What is an "Autonomous Organization"?

By definition, an “Autonomous Organization” governs or controls itself rather than being controlled by humans alone.

An “Autonomous Organization” (AO):

• Defines its strategy to deliver business objectives.
• Runs the business in auto-pilot mode.
• Detects anomalies and reacts to change rapidly.

The old way…

Think about a traditional car rental company with central management and regional offices throughout the world:

• The Business executives define the business objectives and related strategy centrally (products/services, business model, sales channels, locations of presence, expansion/areas of investment, hiring …).
• The regional managers run the day-to-day operations (service customers, manage employees / the inventory, keep the cars clean and ready, resolve disputes, …) and report the results to central management.
• The customers book their cars and pick them up mostly at airports from the rental booths. (as a process, they will have to wait in a queue, ask questions and sign papers and then inspect the car, later drop the vehicle only to the select locations and even prove that the extra scratch was not their fault!)

The main issue with this approach is that:

• High Operational Costs: An employee-centric approach is required to manage the process with related hiring and training.
• Customer Experience: The CX is low as customers may have to wait up to one hour at airports to pick up their cars. They can drop them off only at specific locations at specific times.
• Low Productivity: The regional managers spend %90 of their time managing the day-to-day operations.

In the new world, assuming the organization already did the following:

• The organization has already modernized its fleet with electric / autonomous cars.
• The business executives now only define the business objectives.

The organization, as an AO, would allow the machines (the system) to run the operations in auto-pilot mode to meet the business objectives :

The system would recommend the best strategy and budgeting plan to create the most profitable personalized offerings through the proper sales channels.

The system would tell when to sell the used cars in the market to get the most returns.

The customer experience might then be:

The customers download an app (as an assistant) to help them during their journey (no need for customer service or car rental booths)

Once the customer has landed, the app will ask the car to pick the customer up from the airport exit at the right time. (no hassle to signup papers, wait in queues, etc.)

Once the customer decides to return the car, they can drop it off anytime at the airport in the parking lot. The car would then drive back to a station to recharge its batteries and clean up.

The regional managers experience would be:

The local managers would be busy creating new business models at their homes rather than managing the personnel for day-to-day operations. For e.g., they may identify that their car inventory might also be used in a new “car sharing service” to meet the emerging trend of “circular economy” and to create a new business model to generate revenue.

Only some things will go as planned in life. The unexpected trends and anomalies will need to be detected, understood, and reacted to on time. The local managers will be invaluable in helping to resolve such issues right on time.

As a result, our target AO would promise to deliver the following benefits to business executives and customers:

• ++ Minimum operating costs (no car rental booths, no employees)
• ++ Competitive edge & profits — Allows decentralized regional/local managers to develop new business models/products/services for local markets to test them quickly on the market.
• ++ Better Customer Experience — Assistant help is ready to answer any questions 24 hours a day — Similar to the Siri experience!
• ++ Scalability — No need to hire/ train people to run the day-to-day business. It is a %100 Digital Business to scale quickly, with only 1 local manager required per region.
• ++ Transparency — No room for corruption and fraud.

Technology is opening new doors to organizations (especially SMBs), and embracing it at the right time will help them survive in the 2030s.

The organizations will need to take a faster step to create their AOs in parallel to their current businesses and groom it until it reaches maturity to run the business in auto-pilot mode.

The differentiation of organizations will lie in the speed of introducing new innovative services swiftly on the market rather than dealing with day-to-day operations and securing their own customer base using traditional methods.

The AOs are the future of organizations and will be crucial in the coming five years.

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