We’ve Disrupted the Formal Organisation: But what does it look like now?

Digital disruption, Holocracies, Wirearchies are attacking the formal hierarchy as we had come to know it. While we might accept that the formal hierarchy is becoming less reflective of how work is getting done, it still reflects how senior executives are designing for work to be done. For most organisations, senior executives still agonise over appropriate formal hierarchical structures. And the published organisational chart is usually the first port of call for those wanting to understand the inner workings of an organisation. Is it distributed or centralised?; Sales driven or product driven? Operations, Technology centric or Financial centric?

If the formal organisation chart were to truly disappear, what could we replace it with? Where would the external stakeholders go to understand how the Holocracy, Wirearchy or Networked Organisation is operating? Where are the core capabilities in such environments? What about the disconnected workgroups?

The good news is that formal methods for mapping informal organisational structure have been around for some time. Social Network Analysis (SNA) has provided us with a means for mapping the connections between individuals based on their relationships. With the advent of informal organisational groups, be they part of an Organisational Social Networking platform like Yammer or Jive, an email group or a team site in Slack or Skype, there is a need to understand how these informally created entities are connected to each other. Without this facility it can be hard to see the ‘big picture’ of what may be really happening, leaving the organisational executive flying blind.

One of the easiest methods for creating an organisational wide map is to use a simple ‘shared membership’ approach. Commonly called ‘affinity mapping’, it is the same technique that has been used to uncover board of director interlocks, which have provided insights into largely invisible connections between publicly listed companies. It also happens to be the way that Amazon promotes new books to you, by inferring that you have an affinity relationship with those that have read the same books.

Here is an example map we have created using an organisation’s Yammer group membership (group names have been changed to protect privacy):

At the start of this clip we can see that all the groups are formed into one large cluster, as invariably most groups are inter-connected to some degree with other groups. But you will see as we increase the relationship ‘strength’ filter to only include overlapping memberships of a certain size, the informal group structure starts to materialise in front of our eyes. When taken to the extreme, we are left with the two groups with the greatest level of overlap, being Enterprise Communications and Customer Delivery. The number of common members is shown next to the strength filter. As we move the strength filter back from this point we gradually see other connected groups become exposed. We see the regional stores cluster emerge, suggesting perhaps some common regional issues. We also see a number of non-work groups emerge, interestingly connected to a sponsored diversity group, with all being strongly connected to the enterprise communications hub. This is good news, as these groups are doing their job of connecting staff who would normally not be connected in other ways.

By using this simple relationship strength filter, we can start to explore the emerging structures formed from the voluntary, ‘bottom up’ actions of mainstream staff. The highly connected groups could be seen larger nodes representing the core interest/capability areas that are developing. The enterprise leaders that ‘own’ the formal organisation chart can now ask questions like ‘how well is our informal structure reinforcing our formal structures, or not?’; ‘Are there key capability areas that are not developing and may need more nurturing?’; ‘Are we encouraging a diversity of interests in our staff and if so, how are they helping to reinforce our mainstream businesses?”.

We regularly see analytics provided for activity levels inside groups, but rarely between them. The power for the enterprise now comes from being able to overlay the formal and the informal, as the formal hierarchy starts to give way to the more adaptive and flexible informal structures, being increasingly exposed by Enterprise Social Networking platforms and the like.