Your hierarchy doesn’t work. It is. No value has ever been created down your hierarchy. Nothing of value occurs because of the flow of resources, information or power up and down a hierarchy. All the money invested in perfecting hierarchies through restructures are a massive exercise in waste. Much of the money in perfecting the flow of information up the hierarchy suffers the same fate. The focus on the hierarchy is a focus on status relationships, not the relationships of work.
The real engine of value in your organisation is the interactions and collaborations in and through the hierarchy. These collaborative relationships are where the work gets done and where the formal hierarchical decisions are shaped, influenced or frustrated.
The value that is created in any organisation comes from the wirearchy. Jon Husband’s working definition of wirearchy is
a dynamic two-way flow of power and authority, based on knowledge, trust, credibility and a focus on results, enabled by interconnected people and technology
Speak to any sane chief executive and they are frustrated with the limits of their information, their power and their influence. The constraints that they experience are the outcome of the two-way dynamic of the wirearchy that wraps in and through their hierarchy:
- The ability to order an outcome is not the ability to achieve an outcome. Humans intervene to assess a careful two-way dynamic of trust, credibility and purpose before they yield to raw exercises of power. In many situations the cost of an order to information, trust and credibility may overcome the value of achieving any result.
- The vertical relationships in organisations are often far more tangential and remote than the everyday demands of other horizontal or external relationships. Money, rewards and status can matter less than personal relationships or fit within a group.
- Information is not a standardised input into decision making. Our view of information is shaped by context, by relationships, credibility and trust that come from relationships. Decisions are not made on the papers but through a complex web of relationships and influences.
- Because central planning and control is inherently unreliable, it is the cooperation and collaboration in the hierarchy that reorders work, resources and information to enable critical outcomes to be achieved. The tighter the hierarchy seeks to control these the more poorly the system performs.
- In the absence of trust, the wirearchy fills the vacuum with rumour, gossip and investigative research. Human networks find a way to bring partial transparency to secrets, by routing around the barriers.
- Most dangerous of all hierarchical power with its one-way flows is slow and unresponsive. Remote from the ever-changing interface with customers and the market, the hierarchy is a barrier to innovation, experimentation and adaptation. The change agents who navigate the wirearchies in and around hierarchies are those who remedy this danger.
Our organisations invest heavily in perfecting the hierarchy often at the expense of investment in the elements of this two-way dynamic. Learning, knowledge, trust and collaboration are after thoughts in many organisations plans for the digital world. What would be possible if instead of the perfect hierarchy we invested to develop knowledge, trust, credibility and results in our interconnected world?