Higher-Order Organizations and the Post-Lean Future

In most organizations that have embraced Lean, including Toyota, hierarchical structure still persists. This does not fit well with the type of organizations we see emerging in the near future. Our world is being disrupted by exponentially developing technology, automation of all routine work, shorter employee tenures and organizational lifespans, dynamic freelance markets and an increasing desire for self-actualization. Spontaneous generation and dissolution of organizations and loosely coupled networks of organizations will be the norm rather than the exception. We call this the Post-Lean Future.

In this paper we describe the Post-Lean Future and discuss the tension between just-in-time organizations and developing people. We propose higher-order organizations, organizations that generate other organizations, as a possible way out.