Overcoming Entropy and Bureaucracy
The 2nd Law of Thermodynamics states that entropy (disorder or uselessness) always increases in a closed system because there are far more ways in which matter can be arranged that are disordered and useless than are ordered and useful. Otherwise known as the Law of Entropy, it is considered by many scientists to be the most fundamental law of nature.
Disorder increases spontaneously with time. Our challenge is to overcome entropy by continually striving for an open and beneficial order, which can only be created through the application of energy and knowledge.
Ever-increasing entropy afflicts human affairs just as it does the physical world. For individuals, organizations and society, there are always untold more ways for things to go wrong than for them to go right: “Whatever can go wrong will go wrong.”
At Koch, our approach to overcoming entropy is to create and deploy energy and knowledge through our principle-based framework. This requires energizing all employees to apply these principles, continually transforming themselves and their organizations. We seek to create and maintain a culture in which everyone is open to learning and recognizes that no matter how well we are doing, we can always do better. We learn what is possible and work to achieve it. This is our way of creating an order that is beneficial to us and others.
In organizations, the most common manifestation of entropy is bureaucracy. Bureaucracy results from fixed, detailed rules and procedures, rigid hierarchies and perverse incentives. These bring about loss of the knowledge, ideas and motivation of employees throughout the organization. The effect is entitlement, unaccountability, cynicism, form over substance, slow and poor decision making, risk aversion, resistance to change, short-term focus and lack of openness, knowledge sharing and innovation.
To avoid this tendency toward stagnation and decline, driven by entropy/bureaucracy, we strive to continually transform ourselves and our organizations. By daily renewing our dedication to understanding and applying principles of human progress, we give ourselves and others the opportunity to realize our potential and live lives of meaning.