Few books on leadership address the organizational structure of a business. The few that do focus primarily on measuring performance rather than on how the business is structured. As valuable as quality programs are as mechanisms of change, they are only incremental at best if the real need of the business is the reinvention of its culture and purpose.

The chief problem affecting organizational performance is not an inability of workers to perform, but the structure in which they are expected to perform. Frequently, there is a clashing of cultures: between careerists who are a slave to the outmoded structure of the system and leaders who understand that the organization’s mission is not the perpetuation of the structure but rather innovation and productivity as well as the leadership of the people who serve to achieve that mission.

The bureaucratic structure that constrains many complex organizations requires dramatic levels of change to ensure that it functions well in the future. Take a look at the graphics below. The first graphic, “Hierarchical Structure,” shows what might be considered a typical organizational structure. But notice within that structure, we see a “Network of Relationships,” as illustrated in the second graphic.


These graphics illustrate a collaborative team working within a traditional hierarchical structure. Therefore, hierarchy does not exclude collaboration. When upper management seeks to perpetuate its outmoded structure, the system turns in on itself and quashes innovations and initiative arising from the network of relationships. That is precisely when a clash of cultures occurs.

The longer I work with issues affecting leaders, the more convinced I am that structure is the last frontier of organizational development. To effect change, here is what every business leader needs to know:

  • The structure of an organization exists to serve the mission and the people who are employed to bring it to fulfillment. It is a tool. Nothing more. To make it more brings it into conflict with the organization’s mission. Yet, what I see is structure dictating what the mission should be and how people are to function within it. The structure of a business exists to facilitate the leadership of each individual member of the organization. By leadership, I mean the personal initiative that each person takes in collaboration with others to fulfill the mission of the organization.
  • Structure is ultimately determined by leadership. If a business structure causes clashes and the organization isn’t as productive as it should be, it is because the leadership of the system has allowed it to degenerate to that point. The relationship between executive leadership and structure is a moral one. As a tool, structure serves a purpose. Just as a hammer can drive a nail into a board to build a house, it can also break a window to steal a briefcase from a car. The hammer remains what it is. It is the human use of that tool that determines its moral value.
  • Structures that are not aligned with the organization’s mission and are not open to the individual leadership of its members will ultimately fail. A structure is never too big or too established to fail; they are failing all around us. This is evidenced by the disparities in compensation, high unemployment rates, and the inability of many organizations to adapt to a changing economic environment.

Ask Yourself . . .

For every business leader who wants to cross over into this new frontier, here are a few important questions to answer:

  • Is your business structure obsolete?
  • Are your employees reflecting enthusiasm, independent initiative, collaborative decision-making, and a passion for the organization’s mission?
  • As the senior leader of your business, are you a liberating force for change or a careerist seeking to maximize your own personal benefit from a broken, declining system?

Remember, every structure is just a tool. As a leader, use your tools to best serve your business. For future success of your organization, the time to effect change and make a lasting impact is now.

Photo by Alex Kotliarskyi on Unsplash

Dr. Ed Brenegar is a Leader for Leaders working with individuals, their teams, organizations and communities who find themselves at a point of transition. Ed has developed an innovative leadership model called, Circle of Impact, that clarifies what the impact of their life or the work of their organization can be. From this perspective, impact is the change that makes a difference that matters. Ed. for over 30 years, has inspired and equipped people and organizations to practice this fresh understanding of leadership. All leadership begins with personal initiative to create impact that makes a difference that matters. Everyone within an organization or a community can, therefore, practice leadership initiative. In so doing, they turn what were once leadership-starved organizations into leader-rich cultures that make a difference that matters.

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