“imagine that your job is designed, not around roles & processes & competencies.. but around business – a business within a business”
A rich and insightful conversation with Dean around his vision of a Market organisation : the design and engineering of an ecosystem in which we can all work and thrive. Dean walks us through the idea of a hierarchy that houses a network of entrepreneurs, using the science and engineering principles of organisational design, as well as the golden rules of empowerment to build high performance.
How can we go about conceiving of this vision as well as the mechanics of implementing this vision successfully ?
How can we help and support leaders to think more holistically – to design an organisational ecosystem in which everyone can prosper, even when they are no longer there ?
Dean shares his research, insights and experience, as well as his definition of Organisational design as a science. Together we journey through the different structures within the system as well as his wider vision for high performing organisations, where leaders set time aside to work both ‘in’ and ‘on’ the system.
The main insights you’ll get from this episode are :
– Organisational design is the ecosystem in which we work and interact and there are five organisational systems: three major ones (structure, resource governance, culture) and two minor ones (best practices, metrics and consequences).
– Mechanics/engineering and collaboration within the ecosystem are both human systems and a leader must have a system design in which everyone can prosper.
– Structure cannot follow strategy as strategy is no longer stable in a fast-moving world –organisations must be more dynamic in design and take a systems approach.
– Hierarchy must be used to provide the requisite competencies when they are needed, and the required performance management and coordination so as to leave nothing to chance.
– A different organisational paradigm looks at the engineering science of the ecosystem and change management:
· Vision: a job as a business within a business, job holder is empowered and accountable, teamwork ripples across the organisation and fosters collaboration not competition.
· Decision-making: consensus and the golden rule of empowerment apply – authorities and accountabilities match to prevent either an unconstrained tyrant or a helpless victim.
· Consensus: should only/aways be used when a decision impacts multiple stakeholders across an organisation – this requires clarity from a well-designed ecosystem.
– The approach seems to work regardless of industry although consensus is difficult in large organisations (1000+). It is universal given the human and interaction aspects.
– System mechanics and organisational design are a combination of art and science: applied science of engineering comprising firm constructs plus aesthetics.
– Organisations exist to allow specialisation and the group performs better than the individual because individuals have to be generalists and do not perform as well as specialists.
– The human mind has finite brain cycles, bandwidth and throughput, whereas the world has unthinkable variety: a T-shaped team therefore gives an organisation breadth and depth.
– Common truth, collective wisdom and implementation form the power of participation for success and are essential both for transformation and for capturing hearts and minds. [LLS1]
– Three possible scenarios for creating a radically different organisational model:
· low tolerance for change = cautious evolution (low risk/low reward; a series of small linear changes to form a consistent end state; direction is required);
· choose either structure, resource governance or culture = restructuring and rainbow analysis (colour coding the orgchart to avoid conflict of interest and visualise substructures);
· comprehensive transformation covering all five systems = climate for change and ‘clean sheet’ restructuring (tweaks will not suffice and too many tweaks are painful).
– Truly transformational leadership encompasses all five systems and covers:
· Vision (clear description of end state five years from now), consensus (understanding of subject and willingness/ability to teach and support);
· Gaps against the vision/in the created future (diagnose root cause, sequence root causes into transformation roadmap);
· Plan/root cause analysis (open communication to build trust and patience as well as a solid foundation).
– For total transformation, leaders must set time aside to work both in and on the system: leadership is working in the system, management is working on the system: a great leader focuses on the end game and leaves a legacy of an organisation that performs brilliantly long after they have moved on.