Jean Roberts

Tool No. 5: Organisational/Corporate Structure Tool - the fifth and final Tool of War and Peace in the World of Management in this April 2010 series.

All organisations operate as two equally important structures at one and the same time:

• the formal structure, and
• the informal structure.

Peace is more likely to reign where these two structures are treated with equal value and respect. 

War – or the threat of war – is more likely to be declared where either one is used to belittle or undervalue the other.

So – what’s the difference between the formal and informal structures – and how can they be used as tools of war or peace?

A:        The formal structure

The formal structure indicates the way things should happen – and are expected to happen – to support and strengthen the purpose for which the organisation exists.  It is a written and agreed structure that demonstrates:

1. the nature and extent of authority delegated throughout the organisation,
2. who is accountable to whom and for what,
3. how decisions are made, communicated, implemented and evaluated, and
4. how information moves through the organisation.

Examples of factors which need to be in place to influence the effectiveness of a formal structure:

1. agreed strategic priorities for the use or application of available or accessible resources,
2. policies and procedures for functions or activities that happen frequently,
3. position descriptions for each formal position,
4. systems in place to guide/ensure consistency in response to legislative, statutory and contractual duties, requirements and obligations, and
5. each person or group knowing and understanding the role and responsibilities of each other person or group within the formal structure.

A formal structure that genuinely reflects your organisation’s desired method of management and operation should be published and explained for all to see.  Then it becomes tool for peace.

A wise manager will use and display these management skills to deter war-like behavior through the formal structure:

1. adequate time allocated to planning, implementation and evaluation,
2. trialing and refining of ideas,
3. delegating the right tasks to the right people at the right time in the right way,
4. adequate, available and appropriate resources,
5. clear policies, procedures and work practices that contribute to continuous quality improvement,
6. adequate and appropriate financial and administrative systems, tools and competencies,
7. clear and open communication, and
8. negotiation and supervision.

Management is a combination of ensuring job satisfaction for staff, and meeting organisational demands.

B:        The informal structure

The informal structure, however, shows why things do – rather than should – happen.  It can change for better or worse without warning.  It may or may not have anything to do with the purpose for which the organisation exists – but will certainly impact on the effectiveness of the organisation.  Wise managers will monitor the informal structure closely and regularly, and show as much respect for it as they do the formal structure.

Examples of factors which influence the continually evolving informal structure:

1. personalities and friendships – within the workplace and externally,
2. sudden or lingering dislikes or disputes,
3. work-place relationships – particularly between people at different levels of authority
4. differing personal values, cultures or backgrounds
5. closeness or distance of people’s homes to each other, or to the workplace,
6. people travelling together to meetings or work-related activities
7. people mixing socially away from work,
8. family connections,
9. similarity or dissimilarity of education, qualifications or experience,
10. degrees of familiarity with or confidence in the formal structure, or
11. internal competition for scarce resources.

Regardless of whether there is an obvious and agreed formal structure in place, there will always be an informal structure – and this is where structure can become a tool of war.   People are left with their own interpretation of ‘what’s happening and not happening’ in order to interpret what is acceptable: the this can change according to who is interpreting.

Without a written and agreed formal structure, rules are not only unclear, they can be too easily revoked.  A procedure cited one day can be disowned the next due to a change in circumstance, a swing of unexpected support, new information, etc. 

A wise manager will display these leadership skills to deter war-like behavior through the informal structure:

1. interpersonal skills, including listening, questioning, observing, communicating
2. willingness to learn as well as lead,
3. ability to relate effectively to a variety of behaviours, personalities, contexts and constraints,
4. commitment to building and maintaining relationships,
5. understanding the willingness, ability and commitment of ‘followers’ (you cannot be a leader if others are not prepared or willing to follow your lead), and
6. acceptance of limitations.

Leadership is a combination of productivity and innovation.