Tag Archives: levels of work

Don’t Judge People

From the Ask Tom mailbag –

Question:
It’s been at least four years since you spoke to my TEC group. I was chatting with one of my members yesterday and he asked me if I knew whether there was a profiling tool available that indicates a person’s capability related to stratum level?

Response:
I had the same question in 2002. The answer was and still is, no. There are some consultants who propose to have a profiling solution, but I would question its validity. Anecdotally, most profiling tools have about a .66 correlation with reality. You might say, well, that’s not too shabby until you understand the flipping a coin has a .50 correlation. So, even if there were a psychometric assessment, its validity would likely not be any better than the others.

I don’t judge people. I’m not very good at it. So, let me propose a much cleaner method. Focus on the work. I don’t judge people, but I do judge the work. Work is decision making and problem solving. Focus there.
Problem Solving Methodology

  • S-I – Trial and Error, substituting a single variable at a time until something works.
  • S-II – Cumulative diagnostics, experience, best practice. Solving a problem by connecting to a best practice.
  • S-III – Cause and effect, if-then, required for a single serial system or a single critical path, root cause analysis.
  • S-IV – Multi-system analysis, how one system impacts its neighboring system, based on outputs and inputs, or capacity mis-match.

Look at problem solving required in the work. Then look at the candidate. Is this person any good at solving problems at that level. If they are, that is a clue. Design a project with embedded problem solving, see how they do.

Don’t overthink this level-of-work stuff. It’s not that difficult.

How Many Levels?

From the Ask Tom mailbag –

Question:
You recently described an organization as having five levels. You also said that some organizations don’t need five levels. I am trying to figure out how many levels our company needs?

Response:
Your question is similar to the manager’s span of control issue. The consultant’s answer, “it depends.” The number of levels in an organization depends on the complexity of the decisions and problems faced by the company’s mission. That’s why it is important to occasionally sit down and revisit the mission. We think of mission as “what the company does,” but it also includes which markets, geography of those markets, market segments, governing rules and regulations, availability of labor, incorporation of technology, availability of capital. All of these elements play in to the complexity of the organization.

The initial mission always exists in the individual eyes of the founder. In the beginning, that mission may be modest, simply to prove the concept is viable (minimum viability). With early success, the mission can grow, be redefined as the organization learns more about the environment it created. And we think, with more levels, the more success we see. That is not altogether true. You can have a successful organization at any level, with an appropriate number of managerial levels, even an organization with just one.

S-I (One level of work) – This is the sole practitioner, an individual technical contributor, whose mission is to solve a narrow market problem requiring only one mind, usually supported by technology. Successful sole practitioners could be an artist, writer, even a computer coder developing a single application to solve a market problem. A good living can be had by the savvy sole practitioner, though it is rare to reach any large scale by yourself. (Timespan 1 day – 3 months).

S-II (Two levels of work) – This is the sole practitioner who gathers surrounding assistance. There is too much work for one and that additional work is necessary to solve the problem. At this organizational level that additional work requires coordination for quantity output, at a given quality spec, according to a deadline time schedule (QQT). There is no system yet, because the quantity or complexity of work does not require it. This could be a entrepreneur with a small team. It could also be that the organization requires a system, but does not possess the internal capacity to develop that system. Many successful S-II organizations simply purchase their system from someone else, as a franchise or a license from a larger organization (who has a system for sale). (Timespan 3 months – 12 months).

S-III (Three levels of work) – But even a small franchisee, with one or two stores, who wants to increase to three or four stores, eventually requires an internal system. At three to four stores, an additional level of work appears. It is interesting that one of the larger franchisors, Chick-fil-a only allows one store per franchise. This may be an unconscious realization that the capability of their franchisees is limited to S-II. The hallmark of an S-III organization is a single serial system (single critical path). This is often an artisan craftsman, a subcontractor on a larger project. (Timespan 1 – 2 years).

S-IV (Four levels of work) – Consists of multiple parallel systems that have to be integrated together. S-III as a single serial system is limited in its growth. For an S-III company to scale, it requires the coordination of multiple systems. From its core production system, the S-IV organization also has to coordinate material purchasing, equipment procurement and maintenance, personnel recruiting and training, marketing campaigns, sales efforts, legal review, project management, quality control, sustaining engineering, R&D, human resources and accounting.

S-V (Five levels of work) – This is the enterprise in the marketplace. And, the marketplace is not just about customers. Marketplace includes regulation, labor, finance, technology, competition, logistics, supply chain. This is still within the Small to Medium Enterprise (SME) but also extends to larger organizations.

An organization can be successful at any level, it is governed by the level of their mission.

Why Organizational Structure?

What is organizational structure? On a single piece of paper, it’s called an org chart.

Organizational structure is simply the way we define the working relationships between people with the organization. All social settings have a social structure. Parent-child, teacher-student, politician-constituent, minister-congregation, coach-player, manager-team member. The social structure helps us understand what is expected and what are the norms of behavior.

Organizational structure in a Management Accountability Hierarchy (MAH), helps us understand the working relationships between people in the company. It is important to know who has the authority to make decisions, the authority to solve problems (the way we would have them solved), but most importantly, who is accountable for output.

Managerial roles are stacked in levels of work so we can more quickly understand the context in which that role is working.

Levels of Work

  • S-V – Business Unit President or SME CEO. The context is on the entire enterprise as it sits in its marketplace.
    Timespan 5-10 years.
  • S-IV – Executive manager. The context is the many parallel systems that have to work together. Timespan 2-5 years.
  • S-III – Manager. The context is on a single serial system, or a single critical path. Timespan 1-2 years.
  • S-II – Supervisor. The context is on the work in hand in the near term. Timespan 3-12 months.
  • S-I – Production. The context is on the work in hand today, tomorrow and next week. Timespan 1 day to 3 months.

How Many Manager Levels?

From the Ask Tom mailbag –

Question:
The template you sent out looks like it only handles five levels of work. Our organization has seven manager layers, total headcount 62 people. How do we fit in the extra two layers?

Response:
The reason you have more than five manager layers in your company is that you use some other criteria to define a managerial layer. You decided someone in your company needed some manager experience, so you promoted them with a new title, and gave them someone to manage. Your criteria for creating a new manager level was that someone needed experience. Your criteria has nothing to do with the complexity of problem solving or decision making. You created a managerial layer as an accommodation to a single person. Don’t organize the work around the people, organize the people around the work.

With a headcount of 62 people, I can safely assume that your company should have no more than five layers and possibly needs even fewer. Stop looking at the people you have, and look at the work. What is the necessary work required to accomplish your organization’s mission? When you base your organizational structure on the complexity of decision making and problem solving, the work naturally falls into the levels described below. Using that framework, you can identify where your organization is bloated and where it is thin (too thin).

Levels of Work

  • S-V – Business Unit President or SME CEO. The focus is on the entire enterprise as it sits in its marketplace.
  • S-IV – Executive manager. The focus is on the integration of departmental workflow. Looks closely at work handoffs from one department to another and the output capacity of each department as it sits next to its neighboring departments.
  • S-III – Manager. The focus is typically on a single department, which contains a single serial system, or a single critical path.
  • S-II – Supervisor. This is a coordinating, implementing role, making sure production work is complete, within spec and on-time.
  • S-I – Production. The focus is on pace and quality, how many units at a specific spec.

Art Form or Detective Work?

From the Ask Tom mailbag –

Question:
Love it – the four levels of thinking directly related to the flow of inputs, manner and tempo. This helps so much in understanding an additional vector of complexity, in addition to future ambiguity (as measured by timespan).

Is there a measure that is commonly used and can be attributed to positions in a Requisite Organization design? Can we measure the amount of activity needed in each/any of the four levels to know what type of sophistication a) the org needs at that level and b) that a candidate has? Or is it intuitive only (we sense it and we know it when we see it)?

Can you use this to help bring clarity to the org chart?

Response:
Some would say that identifying capability is an art form, know it when we see it. My take is that it’s more detective work, assembling clues within a framework. The brilliant insight in the question is the focus. Typically, in an attempt to identify capability, we focus on the person. More brilliant, in the question, the focus is on the work, flow of inputs, manner and tempo.

I don’t judge people, I’m not very good at it. But, I DO judge the work. My calibration of level of work always ends with timespan, but at first blush, timespan might mislead, I need other clues, and then timespan falls in place. If all projects are one-week projects and we have twenty of them, it might seem the timespan is one week. But, to handle twenty simultaneous projects, the start time and the stop time begins much earlier and ends much later than the one-week project.

Before the projects start, we have to examine, in all the projects, what is the same? Can we apply the same solution to identical problems? In all the projects, what is different that requires a unique solution? What is our capacity to handle twenty simultaneous projects? Do we need two project managers or four project managers? If we only have two PMs and need four, where will we find two more? What steps in the project can be started immediately? What steps can be done at the same time? What steps must be done sequentially? When we start to answer those questions, we find the timespan is much more than one week?

Laying out the org chart, I generally use a pre-cursor document (spreadsheet) that has columns for each function on a team, or columns for each team in a department, or columns for each department in the organization. The rows in the spreadsheet designate level of work. If you would like a copy, just drop me an email. I use this spreadsheet to clearly identify the level of work before I translate the structure into an org chart.

Assessing Capability

“Your turn,” I said. “Step me through these four levels of work and tell me where you think Jason is struggling.”

Elisa started slowly.

  • Direct action – Jason began as a project manager. We started him on simple projects, things (variables) came at him slowly enough where he had the time to immediately respond, and in that, he was very effective.”
  • Diagnostic Accumulation – Jason did so well on a single project, that we gave him two simultaneous projects. The just reward for hard work is more hard work. With two projects, he did the second project the way he did the first project. He was able to effectively put things together, recognize similarities, connect the dots.
  • Serial Thinking – is where Jason begins to struggle. We asked him to work over the shoulder of junior project managers, up to twenty simultaneous projects. We thought the project management software would handle all the detail, but the sheer volume of decisions and problem solving required Jason to think ahead, anticipate. He had to play “What if?” He had to look at twenty projects and see all the things that were the same, simultaneously understanding the nuanced differences between each project. He had to put a system together and that’s where he struggled.
  • Interactive Systems Thinking – is way beyond Jason. Project management sits inside our organization next to estimating, procurement, logistics, workforce and finance. Most of that is outside of Jason’s scope.

“And, so, where would you peg Jason’s level of capability?” I asked.

“Now, it’s very easy,” Elisa nodded her head. “Jason is on the upper end of Diagnostic Accumulation, but struggles with Serial Thinking.”

“Understanding this framework, can you now, as Jason’s manager, more accurately determine what project assignments, how many, how complex that Jason can effectively handle?”

Four Levels of Work, Four Levels of Capability

“Okay, okay,” Elisa replied. “You are right, easy to see the number of variables in a single project multiplied by twenty projects.”

“This will help us understand the complexity of what we are asking Jason to do and Jason’s capability to actually do it. When we look at levels of work, identifying the level of work in a project, we have to look at the variables. More variables, the more complex the variables, the more difficult the task, more difficult problems, more difficult decisions,” I began to lay the groundwork.

“We understand projects and we understand variables,” I continued. “Let’s look at Jason’s capability* to effectively respond.

  • Direct Action – are variables we can deal with one at a time, that come at us at a pace where we can see it arriving and deal with it.
  • Cumulative Action – are variables that arrive together, where the pace of incoming is faster. We are required to diagnose things together (diagnostic accumulation). We can solve problems that look alike the same way, but only if we are able to see those similarities quickly enough.
  • Alternative Serial Thinking – are variables that arrive in groups, the pace of incoming groups is so fast that to effectively deal with the problems and decisions, we have to anticipate. That is why this level of work requires as much thinking (ahead) as it does action.
    We have to think of each group as a system, with internal cause-and-effect elements.
  • Mutually Interactive Groups – are groups of variables that, as they arrive, begin to impact other groups of variables. If we can see each group as a system, we have incoming systems that impact other systems, systems thinking.

“Our ability to think and act effectively is an accurate way to understand an individual’s capability. You can also see the progression in variables as we move from five simultaneous projects to twenty simultaneous projects.”
——-
*Four levels of mental processing. Elliott Jaques. Requisite Organization

Complexity of Similar Projects

“Jason is our best project manager,” Elisa described. “But, I gave him just a little bit more responsibility and he is failing. Not only that, it’s impacting the rest of our project management team.”

“How so?” I asked.

“When Jason started here, he did so well on his first project that I gave him another project at the same time, two projects. And, he did that so well, I gave him a third project.”

“And?”

“After a year and a half, I asked him to look over the shoulder of another junior project manager, who was struggling with two projects.”

“So, that’s three projects plus two projects,” I confirmed.

“By then, he already had two more projects himself, so that would be five projects plus two projects,” Elisa replied.

“I see where this is going. He is failing. How many projects does he have on his plate, now?”

“Well, we have five project managers on the team. Everyone is handling two to three projects. I just asked Jason to look over everyone’s shoulder and make sure all the projects are running smoothly.”

“I have ten fingers and ten toes, how many total projects?”

Elisa stopped to compute the number. “Okay, let’s use all your fingers and toes, let’s say twenty projects.”

“Twenty projects is different from his original five projects,” I started. “Let’s talk about the complexity of twenty projects, Jason’s natural capability, and where the mismatch may be. Looking at your project management software, how many variables on a single project? Are the projects all the same, with the same variables? How are the variables grouped into phases, related to time? Can some variables be accomplished simultaneously, while other variables depend on each other and have to be done is a specific sequence? Now, multiply all that by twenty. Handling five projects is one level of work. Handling twenty projects is a different level of work.”

Context of Decision Making

“What is the difference between you and your team members, related to the role you play as their manager?” I asked.

“Well, I’m their boss. I provide direction, guidance, coaching. I delegate task activities,” Joan replied.

“Why you? Why doesn’t the team provide its own direction?”

“Well, they weren’t invited to the monthly meeting where the company sets that direction,” Joan smartly observed.

“But, this is the age of Zoom, why weren’t they invited to attend that meeting?” I pressed.

“But, it’s a highly interactive meeting. We can’t have ten more people asking questions. We would never get anything done in the meeting. Believe me, I know my team.”

“And, doesn’t the content of the meeting concern them? Are decisions made that will impact what they do day to day?”

“Yes, it impacts what they do, day to day, but in that company meeting we make adjustments to the overall goals and objectives for the year. It’s important to be flexible, agile. My team may have specific ideas (and questions) about technical issues day to day, but in that meeting, it’s not about technical issues, it’s about a new competitor that’s eating our market share, a new office across the state we are thinking about, a new product that our customers have been asking about.”

“So, the context discussion in that meeting is different than the context your team works in?”

“Yes, that’s it,” Joan agreed.

“So the difference between you and your team members, related to the role you play as their manager, is the context in which you work, meaning the context in which you make decisions and solve problems?” I prodded. “Your decisions impact their decisions, but the difference is the timespan of your decisions vs the timespan of their decisions.”

Joan continued to nod her head. “And, the difference between me and my manager is the same,” she replied. “My manager makes decisions that impact me, but the timespan of my manager’s context is even further in the future than mine.”

“And, so, we begin to see the structure of layers in an organization,” I said, “based on distinct levels of decision making, measured in timespan.”

How Many Organizational Layers?

From the Ask Tom mailbag –

Question:
When you talk about context, organizational context, I assume you mean organizational structure. We have team members and supervisors, managers and executive managers. How many layers should we have? Is it best to have fewer layers, a flat organization or more layers?

Response:
As any good consultant knows, it depends. First, an organization should have no more organizational layers than is necessary, so, it depends on what is necessary. And what is necessary depends on the complexity of the problems to be solved and the decisions to be made to effectively deliver the product or service to the customer.

I watch organizations blow up into morbid obesity because they have no framework on which to base that decision – how many layers? And, who should be who’s manager? How many team members can a manager manage? What do we expect from this manager vs that manager?

Timespan.
What is the timespan of the decisions to be made and the problems to be solved? Think about this pattern –

  • 1 day to 3 months – Level I
  • 3 months to 12 months – Level II
  • 12 months to 24 months – Level III
  • 2 years to 5 years – Level IV
  • 5 years to 10 years – Level V

That’s how many layers you need, and only as many as you need. But, now you have a framework in which to make that decision.

Most entrepreneurs stay within the first two levels, with goals and objectives that rarely extend beyond 12 months. Those with aspirations for larger organizations, with higher revenues, more market clout, have to consider the impact of decisions and problems that extend two years and beyond.

There is a subtle seduction that occurs, however. Any entrepreneur with the intent to take their company to the next level, must first achieve mastery at their current level while sowing the seeds of problems for the next level.