organizational structure

Creating An Organizational Design Consulting Firm for the 21st Century

Photo by Chris Ford

I had been on the lookout for a company like Undercurrent for many years, was aware of Undercurrent for about a year, courted Undercurrent to hire me for about 8 months, and worked for Undercurrent for three weeks. Ever since its demise I've been thinking a lot about what the next truly influential organizational design consultancy of the 21st century should look like. Undercurrent wasn't perfect but I think they were doing a lot of great and new things along that path. Now, there's a huge gap in the market for a company to rethink what it means to do organizational design consulting. Given the state of the market, here is my opinionated take on what a company who wants to be the next big thing in the world of organizational design consulting should focus on.

The Goals

The organizational design consultancy of the 21st century is essentially tasked with helping organizations navigate a world that is rather hopelessly unpredictable, chaotic, and exceedingly quick to change. Organizations are increasingly relying on people who are highly-trained, expensive, and creative who likely have many job options and an increasingly greater expectation to be given opportunities to do meaningful work. These organizations need to become more like living, evolving, learning, and resilient organisms or networks and less like top-down, oligarchical, and brittle machines. They need to be able to make things happen quickly and entice their expensive talent to stick around while bringing their entire creative and motivated selves to the audacious challenges they face at work. Simple, right?

I believe we are seeing the limit of the gains pure organizational restructuring can accomplish. In a company where physical products need to be created and moved from place to place there’s much to be gained from restructuring organizations to amplify efficiency. In a world of knowledge work the key competitive advantage resides more in the ideas of employees and the ability to bring those ideas to fruition quickly. The growth of self-organizing principles we are seeing many companies adopt today is merely the initial forays into a tectonic shift looming in the near future.

How do you prepare for that?

How do you cut through bureaucracy so your most motivated employees feel like the organization is there to amplify their good ideas, not cover them in bureaucratic leeches until they are bled dry? How do you create an environment that facilitates the highest level of performance from employees not because you're standing over them with a stick or dangling a carrot in front of them but because you are giving them opportunities to exercise some of their most innate desires -- to do meaningful work in a supportive environment? How do you create a culture of knowledge workers who view themselves as craftsmen/women on a path of increased mastery over time where personal development and professional development go hand in hand? Oh yeah, and how do you keep making money so the company continues to exist?

The organizational design firm of the 21st century will necessarily have to be selective about the types of companies they work with. The consulting firm who gets this right will not only select the companies who obviously "get it" but will be able to teach and convince those companies who are tottering on the fence between a more traditional way of viewing business and the more responsive, humane, and ultimately more successful way of working.

This may sound fluffy and overly “soft” but I wrote all of the above with the goal of the company's economic health front and center in my mind. In a world where a company needs to grow and evolve like a living organism it is unreasonable to expect it to thrive when its individual parts are being damaged, restricted, or poisoned. A healthy organism has healthy internal components and a healthy sensory system that allows it to navigate it's world. Organizational design in the 21st century will be all about the care and feeding of that organization -- both internally and helping guide it through it's ever changing world.

The Approach

The organizational design firm of the 21st century is going to have to actively work toward resolving (and even embracing) a set of paradoxes internally (with its own existence) and externally (with its clients):

  1. Long-term perspective vs. short-term focus: As a company how can you break outside the market-driven forces that encourage a short-term focus on economic outcomes in order to make long-term decisions for the company's health? How often do companies that claim to be trying to tackle problems of truly epic proportions get sidetracked by the next quarterly earnings call? At the same time, can you have a truly long-term focus but also adopt a mindset of constant iteration and rapid short-term sprints toward a goal?
  2. The power of scale vs. the power of the individual: Software has unlocked the possibility of complex data analysis in a myriad of domains. At the same time, organizations are comprised of individuals. How do you embrace and understand scale while also embracing and respecting the individual (employee and customer)?
  3. Being responsive vs. being proactive: To what extent should an organization be able to respond to the rapidly changing external forces it faces versus to what extent should organizations focus on creating the environment in which it resides? Can an organization be reactive and proactive?
  4. Using data vs. embracing humanity: Is it possible to both be data-driven and also in touch with the "humanity" of an organization? To what extent can or should data be used when talking about meaning, motivation, and inspiration of human beings? How can an organization find useful avenues for data and an understanding of the "softer" aspects of an organization?

In addition to these paradoxes, I think there are a few foundational questions that this new type of consulting firm should obsess over asking:

  1. To what extent can we help organizations enhance the psychological & human resources they already have to meet the challenges they can't even predict?
  2. To what extent can we help organizations identify and tweak their components (team dynamics, environmental factors, culture etc.) in a systematic and holistic way to drive positive change in how they function?
  3. To what extent can we identify points of friction in the way an organization works and then offer truly foundational advice about removing that friction, not just treating the symptom of that friction?

The Services

What will the organizational design firm of the 21st century actually sell? What will be delivered? How will impact be measured? I think it goes without saying that every client engagement would be a highly unique and specialized affair starting with an intense discovery and sense-making effort. What's next?

A few ideas:

  1. Coaching around “new ways of working”: On a one-on-one basis across the entire scope of the organization, from executive, to managerial, to front-line workers there could be coaching on new ways of working. Coaches would emphasize the habits and behaviors that allow individuals and organizations to work more effectively (i.e. anti-procrastination techniques, self-leadership strategies, the development of psychological capital, etc.). A good coach should be able to help individuals develop the meta-cognitive skills and self-reflective behaviors that can drive long-term habit change even after the coaching engagement ends.
  2. Embedding teams/individuals within organizations: Consultants would shadow teams and individuals within the client organization. While this would provide opportunities for formal coaching sessions or workshops, it would also allow for a much more nuanced understanding of how things actually get done in an organization. With that more nuanced understanding the recommendations and interventions could be much, much, smaller, accurate, and simpler. I believe many of the friction points that exist within organizations are so embedded or subconscious that they never appear during interviews or surveys. Only by embedding into an organization will these friction points become visible, and therefore addressable.
  3. The setting and behavior change facilitation of strategy: Strategy consulting is not new. Helping leadership teams articulate and set strategy is a time-honored role of consultants. However, I view this 21st century organizational design firm taking it a step further and pushing, facilitating, and evaluating the action/behavior change that should emerge from a strategy session. What are the behaviors that should change based on our strategy and to what extent can we as consultants find avenues to help people (leadership and otherwise) practice these behaviors?
  4. Organizational development: This new firm will have to be adept at all the more traditional outlets for organizational development (and perhaps this is where some specialization may occur across the industry). Hiring, culture change, compensation, onboarding, physical space ... the list of possibilities is long. In each case, this firm should be able to both dive deep into the latest and best organizational psychology, sociology, industrial psychology, and other relevant academic fields, make sense of what is useful, and then carefully bring that knowledge to bear on the stated problems of the organization.
  5. Organizational re-design: There are new ways to organize companies and the organizational design firms of the 21st century need to be able to facilitate the adoption of those new ways of organizing if that is what the client wants or seems to be the best approach to improving the client organization. These can be self-organizing principles or wholesale adoption of systems like holacracy or Spotify's guilds. No system is a silver bullet and the organizational design consultants of the 21st century will both build our understanding of the contexts in which these systems work (which is an area of knowledge we are woefully lacking) and accurately facilitate the development of these systems at the appropriate time and in the appropriate situation.

Conclusion

No consulting firm is doing what I just laid out -- not even Undercurrent at its peak. From what I can tell there are some firms that are trying to do bits and pieces of it but nobody has really made a concerted effort at uniting it into a cohesive whole. The opportunity to embrace the uncertainty of this new type of consulting and possibly be the early dominant force is truly staggering. It's going to take people who aren't wedded to an old style of organizational consulting or design consulting or anything else that may poke around the edges of a true organizational design practice.

For what it's worth, I'm still looking for my next gig. If I just a.) inadvertently described your company or b.) described the direction you're trying to go with your company -- we should talk.

Otherwise, tell me what I'm missing. Where am I wrong? Where am I right? Let's push this way of thinking forward together.

Rethinking The Growth and Care of Organizations: A Proposal

As The Workologist Newsletter subscribers know, I recently "gave myself permission" (it's complicated) to look for a full-time job in addition to continuing to run and develop everything I'm doing with The Workologist. In a nutshell, I've been entirely entrepreneurially focused since quitting my high school teaching job and coming to graduate school in 2011. There's nothing wrong with that kind of single-minded focus but I've realized that it has limited me from other potential opportunities that might be just as rewarding as trying to develop my own company.

All that is to say I've been perusing cyberspace over the past few weeks in an effort to see what kind of job opportunities are out there and even dipping my toes in the water when I've seen something I like. There are a handful of positions with companies I admire out there but unfortunately I have seen nothing that 100% matches what I'm visualizing someone with my skill set (or a similar one) could bring to an organization.

I'm writing to propose a new position that companies should be hiring for. I don't have a good name for it yet (I'd love to hear your ideas.) I'm also 95% sure this position doesn't already exist in most companies but if it does exist in yours then props to you. From what I can tell not many companies are thinking about what an organizational development/positive psychologist/coach/personal productivity expert/researcher could bring to the table.

Firstly, let's lay out what someone in this position would need in order to do this job well (in no particular order): insatiable curiosity around what it means to do great work on an individual, team, and organizational level; a deep knowledge of productivity best-practices and the contextual factors that limit or enhance each; coaching expertise; a working knowledge of foundational positive psychology, organizational psychology, cognitive psychology, and leadership theories and concepts; the interpersonal skills to facilitate small group discussions, workshops, and one-on-one conversations; a deep appreciation for the power of scientific experimentation and the willingness to use those principles in the quest for more efficient, meaningful and productive work; and a dedication to uncovering the best processes, systems, and approaches to helping an organization operate as efficiently and meaningfully as possible.

Easy as pie, right?

I think the benefits of having someone on the team who is constantly thinking about how to amplify everyone else's impact on an individual level ("making people better"), at the group level ("making teams better"), and at the organizational level ("making systems and processes better") would be huge. That's not to say this is the only person who would be thinking about these topics. However, hiring someone whose express job it is to think about and act on this stuff not only ensures that someone is thinking about it, but it frees up everyone else to use more of their cognitive ability for the substantive work that justifies the organization's existence. The pace of work in most companies is accelerating and being responsive, agile, and innovative may be buzzwords but they also ring true for many companies striving to make an impact in the world. Someone in this position not only frees people up to become more fully engaged in their primary work tasks, but also ensures that everything else that can be done to amplify the effectiveness of the organization is being done.

This isn't a general HR position or a short-term consulting gig or even a training and development specialist. I'm talking about someone who is much more baked into the everyday processes and interactions in an organization and whose only job is to make sure everyone else can be even better in their roles. One person could cover a ton of ground if their primary responsibility was to simply ensure that the organization was firing on all cylinders (and to maybe find cylinders that aren't even firing yet). Obviously, a small organization needs everyone to be operating at full capacity at all times in order to be successful. However, small organizations and startups often quickly grow to the point where questions need to be answered about organizational structure, norms, culture, etc. that often get (not) made by default (to everyone's detriment) instead of being consciously and deliberately decided. The person in this role would be expected to notice when this is happening and step in to facilitate the process of making these decisions consciously.

Hopefully I've been somewhat clear for what this position might entail. To make it even clearer, here's an extremely partial list of job responsibilities and actions this person would need to do:

  • Figure out what training/development/support individual employees need and either develop or find the appropriate resources.
  • Figure out what training/development/support teams need and either develop or find the appropriate resources for them.
  • Assess communication (how we email/text/Slack) and operating norms (how we schedule meetings, run meetings, do our daily routine work, make time for non-urgent but important work, how we keep track of who is doing what and by when, etc.) of the organization and suggest/facilitate tweaks where necessary.
  • Work with managers to develop their ability to successfully coach their employees.
  • Work with employees to develop the psychological resources (self-efficacy, hope, optimism, resilience, grit, self-leadership, etc.) to thrive at work (and beyond).
  • Work with members of the leadership team on developing leadership capabilities.
  • Assess and facilitate tweaks to physical workspaces given the best environmental psychology evidence.
  • Stay up to date on organizational psychology research that may be relevant to the organization and translate/synthesize findings into useful information for all members of the organization.
  • Be constantly thinking about how the organization goes about getting it's work done and note areas for improvement.
  • Support all members of the organization in the quest to make work a meaningful growth experience through the way each person approaches their work and makes sense of their role in the organization in an effort to support job satisfaction, engagement, and ultimately organizational performance.

Many of these responsibilities are currently offloaded to a hodgepodge of training and development specialists and consultants or thrust upon already overworked managers. The psychological health of an organization is too important to spread across disparate departments and individuals. It needs to be treated holistically and managed intelligently. I'm convinced bringing a positive organizational psychology trained, personal development and personal productivity obsessed, experienced coach and generally insatiably curious person into the fold of an organization would have huge ramifications.

The best way I can think of to describe this position is as a catalyst that is constantly circulating through an organization to make sure all the chemical reactions that need to be happening are happening. That areas that need a little boost are being boosted, that areas needing a little cooling get cooled, that by coordinating all the disparate reactions that are happening across the entire system the overall effect can be more explosive and productive than anyone ever expected.

Photo by Marcus Peaston

People and Holacracy: Four Necessities for Success

Holacracy is the new rage when it comes to organizational structure. It's a relatively radical new approach that distributes power, tries to remove hierarchy in favor of self-organizing teams, and strives to make organizations leaner and more adaptable. Holacracy proponents argue the world moves too quickly for the stolid organizational structures and procedures of the past. Companies need to be nimble and make decisions that can be implemented and iterated on quickly. Holacracy tries to support this reality by removing the more rigid aspects of organizational structure that most of us recognize in an attempt to make working for the organization more efficient, productive, and even more meaningful.

Personal skepticism aside about the need for leadership, direction, and whether hierarchy can ever really be eliminated (I don't have personal experience working in a holacratic organization) I do acknowledge that holacracy is an exciting development for much of the knowledge work world and may be extremely beneficial when thoroughly adopted. For an organization to really thrive in a holacratic structure, though, I think there are some pretty crucial psychological characteristics employees need to develop. In fact these psychological characteristics apply in any organization that offers even a modicum of autonomy in terms of how you do your work. Autonomy in your job can be an incredibly motivating characteristic but only if you have the skills to take advantage of it.

I humbly submit the following four ideas for consideration as vital to succeeding in any organization where the employees have a high level of autonomy (holacratic or otherwise):

Self-leadership

People with high self-leadership are able to take action on the things they know they need to do even when they don't necessarily feel like doing it. In an organizational structure where there is no direct feedback coming from a superior it places the onus for figuring out what to do and then making sure it gets done on the individual employee. Employees with high self-leadership can guide their own behavior with a minimum of oversight. Self-leadership can take many different forms, from behavioral strategies like self-reward or self-punishment, to finding enjoyment in the work itself, to structuring your environment to support your work intentions, and a host of other techniques.

Personal productivity

The whole point of adopting a holacratic structure is to make the organization more capable of getting things done (which, ironically, is also why more rigid structures were originally created, too). Regardless of structure, an organization is only going to be as productive as the individuals who make it up. Ideally holacracy cuts through the red tape and bureaucracy that often blocks personal productivity. Employees with a relentless drive toward completion and a high level of self-leadership are going to become even more valuable members of the team.

Tolerance for ambiguity

Managers often remove ambiguity for employees by assigning work and giving feedback. Holacracy removes this which means you need to be much better at being okay with ambiguity. Entrepreneurs have generally accepted this as part of the experience of getting into that line of work whereas the world of steady full-time employment has usually minimized it (i.e. job descriptions, performance evaluations, etc.). That divide is being closed as being an employee becomes more like being an entrepreneur. Fluid situations that are constantly changing are by their very nature ambiguous. Removing that ambiguity may feel nice and secure in the moment but in practicality is nearly impossible. Instead, employees have to get better at reconciling the complexity they perceive on a daily basis with the desire to have discrete projects and make visible progress. It's still possible to do both of these things, but the path to completion is likely to be much more winding than it used to be.

Psychological capital

Organizations usually have a good handle on their economic and physical capital. It's relatively easy to see and wrap your arms around those concepts. Even social capital, the relationships among the members of an organization, can be observed and noted. However, quite possibly the most important type of capital to the success of any organization is psychological capital -- the extent to which its members have Resilience, Efficacy, Optimism, and Hope. Without this an organization has nothing. It seems to me that holacracy eliminates the productive layer that can act as a buffer between employees with low PsyCap and their impact on the organization. For better or worse, PsyCap will have a greater impact on the holacratic organization. Luckily, it appears that PsyCap can be taught, enhanced, and developed.


Coincidentally (or maybe not) these are the same characteristics I've been homing in on for my research on independent workers and entrepreneurs. We know that the ranks of the independent are growing and if we begin to include the employees of holacratic organizations then the number of people who need development in these characteristics is growing even quicker than I first thought.

Do you work in an organization that has adopted a holacratic structure? What has your experience been? More generally, where does autonomy feel like more of a curse than a blessing in your job (regardless of whether it's within a holacratic organization or not)?


If you aren't already a member of The Workologist mailing list you may be interested in checking it out. Signing up gets you a free copy of my 50+ page e-book on using principles of positive psychology to work better. Mailing list members also get discounts, announcements, and unique articles that never see the light of day on the general site. Fill out the form below to join the list!

Name

Name

First Name

Last Name

Photo by Mark Chadwick

The Role of the Individual in the Organization of the Future

I was recently introduced to the work of Undercurrent, an organizational design consulting firm that is really pushing against the edges of how we think about optimally functioning organizations. I’m going to do my best to summarize some of their overarching thoughts, but if you’re really interested you should go straight to the sources.

Organizational Structure for a New Era

In a nutshell, Undercurrent is a proponent of the idea that the most responsive and nimble organizations also tend to be the most effective. Given the speed and power of technology and communication in the world today organizational structures that dominated in the 70’s and 80’s are not the same types of structures that will dominate today and in the future. Instead of creating tall hierarchical structures with clear chains of command and the titles and job responsibilities that accompany a hierarchy, many successful companies are choosing a much “flatter" and in many ways, complex, structure.

Holacracy, agile squads, and self-organizing teams are all the rage and many would argue it's for good reason. With these structures (or really, the lack thereof) companies can be quicker to respond to economic pressures and opportunities. It’s easy to see how this would work for Silicon Valley tech startups but Undercurrent would argue that even well-established companies in less high-tech industries could benefit from moving toward less hierarchy, less structure, and more self-organization.

All of this is fascinating.

Independent Work and Workers

I’ve taken organizational theory and organizational development classes in my PhD coursework and I’ve enjoyed all of them. This talk of structure and overall organizational decision making is incredibly interesting to me and I know quite a bit about it — but it’s also not my bread and butter.

My bread and butter actually has almost nothing to do with people who work in organizations and yet, I think my research interests align incredibly well with the organizational structure movement Undercurrent is promoting. There are questions pounding away at my head as I think about this changing nature of work and organizational life are: What implications does all this have at an individual level? How do you develop (or hire) people who thrive (not just survive) in highly autonomous, uncertain, and ambiguous work situations?

As many of you already know, my research is currently focused on independent workers — freelancers, micro-entrepreneurs, and contract workers. People who start their own thing and keep it deliberately small (for a myriad of reasons). At this moment, I’m particularly interested in the developable skills of self-leadership and self-management for this group of people. Being able to self-lead and self-manage when you work on your own are utterly vital skills to have. Given a lot of the economic indicators and statistics that I’ve seen, I think the growth of independent work is inevitable and already a movement that has been very much set in motion. However, I know that the future of work is never going to be everybody running their own freelance careers or starting independent businesses. Organizations aren’t going away — but I think the way that we’ve thought of organizations for a long time, is.

The Collision of Independent Work & New Organizational Structures

Working in one of these holocratic or highly responsive organizations is going to become more and more like being an independent worker. Autonomy is rampant. Ambiguity about job roles and tasks is a given. A general lack of structure about the how of work is substituted for a focus on the what. As life in organizations becomes more like independent work the skills I’ve begun to identify as being absolutely vital to independent workers, tolerance for ambiguity, self-leadership, self-management, self-awareness, growth mindset, “integrated personal development,” to name a few, are also the skills that anyone working in an organization of the future will need.

How do you develop the people you already have within your organization to be a better fit for this more dynamic, fluid, and uncertain environment? What can be done at the organization level to upgrade the skills of your people? To upgrade the frameworks they use to think about their role in the organization and what it means to do good work on a moment-to-moment basis? Looking outside the organization, how do you make sure you hire people who will be a good fit for this type of environment? How can you make sure you select the people with the highest probability to thrive in an environment that looks more and more like a buzzing and roiling ant hill than an orderly and logical military unit?

I have some ideas about answers to these questions and luckily they spur even more questions within me that seem ripe for empirical investigation. When I originally stepped down this path of indie work research I was a little bit worried that I was setting myself up for failure by focusing on too small a niche. Sure, there are a lot of independent workers in the world and the number seems to be growing, but more people work in organizations. What impact could I really hope to have when I was focusing on a minority of the working population? The work of Undercurrent (and I’m sure other organizations that I’m not aware of yet) has assuaged that fear for me. I now realize that to understand independent workers is to better understand highly autonomous workers regardless of whether they work for themselves, a start-up, or a Fortune 500 company just beginning to experiment with new ways of organizing.

Organizational structures are changing in such a way that requires you to get better. Is there anything more exciting?

Photo by John