"Principles for Reorganization: How To Mix Levels, Span, and Size to maximize Communication and Decision-Making" offers a more detailed look at the data behind the theory we presented in NetAge Report #4, "Organizing at the Edge of Chaos," and blogged here. It provides greater insight into the metrics that those responsible for enterprises can use to reduce risk of failure, extend leadership circles, and improve organizational designs. (Download Principles for Reorganization.)
NetAge Working Papers set out a new theory and practice for organizations. We feel compelled to publish these more technical papers now as an urgent response to the collapse of traditional hierarchies and bureaucracies as evidenced by the current economic debacle. As the economic crisis deepens in 2009, we believe that now is the time for new ideas, new frameworks, and new theory to come forward, approaches that will allow all kinds of organizations whether large or small to reorganize in smarter, better, and faster ways.
Here are a few paragraphs from the "Principles" paper:
In this working paper, we present the data behind our theory of hierarchy as a network. We show how the complementary dynamics of communication and decision-making play out in the unexpected properties found in hierarchy. We provide more data detail because it allows a deeper look at the forces that shape the formal structure. These measurements of structures and forces enable organizations to predict and to prescribe, two hallmarks of science.
Accurate maps and data of organizational networks of positions help us see and understand the global configuration of relationships, which enables us to make better local decisions.
Our organizations are human. Humans organize themselves. They are self-organizations.
Self-organization, a term introduced in the 1940s by Ross Ashby, has been a foundation idea of cybernetics, systems science, and, more recently, complexity science. It refers to the ability to change and grow in complexity without outside guidance.
Self-organization is the only route to managing complexity writ large in a networked world. “It” must manage “itself.” Indeed, the organizational network is already managing itself, but remains largely unaware it is doing so.
As we said in NetAge Report #1, “The Digital Reorganization Chart,” start toward a conscious process of self-organization by mapping the current formal structure. Then assess the existing pattern of communication-decision dynamics as suggested by the Eleum example that follows here. This analysis is available to all organizations. It falls out of the reporting data already sitting in the enterprise data system, much of it gold-standard quality in terms of accuracy and completeness.
Use the global map to provide context for local mapping and design decisions. Bring local intelligence to bear on local questions of optimal fit for purpose. This is redesign from the inside out, local answers to factors of size, span, and levels to meet immediate conditions.
At the same time, local decisions roll up and effect organizational behavior at larger scales. It falls to the executive cadre, managers who are directing teams of teams, to balance the strategic direction of large-scale goals with the local tactical optimization solutions.
Simple sorts of size and span spotlight the hub positions and bring extra attention to those critical areas of the organization. In particular, an organization wants to highlight the hotspots. Is this dual-hub structure the right design for this set of circumstances? If so, are the right people in these high-stress positions?
As Eleum demonstrates, knowledge of the level, span, and size of every position is immediately useful information with many practical applications. And it’s not just about better, more adaptive organizational structures. It is easier to get the right people and skills into the right positions when you know the position’s multiple roles in the overall configuration.
For more, Download Principles for Reorganization
-- Jeff Stamps
