- Alternative meaning: Organisation (band).
An organization or organisation is a formal group of people with one or more shared goals. This topic is a broad
one.
According to management science, most human organizations fall roughly into five types:
Pyramids or Hierarchies
A hierarchy exemplifies an arrangement with a leader who leads leaders. This is the classic bureaucracy.
Usually one "rises" by seniority, or by acquiring authority over more people.
Pyramids are an effective way to achieve repeatable results because they have the
shortest path from the standard-setter to the worker.
They suffer from communication and supervisory faults because the organization is only as good as its weakest link. They lack
creativity because they have poor communications.
The classic fix for the communication problem is a magazine that reviews the whole hierarchy's business, perhaps daily or
weekly. One good scheme has each person send e-mail up each week, telling what he did, his plans, and problems. Each boss makes a
summary and sends it up. Then all the bosses send their summary down, appended to the summary from their boss.
At Printronix this freed cash equal to a year's revenue, sped up engineering
cycles six fold, reduced defects by two sigmas (see variance), increased inventory
turns tenfold and doubled product service life. People found out what to fix, and where.
Hierarchies were satirised in The Peter Principle (1969), a book that introduced the term
hierarchiology and the saying that "in a hierarchy every employee tends to rise to his level of incompetence".
An extremely rigid, in terms of responsibilities, type of organization is exemplified by Führerprinzip.
Committees or Juries
These consist of a group of peers who decide as a group, perhaps by voting. The difference between a jury and a committee is that the members of the committee are
usually assigned to perform or lead further actions after the group comes to a decision, whereas members of a jury come to a
decision. In common law countries legal juries render decisions of guilt,
liability and quantify damages, juries are also used in athletic contests, book awards and similar activities. Sometimes a
selection committee functions like a jury. In the middle ages juries in continental Europe were used to determine the law
according to consensus amongst local notables.
Committees are often the most reliable way to make decisions. Condorcet's jury theorem proved that if the average member votes better than a roll of dice, then adding
more members increases the number of majorities that can come to a correct vote (however correctness is defined). The problem is
that if the average member is worse than a roll of dice, the committee's decisions grow worse, not better! Staffing is
crucial.
Famously, unstructured committees can dither without making decisions. Parliamentary procedure, such as Robert's Rules of Order, helps prevent dithering.
Staff Organisation or Cross-functional Team
A staff helps an expert get all his work
done. To this end, a "chief of staff" decides whether an assignment is
routine or not. If it's routine, he assigns it to a staff member, who is a sort of junior expert. The chief of staff schedules
the routine problems, and checks that they are completed.
If a problem is not routine, the chief of staff notices. He passes it to the expert, who solves the problem, and educates the
staff -- converting the problem into a routine problem.
Staffs make decisions quickly, and carry out assignments efficiently, though less reliably than committees or matrices. For
this reason businesses often prefer to use this method.
Staffs break down easily, usually from bad selection of people. Dilbert's boss is
a non-expert trying to run a staff. In a "cross functional team," like an executive committee, the boss has to be a
non-expert, because so many kinds of expertise are required. Also: chiefs of staff can be disorganized, play favorites, or can't
tell what should go to the expert.
Executive committees can be expert staffs: at choosing people. This is how General Electric succeeded under Jack Welch. You could
do worse.
Matrix Organisation
On the face of it, this is the perfect organisation. One hierarchy is "functional" and assures that each type of expert in the
organization is well-trained, and measured by a boss who is super-expert in the same field. The other direction is "executive"
and tries to get projects completed using the experts.
Matrices are the only known organizations that can consistently create complex technical products like airplanes and
engines.
The problem is that going through channels takes too long. Getting approval to actually do anything often needs the
approval of each type of expert, and both of each expert's bosses! The trick is to speed approvals: make approval everybody's
number one job, and simplify sign-offs.
Ecologies
This organization has intense competition. Bad parts of the organization
starve. Good ones get more work. Everybody is paid for what they actually do, and runs a tiny business that has to show a
profit, or they get canned. For example: upper managers invest, and if they make bad
investments, there's no profit. Engineers rent their designs out to manufacturing. Facilities people rent space, etc.
This is a really effective organization. But it's wasteful because all those dead pieces of organization have valuable
training, and are very hard to recycle. They're bitter, and they will stop taking it after a while. Reorganization follows.
This may reflect a rather one-sided view of what goes on in ecology. It is also
the case that a natural ecosystem has a natural border - ecoregions do not in general compete with one another in any way, but are very
autonomous.
The pharmaceutical company GlaxoSmithKline talks about functioning as this type of organisation in
this external article (http://www.guardian.co.uk/business/story/0,3604,1294443,00.html) from The Guardian.
Composite Organizations
These try to use each of the above types of organization in the right places. Very occasionally, a true organizational genius
can make this work, for a while.
Don't bet on it in the long term. Success outgrows the ability of the genius. There just get to be too many special cases.
One golden exception may be a hierarchy of staffs, where every staff above the first level works to find or make the right
people. This is the G.E. model, of course.
"Chaordic" Organizations
An emerging model of organizing human endeavors, based on a blending of chaos and
order (hence "chaordic"), comes out of the work of Dee Hock and the creation of the VISA
financial network. Blending democracy, complex system, consensus
decision making, co-operation and competition, the chaordic approach attempts to encourage organizations to evolve from the increasingly
nonviable hierarchical, command-and-control models. Reference: http://www.chaordic.org.
Similarly, see Emergent organisations, and the
principle of self-organization. See also group entity for an anarchist
perspective on human organizations.
References
Organisations which are legal entities: government, international organization, non-governmental organization, armed forces, corporation,
partnership, charity, not-for-profit corporation, cooperative, university.
Miscellaneous
Related concepts
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