Writings
Foreword by Peter M. Senge, page 2
Likewise, with innovations in many other areas, O’Brien and his Hanover colleagues ventured where few predecessors had gone. They worked to develop a “values-based, vision-driven” organization well before writing values and vision statements became a corporate fad. They identified knowledge generation and diffusion—organizational learning—as a core source of competitive advantage before anyone had written about “knowledge management.” Along with a few other pioneers such as VISA, Hanover developed a radical, decentralized governance system, with divisions reporting to independent internal boards, before people ever talked about “decentering” large corporations.
In brief, the main reasons you may not have heard of Hanover is that it was so far ahead of its time that few knew about or understood what O’Brien and his cohorts were doing.
I knew about Hanover because, in 1980, Bill joined a group of CEOs that met regularly at MIT to talk about deep changes that were starting to play out in the business world. The group included Ray Stata, CEO of Analog Devices and founder of the Massachusetts High Technology Council, and Arie de Geus of Shell, from whom we all learned about organizational learning for the first time. This CEO group became a prime incubator for many of the ideas that eventually came to underpin work on organizational learning, and the collaboration among the companies established the pattern that evolved eventually into the SoL (Society for Organizational Learning) global network.
From the outset, it was clear that Bill was a distinctive contributor among this group of leaders. His remarkable gifts for simply articulating complex issues and seeing to the bottom of things became deeply appreciated, as did his resolute unwillingness to swim with the tide of management fad and fashion.
For example, early in our meetings, he spoke of the importance of developing a “home-grown philosophy” in an organization. This had nothing to do with being closed to outside influences and developments in the larger world. Indeed, O’Brien was famous within Hanover for continually rocking the boat of organization tradition by bringing in people and ideas from outside. But he was equally adamant that no real change could start to occur unless new ideas were internalized and eventually became a transparent part of the organization’s own way of doing things. In this way, he was able to help the organization achieve balance between change and continuity, to keep experimenting without getting caught up in the “flavor of the month” programitis that afflicts so many corporations. “You must be truthful to the roots of the company,” Bill says— “transplants will be rejected.” The only way Bill believed a company could “sustain continual radical innovation yet not chase fads is to have theory and practice rooted in your soul.”
Theory is a word you rarely hear from managers. For O’Brien it was crucial. “One day,” he says, “I was reading a twenty-year-old memo. What it said was exactly what people were saying all around me at that very time. Every six to ten years, the insurance industry cycle shifts. When this happens, there are predictable patterns. When business gets hard, people withdraw authority from the field, cut the bottom ten to twenty percent of their agents, and publish new rules for more stringent underwriting and cost containment. Six to ten years later, when business booms, all of this is reversed.