Organizational Structure Part 1 of 3

Introduction

In this article, we examine how we can redesign the organization structure to withstand the shocks of the changing seasons in life. As human, we abhor uncertainty. It could be because of fear of ambiguity or the discomfort of feeling powerless due to lack of control. When we build organizations (businesses), we build it around certainty and control. At the extreme, we start and build businesses that work on changing nature.

Unfortunately, nature does not work that way. In nature, there are seasons (cycles). If we start and build businesses in harmony with the way nature work, I believe that our businesses will survive much longer.

The Seasons of Life (See the part in the 4.20 th minute of this video)

Organizational Structure

The hierarchical structure which modern organization adopts is a military structure rather than a community structure. For military purposes, it is built for short-term (time) swift maneuver (quick moves) of troops that have short life-span (they are sent into the war fields to die).

My Comments: However it is also a rigid and inflexible. It does allow the organization to be agile; fleet-footed. It means that the organization cannot adapt easily to change.

Hierarchy and Network: Two Structures, One Organization

How Organization Really Works

Here are 2 diagrams taken from the book The Hidden Power of Social Networks: Understanding How Work Really Gets Done in Organizations written by Robert L.Cross and Andrew Parker. Figure 1.1 shows the organizational chart on paper. Figure 1.2 shows how organization actually works.
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The book explains the reason for the second diagram: “Survival often depends on incorporating oneself into unofficial social networks that allow one to gain access to necessary information and to collaborate with the colleagues who can actually get things done.”(Source: editorial reviews of the book by Publishers Weekly).

My Comments: This observation begs 2 questions:

  • If the hierarchical organization chart does not reflect the way people work, why do we still want to keep it?
  • If the hierarchical organization structure is rigid, how do we organize people so that we can maximize that organization for flexibility to change?

Top Down Org Network Org

The Case for Flat Organizational Structure

Most organizations today are hierarchically structured. Whenever the organization is facing financial difficulties, it either cuts supporting positions or positions between the top and low levels.

My Comments: That is a signal that a hierarchical structure is not financially sustainable through the long term, when the business environment will go through its natural cycles.

In addition, a hierarchical structure promotes competition rather than collaboration because people in the structure will compete for positions within the structure. This also contributes to the creations or silos as different functions build up a defensive wall around themselves.

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