STRUCTURAL CYBERNETICS

This page is an overview of the basic concepts of organizational structure, including both the science of designing organization charts and the mechanisms of high-performance teamwork.

It includes links to frequently asked questions (FAQs) , more detailed explanations of each of these topics, as well as links to NDMA resources that can help you implement a new organizational structure or fine-tune your current structure.

Definitions

Structure is the definition of jobs and the reporting hierarchy (the organization chart), as well as the processes that combine people into teams as workflows across organizational boundaries. Structure defines people's specialties, as well as their relationships with one another. It determines who does what, and how people collaborate to get work done.

Structure has two components:

* Organization charts that define distinct lines of business and specialties.

* Workflows that assemble the right specialists from throughout the organization on project/service teams.

Changes in the organization chart inevitably induce changes in workflows. Both must be designed together.

The Science of Structure

Designing effective organization charts is a science, not just a matter of opinion.

Whether you're working on an information technology department organizational chart, a corporate organizational structure, or a business organizational chart for any department, the same principles apply.

NDMA's Structural Cybernetics research identified the five fundamental building blocks of structure -- five different types of businesses found within any corporation, company, or organization.

More on the lines of business within organizations....

"We've been struggling with organizational issues for years. Our discussions were often confused, occasionally emotional, and rarely decisive. Structural Cybernetics brought everything into focus. It's not a rigid answer.... It's a well-structured process with a clear language that helped our leadership team come to consensus on a whole range of tough issues."

Bill Wilkins CIO, John Alden Financial Services Corp.

Research also revealed clear principles for assembling them into an organization chart.

Overview of principles....

These scientific principles can be used to analyze the pros and cons of an existing (or proposed) organization chart, as well as to design a new structure.

The result: jobs that are entrepreneurial, well focused, and have a minimum of conflicts of interests.

"Dean Meyer introduces you to a new organizational construct that makes sense and works."

Carla Garnham Special Assistant to the Provost, University of Wisconsin Milwaukee

Examples of Organization Charts

There is no "one right" organization chart. Every organization is different. But using this science, a leadership team can design an organization chart tailored to its unique situation.

With that understood, illustrations of different types of organizational structure in different functional areas are offered below. They are described in the precise language of the building blocks, although in practice the groups would be renamed to be more easily understood by those not trained in Structural Cybernetics.

Holding Corporation Organization Chart (business is building companies)

Operating Company Organization Chart (business is building products)

Health Care Organization Chart

Insurance Organization Chart

Information Technology Organization Chart

Human Resources Organization Chart

Education / Training Organization Chart

Finance Organization Chart

Public Relations / Corporate Communications Organization Chart

These examples of corporate organization charts are not recommendations, but rather only serve to demonstrate how the Structural Cybernetics building blocks and principles can be assembled into structure.

High-performance Teamwork and Cross-boundary Workflows

Beyond just the organization chart, structure must consider workflows. If people don't team across structural boundaries, the organization will revert into "stovepipes" of self-sufficient generalists. The structure implementation process must establish fluid cross-boundary workflows as an integral part of the design.

High-performance workflows are based on the business-within-a-business paradigm. Each project or service is assigned to a "prime contractor." The first job of the prime is to arrange for help from peers, that is, to line up any needed "subcontractors."

More on dynamic cross-boundary workflows....

"The Structural Cybernetics process forced us to specify our products and services, [and] our customers and suppliers for each operating and support organization within our [department]. This brought to light many of the inefficiencies that we had been struggling with and allowed us to deal with them."

William T. Houghton President Chevron Information Technology Company

Implementing Structural Changes

The Structural Cybernetics implementation process is radically different from the all-too-familiar process of juggling boxes at the top, announcing the new organization chart, and then hoping for the best as people struggle in public for month after month to figure out how it should work. It emphasizes leadership education and careful planning before announcement day, so that the new organization can then "hit the ground running."

The implementation process is open and participative, building deep understanding and commitment within the leadership team. Structural Cybernetics principles are the key to a productive participation. Instead of territorialism and battles of opinions, leaders argue the trade-offs of various design alternatives in a rational, fact-based design process.

"Once we adopted the [Structural Cybernetics] principles, we had a framework that provided a basis for any decision, defused the inevitable turf battles before they ever began, and accelerated our learning process in a way that probably could not have occurred otherwise."

John Benci General Director, M.I.S. The Canadian Wheat Board

More on the structural change process....

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