Thursday, February 01, 2018

Importance of structure: Systems thinking

One of the beauties of Systems thinking is, it is easier to observe but difficult to design. I compare this to a river. It keeps flowing, carving out its directions, carrying it away that comes in it's path. 
Even though the behavior of the river remains the same, but the water is not the same. The old water keeps flowing in from various sources, mixing with the existing structure. 
Similar to the river, the organizations gets created with a structure, but the people keeps moving in and out of the system. The structure determines the behavior of the agents operating in the system. 
Designing the structure of the organization/system during its inception is simple but plays a crucial role in deciding the future of the organization. That hardest part is to have the patience to wait to understand the system's behavior due to the changes. 
Uber is a classic example in the recent times. It looks like the senior management created the structure allowing the non-sense to happen and its impact is being seen after several years.
That is why it is essential for the organizations to create a proper structure in place for the people to operate. Of course, the structure needs to be deliberately designed to ensure to achieve the system optimizing goals. But again, this is not something can be done in a day. Keeping the delay in mind, one needs to keep a tab on the system's behavior and making necessary course corrections in structure. 
In large organizations, it 's challenging for a single person(like a CEO or a founder) to manage every part of the company, and this is where the "decentralized" structure could work better. 

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