last 100 years was all about stability and foresight to predict the future based on the information from the past. And it was all about efficiency. can Tayloristic driven efficiency? was inward looking.

Mike Jones (35:37)
Yeah, yeah.

Yeah.

Mm.

Janka Krings-Klebe (36:01)
How can we become more efficient? How can we squeeze out the final sense to become more profitable? And so you streamlined everything towards your predominant business and leaves no room for new ideas that are not that close to this one predominant

Mike Jones (36:12)
Yeah. Yeah.

Mmm.

Janka Krings-Klebe (36:28)
business. And by always looking inside, we forgot to look outside. What's happening outside the company? Sadly, the market is moving faster than you could keep up with.

Mike Jones (36:29)
Yes.

Yeah.

Yeah, it's like thinking back to the iPhone and you you see the famous videos of Steve Bolch, I can't remember his second name, but Steve, the Microsoft guy and a few others and they were talking about, are you worried about the iPhone and stuff and they're like, no, no, no, we're not worried about it because they were doing exactly what you do. They're looking at past data, past information.

Janka Krings-Klebe (36:50)
Yeah.

Yeah.

Yeah.

Mike Jones (37:13)
But when we're thinking about the external environment, I'm not saying no date is useful, it's about a world that does not yet exist. And it's about seizing those opportunities. But if you're just so fixated on a balanced scorecard that gives you indicators of what happened the last six months, you're not going to have that capacity then to think about what's possible, what's the future doing.

Janka Krings-Klebe (37:21)
Exactly.

Mike Jones (37:38)
and how can we seize that to our advantage.

Janka Krings-Klebe (37:40)
Yeah, exactly. And it is more demanding than ever that you know, you need to recognize those early signs, upcoming opportunities in the market. Because the problem is markets are getting more and more dynamic. People are connected better than ever before. Customers decide within hours

Mike Jones (37:56)
Yes, yeah, yeah.

Mm.

Janka Krings-Klebe (38:04)
they may also re-decide what kind of product they want to buy. So the market is moving faster than ever. Condumer desires just switch in a blink of an eye. And so you need very, you need to be very close to the market. Otherwise you won't get those early signals and you miss those opportunities because

Mike Jones (38:12)
Yes.

Mmm.

Yes.

Janka Krings-Klebe (38:30)
the time when you design a new product and bring it to the market the time that this product is profitable is shrinking because competition is also increasing so your product lifecycle time is shrinking the reaction time you have

Mike Jones (38:44)
Yeah.

Janka Krings-Klebe (38:51)
is also shrinking and that you need to find a different way to still stay relevant in the market. And that means we need to sense those early signs so that you have enough time to develop a product that may match with this upcoming user expectations or needs. You may fail, but that's the same in venture capital.

Mike Jones (38:53)
Mmm.

Yes.

Yes.

Janka Krings-Klebe (39:18)
When you look at adventure capital, usually 9 of 10 startup ideas fail. So that's the same. You need to try out what works and what doesn't work. And that's the only way that keeps you in the game.

Mike Jones (39:25)
Mm, that's Yeah.

Yes.

Yeah, you highlighted some really good points around, know, that organisations can probably reflect on and think, you good is our sense making? So how in tuned are we to the external environment? How do we balance the tension between status quo and change?

So have we got that innovative element in our arm and is that actually protected to innovate? And maneuverability. So what's our maneuverability like in our organization? Because you said that the product cycle time, profit time is getting shorter. So that means we need to move at a greater pace. Otherwise, yeah.

Janka Krings-Klebe (40:20)
Exactly.

Mike Jones (40:21)
If we're too slow, as the competitors will come quite quickly. So if you could only move at a continuous improvement pace, that's probably going to be out of sync to what the competitors, what the external environment do. And that's probably a good advantage to think how do we increase our change rate across the organization so we can connect it from the sense making to the ideation to the innovation of getting the business.

from idea to profit as soon as possible.

Janka Krings-Klebe (40:52)
And he especially what is a great, I wouldn't say key indicator, but what gives you an idea is think of a new idea or an opportunity and the organization is still thinking about maybe do we want to jump on that opportunity or not? Then the question is

How fast can you adapt your processes, your internal processes, so that this opportunity can really smoothly flow through your organization and get what it needs? So how fast can you adapt your existing processes or create one? What does it cost? So how long does it take to get those costs back from the profits?

you get from that potential product. And what would it take to reduce this amount of money and that time to half?

Mike Jones (41:45)
Yeah.

Janka Krings-Klebe (41:54)
if you so it would what about having this in half the time at half the costs how easy is it to start with a new idea in your company

Mike Jones (41:54)
Hmm.

Janka Krings-Klebe (42:06)
Do you have an innovation process outside the R &D department at all?

Mike Jones (42:07)
Yeah.

Janka Krings-Klebe (42:12)
Assume you have an employee with a good idea. How hard is it for this employee to explore this idea further, to work on that, to make an MVP out of it, to get funded, to get resources, to try things out and to validate his or her market idea.

Mike Jones (42:33)
Yeah.

Janka Krings-Klebe (42:37)
How easy? Is it like a one click buy on Amazon? Or is it much harder? If it's not that easy, like a one click buy on Amazon, you have a problem.

Mike Jones (42:37)
Mmm.

Janka Krings-Klebe (42:49)
Because innovation needs to be easy. Not innovating, but process needs to be easy because then you can get people into that topic. Then you can get people...

Mike Jones (42:49)
Yes.

Mmm.

Janka Krings-Klebe (43:05)
wanting to ideate, to get a new, to test a new idea. The harder the process is, the less people you get.

Mike Jones (43:11)
Mmm. ⁓

Yeah, I can see why you're a good sparring partner for these people because I have no doubt that if you get the executives or people in that organization, you're standing there asking them these questions. I'd love to be in the room. Definitely when you get the different perspectives of the executives, but also the people on the ground, they're like, how easy it to get us from half that time and you probably get...

Janka Krings-Klebe (43:33)
Yeah.

Mike Jones (43:40)
some of the executives going, yeah, it's been quite easy. And you've got people on the ground going, not a chance. Yeah, yeah, yeah, long time. But I think those questions that you talked about, they're really revealing. And I doubt that a lot of the times, because we're so used to just delivering and delivering, do we sit back and think, actually, how are we? Because as you said before, over time,

Janka Krings-Klebe (43:43)
Yeah.

Mike Jones (44:02)
We increase more policies, more processes, the regulators get involved and we have more and it almost becomes unconsciously we are creating those challenges, these difficulties. But when do we stop and think, actually, where are we now? What's happened? How has this impacted our ability to do X, Y and Z? So I think, yeah, those questions are really revealing.

Janka Krings-Klebe (44:25)
Yeah, that is a feedback loop we usually don't close in the company. We don't reflect on our governance, we don't reflect on our processes and that leads to this bureaucracy. We always put, we add on top but there are still processes that are not valid for any other stuff and I...

Mike Jones (44:30)
Mmm.

Janka Krings-Klebe (44:49)
I experienced that at Bosch myself when I worked for the special machinery division. We found out that those, I think it was 97 rules for purchasing and for the corporate. And because we were producing

special machinery assembly lines automated assembly lines for mass production and that is not comparable to let's say a driller or a diesel injection pump that you produce I don't know hundreds within an hour so from all these 97 regulations only five

Mike Jones (45:24)
Yeah, yeah.

Janka Krings-Klebe (45:33)
are applicable for us.

Mike Jones (45:34)
No. Yeah. Yeah.

Janka Krings-Klebe (45:35)
So

you see, the dominant business is always ruling the processes. We don't think of modularizing them. And that is holding us back.

Mike Jones (45:42)
Hmm.

No.

Yes, and I agree and sometimes it's, know, correct me wrong from your experience, but sometimes you have got the physical barriers like the governance and stuff like this, but then we over time internally create our own constraints and barriers because our belief, because we just feel that we're so constrained that our belief is, we can't do that. How can you not do that? And there's not reality to it. It's just...

They just learn over time that why bother? Because it's too hard.

Janka Krings-Klebe (46:16)
Yeah, exactly.

People adapt. So you can be an innovative person and let's say being really creative in, I don't know, building your garden and houses or what else?

and then entering the company and completely losing that ability. Because as humans, are very good in sensing in what kind of culture we are in at the moment in a certain context. And when we learn that we are not allowed to decide whether we can buy a pencil or not, then we adapt.

Mike Jones (46:36)
Yeah, yeah.

Janka Krings-Klebe (46:59)
We always adapt to the culture. And culture is nothing that you just put on a wall in the entry hall. It is what you experience day by day. What is allowed? What is incentivized? And what is sanctionized?

Mike Jones (47:13)
Yeah.

Yes.

Janka Krings-Klebe (47:20)
Am I allowed to decide certain things or not? How do people interact with each other? How is the tone they talk to each other? What is the management doing? How do they act? What kind of behaviour do we see in our management? Do they decide and then chicken out or do they...

Mike Jones (47:37)
Mm.

Yeah.

Janka Krings-Klebe (47:45)
stand their line. So that is what builds a culture. What you experience on a daily basis. so you could have the most innovative people in your company that are only innovative when they leave the company. ⁓ Because your rigid rules and structure won't allow them to be innovative within the company.

Mike Jones (47:50)
Yes.

Yeah, yeah.

Janka Krings-Klebe (48:09)
Because

Let's say you are not accepting any failures then people won't try things because the risk is too high it would maybe end their career.

Mike Jones (48:21)
Mmm. Yeah, I like that. And I think that's really gets overlooked in when we think about antifragile organizations, our ability to act. It's we need to move away from just this idea that is behavioral, but I can just tell people to be more inventive. Like you said, think outside the box.

and we really do need to look at the systemic elements of it, see the structures, the processes, the decision rights, and all these things help then emerge the culture of the organization, a way in which people understand how they should behave in that environment that can be useful or not. That's really like that.

Janka Krings-Klebe (49:00)
In the past

we trained people that alignment means uniformity.

Mike Jones (49:07)
Yeah.

Janka Krings-Klebe (49:07)
But alignment is more about unity. We need to be sure to move into the same direction or towards a shared goal or purpose. But we should allow to take different routes.

Mike Jones (49:11)
Mm.

Yeah.

No, yeah, exactly. I agree. That coherence. That's a great point for people to think about. But it's been fantastic having you on. I've really enjoyed the idea of what you're talking about, the anti-fragile. And more so for me, because a lot of times when people talk about anti-fragile organisations, they talk about this stuff, it's very much just a checklist or...

just a behavioral mindset thing where you really explore the more systemic elements of how in your context as a leader, you can apply this stuff. And it's not just do this, this and this, it's more a way of how to think about these. I think that's really good, so I appreciate that. Before we go though, is there anything you would like to lead the listeners to think about from this episode?

Janka Krings-Klebe (50:17)
yeah, yeah. I would end with a kind of provocative statement. When we look outside, I would say to the markets, I would say, yeah, welcome to the Cambrian explosion of business. We're in an era where ecosystems outlive empires and fast learners eat the well planned. So...

Mike Jones (50:24)
nice.

Janka Krings-Klebe (50:41)
I think the future isn't built, it's grown. Everything can evolve and it will evolve. Everything that can't evolve will die. Net-to-fragile organizations feed on the explosion of options. Governance becomes guidance. Ecosystems become lifelines. Strategy becomes survival of the most adept.

Mike Jones (51:05)
Yeah, I like that. I just love the idea about the optionalities of keeping those options alive. And we've seen increasingly around more complex environments, processes aren't the key, it's principles, it's guidelines to help thinking. yeah, that's really good. Like I said before, I could imagine what it's like to be an executive getting in the ring with you.

You know, I bet it's a hell of a journey, but by the time round 12 comes, it's been insightful. And I've really enjoyed this conversation. So please, Yankee, thank you very much for joining me today.

Janka Krings-Klebe (51:44)
Thanks a lot and I really enjoyed our conversation.

Mike Jones (51:47)
Thank you. And for the listeners, if you enjoyed this episode, please like share to your to people, you know, that may enjoy this as well. I'll put the link to the anti-fragile organisational book from Yanke and a colleague. And yeah, I hope you enjoy it as much as I do. So I'll see you next time. Take care.