The Organization Chart is Dead!
Long Live Networks!

Richard Citrin and Michael Couch

We first read about the concept of “organization white space” in the 1990 book entitled Improving Performance: Managing the White Spaces on the Organization Chart by Gary Rummler and Alan Brache. The importance of organization white space came rushing back to us recently after working with technical leaders, engineers, and program managers at two global manufacturers.  In both instances, we were discussing what it takes to be successful as a technical leader, now and into the future.  As we reviewed the challenges facing the leaders in these companies, it became clear that organization charts no longer even come close to depicting the way work is actually occurring (even if we add dotted lines or depict the organization as a matrix).

Who-reports-to-who doesn’t make much difference when most of you don’t just have a job in a department anymore.  Your critical contributions come from the roles you play in key business processes (which could be several) and on project teams (which are usually multiple).  You probably don’t have a single boss – you may spend more time with process owners and project leaders than with your manager.   If you are a manager of a major product platform you probably don’t have anyone “reporting” to you but must accomplish mission-critical projects through cross-functional teams, sometimes spread around the globe.  Our work no longer occurs solely by management decree.  It is increasingly more self-organized and occurs through collaboration, negotiation and resourcefulness.

The ever-growing evidence from research on social and organizational networks shows that the quality of the spontaneous, informal connections in an organization drives overall performance. For example, researchers at CMU analyzed the advice-seeking habits of employees in 52 branches of a bank and were able to predict profitability by characteristics of the branch network structure.  The more advice giving that occurred across all levels in the branch, the higher the profitability. University of Kentucky researchers found that highly engaged software development employees are anchored locally (strong ties with local colleagues) and connected globally (strong connections to distant colleagues).

In this networked world, to do your job in a manner that drives business performance, you must be personally effective but also help others succeed.  You must also make sure your work is aligned with overall company goals and with the work of your network partners.  Functional and technical skills alone are no longer the “hard” skills.  To be a top performer, you need to be comfortable with the complexity of organizations and be savvy about maneuvering through a variety of networks. You need to build effective formal and informal networks, work collaborative with a number of partners and garner support through persuasion and negotiations.  You have to be comfortable when things are up in the air, be able to shift gears quickly, and be flexible.  And you’ll need to be okay with not having a clearly defined box on a chart.

Understanding organizations as networks also means that your perspective as a leader must change.  Leaders can begin by understanding and communicating that work is complex and that things will be ambiguous at times.  You will need to emphasize the importance of networks and accurately understand how your organization’s networks operate.  Leaders who demand that the chain of command be followed, hoard talent or who are threatened by informal leadership are not network savvy.  We need to recognize and encourage employees to help others succeed and to help employees build local and distant networks.  Few critical networks are assigned or defined; individual employees have to self-connect with the right people.

As a network savvy leader, you may need to reprioritize the skills and abilities on which you hire, promote and develop talent. When we visited ultra-networked Google with the Pittsburgh Technology Council, we asked about what they look for in a new hire.  Our host indicated that the ability to learn/cognitive ability, the ability to both be part of a team and to step-up and lead when needed, and the ability to contribute to the Google culture (a competency referred to as “Googliness”) are at the top of their list.  Technical knowledge was given less emphasis.

The structure of your organization’s social networks matters.  Understanding and capitalizing on networks can be a real opportunity, particularly as a tool to enhance individual and organizational effectiveness.

The background has become foreground.  The organization chart is dead!  Long live network savvy leaders!