Don’t restructure, change the system

The “Naughty Kid” Paradox

I was, by many accounts, a pretty badly behaved kid at school. I remember smashing a window with a foam football I’d soaked in a puddle on purpose. I remember chewing a sheet of A4 paper for 45mins so that I could throw it at the whiteboard whilst my teacher was writing. I remember emptying a bin in a teacher’s briefcase whilst they went to the loo. I remember throwing a teachers bag out the 2nd floor window. I remember getting the whole class detention and then breaking the whole class out of detention.

And yet…

At exactly the same time, I was a model student when playing sport. I played Squash at a high level and whilst the other kids were out drinking, I would watch old videos of pros I admired. There was a left handed player I liked so I set up a mirror facing the TV so that I could analyse his games whilst being able to relate to his style of play better. I wrote essays about the game. I asked for a camcorder for xmas so I could analyse my own games, writing crosses on a sheet of paper to understand my shot map. At tournaments, whilst all the other teenagers were causing havoc, I would spend all my time with the coaches eager to learn.

It Wasn’t the Kid, It Was the Environment

In the squash club I was described by coaches as kind, respectful and smart. At school I was troublesome and one school report said: “Jonathan must stop daydreaming and looking out of the window”.

To school, I was the problem. But what about school being the problem?

This mirrors what I hear time and time again in organisations: That everything would be alright if it weren’t for the people under performing.

Quashing Potential by Design

Those hierarchical, bureaucratic and stifling structures run contrary to what we know about human motivation, that motivation has three fundamental drivers:

• Autonomy
• Master
• Purpose
  (These are Daniel Pink’s words from his book Drive, they’re based on Self-Determination Theory the academic framework around motivation which names them differently as: Autonomy, Competence, Connectedness)

And particularly it ran contrary to the first one: Autonomy.

The problem was that the very structure quashed my potential. I had talent. Some good teachers even noticed. But it couldn’t express itself. They could change my classrooms, or teachers and you might get an incremental improvement but ultimately the system itself wasn’t growth-promoting for me. In developmental psychology there is this concept that we each have a ‘natural curriculum’ and school – for me, and I’d argue for most – doesn’t allow that curriculum to express itself. There’s too many top-down structures to allow for it.

The Restructure Addiction

And this is what we see in our organisations. The number of organisations we see ‘restructure’ only to have more problems than what they had before. Or move lines of reporting. Or hire people who ‘fit the culture better’. Only for the same old issues to resurface. Some organisations restructure and restructure and nothing changes. Some industries like the charity sector are almost addicted to restructuring.

But it doesn’t help. People aren’t the problem (or rarely so). And the structures belong to an often archaic system. Changing structures in a hierarchy is like wanting a faster horse, when uou could really do with buying a car.

No. It’s the system itself that is the problem.

How Hierarchies Sabotage Motivation

The dominant structure inhibits potential in multiple ways through silos, by pigeon holing people, by subordinating people to parent<>child dynamics, by keeping information in certain places and therefore not giving people the most fundamental resource they need to make good decisions and take initiative… the list goes on.

At Pala we often talk about the 3E’s that an organisation should be:

• Effective: i.e. high output
• Efficient: i.e. low waste
• Engaging: i.e. high motivation

Hierarchies fail at all of these.

The layers slow the effectiveness because a centralised system means fewer decision makers thus limiting the processing power of the system. They are inefficient because of the slowness and time spent with decision making going up and down vertical silos (hierarchy) and cross-departmental collaboration being so slow across horizontal silos. And they’re infantilising as they take away autonomy from people who are otherwise adult enough to vote, raise children and manage household finances, so that’s engagement gone.

Doing Less to Achieve More

The amount of money, time, emotion wasted on restructures is mind-boggling. It’s unnecessary.

Instead an entirely different system is needed. The beauty is that this new system requires doing less not more. It requires removing bureaucracy and hierarchy and replacing their supposed features with self-regulating processes that coordinate whilst increasing their autonomy.

Using the 3Es again, more decentralised, distributed, autonomous teams are more effective because more people have the agency to move things forward at pace.

The processing power of the organisation goes up.

The lack of friction also increases efficiency, whilst waste from things travelling around decreases, because there’s fewer silos. We also find these organisations are more resilient (which is proven at huge scale with the world’s most resilient bank, Handelsbanken, who operate through a decentralised model).

And as for engagement, every client we’ve worked with in a long term partnership has reached engagement rates of over 90%.

Continuous Evolution, Not Big Bang Changes

The beauty of a shift towards more self-managing teams is that you never need to restructure, because the system is constantly making 1% restructures every day.

Each team in their weekly team meeting is given specific practical tools to add/edit/remove roles each week. So there’s never these big emotionally exhausting and financially expensive restructures.

Nothing is done to people. But rather each day people make small tweaks that they believe will increase their effectiveness as a team.

As Peter Senge once said:

People don’t mind change. They mind being changed

Stop Parenting, Start Empowering

And so if you’re a CEO thinking of restructuring right now, please don’t.

Consider changing the underlying system, not the structure.

Consider doing less, not more.

Take barriers away.

Simplify.

Replace hierarchical structures with self-regulating processes.

Empower people.

If you do this, and add smart coordinating processes as you go along, you will soon find a treasure trove of talent. Rather than parenting naughty children, you will soon find yourself being a peer to competent adults.

What might they be able to take responsibility for in the organisation that the system currently prevents them from?