Book Notes: Principle-based Organizational Structure: a handbook to help you engineer entrepreneurial thinking and teamwork into organizations of any size, by N. Dean Meyer

👍 👍

Note: “Book Notes” are brief jots on books I’m reading, not full blown reviews.

This book effectively a long-form treatment of the “Building Blocks” book I reviewed above.

It begins by describing organizational design (aka structural cybernetics) as a science, not an art.

To that end, it begins by outlining some of the basics of variety/complexity theory.

It then dives into the engineering principles of organizational structure:

• empowerment (the golden rule): authorities must match accountabilities.

• specialization: you can only be world class at one thing at a time; but you can’t specialize if you can’t team.

• precise domains: define clear boundaries with no overlaps or gaps

• basis for substructure: divide a function into groups based on what it’s supposed to be good at.

• avoid conflicts of interest: don’t expect people to go in two opposing directions. (e.g. don’t expect engineers to also be operators, since that creates a conflict of interest — between innovation and stability).

• cluster by professional synergies

• Business within a business: every manager is an entrepreneur whose job is to satisfy customers (internal and external) with products and services.

The book also includes a compelling analysis of why various popular organizational structures and approaches to organizational design are self-defeating, including:

• strategy as basis for substructure

• Decentralization

• Plan-build-run

• New versus old (I.e. “innovation groups”)

• Quick versus slow (“I.e. bimodal IT”)

• Leaderless organization (sociocracy, Holacracy).

The second half of the book is a (somewhat) detailed look at implementing an organizational redesign based on the above principles.