In my last post, I probably went a bit too far, arguing that there doesn’t need to be a move from hierarchical organisational structures to networks. But in some ways, there does.
Hierarchies and structures in general receive too much attention. As I wrote in my last post, leaders and managers tend to think about hierarchies when they’re redesigning organisations and teams, but it really isn’t the most important aspect of an organisation, and certainly isn’t the only one.
So structures do deserve less attention, and networks don’t receive enough.
As I also noted in my last post, I didn’t use to think about the network aspect of organisation design at all, but I certainly wasn’t the only one – and I suspect most people designing organisations today still don’t.
We do need to put more emphasis on networks and I’ll describe why shortly.
First though, to perhaps explain the point from my last post a little bit differently, I accept, and reinforce, that the social revolution requires more focus on networks. I just don’t believe it’s about replacement of one with the other. They both have their place within organisation design.
See also this recent post from CV Harquail on Authentic Organisations. I’ve not read Barley & Kunda, so I’ve no idea whether I’m interpreting their remarks correctly, and whether their views support or conflict with mine, but I do like the quote:
“Hierarchy is a property of a network’s structure, not something that a network replaces.”
Anne Marie McEwan’s comments on the same blog post resonate with me as well.
Anyway, on with the post:
3. If networks are replacing anything (and they aren’t), it isn’t corporate hierarchies, it’s business processes
I’d argue that the real change we need to make in organisation design (rather than how well organisation design is done) is a move from processes to networks.
Processes
Processes are traditionally the building blocks of organisations. They specify how work needs to get done and accountabilities for doing this.
And although I’m saying we need to move towards networks, I don’t think we should move away from processes. I think this is an area of organisation design that HR, and organisations in general, could be a lot more skilled in than they are.
See this piece from my book:
“One of the other examples of creating value HCM approaches I quite often use, particularly where I’m developing HR teams, is creating organisation capital through business process design. It’s a good example for a number of reasons: it’s a key area of organization design that many companies forget about; often no other functions have responsibility for it; and it calls on many of the skills that HR professionals already have.
However, it’s also an area that provides HR with a wonderful opportunity to mark out their new role. Often the first time an HR business partner offers to support a business client to redesign their business processes, they get told to go away and come back once the manager has done the redesign, and they know how many redundancies they need. It gives HR a great opportunity to respond back that no, this is not what they mean.
They have a methodology and particular skills to help facilitate the development of better processes. It gives them an opportunity to point out that there is a separate administration
centre that handles the redundancies – this is not their job.’”
(Also see this post on process design.)
However, processes only work well for repetitive and especially production oriented work. They apply less well to work that is complex, changeable, knowledge based, creative, people focused and so on – ie to a rapidly increasing proportion of the work that people do today.
Networks
What governs this type of work is the network. It’s who people talk to in order to get input, support or get things done. And it’s messy – it can’t be laid out in process terms.
This is the main reason that networks are becoming a more, if not the most, important element of organisation design.
So the shift isn’t from structures (hierarchies) to networks, it’s from processes to networks. Hierarchies can carry on pretty much as they have done before. But networks are different to processes – they can be designed in the same sort of logical way (see slide).
I’m going to come back to post more about the analysis and design of networks shortly. Stay tuned for more….
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Yes, a "hierarchy" is a special type of network called a "tree"... just various patterns of connections!
ReplyDeleteThanks Valdis. I need to have a think about that!
ReplyDelete