The Organisation Nobody Chose

In most head offices there is a wall with the values written on it. Somewhere within sight of that wall there is usually a screen, or a board, or a weekly email, showing the numbers.

Both are statements about what the organisation cares about. Only one of them decides what happens on a Tuesday afternoon when the two point in different directions.

That is not a criticism of whoever wrote the wall. In most organisations the people who wrote it meant it, and some of them will later carry the consequences of the fact that it did not hold. The question this essay is about is why it did not hold, and the answer is not that anyone was insincere.

Two essays, and what falls out of them

The first essay in this series argued that organisations do not solve for structure. They solve for strategy, for talent, for capital allocation and for risk, and they assume that the structure through which all of it has to travel will arrange itself.

The second argued that the individual inside that structure is the most measured and least informed party in it. They are read continuously, by systems they did not choose, and they can read almost nothing back about the conditions they are working in.

Put those together and something follows that neither says on its own.

If nobody is solving for structure, and nobody inside it can see it, then structure is the thing most likely to change without anyone deciding that it should. Most other significant properties of a business are set deliberately and reviewed periodically. The reading this series works from is that structure moves on its own, in the direction the incentives happen to be pointing.

That is structural drift. It is not an event, and there is no day on which it happens.

A target is raised by three per cent because last year's was met. A step is added to a process after something went wrong once. A role is left unfilled through a hiring freeze and the work is absorbed by the people either side of it.

A date is committed before the work is scoped, because the customer was on the phone. None of these is a decision anyone would defend as important, and each one is entirely rational on the day it is taken.

Compounded over several years, the argument runs, they can produce an organisation nobody chose and nobody can describe.

The danger is not that drift is severe. It is that it is undramatic, and the instruments an organisation owns are largely tuned to detect events.

A drop in revenue is an event. A resignation is an event. Fourteen quarters of a schedule quietly getting tighter is not an event, and nothing in the reporting pack has a row for it.

A note on the word, because it is used more narrowly elsewhere. At the level of a single role, drift usually describes the content of a job moving away from the person doing it while nobody adjusts anything. That is the same mechanism at a smaller scale, and this essay is about the organisational case.

The remedy that is always offered

Faced with the sense that something has gone wrong in how the place works, almost every organisation reaches for the same instrument. It restates what it believes.

Values are written or rewritten. They are launched, cascaded, put on walls and built into an onboarding deck. Senior leaders are asked to model them and everyone else is asked to live them.

This is not an argument that those programmes are cynical. The sincerity of a values programme is usually the least doubtful thing about it. Insincerity is not the problem and never was.

The problem is what a values programme is aimed at.

A value is an attempt to change what people intend. Structure changes what people can do, and what happens to them when they do it. The case made here is that these are not two routes to the same place, because behaviour under pressure tends to follow the option set rather than the intention.

If that holds, a values programme is one step further from behaviour than a structural change is, rather than the same distance by a gentler road. It works on the wish, and hopes the wish survives contact with the arrangement.

When a value is structural, and when it is decoration

There is an objection to be made here and it is a good one, so it is worth making properly rather than stepping around.

Norms are structure. The unwritten rules about what actually gets done, what gets rewarded and what is quietly tolerated are among the most powerful constraints operating in any organisation, and they are cultural in nature. It cannot therefore be true that values are never structural.

That is correct. The observation worth making is that the norms which genuinely bind are often not the ones on the wall.

The binding norm is the one a new joiner works out in their first month without being told. Who actually gets promoted, what happens to the person who raises the awkward thing, and which deadline is the one you do not miss.

None of that is written down anywhere, and all of it is load bearing.

So the distinction we would draw is not between values and structure. It is narrower than that, and it can be stated in a line.

A value is structural when it cannot be side-stepped.

Not when it is enforced, which is a weaker test than it sounds. A consequence attached after the fact can simply be paid, and an organisation under pressure will pay it. A value becomes structural only at the point where the move that contradicts it is no longer available: a gate that does not open, an approval that cannot be routed around, a person whose no is final rather than escalatable.

Everything short of that is a description of an aspiration, and it can be contradicted indefinitely by anyone willing to absorb the disapproval.

This is also why values programmes are so popular, and the reason is not cowardice. Making a value unavoidable is the expensive step, because it means giving up optionality precisely when the organisation most wants it.

Take any stated value and ask what it would cost to make it unavoidable. Safety above schedule, as a structure rather than a sentence, means somebody can halt the work in the quarter when halting the work is unaffordable, and nobody senior can overrule them. Quality above volume means a number gets missed, and the person who missed it is not quietly marked down for it at the next review.

That is an expensive thing to buy, and it is rarely bought. The programme stops at the stage before it, which is affordable, and which changes far less.

The test, which you can run this week

None of this requires a case study. It requires one question, asked about each of the values the organisation has published.

Name the move that would contradict it. Then establish whether that move is currently available, and to whom.

If it is available to anyone with enough seniority, or with enough commercial pressure behind them, then the value is a statement of intent. That is not nothing. It is simply not a constraint, and it will lose to a constraint every time the two meet.

Most executive teams have never run that test. The reason is not negligence. It is that the answer is uncomfortable and the remedy is expensive, and there is always a cheaper thing to do this quarter.

Why nobody has an accurate map of their own structure

There is an obvious response to all of this, and any chief executive reading it will have reached it already. The organisations anyone can say this about with confidence are the ones where something went badly wrong, and drift in an ordinary company never produces a public account of itself.

That is true, and it is the point.

The accurate structural accounts that exist were nearly all written afterwards, from outside, by people with a mandate and a budget, and they were paid for by damage. An independent review is not an instrument an organisation owns. It is what arrives once the cost has already been incurred, and its findings are addressed to a period that has closed.

Which raises the question this series is really asking. If the only reliable way to obtain an accurate description of your own organisation's structure is to damage it badly enough that somebody else comes and writes one, what exactly is a leadership team working from in the years before that?

Opinion: The Values Were Never the Variable

Our position is that structural drift is the dominant unmanaged risk in large organisations, and that the values programme has become the standard response to it precisely because it is the response that changes nothing.

This is not an argument against having values, and it is not an argument that the people who write them are naive. It is an argument about the category error underneath.

Drift is produced by arrangements: by targets, sequencing, reporting lines, incentive design, and by who is allowed to say no and at what cost. A statement of belief operates on none of those, and a statement of belief is what almost every organisation reaches for.

There is a second error stacked on the first, and it is the one that does the lasting damage. When a values programme fails to change anything, the failure is attributed to people.

They did not live the values. They were not bought in. The engagement scores did not move.

So the organisation concludes it has a people problem, and reaches for the same instrument again, with more conviction.

It is worth being clear about where this leaves the function that is usually asked to carry it. Human resources has been handed a brief written in the language of behaviour, and then held accountable for outcomes produced by structure.

That is not a failure of the discipline. It is a misassignment, made at the top, and it has persisted because the alternative would require the executive team to accept that the structure is theirs.

The provocation we would leave open is this. Every organisation now measures engagement, sentiment, performance and productivity, and most measure them continuously. Not one of those instruments describes the arrangement that produced the numbers.

A chief executive can therefore say with precision how their people feel about the conditions, and cannot say what the conditions are, or whether they are the same conditions as eighteen months ago.

A decade is arriving in which structure is close to the only thing an organisation is actually made of. What the next essays in this series ask is whether a structure can be read while it is still moving, rather than described afterwards by somebody sent in to find out what happened.

Essay one, The End of Structured Thinking.

Essay two, The Most Measured, Least Informed Person in the Room.

The contents of this article are for informational purposes only and do not constitute professional, legal, or financial advice.