Previous Article Next Article Related posts:No related photos. Boxed inOn 1 Sep 2002 in Personnel Today Comments are closed. What are the seven deadly sins of organisational charts? Jo Owen explainsBoxes are for the dead. But when it comes to organisation charts, managerslove putting people in boxes. They stack the boxes up and rearrange them inneat, orderly rows. It is not a pretty picture. They then expect staff to liein their boxes. Some staff enjoy this: it is their own space which no-one elsecan occupy. But for many managers this is another excuse for more powerpolitics in which they trade hapless pawns with other managers. Used well, organisation charts are for the living, not the dead. Theysimplify and clarify critical issues about who controls what. Even in today’sworld of flat organisations, the issue of control is essential – management hasnever been a democracy and never will be. Clear lines of communication, control, accountability and decision makingremain important in every business. There are many ways to design the right organisation but too manyorganisation charts complicate things. Following the architects’ dictum that ‘form follows function’, so theorganisation (form) of a business should follow its function (strategy). Thereare, however, a few ways in which businesses get their organisation wrong.These are seven deadly sins of organisation design – if you see one, take care.1 The upside down pyramid: Very trendy, it is normally used bythe most senior manager to show that the leadership team are really at thebottom of the organisation pyramid, and it is their job to support the mostimportant people, the front line staff at the top of the pyramid. This at leastimpresses the person giving the speech. But for the front line staff hearingthe speech, they do not see an upside down organisation chart with them at thetop. They see a spinning top, possibly spinning out of control, in whicheverything depends on the great leader at the bottom of the chart. If theleader moves, the rest of the spinning top has to lurch in the same direction. A mild variation of this speech is the pyramid on its side, with the frontline staff facing off against the customers. This is a slightly more honestpicture: it shows the front line staff, like soldiers, at the front facing thecustomer. The generals naturally, are safely in the back issuing orders to the frontline. If you have a pyramidal hierarchy and you lead it, then say you lead itand show you lead it. The upside down pyramid is at best as trendy as purpleflared disco trousers, and at worst patronising to front line staff. 2 Silos: By now, most managers are familiar with the danger oforganisational silos. These are most common in traditional functionalorganisations, which work well in relatively stable environments. The problems occur when things change fast, or when unexpected difficultiesemerge. When there is success, everyone is responsible. When things get tough,suddenly it is everyone else’s fault. When sales dropped at an electrical goods manufacturer, the sales departmentblamed marketing for a poor promotion. Marketing blamed product development fordeveloping the wrong products. They in turn blamed R&D, who blamed financefor cutting their budgets. Finance blamed sales for underselling. So the circlewas complete: every silo either was or was not responsible, depending on whoyou listened to. And because each function inhabited deep silos with strongwalls, there was no discussion or co-operation between the silos. All thediscussion went up to the top of the silo, across and back down again. Socommunication, decision-making and conflict resolution were at best slow, andmore often non-existent. 3 Pancakes are closely related to, and tend to reinforce,silos. A pancake-reinforced silo is a deadly organisational concept. Eachpancake is a layer of the organisation. The more layers, or pancakes, there arein the organisation chart the fatter and slower the organisation is likely tobe. Each pancake acts as a filter, or obstruction, to both communication anddecision making. A silo organisation with many layers, or pancakes, is one designed for asteady state. It will be slow, risk averse and cumbersome – and in manycountries is known as the civil service. There is an alternative version of the pancake organisation: one which isvery flat and does not have a big bureaucratic hierarchy. The Catholic churchis flat: Pope, cardinals, bishops, priests and laity give a total of fivelayers for an organisation with up to a billion members. Most business withjust a thousand staff struggle to get by with less than five levels fromchairman downwards. The Catholic church has survived longer than most businessorganisations are likely to. 4 When you cross a pancake with silo, you get a cave. Themanager is walled in on either side by the other functional silos. Above is theceiling of more senior management, and below is the floor, beneath which morejunior management exist. The manager watches the shadows of the outside worldflicker past the entrance to the cave. In the cave there are limitedresponsibilities, limited communication and a limited view of outside reality. Organisation design should blast caves and caveman thinking. This shouldenable clear responsibility, good communication and decision-making and shouldallow outside reality to be felt throughout the organisation. 5 The matrix organisation: Meant to be the antidote to thetraditional command and control hierarchy, with lots of silos and pancakes.Some matrix organisations simply succeed in adding complexity to the simplicityof the command and control organisation. Like the dieter who asked his doctorwhether he should eat his diet before or after every meal, not everyoneunderstands it: the matrix should be lean, simple and instead of thetraditional organisation, not in addition to it. One traditional life insurer managed to go to a seven dimensional matrix.There were units facing off against products, geography, customers (by type),customers (by letter of alphabet), functions, channels and industries. Stephen Hawking may be able to think and operate in seven dimensions, mostof us struggle with more than two organisational dimensions. And even then, inpractice, our loyalty and commitment is always skewed to one side of thematrix. We prefer certainty over the ambiguity of the matrix organisation. Butif there is a matrix, make choices and keep it simple rather than fudge thedecision and have a bit of everything. 6 The virtual organisation is the antidote to formal organisationstructures. This is where the organisation chart is thrown away and theorganisation insists everyone works in flexible, non-hierarchicalself-organising teams. In theory, this is a high commitment, high involvementand highly flexible workplace. And it can work, where the business is verysmall and trust very high. Four or five people working together in a start updo not need organisation charts. But in larger organisations, clarity is neededabout who does what with what resource and to what end. The virtual organisation can exacerbate the worst features of the matrixorganisation: it clouds responsibilities and allows people to hide. 7 The organisational bible: Deadly. Whenever a manager canimmediately produce reams of organisation charts from a desk drawer, orgigabytes of the same on a computer screen, be suspicious. One privatisedutility had mountains of organisation charts, which went alongside bookshelvesof procedural manuals. It was bureaucrat heaven, customer hell. Each part ofthe chart represented an empire which was jealously guarded by each littleemperor and empress. The result was an overdose of in-the-box thinking: thepriority was to protect and promote the box which represented each empire. What the leadership had missed was that there are other ways in which tocontrol the organisation besides structures: culture, reward and measurementsystems and common skills can all balance and complement the formal controls ofthe hierarchy embedded in the organisation chart. There is no universal solution to the problem of organisation charts,because there is no one type of chart that fits every organisation. Often thebest thing to do is to draw the chart up and then throw it away. The process ofdrawing up the organisation chart forces management to focus on three keyorganisational decisions: who is meant to achieve what (responsibilities); howthe resources of the organisation will be focused and controlled; and who needsto co-operate with whom. Implementing the new organisation chart is also a wonderful opportunity torenew the psychological contract with everyone. The new organisation shouldgive rise to a series of structured conversations about what both the managerand the managed expect to achieve in their new roles, and how they can bestwork together to achieve those goals. Done well, the process of reorganising can re-energise and refocus theorganisation. Done badly, it will demoralise the organisation with uncertaintyand politics. Speed, simplicity, clear choices and good communication tend tobe at the heart of most effective reorganisations. In a complex, changingworld, that is often easier said than done.