Networks, the signature form of organization for the 21st century, are everywhere--but instead of wiping out hierarchy and bureaucracy, networks reduce them and transform them. In the Age of the Network, there's room for all types of organizations. The art of co-opetition, combining cooperation and competition, is key to success. When people learn to cross their own organizational boundaries, they gain great power. Working in teamnets--networks of teams--people can do together what they cannot do alone.

• Why Networks?
• Riding the Transitional Wave
• What are Teamnets?
• Co-opetition: When Competitors Cooperate
• Benefits of Boundary Crossing

A global revolution is underway, a social upheaval in organization that involves you and everyone you know. It shakes every place of work, quakes the foundations of our biggest institutions and our smallest groups, even sends quivers into our homes and communities. It swirls through organizations of all sizes, in all sectors, in all countries. Regardless of gender, race, creed, or economic status, people are turning their organizations upside down, on their sides, and inside out.

The network is emerging, the signature form of organization in the Information Age, just as bureaucracy stamped the Industrial Age, hierarchy controlled the Agricultural Era, and the small group roamed in the Nomadic Era.

Does this mean "smash the boundaries," "tear down the hierarchy," and "dismantle the bureaucracy?"

"Clear out the old to make way for the new" goes the conventional wisdom. Appealing as these slogans of management revolution might be, they are misleading. Has any organization you know rid itself entirely of hierarchy and bureaucracy? What is more important, should it?

To develop healthy, flexible, intelligent organizations for the 21st century, we need to harvest the best of the past and combine it with what is really new. Surely, some learning from thousands of years of organizational life must be worth keeping. There must be continuity as well as change.

So, what is timeless in hierarchy and precious in bureaucracy? Where's the baby and what's the bath water? What should we throw out, what is best to keep, what is both new and will be enduring?

Every day, our interaction with traditional organizations presents us with the personal challenge of learning how to function in groups, small and large. Couples argue about how to organize the housework; co-workers squabble about who's in charge; politicians debate how to balance their power, even to the point of "reinventing government." New ways of doing things are growing in, between, and alongside "the way things are and always have been."

Each of us participates in many small groups. Every encounter, every meeting, every moment spent planning the future is an opportunity to do a little organizational design. With each new set of connections, we realize anew how connected things really are-among people, small groups, companies, cities, nations, and every other human grouping.

Millions of people are active participants in the organizational revolution propelling world civilization into the Age of the Network. The writing of the next chapter belongs to all of us as we design the organization of the future, which looks as different from the one of the past as the box-car does from the chip.

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We don't arrive in the next century without a heritage. Today's generations straddle two eras, the graying industrial one behind, and the sleek information one ahead. Just a decade ago, this was Sunday Supplement speculation; today, it is a mainstream idea.

Collectively, we are in the middle of the transition. Too far in to go back, yet not far enough along to see how it's going to turn out, we are actors in the drama, playing out the awesome zig-zags of truly changing times.

Today, in transition, we naturally live with all types of organization.

• Hierarchy, the top-down pyramid, has been pronounced dead, yet lives, and, in most circumstances, still holds final rule.
• Even as virtually everyone vigorously complains about it and finds ways to skirt it, bureaucracy, with its neatly stacked, specialized boxes, continues to spew out more policies and procedures, rules and regulations.
• Small groups and teams are in-from the shop floor and front desk to the executive suite and board room.
• At the same time, new networks are forming, both within and among older organizational forms.

How do these forms fit together to create the most effective organization for a variety of circumstances, including your specific situation? To help answer this question, we need to start with a broad view.

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Teamnets bring together two powerful organizational ideas:

• Teams, where small groups of people work with focus, motivation, and skill to achieve shared goals; and,
• Networks, where disparate groups of people and groups link to work together based on common purpose.

While teamnet means "network of teams," the two comprising terms are complements; each brings something to the other. "Teams" imply small, in the same place, and tightly coordinated; "networks" imply large, spread out, and loosely linked. "Teamnet" brings the best of both together:

• Teamnet applied to small groups means more networked teams.
• Teamnet applied to large groups means more team-like networks.

In an ideal teamnet, people work in high-performing teams at every level, and the network as a whole functions as though it were a highly skilled and motivated team.

The Teamnet Factor is about organizational advantage.

What Denmark, Asea Brown Boveri, Erie Bolt, and Japan represent is the power of people to organize for competitive advantage. Japan has few natural resources or other traditional industrial advantages. Its advantage is organizational.

The right organization gives you the right edge.

Teamnets are an intra-enterprise way to leverage small empowered business units and an inter-enterprise way to leverage partnerships with other businesses.

By using the power of boundary crossing for mutual competitive advantage, companies can organize to tap people's potential, enter new markets, expand their product base, and invest in the future. Teamnets are organizations for the new economy of the 21st century.

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Compete and cooperate. Many businesses will not survive into the 21st century unless they resolve this apparent contradiction. Will yours?

There is a great strategic change underway in the way the world does business.

Companies cooperate and compete at the same time.

The competitive advantages of cooperation come from doing things together that cannot be done alone. The cooperative advantages of competition arise from innovation and striving for excellence.

"Co-opetition" is the oxymoron that combines the words cooperation and competition. You may have already heard the term, perhaps used in a context like this TV story about the auto industry:

The Big 3 auto makers meet with their Japanese counterparts in May 18, 1992, in Chicago. They are setting up "a number of task forces to explore areas where Americans and Japanese can work together for mutual benefit," Peter Jennings explains on ABC News. "Cooperation between US and Japanese companies has produced a new word-`co-opetition'-which industry analysts say may be the wave of the future," reporter Al Dale tells the viewers using this newly minted word. "[It] may be the only way for some car makers to survive in years to come."

Coined word or not, co-opetition perfectly captures the difficult to describe dynamic of independence and interdependence. This dynamic is at the core of the new emerging flexible organization style that so many companies emulate. Fast replacing the old, hierarchical bureaucratic organizational machine, this style uses cooperation to cross boundaries, not competition to dissolve them.

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How does a boundary crossing teamnet differ from a conventional team?

A boundary crossing teamnet crosses traditionally guarded organizational borders. Borders remain, benefits are gained.

What such teams have to offer is critical for dealing with the speed of change and the new decentralized, globalized economy. Teamnets boast three basic competitive advantages: power, speed, and flexibility.

• Power
  With more than one organization working toward the same purpose, boundary crossing teamnets have at their disposal the power of the part and the power of the whole. They share knowledge, learning, skills and resources. In Louisville, Kentucky, the Ford Explorer and Mazda Navajo come off the same assembly line; Ford does most of the styling while Mazda provides the engineering. At the other end of the scale, small businesses acting together have the buying power of big companies.
• Speed
  Boundary crossing teamnets streamline decision-making. Multiple decision-making leaders work in parallel on different aspects of the same problem. A few phone calls replace 15 levels of signatures. Rapid realignment of resources to respond to opportunities is the order of the day. Information disseminates rapidly through person-to-person contact rather than official forms and memos that no one ever reads.
• Flexibility
  Unlike their rigid bureaucratic relatives-organizational "stove pipes," "silos," and "chimneys"-that prevent creative response to opportunities, teamnets are highly plastic. They bend, conform, and contort, configuring and reconfiguring to respond to the needs of the moment. Because such teams depend upon many connections among members at many levels, they are always "at the ready" to take a new shape, depending on what's needed.

Every culture has its own view on why cooperation is "unnatural," why the idea "can't work here." Ironically, a fierce strain of independence is one of the necessary ingredients that makes such arrangements work. There's a healthy tension between autonomy and integration in boundary crossing teamnets. These attributes weave through the invisible infrastructure that permeates teamnets of all sizes-from the global scale of McDonnell Douglas's proposed new jumbo jet to the local success of a woodworking network, The Philadelphia Guild.

If the ideas in the chapters ahead prove to be the trend of the future, many companies and people in many countries all will be winners.

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