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Organisational design – a future perspective.

Organisational-design-introm-small Introduction to Organisational Design - An Orgtology Perspective

Without Organisations we would be primitive. It is through Org that we can control things and people. Religion, politics, philosophy, ideology, culture, business, and government… These are all organisations. Even language is an organised expression. Org gives humanity its collective consciousness and holds its intelligence beyond physical form. In a real sense, Org is AI. In so, the rules of Org differ from those of nature. This is especially true for the relationship between activity and resources.

In nature, resources drive activity. E.g., The density of oxygen and sunlight will drive the rate of evolution. This shows how, in nature, resources direct activity. It is an evolutionary process.

In Org, it is the other way around. I.e., activity dictates resources. E.g., Amazon has the goal to link information to products. A goal that will dictate the resources that they need to link Alexa to home robots. This rule extends to organisations such as capitalism. Evidence is the worldwide population boom after the first industrial revolution. The world needed people to work in factories. Elon Musk and Jack Ma has a noteworthy view on this. They predict a population decline with the rise of AI since Org will need fewer human resources. These examples show how, in Org, activity dictates resources. It is a revolutionary process.

The relationship between activity and resources is key for organisational design. Org exists through this relationship. Purpose binds activity, whilst intent directs it. This is the essence of organisation.


The basic assumption of organisational design

If organisation takes place through the movement and resourcing of activity, then we must design Org around the flow of its activity. Resources are fuel that makes ideas and solutions happen.

Mostly we use an organigram (organisational structure) to dictate activity. The above assumption raises questions around that. In process engineering, the engineer will use the organigram to guide process flow. In orgtology this thinking is flawed since departments are not necessarily systems. E.g., a human resource department holds employees who knows how to manage human resources. Yet, this conglomeration of knowledge will only make sense if it is part of a process flow. I.e., goods, services, employees, assets, and cash must flow into Org to fuel its activity. The more collective Org views and organises this flow, the more efficient it will be. That is a myriad of divisions that share one process flow. In so, audits, performance assessments, R & D also share the same process flow. They all gather intelligence to increase efficiency and effect.

There are many examples to show that focus can distort form. We can only grasp the real shape of Org through mapping its collective process flow.


  Traditional organigram designs

It seems that an organigram and process flow do not always depict Org in the same way. An organigram shows the authority relations within Org, which helps Org to manage and control its resources. Process flow, on the other hand, shows the most efficient way for activity to create outputs. This difference creates a conflict of understanding. In turn, this causes a myriad of problems.

Mostly, a process engineer will use an organigram to create processes flow. In so, he/she assumes that all activity takes place within the boundaries of an organigram.

This creates immense inefficiency. E.g., the HR unit might have recruitment, performance, and labour relations officers. They all work with human resources and they have studied the same degree. Yet, recruitment, procurement, and budgeting all supply resources to Org. They never talk to each other because they are in different departments. Each with their own locked-in process. In so, performance assessment, internal auditing, and accounting share a process. They all assess the past, to secure a relevant future. Similarly, it makes sense to slot labour relations in with customer and stakeholder relations.

To design activity flow within a traditional organigram construct will create an immediate inefficiency. Thus, it will be hard for AI systems to make holistic sense of traditional designs. Efficiency is the only thing that can ever make sense to AI. When we do an inefficient thing for the first time, we teach AI. In such case, AI will find a way to make it impossible for us to do it again.


Traditional Models of Organisational Design

To engage with organisational design, one must grasp the basic movement of activity. As explained through Theory 2P of work, activity either repeats or not. In other words, we do our work through projects and processes. This creates two constructs. These are the process- and project- constructs.

As explained in earlier essays, a construct differs from a structure. A construct is non-tangible, e.g., a process map, whilst a structure is tangible, e.g., a table.

The third construct is more complex to grasp because its activity is not as predictable as the work we do. This is the relationship construct. Its aim is to make things real. You know that you are real because you can breathe and talk to others. Day to day, one must deal with things like gravity, lust, time, etc. An entity exists because of relations and relationships. The relationship construct of Org helps it to empower and influence its relationships.

A relationship construct defines both, performance, and relevance. The resources that the processes of Org use, will depend on what its stakeholders want. In so, relationships decide how Org must perform. Whether Org does relevant things, is an assessment that its stakeholders will make. In so, relationships also decide how relevant Org is. Where the relationship- and process- constructs intertwine, Org defines its performance. Where the relationship- and project- constructs intertwine, Org defines its relevance.

All the work of Org either repeats or stops, thus it is either a process or a project. This creates the activity that consumes resources so that it can produce results. Human and systems intelligence drive all of this. The process- and project- constructs of Org thus defines its work, orgtelligence, and results.

The relationship construct of Org has the task to make its work meaningful. There is no point in operations or strategy if it has no effect. Without relationships, Org has no meaning. Without a relationship construct, Org has little control over that which gives it meaning.

Jointly, the three constructs of Org, creates the Relevant and Performing Organisation (RPO).


The three constructs of organisation - an orgtology perspective


Flow of resources vs. flow of activity

Traditionally, we do not separate the flow of activity from the flow of resources. During the first industrial revolution we had to create constructs for organisations. This was due to the automation possibilities that steam power gave. In so, non-biological intelligence (AI) began to play a significant role within Org. Some estimate that as much as 20% of factories could run without human intervention (conveyor belts, etc.). Yet, systems intelligence was born long before that. I estimate it was about six thousand years ago when a farmer connected the first plough to an ox. In so, he created a system that runs on a collective intelligence. With that I am not saying that AI did not begin long before that. It is just that agriculture is an easy reference. In a cyber-physical world, Org will need less than 40% human intervention to run. This will change the way in which we construct organisations.

In the 1800's, during the first industrial revolution, the minds of people ran Org. It thus made sense that organigrams showed human authority. The boundaries of teams and work was clear. Org was a bounded system with clear internal and external demarcations. In a cyber-physical world this no longer makes much sense. Boundaries of teams are more permeable now.

The more diverse the thinking of an environment becomes, the more complex its process will be. We already live in a time where we cannot depict the complexity of activity flow on a two-dimensional organigram. The future shape of Org will look more like a complex neural network. This is vastly different from the current authority connexions that we make through our organigrams.

Systems are fast evolving in their drive for efficient organisation. This will widen the gap between traditional organigrams and activity flow. To become efficient, Org must automate. In so, it must transform from an authority- to an activity-based construct.

The activity of Org mostly flows in a generic way. In line with hypothesis 2x, this flow ensures receptive / projective interaction.

In its most basic form, Org must deliver products & services. This creates its core process. To run this core, it must have resources. Thus, there must be a system that gives Org the people, money, and assets that it needs. Yet, to exist, it must have relationships with people and other organisations. These are customers, suppliers, competitors, the industry, employees, etc. I.e., Org's relationships with its stakeholders. Jointly, these three systems create the receptive part of Org.

Disruption and change will riddle any industry. This presents problems and opportunities, which will demand transformation and risk management. Jointly these systems create the projective part of Org.

The table below shows the generic flow of activity within Org.


A generic flow of resources and activity


Organigram of the future

In future, systems intelligence will allow teams to connect in abstract ways. It is unlikely that divisional constructs will survive. The construct of teams will depend on the most efficient way to create effect. In so, these teams will cease to exist when their processes or projects stop to flow. Beyond that, Org must move or dispose of its resources. I am not endorsing this cold approach. I am simply explaining what would make "efficiency" sense to Org.

Whichever approach becomes the norm, it must face the efficiency flaws that AI will point out. This will create a new relationship between systems intelligence and human intellect. Many suggest that this new relationship might induce a fifth industrial revolution. Who knows what the future holds? What is certain, is that the way we construct Org is bound to change.

The organigram of the future must drive efficiency that will induce effective results. This implies the efficient use of resources. In so, Org must shift its focus from human authority to flow of activity. This would mean that Org must shift from divisions to teams. These teams will work towards creating equilibrium between how we run and how we change Org. I.e., how we create interaction between the receptive and projective parts of Org. These teams will also be less dependent on employment. Team membership will imply that you are a valuable resource to a process or project. One would then also be part of many teams at the same time. This means that the employment boundaries with teams will increasingly blur. This might lead to redefining employment. In turn it will blur the boundaries between recruitment, budgeting, and procurement. This will further challenge the validity of traditional organisational designs.

As AI advances, it will become more difficult to depict any organisational construct. Currently we use authority-based diagrams to depict a construct for Org. Unfortunately, these can simply not capture the complexity though which activity interacts. Even if divided into teams, it will still prove an impossible task. This is because one employee can belong to a myriad of teams. Each process or project is a different team.

It seems that human minds will not be able to map the complexity of organisational networks. Intelligence to do so will be artificial rather than human. It will build activity sequence around purpose, in so, creating operations. This will become its receptive part. To keep this relevant, it must create activity around intent. This will become its projective part. It is likely that such construct will have the shape of a molecular or neural network.

The future organigram will be a network of teams all centred around the purpose and intent of Org. I discuss the practicality of designing an organigram in a later essay. Trying to depict Org as molecular network will not be practical for any EXCO team to try and do. Only AI will be able to accurately depict the construct of a future Org.


Orgtology Team Networks


The relation between Hypothesis 2x and organisational design

Hypothesis 2x states that Org exists through duality. I.e., something projective must relate to something receptive. The projective part of Org is strategy. Operations is its receptive part.

Jointly, strategy and operations create a projective / receptive duality. This makes the activity of Org meaningful. In so, Org design is about creating the receptive part of Org. I.e., the systems that creates its efficiency. The idea of Org design is to create something that we can control and predict. The opposite of that is chaos – to humans at least.

The task of Org design is then to apply Hypothesis 2x to the constructs of Org. I.e., its processes, projects, and relationships. Strategy is where we cross the bridge from receptive order to projective disruption. This is where we drive a pipeline from systems intelligence to human intellect and contrariwise.


 Conclusion

To design Org, we must first understand what it is, and then what we want to achieve with that. Once we have its purpose and intent defined, we must draw a blueprint for its flow. Then we must harness energy in the most efficient way possible. This is to let activity flow without interruption.

The future Org is one that through cooperation, will build on the inventions of others. Eventually it will be one that connects all humans to a cyber singularity. This should be a state of absolute individuality driven by superior efficiency. We are still light years away from that but we are on our way.

To begin the design process, we must separate purpose from intent. We do this by first defining what we must do to perform, and then deciding how we will stay relevant. Purpose will drive our systems intelligence, processes, and efficiency. In so, intent will drive our human intellect, projects, and effectiveness. This division creates a dual relationship within Org. In so it will distinct how we "run and change our business" (Nkambule: 2019).

The things that we do to run our business creates a process construct. The things that we do to change our business creates a project construct. The things that we must do to sustain defines a relationship construct.

As activity flows, adjusts, and redefines, it will become more efficient in its purpose. At the same time, it will also become more effective in its intent. Org will grow, which will create consciousness. New consciousness will bring innovative solutions. Org is how humanity will continue to survive and thrive.



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Join the Orgtologist Certification Program (OCP) and become a Certified Orgtologist with the International Orgtology Institute

The program is highly suitable for senior managers, directors, executives, and those who aim for senior positions within an organisation. The OCP has four parts. They are: orgtology theory, organisational design, strategy, management and leadership. This is an advanced program. To enroll, you must hold a bachelor's degree with three years of work experience. On completion, you can enroll as an Orgtologist with the International Orgtology Institute (IOI).


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© Derek Hendrikz: 2020-12-05

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