Category Archives: Organization Structure

What is the Level of Work in Disney?

From the Ask Tom mailbag – Related to yesterday’s post on Levels of Work. Thanks to Barry for posting.

I agree that the place to start is with the work, but I’m confused by your presentation of the structure of the work. This description seems to only apply to organizations that have five hierarchical levels. When Walt Disney was 20, he was president of a corporation called Laugh-O-Gram Films, Inc., that was established to make a series of silent cartoons. This was long before the creation of Mickey Mouse. All ten or so employees reported directly to Walt.

So, I agree with your last statement that the first step is to understand the work and the different levels of work, but I’m not sure the work necessarily matches up with the five levels you provided.

Barry, thank you for a great question. You are correct. Not every organization has five levels of work. The example you provide, Laugh-O-Gram films was likely a Stratum III organization. Each film was likely a Stratum II project, but to be successful, they had to develop Stratum III systems in their animation methods. Ten or so employees would be consistent at that level of organization.

As time went by, Disney’s successor corporations, either by organic growth or acquisition, grew in complexity. We can calibrate that complexity using Time Span, examining each successive level of work. Disney is now Disney-ABC Television Group after its acquisition of ABC-Cap Cities in 1996. Now, an international media company, its highest level of work is high Stratum VI or low Stratum VII.

Time Span – Where Do I Start, How to Implement?

From the Ask Tom mailbag -

Question - 
I attended one of your workshops on Time Span.  Since that day, the subject is like a song that I just can’t get out of my head.  At the same time, where do I start?  You described Time Span, or Requisite Organization as a comprehensive management system, but where do I start?

Response - 
A first introduction to Requisite Organization and its central kernel, Time Span, can be overwhelming.  But the first steps are not that complicated.  Over the past ten years, I have shared this concept with more than 5,000 CEOs and managers, and this is always the first question – Where do I start?

It’s all about the work.

There are many kinds of organizations in the world, groups of people organized around a purpose.  There are religious organizations, community service organizations, political organizations, and organizations to get work done.  Work is my focus.  It’s all about the work.

So, what is the work that has to be done.  Where do I start?  It starts by understanding the answers to these questions.  These questions are helpful, to understand the different levels of work required in any complex endeavor.  Where you start, is by understanding the work.  The first step is understanding, the first step is a design step.

  • (S-V) What is the superior purpose for the work?  At the end of our foreseeable future, what do we want to accomplish?  This is often called vision, mission, purpose.  Without defining this purpose, the rest of the list doesn’t make sense.
  • (S-IV) To achieve the superior purpose (vision, mission), what are the big milestones that have to be achieved?  What are the big rocks that have to be moved?
  • (S-III) To move those big rocks, what are the consistent, repeatable behaviors (habits, systems) that have to be created?
  • (S-II) Inside each system, what are the deadlines and completed actions (projects) that have to be completed?  What are the materials, equipment and people required to complete those projects?
  • (S-I) What are the fundamental tasks that have to be organized?  What is the production work that has to be completed day in and day out?

The first step is to understand the work, to understand the different levels of work.

Finger Pointing Between Functional Departments

From the Ask Tom mailbag -

Any advice as to how to align all members from multiple cross-functional departments into one purpose; create an efficient, streamlined process that assures that communication, documentation and actual product flow is executed efficiently?  We are specifically a design firm, but our revenue comes from the products manufactured from our exclusive designs.  So, we have mature internal systems in each department, but the transitions of work flow from one department to the other sometimes break down, so there are logjams, finger-pointing and sometimes, general chaos.

Much of the answer is in your question.  Let me pick out your key words.

  • Purpose
  • Efficiency
  • Flow

Let me add three more.

  • Balance and optimization
  • Authority
  • Accountability

What you have described is the classic transition from Stratum III systems to Stratum IV system integration.  It sounds like you have done an adequate job of creating multiple internal systems, that are efficient in each of your workflow disciplines.  It is the integration of these systems that is giving you fits.  Let me take a stab at listing some typical systems in this flow.

  • Market research system
  • Design system
  • Prototyping system
  • Approval system
  • Production system
  • Finished goods inventory system
  • Marketing system
  • Distribution and logistics system

Each of your internal systems likely works well within itself, but now you are experiencing balance problems between your internal systems.  It is not sufficient to have a great design system and a great production system.  If you have a weak prototyping system, your designs will get stuck on paper and never make it to production.  You may have a great marketing system that creates consumer demand, but if you have a weak finished goods inventory system, your products will never find their way to distribution.  Your weak systems will be doing their best and your strong systems will be finger-pointing.

So, that’s the problem.  What is the solution?  This is a Stratum IV issue, where someone needs to have end-to-end accountability.  Some companies attempt to solve this problem by creating a role called product manager.  The product manager would be accountable for tracking each step, likely creating a Gant chart of product progress from one function to another.  While this role gathers necessary data about the status of a single product in the chain, it still might only document that the product is stuck.

That is why this is a Stratum IV issue, one of balance and integration.  The S-IV manager (likely a VP) would be accountable for examining each system for capacity and handoff.  This is not looking internally at the mechanics of a single system, but the interaction of each reinforcing system to each balancing system.  It is not a matter of having one or two high performing functions, but having all functions able to keep up with each other, optimized for capacity.  No single system manager will have the authority, nor likely the capability, to do this work.

And somewhere in this integrated whole system, there will be a constraint.  There will be some limitation in a single system which will drive the cadence of all the systems working together.  The hat trick is identifying and placing that constraint strategically.  Typically, this strategic constraint will be an expensive resource, too expensive to duplicate (which would double the capacity of that system).  The identification, selection and placement of the strategic constraint, and then subordination of all other systems to the strategic constraint is the work of the S-IV manager.

With this integrated system design, then the work of documentation, handoffs, communication and feedback loops begins.  Most companies get this backward and have a communication seminar without balancing the systems for total throughput.  You can imagine that this communication seminar makes everyone feel good, but nothing changes in throughput, the finger-pointing continues.

For more reading, start with Eli Goldratt’s The Goal and Peter Senge’s Fifth Discipline.

Tribal Leadership?

From the Ask Tom mailbag -

I just picked up a book on tribal leadership that suggests hierarchy is an old fashioned, out dated approach to organizational structure.  Your workshop suggests that hierarchy is the only approach to organizational structure?

I hear these things from time to time, about how hierarchy should be abandoned and replaced with throwbacks to earlier organizational models and, as you can imagine, I am not overly impressed.  First, understand that there are many purposes for groups to organize.  Groups may come together to worship, promote political causes, live as families and communities.  Each may engage in different organizational structures, collegial, political, religious, family.  When I promote hierarchy as a structure, I am referring only to those groups of people organized to get work done.

And some work does not require a complicated structure.  But, gather any group of people together and give them a task to do, they will self-organize into a structure to get the work done.  First, a leader will emerge.  That person does not have to be assigned that role, they will simply emerge from the group.  If the group task requires several separate, simultaneous actions, people will gravitate to roles and cooperate, under the guidance of the leader to complete the task assignment.  If the task is of sufficient difficulty, requiring problems to be solved and decisions to be made, that organized group will take on the shape of a hierarchy.

I know there are organizations, designed to accomplish work, that self-proclaim a flat, tribal, non-hierarchical structure.  Baloney.  If the work is of sufficient complexity, and you examine the related tasks and people playing roles to complete those tasks, you will find hierarchy.

No tribe ever sent a man to the moon.

Identifying Supervisory Capability

“When was the last time you walked the floor and talked to the line crew,” I asked.

Denny paused.  He knew it was a loaded question.  ”I walk the floor a couple of times a day.  But, I depend on my supervisors to talk to the line crew.  As the Plant Manager, I have a lot of important things that keep me in my office.”

“So, what do your supervisors tell you about the line crew?”

“Mostly, they just complain about this one coming in late, or somebody out sick.  The usual stuff.”

“So, you never actually talk to anyone on the line crew?” I pressed.

“No, if there is a problem, I let my supervisors handle it.  I don’t want to interrupt the chain of command,” Denny explained.

“What happens if one of your supervisor’s quits?”

Denny peered over the top of his glasses.  ”I guess I would have to hire another supervisor.”

“And, where would you go first, inside or outside?”

“I don’t know that there is anyone on the line that could step up and be supervisor.  I would just put an ad in the paper, do some interviews and pick somebody.”

“Why don’t you know if there is anyone on the line with supervisory capability?”

The Problem with Matrix Management

From the Ask Tom mailbag -

Our company has a Matrix management structure within a functional structure.  Each department is struggling with execution and achieving target results partially due to resource alignment challenges associated with the functional and matrix organization structure. 

Matrix structures were created, with the best of intention, to resolve priority conflicts.  A team member who is temporarily assigned or part time assigned to a project team has a new built-in conflict.  “Who is my manager?”

Do I take direction from my manager or my project leader?  And when there is conflict between those directions, who wins?

And that is how matrix management was born.  Unfortunately, the end result simply codifies the existence of the team member’s (now) two managers without identifying who the real manager is.  Further, it does little to bring clarity to the project leader’s authority when there are conflicts.  The team member is simply stuck.

Again, the intention to invent Matrix was pure, to identify managerial authority and project leader authority related to the same team member.  Mixed results emerged.  Luckily, projects have limited duration and so the undecided conflicts eventually go away.  Some declared that Matrix was effective and then made the fatal mistake.  The fatal mistake was thinking that Matrix should then be applied to the entire enterprise.

Matrix operates under the false assumption that a team member can have two (or more) managers.  Matrix does little to identify the managerial authorities or the limited cross functional authorities required by a project leader.

This perspective was clearly identified by Elliott Jaques in his research on time-span. The prescription is to dismantle Matrix, establish clear accountability in your managerial relationships and structure cross-functional working relationships for the following roles -

  • Project leader
  • Auditor
  • Monitor
  • Coordinating relationship
  • Service getting relationship
  • Collateral relationship
  • Advisory relationship

These cross functional working relationships accurately identify the limited accountability and limited authority required to successfully move work horizontally through the organization.

If you would like a pdf about cross-functional working relationships, titled “Get Rid of Your Dotted Lines,” just Ask Tom.


What to Do With Untapped Potential

From the Ask Tom mailbag -

What action should we take if we have a person with Stratum IV capability in a Stratum III role?

First, I would ask, how do you know?  What behavior are you seeing?

You might see competence.  Competence with spare time left over.  Spare time to help other people.  Spare time to coach others.  Spare time to train others, teach others.  Spare time to participate in higher level planning.  It’s not such a bad thing.

The problem with having someone with S-IV capability in an S-III role is to determine if there is enough challenge in the role to gain their long term interest.  You might observe boredom with their day to day problem solving and decision making.  Boredom can create sloppiness, inattention to detail.  But boredom can also lead to effective delegation, innovation, efficiency initiatives.  I can hear the words.

“I am a bit bored with this task.  In what way can I make it more efficient?  In what way can I delegate this task to someone who might see this work as a challenge, to help them develop professionally?  So I can get on with more interesting work.”

Having someone with S-IV capability in an S-III role is an opportunity.  Just ask them.

It’s All About Work

Good friends of mine, Stephen and Chris Clement have been working on a new book for the past couple of years. It’s All About Work is now available. Here is why you should buy it.

In 2001, I was introduced to the research of Elliott Jaques, and those of you who know me, describe this research as a near obsession for me. I have collected most of Elliott’s early manuscripts, which, over the decades transformed into more polished writings. One book, in particular, caught my attention, Executive Leadership. It was written almost as a manager’s handbook by Elliott Jaques and Stephen Clement. Elliott and Stephen met during a project with the US Army, under the direction of General Max Thurman. Stephen was assigned to the project from the military side to assist in the compilation and interpretation of data collected during the research period.

Following the US Army project, Elliott was summoned by Sir Roderick Carnegie to travel to Australia to help the CRA Mining Company (now known as Rio Tinto) in its organizational struggles. Because CRA would have access to some of the findings from the US Army project, Max Thurman assigned Stephen Clement to accompany Elliott on his assignment down under.

Knowing that he and Elliott would be spending several months together, parsing data over dinner, Stephen invited his son, Chris Clement to join in the excursion. It was out of these projects, that Executive Leadership was written.

Fast forward a few decades. Elliott passed away in 2003. Stephen Clement is now in private consulting. You can see his client list by reading the testimonials on the cover of their new book, Office Depot, Textron, Con Agra Foods, Ford Motor Company, Pepsi. I can imagine rekindling the conversations between Stephen and Chris revisiting the principles established in Elliott’s research and how they have been applied in both large and small organizations.

While some may think that these principles are only for the large organization, I think they are even more important for the small organization. Standing outside the shadow of this research, Chris Clement has run several small businesses and is able to demonstrate how they apply to the manager in the trenches. Large organizations, when faced with a problem, can throw budget and people at the challenge. Small organizations typically have only one chance to make the right move.

My book Hiring Talent focuses specifically on identifying levels of work in the hiring process. It’s All About Work provides more of the backstory and how levels of work operate in the overall structure of the organization. Here is the link, buy it now – It’s All About Work.

You Are Not a Manager So People Can Report To You

“Yes, but shouldn’t these people be reporting to me?” Ted asked.

“That depends. Functionally, their roles produce results you are interested in, but are you prepared to be their Manager?” I replied.

“I think so. I think they can report to me. I think I can hold them accountable for producing those results. I think I can check up on them to make sure they are working,” Ted proposed.

I smiled. “I know, you think being a manager is all about people reporting to you, and you, telling people what to do. But are you prepared to be their Manager?”

Ted gave a glance sideways.

“Your most important role,” I continued, “as a manager, is to bring value to the problem solving and decision making of your team. Are you bringing value by telling them that their reports are due on Friday and then reminding them Monday morning that their reports are late?”

Ted was still staring, but putting the pieces together. “Well, no, not when you put it that way.”

“Then, how, as their Manager, do you bring that value? And are you committed to bring that value? Are you willing to commit the time to bring that value? The answers to these questions will determine whether you should be the manager of this team.”

Quick-list on Levels of Work

From the Ask Tom mailbag:

Tom, I just read the One Most Important Thing and it does cause some thinking and wondering how much many of us are doing this all wrong. I am the owner of a business but have been in some form of leadership or management for over 15 years and I don’t ever remember a real comprehensive approach to hiring or even with the detail you offer. I am reading your new book, Hiring Talent right now and hopefully can glean much of what needs to happen in our own company. I wanted to ask you about how long you see this taking to really create a different and better culture within an organization that perhaps never used any of these tools? It almost seems a little overwhelming to be honest with you. We are going from doing none of this to doing what we should be. I may be in touch with you often for some guidance.

How long does it take for a child to learn to walk. As long as it takes. And it is always a work-in-progress. I believe the most important element of this process is you. Hiring Talent is a mindset about work. It’s a different way of looking at work and the candidates you select from your talent pool.

Most managers never consider the level of work when thinking about a new role or filling an existing role. All the tasks and activities get lumped on a list with the tagline – “and anything else we can think of.”

Level of work is the key to understanding the capability required for success in the role. Here is my quick-list on levels of work.

  • S-I – Individual output, longest task – 1 day to 3 months
  • S-II – Coordinate team output, longest task – 3 months to 12 months
  • S-III – Create, monitor, improve system output, longest task – 12 months to 24 months
  • S-IV – Integrate multiple systems and subsystems for “whole” system throughput, longest task – 2 years to 5 years
  • S-V – Create, monitor, improve value chain between internal “whole” system and external market, longest task – 5 years to 10 years.

Any questions?