November 2003

Innovation Tips

…for thriving on collaborative innovation

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The New Organizational Chart

We have all seen the familiar hierarchical chart that assigns people to their respective departmental boxes. The chart may create a sense of order and lines of responsibility, but it also tends to build confining operational silos into the structure of the organization.

Organizational charts, like fixed walls in an office layout, tend to confine dynamic interaction. The tendency to organize, to regulate, to define, to position is in us all. But it must be tempered by the need to interact without restriction, without regard to hierarchy or organizational structure.

Innovation springs from diversity and the absence of bureaucratic controls, so we must consistently engage in what Joseph Schumpeter, the Austrian economist, called “creative destruction.” We must creatively destroy the barriers, the implicit rules and standards that thwart innovation.

Traditionally rigid organizational charts are saturated with implicit rules about relationships—who may talk to whom, who may tell whom what to do. Once created, they become unconscious impediments to the free flow of information through the organization.

It is better to have a sketch, a vignette of key relationships for a variety of circumstances. It is better to create roles than reporting “positions,” to describe the value people bring to the party rather than who is one rung higher on the organizational ladder. Competent people don’t need to be managed by a “boss.” They need freedom to think, create and interact with other competent people.

The organizational “chart” needs to be expressed in new and more innovative ways. It needs to capture the complexity of relationships that help creative organizations thrive. It needs to clarify roles and the value delivered by those roles, but it doesn’t need to do what it has too often done—build restraining silos into the social architecture of the organization.

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