Say goodbye to the organisational hierarchies please

It all started by John Tropea's post, then the discussion moved onto Google+.

My first comment was "I'm still puzzled why all still accepts "organisational hierarchies" as a given... after all they're nothing but frameworks for work processes, of the push kind mostly, based on technology like quills, whips and shoe leather."

As always, succinctly described by Hugh at Gapingvoid! 

Not having organisational hierarchies is almost unthinkable, so in the comments the premise for the question had to be backed up by a little fictional story:

Say you and five friends start a new company, let's pretend an advertising company. All of you know your stuff, albeit with slightly different focus, interest, abilities and experience. On day one you all sit in one room and the telephone rings, a customer. Luis sitting next to it picks it up and does a damned good job at it, landing your first customer. This was noticed with much satisfaction by all of you so next time it rings all call out "Luis, call for you!" and soon Luis is the designated sales/customer-handing person.

By way of interest Keith starts doodling with some art ideas, while you have some channel ideas spurring you to pick up the phone calling some friends to bounce off your ideas. And so forth. Group dynamics at it's best, and soon your little firm have natural leaders for each type of activity, the next arts chap gets his desk next to Keith. But nobody bothers about titles until you're asked for it by some corporate customer going "ehh, yes, Keith is our arts director" while giving Keith a glance to see if that sound ok :)

The work flow in that example is all manual, but with extremely low overhead thanks to all sitting in the same room, hearing all, seeing all and communicating via looks and head nodding or the occasional group discussion without leaving your desk. Not a report in sight, you all know what's going on after all.

But soon you guys are 120 people and no single room can hold you anymore, offices are rented and walls are cropping up - so now you turn to the classic solution to make the work flows flow - you establish management positions, who will have morning meetings and gather in reports which are distilled into new reports for the management group who spend three hours meetings at regular intervals to inform each other and set new goals. To make all that more efficient you invest in collaboration tools and budget tools and the half-hour slots in google calendar now becomes the guide for your day and scheduling-conflict-time-waster ("sorry, cannot on Tuesday, what about Monday week after?"). And Keith's almost 100% focus on creating great art soon falls to say 40% of the time, rest is spent on "managing" and meetings and reporting. (The 40% BTW is supported by research, we do spend between 55 and 75% of our time on moving the flow forward in similar situations.)

This is when the work to make the work flow becomes costly - Keith is value-creation-wise only 40% of the man he used to be (sorry Keith ;)) Luis having to handle all the interest have a few chaps and chapettes helping him so soon he's also a "40% man" (sorry Luis). And not to talk about the new hires that have to sit in at those meetings and write those reports - so you end up hiring people and paying them 100% for only 40% value-creation time!

If IT architects were abundantly clear that the sole purpose of the organisational hierarchies, the meetings, the calendars, the reports and budgets were nothing but a process framework (make flows flow) - then they would have shifted their focus away from making those manual work flow mechanisms more efficient to focus on actually making the whole more effective by making the flows flow (and flow is process, Barely Repeatable or not, so a process engine must be the core of such solutions). In short, allow the 120 person group in the story to operate as if they were in the same room where no org hierarchy was needed (except to please old school corporate types who need it to navigate) and no reports were required as all could see what was going on in real time.

This focus on efficiency over effectiveness should remind us of what Peter Drucker once said: “There is nothing so useless as doing efficiently that which should not be done at all.” And today, thanks to modern IT we do things very efficiently, especially the 60% that which need not to be done at all.

If all of that 60% non-value-creation could be done away with by a new kind of work flow engine your new advertising company could triple it's output, and not to talk about the pleasure of not having to be pestered by bosses, pester subordinates, sit at long meetings, write reports, or struggle with budgets that we all know is less real than anything coming out of the Walt Disney studios!

As an end note I'll just mention, even if plugging one's own products is frowned upon; this is what we at thingamy actually is doing - automating the flow work.

Comments

[Miguel Rodríguez Oller]

Good points and clever vision on how work works on today's organization... But... I believe it's a bit simple to say that hierarchies are just frameworks for work process.. It's also about power (formal and informal), influence, decision making, leadership, relationship (intellectual and emotional)... It's about people, and human beings are, obviously, far more complex than process and frameworks. I'm not saying that we are damed to have hierarchies, but I do believe that organizing relationship and collaboration it's the real key... call it networks or communities or whathever other cool way to describe how people interact with each others. What we need is not to say farewell to hierarchies, but instead to build new, flexible, knowledge oriented 'hierarchies'. That's, in my view, the hard task to really change things, when 'things' means people.

[sig]

Hi Rodriguez,

allow me to take it point by point, makes it easier on a late evening :)

The list you mention are mostly results from having the org hierarchies, and not the purpose for the same! Except leadership which is entirely decoupled from managing and hence the hierarchy, it happens despite the org hierarchy I'd venture.

In fact a process can be as complex as anything, there are no limits there. Unless one uses the old misconception of linear and predictable processes - which is too narrow a definition.

And why organising relationships? Cannot see any reason for that. Look to WR Gore where leaders are chosen by the peers, or any ad-hoc group still unhampered by "organisation" and where group dynamics can work freely - way better than top-bottom rules.

Collaboration btw is the most misused word ever, it really means work together, and is not restricted to simultaneous - hence it's the core of all value-creation done by more than one person.

In summary I do disagree with you, we really do need to dump organisational hierarchies as that's an old model created with technologies way back, and for sure, I think we all can agree that it's not quite perfect - and that after thousands of years, 100 years of business schools and 40,000 management handbook in print at any time! If all other "sciences" was as developed as management sciences we'd still think the universe would be earth centric! (Galileo changed that after the newest part of management methods was invented...)

And, lastly, why do you want to change people? What I'm talking about - ripping out the org hierarchy as work framework and putting in something else has been done before, albeit for Easily Repeatable Processes. And that without a day of training, with nary a psychologist in sight, but with an increase of almost 9 times in effectiveness in one year. Ford, Detroit in 1913...

[Miguel Rodriguez]

Hi. (I tryed to included this time my comment thru my twitter account... but not possible?)

Firstly, thanks for your time responding to my previous post. I really appreciate it.

And, secondly, probably we are much closer to be in agreement than in disagreement (I frankly think so), but perhaps we are using different "terminology" or different points of view to talk about similar things...

Anyway, it's far from me the intention of "provoking" you or going against your ideas. My intention was just to suggest that, to me, is too hard to affirm that hierarchies must be abolished as it they were per se a source of "evilness", a killer of creativity and productivity. I think it all depends on the kind of "hierarchy" (and I agree that the word is ugly and that, in the emerging and fresh world of social business, the concept seems just the enemy or coming from the Stone Age). And the way you use "!" I don't dare to propose a new term :-)... but, frankly, I can't see what can replace, in a medium-big size organization, some kind of "organizational structure".

I do believe that there is bad or good organizations... (regardless of shoes leathers or sneakers) and I'm sure that the business need and will change a lot in the coming years, for sure, but, I don't view -or maybe understand- the alternative you are proposing. And, believe me, I would love a world without bosses, without the need of demanding clients to attend, or hard competitors to beat. I promise to follow regularly your blog to understand better your point of view.

In the meanwhile, let me very briefly to point some comments to your points.

I'm not sure of understanding clearly your first point. It seems that you see things like power, or influence as collateral damages from org hierarchies. I think they are part of human condition that a business must try to manage the best possible way. And you can be a strong leader (and being recognized as such) without any formal authority in the organization. Sorry if I'm misunderstanding your point here.

I know process can be extremely complex, but I think I'm talking about another type of complexity to refer to human relationships (an our conversation is a good example).

Sorry, I don't know what's WR Gore (my fault)and I also vote for democratic organizations instead of military organizations (in case of war, the other way around). In the Country Vasque (north Spain)there is a significant group of companies managed as cooperatives, that have the most participative and democratic models I know, but they still need organizational structures.

I totally agree with your point on collaboration.

I also agree on calling "science" to management is too much... but I also think that "management" or keeping people together to achieve a sustainable goal deserve some respect. I know that the primitive Christians did exist, but, at the end, they needed to build an organization to (as a friend of mine says) build the most ancient "business" in the world: the Catholic Church. Very clever people... Again, all my support to try something different and better, but I still don't finish to see "the light" to follow.

And finally, I don't have any intention to change people... but people changes, without mentioning how is changing the world and how that change is impacting our traditional views, perspectives, social structures, work-environment. Why do you pretend to avoid organizational structures then if it is not for changing the way people works and act on today's organizations? And, finally, in my view, Henry Ford's mass production system is a great example... of command&control, rigid, heavily hierarchical organization. No psychology needed, I agree. So, I do believe we need to reinvent the organization structure of the 21 Century, but building it upon the present one, not over its destruction,

Again, thanks for your time and I will keep reading you. Very challenging and enriching points of view

[sig]

Miguel, excellent and much appreciated, a good discussion is what moves us forward - even if as you say it often requires sorting out semantics!

But you're right, we need a framework for any value-creation activity as it's always a flow/process - a series of activities with a goal. It's like water and water always needs a framework to be made useful: Pipeline, riverbed or passing buckets - from very structured, rigid and efficient to highly flexible but very manual with a huge overhead.

Easily Repeatable Processes (ERPs) can have pipelines - production and some people oriented processes like HR (pay people every month etc) or say insurance claims (pretty predictable).

It's for the Barely Repeatable Processes (BRPs) we end up using the pass buckets technique where the organising of the line is the org hierarchy, and where meetings, budgets, business rules, double-entry book keeping, meetings and reports makes out the rest. Research point to the cost of that, the OH to be between 55 and 75% of our time and resource use.

So what I'm saying is that we need to move to a riverbed for BRPs so we can convert some or all of the 2/3rd of our wasted time in the office to real value-creation.

In addition we could get rid of a lot of side-effects like power and influence merely based on some top to bottom created positions (don't say you never saw a boss that had lots of influence and power that he/she never had if you had asked his peers and subordinates? ;))

Current IT systems are all fully focused on helping the bucket passing to become more efficient, what I say is that one must forget that, including the whole concept of bucket passing and rather focus on creating a new flow framework of the riverbed kind.

That I think is only doable by using IT, where first requirement is to start over, forget the accepted methods (bucket passing) and build a flow framework based on the strategies of a firm, modelling reality directly and not the existing framework.

That kind of IT system must have a process core (it's all about flows after all), it must allow participant choices as to where the flow goes, it's path, at run-time when it makes sense (doctor examining a patient, then making decisions if X-ray is needed, direct to surgery or what) but still automates the actual flow. By that I mean it should deliver the task and all pertinent information and context to the right person at the right time, and be able to capture all that happens.

Then you'd have a riverbed, and with a riverbed you'd have no need the bucket passing structure any more.

Let me clarify, here's what might be tripping our discussion: I would not say "throw away the org hierarchy and meetings and double-entry book keeping first", that would only leave us zero framework.

What I'm saying is that the _IT architects_ should do that exercise and create a system without regards to the existing framework - then if that pans out implement. When this potentially new framework were in place the old framework would rapidly become irrelevant - the buckets passers would see the water flowing nicely and unpredictably in the riverbed towards the bottom of the valley.

With that the old will slowly disappear by itself and quite naturally and all would be good :)