During the American Civil War, a Scottish-born American railroad engineer named Daniel McCallum, one of the earliest pioneers of management, wanted a way to articulate the relationships in an organisation so people knew how it all worked together.
So he drew up a diagram, now known as an organisation (org) chart. McCallum’s org chart was a reflection of how he viewed the workplace and the people in it. Like a father with children looking up to him for guidance.
This was a time period where workers were seen as mechanical units suited to small, highly repetitive, technical tasks. If there were problems (or complaints), the workers could be replaced, much like components.
This mentality served the period well. Most work was highly mechanical and the tasks themselves hardly changed over long periods of time. It was predictable and stable.
Most of todays management practices come from this period. The hierarchal models most of us know are left-overs from the railroad companies and the military. Even the language we use about business is filled with undertones of conflict, influenced by this period. We crush competition. Our staff are on the front lines. We do battle with our competitors. You win or you lose. Workers reside in the trenches.
The world has changed quite a lot since those days, yet strangely, some of the core management concepts, practices and artefacts we still use today come from this time, which is perhaps why so many of us feel our organisations are letting us down. We are quite literally, not soldiers.
Key Points
- Org charts offer little value today
- There are modern alternatives to consider instead
- Org charts re-enforce behaviours we are all trying to pull away from
Why do we use Org charts anyway?
We draw up organisational charts for a few reasons.
1. To re-communicate the authority that needs to be obeyed.
This happens when leaders are trying to ensure that those on the front lines know who’s boss. Maybe it’s because different team members need a mediator for conflict, or perhaps it’s because it’s unclear who is supposed to decide what.
2. During a re-organisation
When departments are moved around, new roles created and old ones discarded, it might be time to re-draw the maps of authority. Otherwise how else will people know who is in charge?
3. Large groups need a manager
When teams get too big for one manager (known as the span of control) the thinking goes it might be time to add more levels of hierarchy to further break down an area into more manageable components and put someone at the top.
4. To show people who to turn to
When people in a company have a question, they usually just walk over to the person they think will have the best answer, at least to get them pointing in the right direction. By using an org chart, we think we’re doing them a favour by spelling it out for them. The idea being they can consult the org chart and go to the right person, assuming the org chart is up to date. It won’t be.
5. Just because
Perhaps one of the more common reasons to do an org chart is simply because you don’t have one. It doesn’t mean you need one, but when a company gets large enough it feels natural to want to document the spread of people so you can simply wrap your head around how the organisation looks. The biggest driver for this is new starters.
The thing is…
When was the last time you looked at your org chart to help you get something done? When you look at an org chart, one of 3 things comes to mind, and it depends who you are. Nearly all emotions felt when looking at org charts, unless you’re the CEO, relate to either anxiety, ambition or disappointment. They solidify fears in people, framing their situations as concrete, immovable, and often, un-fair.
Ultimately, they are reminders we are probably not where we think we should be.
If you’re the CEO. You feel good because you’ve clearly communicated how you want the structure to look. You feel organised. You assume this will make people feel comfortable, because everyone knows where they stand.
If you’re somewhere at the top, it’s validation you’re doing the right thing in life and that your career has been worth it. You’re amazing, and people should know that. Perhaps you feel like an imposter? When will people realise you don’t belong there? Perhaps someone already knows…
If you’re at the bottom, it’s a reminder that others above you are not always great leaders. And it perhaps reminds you that life is unfair.
Or perhaps you look at the org chart and think. I’m only new here. What do I care anyway.
The only thought that comes to mind when I look at org charts is…
“Wow…look at all these people that don’t work here anymore. Someone should probably update this thing.”
Org charts represent a major dichotomy in organisational life. What is often written down about how the organisation works, is likely different to how it actually works. So why write it down at all?
People as components
Org charts in a world where people worked for the same company for 20 years, where things stayed mostly the same, make perfect sense. But today where jobs and roles are much more fluid, where the pace of change is accelerating a little more than the 1800’s, I think it’s time we evolved the org chart to actually solve a problem we have, or drop them all together.
Org charts are the paper evidence that organisations need to be managed like infant school children, who if left to their own devices, would put spoons in the microwave and blow themselves to smithereens.
The truth is organisations are mostly a psychological wrapper around people, processes and technologies. As Yuval Noah Harari puts it, humans have a unique capability of believing in things that don’t really exist in the material world. Money and organisations are good examples of this. They exist on paper, and yes companies have buildings you can walk into, but if those buildings were to be torn down, in our minds, those organisations still exist.
Aside from a legal entity, a company is really a mental construct we create so we can all start working on something together. If we work for a company like Microsoft, the act of being hired transports us to an alternative reality where we see the business and our team as part of our identity, and those at Google as the enemy. Us and them. But we are still the same people. Nothing has changed in the physical world.
Being able to believe in constructs like this is an evolutionary aftershock that enabled us in our earliest stages of life to co-operate with other humans to perform activities we couldn’t do on our own — like build a community, or a city. When we have a shared belief system, we can unite behind that belief to do things that are very difficult; this is believed to be one of the reasons that brought our species forward. Humans have been able to build lasting civilisations behind ideas like religion, a concept that transcends race, borders and distance with much greater agility than statehood. Even country borders themselves are mostly in our minds. There is no actual geographical wall (not yet anyway) between the United States and Canada.
A cultural belief transcends physical boundaries, much like a modern organisation.
This psychological construct helps us get things done together, and perhaps the org chart is a way to document this so we can interpret the phenomenon logically.
How we actually organise companies
There are three types of organisational structures which exist in conventional organisations today.
1. Formal Structure
The formal structure of an organisation is what Daniel McCallum drew up in the 1800s. Top down, letter of the law structures, usually with lots of hierarchy. This is where the org chart and formal job descriptions come into the picture. It is also mostly a fantasy.
2. Extant Structure
The extant structure is how things actually work, and most will relate to the image here. it reflects instances where Tony from Engineering, even though he works on the help-desk and people think he has no power, he’s been here for 20 years and actually knows how to get things done. His brother is also the CFO so sometimes it’s easier to get your receipts approved by him instead of your actual manager. The extant structure is what happens every day, no matter what the org chart says.
3. Requisite Structure
The requisite structure is something different again. It’s the structure which feels the most natural, and best suited to the needs, purpose and demand of an organisation. It’s the structure that the company really wants to be.
You can usually feel the requisite structure trying to poke through when you identify friction or sluggishness.
What we actually might need?
If our primary purpose of having an org chart is to show how the organisation works together, it would probably look more like a data visualisation migration chart, showing small interactions constantly moving and changing depending on the task at hand. It would be a live-stream video, not an image.
What you could discern from something like this would be those in the organisation who you interact with the most; perhaps that’s useful. But probably not.
If I think about the basic needs when companies get big, we really need a few things.
We need to know who can make what kinds of decisions.
This can be tackled by a very clear understanding of what authority is, and who has it. Knowing who can make what kind of decision is rare in todays companies. Most people are unsure where the lines of authority lie because it’s never been spelled out.
How can I contact the right person about a particular topic?
Most people ask colleagues for this anyway. This is where the extant structure is more useful. Who is best to ask is more about merit and experience more than job titles. So the org charts don’t help us. We often ask those who we have the strongest political relationships with as a starting point. To seek council from someone is a deep sign that you respect them.
Who can modify the structure and for what purpose?
Great question. Who can actually change the org structure. Most feel they couldn’t unless they are in in the top job. But what if I want to setup a small crack team to work on a project for a week. Do I have the authority to do that? And if I do, should I visualise that for the rest of the organisation? Modifying an organisational chart here is painful. Because people cannot exist in more than one place on an org chart usually.
One example people often talk about here is Valve Software, the video game makers behind the HalfLife franchise. At Valve, the desks have wheels on them, and teams are encouraged at certain points to decide which projects they’d like to work on the most. This gives people the ability to rally behind the most compelling ideas and change team structures.
What roles do people exercise day to day?
In normal cases, we think this is where job descriptions come into place. But job descriptions tend to go out of date faster than org charts and fail to respond to change very well.
Perhaps the best example I’ve seen of a different approach to reflecting how an organisation looks is in a product called Glassfrog, a tool created by Holacracy one. It highlights circles within the organisation. These might be teams, or even temporary projects. Because when we think of a traditional org chart, it does not allow for temporary structures that spring up very well.
Let’s say you and 5 other staff have been put on a temporary team to arrange the move to a new office. This isn’t on a traditional organisational chart, but it is indeed useful information to know. By placing all structures in these circles, you can see the different ‘psychological units’ which people can participate in.
About OHNO.ai
Our mission at OHNO is to reboot the workplace and liberate teams from mediocrity. We think there are too many ceremonies and practices we all know in our hearts to be useless & wasteful, and lots of them don’t serve our customers or help us enjoy what we do. We value outcomes over traditions.
We want to liberate teams from those burdens by helping them get to the heart of what’s slowing them down using a really clever product we built called OHNO. If you liked this article or care about our mission, I’d love to hear from you. You can reach me on Twitter here.
And you can always try OHNO for free. Discover what’s holding you back from your goals at http://ohno.ai
