Organizations & the First Law of Thermodynamics

The first law of thermodynamics is conservation of energy. The law states that the total energy of an isolated system is constant; energy can be transformed from one form /state to another, but cannot be created or destroyed. This can also be stated as the energy of a system has to be equal to the work that is being done, plus or minus the heat that flows in or out of the system.

Organizations and the first law of thermodynamics 

In business terms this means that the energy put in by your organization cannot be destroyed, however it also does not mean it will result in work that generates positive results for your business. A portion of organizational energy represented as heat can be viewed as loss of work, however when recognized and managed, it can have either negative or positive effects.  

Let's look at the problem in very simple terms

As a leader you place a goal or task on your organization. Your expectation is that the amount of energy or resources required to satisfy the task is defined and it will perform at a very high level of efficiency. The amount of energy or work required to meet your goal is viewed as a constant and you track progress and results. The problem with this type of management is that we do not take into account the energy that will be utilized outside of accomplishment of the goal. We tend to think in terms :

This view leads to disappointment, schedule slippage and cost overruns of projects, tasks and unmet expectations by management. In many cases it also fuels greater future waste in additional reporting and meetings spent trying to understand what went wrong. The reality is leaders and managers need to take into account that only a percentage of their organizations capacity or energy will be utilized in meeting a specific expectation. 

A different way to look at this equation

Let's again start with placing an expectation or task on an organization to deliver a result. If we agree a portion of the energy put into meeting this expectation will not be converted into driving the result what will come of it? Well that has a lot to do with the culture you have established in your organizations. This energy may be wasted in discussion and discontent with the expectations of management or worse it could be used in derailing or slowing efforts in accomplishment in the work outlined.

In a culture of open innovation and transparency as described in my post Lessons from "Nature" in Organizational Transparency this energy can be utilized a positive manor. The energy not converted into work is not wasted rather it is used to refine and re-scope the definition of what success means in the expectation of management and leadership in the form of innovation. It can reduce the effort required to accomplish a task or in many cases improve the organization value of work accomplished. 

The innovative organizations approach

The key is the context we consider work is accomplished versus fulfillment of a task. A culture or management style that is open and adaptive to new ideas and methods understands that Q exists and can have a positive effect . When employees understand managements desired outcome and are not constricted in the way to accomplish an expectation a magnification of the value of work done is possible. So if we think about the equation in terms of its relationship to organizational value:

This view does not change thermodynamics first law of conservation of energy as described above however its brings value into context and allows for energy not converted into work to be utilized in a positive manor.

I hope you enjoyed this perspective on how this simple law can be viewed in how effective you or your organization creates value. As always, I enjoy comments and appreciate pushing the thumbs up like button if you found this interesting and thought provoking.

Thanks,

Kevin