Vedic philosophy describes the body as a universe and the universe as a body. Since the world is intended for living beings, there is no fundamental divide between “physical sciences”, “life sciences”, and “social sciences”. Thus, the cosmic structure, the social structure, the biological structure, and the psychological structure are parts of a single continuum. Given this continuum, we can presume that what lies in between the categories that Vedic texts already describe can also be described in the same way as the other types of entities on the continuum. I will use this post to illustrate the application of Vedic principles to sketch the foundations of an Organizational Theory, borrowing from the principles of material organization found in other areas such as Ayurveda, Aśtanga-Yoga, Vedic Cosmology, and Sāńkhya philosophy. Such a study is useful not just in comprehending the nature of organizations, but also helpful in comprehending other kinds of organization such as the universe and the living body.

A Quick Recap of Three Modes

Vedic philosophy provides a description of matter comprised of three modes of nature. There are many ways to understand these three modes, and one of them is called manas, prāna, and vāk. The term manas means the mind or an idea. The word vāk means a word or sound that expresses that idea. The connection or the process by which the idea is converted into a word is called prāna.

I’m quite certain that these are not easily understood ideas, so other ways to understand them are not likely to hurt us. The world in Vedic philosophy is symbolic—i.e. it expresses the meanings that the soul wants to enjoy. The universe is therefore comprised of symbols. A symbol has a meaning, or what Ferdinand de Saussure called signified. The symbol also has a physical embodiment that refers to the meaning, which Saussure called the signifier. This would have been adequate enough for symbolism if we were only talking about text in books, and not trying to describe how such texts were produced by the activity that converts ideas into symbols. When we try to describe how things are created from ideas, or how ideas are learnt from things, we run into conventional mind-body problems.

Saussure’s division into signifier and signified is inadequate. To make this complete, we have to add a third component into this—let’s call this signifying—which is the act of converting an idea into a symbol. A symbol can thus be broken down into signifier (vāk), signified (manas), and signifying (prāna). Thus, matter is a symbol, in which the mind is the signified, the body is the signifier, and the connection between the mind and the body (created through prāna) is the act of signifying. When the person dies, the prāna detaches the mind from the body, carries the mind to a new location, and then creates a new body. Prāna is the activity, manas is the idea, and vāk is the thing. A symbol has three aspects—and idea, an activity, and the thing produced by the activity which represents the idea.

The Building Blocks of an Organization

Based on the above description of material nature (manas, prāna, and vāk), we can find a synonymous English description for organizations. I will use the words “idea”, “process”, and “product” to translate manas, prāna, and vāk, commensurate with the fact that manas is the concept, vāk is the physical expression of the concept, and prāna is the process by which this concept is converted into the product. Many organizational theorists speak of these as the vision (which denotes the mission or purpose for which the organization exists), strategy (the path, trajectory, or methodology the organization will follow to achieve its vision), and execution (the actual products or services that the organization will provide to its consumers).

The words vision, strategy, and execution are much abused and variously nuanced. Therefore, I will employ a much cleaner terminology here—idea, process, and product—which have relatively cleaner interpretations and therefore subject to much less confusion arising from current theories.

If we want to quickly see an illustration of how this maps into a real-world organization, then we can think of a market-driven business organization where the new ideas are produced by the “field” teams such as sales and marketing, the “operational” teams define processes for execution and quality to convert ideas into products, while the “engineering” teams follow the processes to create a product. Therefore, the sales gets the “ideas”, the operations define “process” and engineering creates “products”. An organization must have these three parts in order to qualify as a complete organization.

The field teams create the requirements—the “what” and “why”—for the organization. The operational teams create the processes and procedures—the “how” and “who”—for the organization. Finally, the engineering teams create the actual product—“where” and “when”—for the organization. It is important to answer the “what” and “why” before we answer the “who” and “how” questions: we must know what we are going to do and why, before we discuss how it should be done and by whom. Similarly, it is important to answer the “who” and “how”—i.e. the methods of working and the qualified people who can follow these methods must be known—before these people would create the product (each product has parts with individual trajectories—the “where” and “when”).

Thus, a natural hierarchy or priority between idea, process, and product exists in all organizations. However, this doesn’t necessarily mean that all ideas would be freely created prior to products. It just means that some ideas must be converted into products because products can be used to create new ideas. In fact, there are both top-down and bottom-up processes as we shall soon see.

The Structure of an Organization

Every system requires some idea, process, and product. Whether all these things are done by a single person—e.g. a person expressing their ideas through speech—or they are executed by a team of people (which divides people into different functions) or they are embodied into the functions of a large organization, the logical components and their logical priority remains unchanged. In fact, by understanding this logical order and priority, we can construct complex hierarchies in which the product (output) of one level becomes the idea (input) for another level in the organization.

For example, in a business organization, a top-level executive can provide an idea as a brief to her subordinates who can then transform this synopsis into a detailed document of requirements, which even lower subordinates can elaborate into individual feature functionalities. The abstract idea thus begins at the top, but through processes and products, gets more and more refined. At the top, one might just have a crude idea. As this idea trickles down, it obtains better and better definition. In fact, the top-level idea division can in turn be divided into idea, process, and product, and then each of these divisions can be further partitioned into three parts.

The functionality of such divisions is defined in relation to the higher level entity. For example, if a division of “product” is under a division of “process”, which is under a division of “idea”, then the function of such a “product” division is to produce a document, which outlines the “process” by which new “ideas” will be created. Similarly, if there is an “idea” under a “process” under a “product”, then the meaning of such hierarchy is to provide an “idea” about a new “process” to create “products”.

Hierarchical Tiers of an Organization

Sāńkhya philosophy describes how the infinite variety in the universe can be reduced to three categories—idea, process, and product—and variety is created by structuring them into hierarchies. Each symbol has three parts—manas, prāna, and vāk—but its full meaning is given in relation to the entire hierarchy of symbols. In that sense, the universe is constructed as a diversifying tree of symbolic meanings.

As the symbols emerge from higher symbols, at the top of the tree are 3 trunks, which then divide into 9 branches, which then produce 21 twigs, and so forth, at each layer multiplying the divisions by 3. The tree grows exponentially in complexity, however, it still has a finite number of levels, which constitute the “space” of that level. The top level space has 3 parts, the next lower level space has 9 parts, the next lower space has 21 parts, and so forth. The top level concepts are abstract or “big” ideas. Their subdivisions are detailed or “small” ideas. The small ideas are created inside the big ideas, due to what I have called the has-a hierarchy of containment which creates parts inside wholes. Each of these tiers, from top to bottom, exists like a space stacked on top of the other spaces like a spindle.

The result of such partitioning is that the organization is now crafted into multiple tiers, such that each tier has three components—idea, process, and product—and each tier connects to lower tiers. At each tier, a good organization expects collaboration or cooperation between the idea, process, and product tiers. And at each level, a good organization expects a good command over lower levels. In that sense, each organization has “command and control” from top to bottom, and “collaboration and cooperation” from east to west. Organizations fail when there isn’t enough collaboration at a given level, and when an organization loses control over lower levels and the lower level is disconnected from the higher level.

Similarities to Biology and Cosmology

One of the key goals of this post is to illustrate that in discussing organizational theory, we are not talking about a new model that applies only to organizations. Specialization is dominant in the modern academia which divides knowledge into separate departments where each department speculates independently on its particular domain oblivious to what implications such theories have on other parts of the system. For example, economists have little understanding of sociological impacts of theories such as capitalism, because sociology is a separate department from economics. The sociologists, similarly, have little understanding of the impact of social organization on people’s psychology because psychology is a separate department from sociology. Similarly, every department operates independently, creating models that have little to no similarity to other departments. Vedic knowledge is different. It describes a model of organization that can be applied to every kind of system—cosmology, organization, and biology. Here are some similarities between the models.

An idea is higher than a process which is higher than a product, and yet these are aspects of a single symbol produced from a higher symbol (which too has the same three aspects). This means that there is hierarchy between the symbols and within a symbol. The different parts of a symbol are therefore not at the same level, and the different symbols at a given level too are not at the same level. Rather, there is a slight hierarchy within each level too, which means that the “level” is not flat or uniform on all the sides. Rather, one-side (denoting the idea) is higher than the opposite side (denoting the product).

In Vedic cosmology, the two sides are called Uttarāyaṇa and Dakshināyana as the Sun goes up and down a tilted circle. The connection between the idea and the product is made by a process, and there are two parts of this process—one that slants downwards and the other that slants upwards.

As the Sun goes downwards, the path is called Dakshināyana and as the Sun goes upwards, the path is called Uttarāyaṇa. The key point is in one half (called Dakshināyana) the ideas are converted into products using a process while in the other half (called Uttarāyaṇa) the products are converted into ideas using a process. The downward path defines products from ideas, while the upwards defines ideas from products. We can think of these two paths as synthetic and analytic respectively: the synthetic part constructs a product from an idea, while the analytic part extracts the idea from a product.

However, the synthetic and analytic processes don’t just execute within a circle. Instead, the process cascades across multiple levels as show in the above figure. The upward process covers one side of the circle while the downward process covers the other side of the circle. In this way, the upward and downward processes cross each other. These opposite processes are joined at the top and bottom, which means that when the product is fully developed, immediately the process of conceiving a new product is begun and when the new conception has finally been fully abstracted, the process of creating a new product is immediately started. Thus, there is a top-down loop, and there is a sideways crisscross loop. This kind of loop is best understood through the depiction of yoga-nādi in the body.

In yoga philosophy, the downward path is called idā and the upward path is called pingalā. The idā starts at the left nostril and then moves to the right and then back to the left alternately. Similarly, the pingalā starts on the right nostril and then moves to the left and then back to the right alternately.

It is also noteworthy that the downward path goes clockwise (similar to how a screw is tightened and moved downward) while the upwards path goes anticlockwise (similar to how a screw is unscrewed and moved upwards). Owing to this screw-like behavior, the idā and pingalā are said to be “coiled” and hence called kundalini. The coiling of the kundalini is often compared to a coiled snake. They constitute two opposite paths—upward and downward—but these paths are not actually straight lines. Rather, they are like spirals—move clockwise to go downward and move anticlockwise to go upward.

The upward and downward path are not active simultaneously. Rather, there is a time when the screw is tightened and the pressure is applied from the top to the bottom to convert ideas into processes and then into products. Then the pressure is released and the products are converted back into processes and then into ideas. The top-down motion is detailing, and the bottom-up motion is abstracting. These two processes are not applied simultaneously but occur one after another. Thus, the person who dies during Uttarāyaṇa ascends to higher planetary systems—because they are able to leverage the upward movement to transfer themselves to higher planetary systems. Similarly, the person who dies during Dakshināyana will be carried downward by the downward movement.

The true yogi, however, doesn’t rely on the alternating idā or the pingalā. He relies on the central nerve called sushumnā—which rests at the origin of the spindle and everything emanates from this origin. This central nerve is energized when the idā and pingalā are no longer alternating paths; instead they become simultaneous paths. Thus, the yogi doesn’t depend on upward and downward alternating process. He rather directly ascends or descends through the central nerve. We have discussed this in an earlier post.

The key import of this description is that for most people creativity and learning are alternate jobs. Initially everyone creates something and see whether it works; the fact is that most of the time it doesn’t work. Then they use the failures of the created system to learn new processes and ideas, and these new techniques and ideas are then used to refine the product iteratively. This is called the process of theory and experiment in which one observes the world and through an analytic process extracts the ideas out of material objects, and then tests these ideas by creating new objects. Thus, one goes through the cycle of creativity (constructing a product) and learning (analyzing a product).

The constructive process is anabolic and the analytic process is catabolic. Due this nature, the top-down process is that of Moon or creativity and the bottom-up process is that of Sun or learning. Since the top-down and bottom-up occur alternately, the process is described as a cycle in which there are alternating phases of Moon and Sun—which are then compared to the periods called “day” and “night”. Of course, they are not actual day and night; they are alternating periods of new analysis and new creativity.

While most individuals, organizations, and the universe go through the periods of creation and analysis, the true yogi called stitha-prajna situates himself at the center and away from the alternating cycle where he is not constrained by the cyclic movements to go up and down. Such a yogi can move up and down whenever he wants, which means that there no period for creativity and analysis. The person who has understood the cycle of creativity and analysis exits this cycle and places himself in the center which never changes—i.e. doesn’t go through the cycle. This fixed position helps them continually rise and not be effected by the ever changing cycle of rise and fall in the idā and pingalā.

The central path preferred by a yogi offers insights into how an institution or organization can end its “experimental learning” processes where it tries to implement a half-baked product, which inevitably fails, and then uses it to learn something new, and naturally the learning is about what was missing previously. Now this missing ingredient is again implemented in another half-baked product to avoid the shortcomings of the previous product, but the new product is now lacking in what existed previously. Thus, the new product also fails, and one goes back to the analysis phase of what is missing. In this way, organizations keep going round and round in circles repeating the same mistakes through a cyclic path. The exit for them is to realize that there is a “middle path” which is outside these cyclic paths. This middle path involves the creation of a “balance” between the various extremes. If any of the previously mentioned facets—idea, process, or product—is overemphasized, then an imbalance will be created. The “middle path” is therefore the path of balancing the three different tendencies to end the up-down cycle.

Two Models of Innovation

The perfectly balanced system is situated in the middle of the space shown above. The imbalanced systems are situated away from the center. As a system moves towards the center—i.e. obtains greater balance—the changes involved over a cycle continually reduce, and the system tends towards stability. The products created by an organization that is close to the center live very long and require minimal changes. The ideological churn in such organizations is minimal and the organization repeatedly produces the same product using the same process, instantiating the same idea. Ultimately, when the organization touches the center, its cycle of learning and creation ends; it can now evolve or rise to the next level where it can start delivering a whole new kind of product and/or service that it was not delivering earlier, closely aligned to what it was previously doing.

Conversely, as an organization moves outward from the center, the cycle of change becomes bigger and bigger. In each cycle, greater and greater number of products have to be created or modified, which requires a continuous generation of new ideas and new processes. Modern management theorists call this “innovation”.

The essential fact underlying “innovation” is that things are not working. If they were already working, then why would anyone require “innovation”? But if things are not working, then certainly there is a need to improve things. However, there are two modes of innovation—a real mode and an illusory mode. The real mode of innovation is that an organization produces very few products which don’t need to be changed. The illusory mode of innovation is that one produces too many products which need too many changes. In the former mode, the organization tends towards stability. In the latter, the organization quickly reaches instability due to radical, wide-ranging, and continuous changes, arising out of trying to do too many things—all of which are imperfect, and therefore require frequent revisions.

Modern management theory exhorts organizations to move towards instability in which everyone has to try to do many things which might all be imperfect in the beginning but they have to be quickly revised and improvised through experience, and the ideas or products discarded if they are not working. There is even a term for this illusory innovation model—“fail fast”. The central flaw in this model is that nobody is prepared to give any reasonable amount of thought and time to understand the real problems in order to build what is right. The goal is simply to build what one needs right now, test it against what little opportunities are available, and make a quick decision without understanding pros and cons. In short, impatience and short-sightedness are the techniques for innovation and the key value you can bring is to dazzle your consumer with a new shiny contraption such that it would be worthless soon, and you would now be required to prepare one more equally worthless contraption pretty soon.

Organizations which seem to profit from such a model of innovation don’t realize that as they do more and more faster and faster, they are running a huge risk of making many simultaneous mistakes, which can be hard to correct, and if they are not corrected, they can eliminate the organization. The intelligent consumers realize that they don’t need the latest and greatest innovations. They rather need something that works reliably, and can be obtained at lower cost relative to the value. Therefore, to fuel their model of innovation, the fast movers have to resort to “marketing” and “advertising” which are euphemisms for deluding the consumer into thinking that such “innovations” are necessary.

The Problem of Balance

As an organization iterates faster and faster, there are greater and greater opportunities for imbalance simply because some part of the organization will slack and not keep up with the pace of the rest of the organization. We cannot expect multiple distinct parts to move synchronously and harmoniously. Attempts to push organizations to run faster and faster can backfire as they can break the organization into disjoint pieces which are out of sync with each other. There is simply no way that humans can work faster and faster, because there is a pace at which humans are designed to work. The aim of all organizations should be to stop the churn in the anabolic and catabolic part of the cycle. That is, what we create and what we learn are stable and the organization operates smoothly, not making big ideological, process, or product changes. It just must be close to the center, ideally right at the center so that its products are widely appreciated, cost optimal, and long lasting.

As an organization picks pace, one or more of the three modes become dominant or weak, thereby resulting in anomalies. The table below describes eight cardinal anomalies.

Manas Prāna Vāk Notes 1 Dominant Weak Weak Many new ideas, but no practical realization of these ideas 2 Weak Dominant Weak Same idea produces same things by following many different processes 3 Weak Weak Dominant Many products from the same idea and process with minor differences 4 Dominant Dominant Weak Many new ideas and new processes but the end result is the same as before 5 Weak Dominant Dominant Old ideas but new processes used to create several different products 6 Dominant Weak Dominant New products created using new ideas, while following the same processes 7 Weak Weak Weak No new ideas, processes, or products; the system appears to be dead 8 Dominant Dominant Dominant Too many new ideas, processes and products; the system seems chaotic

Of course, these aren’t the only anomalies for two main reasons. First, these anomalies are sequenced one after another in a circular fashion within a given level. Second, the levels themselves are stacked hierarchically. Each symbol in the material tree can be anomalous in 8 different ways, and the result on the branches of such anomalies are exponentially higher. In other words, the chances of anomalous behavior are far greater than the chances of stable behavior. And as the system become anomalous, it risks being broken apart and destroyed. There are many typical failures by which organizations can die which include its members deserting the organization and its products losing the quality.

The Question of Organizational Longevity

Everybody wants to lead a longer life. Every organization, similarly, wants to exist perennially. However, just as living bodies can die sooner than later, similarly, organizations too can cease to exist sooner than expected. Forbes, for instance, notes that “Half a century ago, the life expectancy of a firm in the Fortune 500 was around 75 years. Now it’s less than 15 years and declining even further.” Similarly, Forbes also notes that “In total, Fortune 500 companies represent two-thirds of the U.S. GDP with $12 trillion in revenues, $840 billion in profits, $17 trillion in market value, and employ 27.9 million people worldwide.” These are amazing statistics because they tell us that on one hand the share of the large organizations is 2/3rd of the largest economy. On the other hand, they also tell us that the average lifetime of such an organization is now less than 15 years. The combination of the massive share and the rapid destruction of such large companies represents a crisis in Organizational Theory.

Those who argue that such “creative destruction” is good for society are probably blinkered economists who may have never opened a book on sociology, psychology, politics, or medicine. In other words, they have no clue on what effect such destruction has on society at large, and how it changes people in ways that is counter to the promise for which economics was invented in the first place—happiness.

Every society will build institutions and organizations because humans act collectively and consensually. We don’t have to explain to anyone why teamwork is important, because the fact is that no man is an island unto themselves. People have to organize themselves into collective activities. But they cannot become happy as part of these collections, nor can they achieve the purposes of such organization, unless we formulate accurate theories of such organization. What are the essential parts of an organization? How many layers must an organization have? How big should an organization be, relative to how nimble it has to be? Clearly, organizations that have to be nimble must be small, and organizations that have to be long-lived must be large and stable. But where is the theory that explains why large organizations cannot be nimble and why nimble organizations must be small?

Organization Theory, like the other “social sciences” such as economics, sociology, politics, etc., is actually not different from natural sciences because the principles of structure, function, and organization are common across natural and man-made systems. The natural systems are not created randomly, and the man-made systems are not simply ideas in our heads. There are real principles of organization by which energy flows both top-down and bottom-up, and only by understanding the principles of such energy flow can we craft and design organizations that are suitable for the given purpose, achieve what they were meant to achieve, and live for the duration that they are expected to survive. A theory of organization is natural science—like cosmology and biology—and all these domains share common structural and functional principles.