The real organisation does not fit on an org chart

Every company has a formal structure, set out in org charts, processes, responsibilities and reporting lines. But there is also another organisation, less visible, built through the relationships between people, the experience they accumulate and the ways they find to solve day-to-day problems.

The org chart shows who reports to whom. It does not necessarily tell us who is consulted before an important decision, who we turn to when a difficulty arises, or who can unblock a situation that looked to have no way out.

This informal organisation can be decisive for how a company works. And even so, it is not always well enough understood by the people running it.

The organisation that exists beyond the formal structure

The informal organisation comes out of the relationships, habits and ways of working together that develop over time. It does not always match the documented processes, but that does not necessarily make it a management failure or a lack of discipline.

Often it emerges precisely because people need answers to situations the formal structure cannot anticipate.

A company may have grown faster than its internal organisation, leaving teams with ways of working that suited a different size. A procedure created to deal with an exceptional case can turn into standard practice. Or one person can become indispensable because they have accumulated knowledge and relationships that exist nowhere else in the organisation.

These situations can be an intelligent adaptation to what the company needs. The problem comes when they stop being understood, when they create excessive dependencies, or when they start shaping decisions without management being aware of it.

So before trying to remove an informal practice, it matters to understand why it appeared and what need it still meets.

Why does a reorganisation not always change the company?

Changing an org chart can be relatively simple. Changing how people work together, share information and make decisions is a rather different challenge.

Relationships of trust do not disappear because a team now reports to a different director. Someone long recognised for their ability to solve certain problems may go on being sought out, even once that responsibility has formally been assigned to another role.

This helps explain why some reorganisations produce visible changes in the structure yet have limited effect on everyday working.

It does not mean the reorganisation was unnecessary. It means the formal design, on its own, may not be enough to change the behaviours and relationships that hold the work together.

An organisational change therefore needs to understand not only how the company should work, but how it actually works, and what would have to change to bring those two realities closer together.

When the informal organisation turns into a dependency

There are signs that can point to an excessive reliance on informal mechanisms.

New joiners may take longer than expected to settle in because much of the knowledge they need is undocumented. Certain decisions may systematically depend on the same people, even when they are not formally responsible for them. Or there may be written procedures that are rarely used, because teams have developed alternative ways of working.

None of these signs, on its own, demonstrates a structural problem. But each of them is reason enough to understand better what is going on.

These dependencies become particularly significant as the organisation grows. What worked through personal relationships and knowledge shared within a small group can become harder to sustain as teams, clients and operational complexity all increase.

One person leaving, a long absence or a change of responsibilities can then expose weaknesses that were not previously apparent.

The risk is not necessarily in the informality itself. It is above all in failing to recognise the dependencies it has created, and to judge whether they still suit the reality of the organisation.

Understanding how the work actually happens

Getting to know the informal organisation takes more than studying org charts or reading procedure manuals. It requires talking to people, watching processes and understanding how decisions are actually made.

Some questions can help bring that reality into view:

• Which decisions keep finding their way back to the same person, regardless of formal responsibilities?
• Which informal procedures are used because the existing processes do not meet the need?
• Which exceptions have become standard practice?
• Who do teams turn to when they need to resolve an unexpected situation?
• Which activities would be compromised if particular people were away for a few weeks?

The answers can vary a great deal depending on each person’s role, experience and position in the organisation.

That is why I think it matters to hear different perspectives, including those of the people who do the work every day. Often those closest to the operation know of difficulties and solutions that never reach the decision-making levels.

But listening is not enough. The accounts have to be related to one another, set against the existing processes, and tested against evidence that distinguishes isolated cases from recurring patterns.

The aim should not be to find culprits or hunt for departures from the formal structure. It should be to understand the organisation that exists, and why it works the way it does.

Not everything informal needs to be removed

When we identify an informal practice, the first instinct can be to regularise it. But formalising every behaviour does not always make a company work better.

Some informal practices are more efficient than the procedures originally defined. In those cases it can make sense to fold them into the organisation’s processes, so other teams benefit from the same learning.

In other situations informality exists to compensate for a gap. A team may keep a parallel spreadsheet because the information system does not give them the data they need. Removing that spreadsheet without addressing the original limitation is unlikely to be enough. A new workaround will probably appear.

And there are informal practices that work well, carry little risk and do not warrant intervention. Flexibility has value too, particularly in organisations that have to respond to the unforeseen.

The decision should rest on the usefulness, the risks and the consequences of each practice. Formalising, replacing or preserving can be equally valid answers, depending on the context.

Making visible what shapes the organisation

The informal organisation can be an important source of knowledge, collaboration and adaptability. But it can also concentrate decisions, create dependencies, make knowledge harder to pass on, or let certain problems stay outside the usual management mechanisms.

When that happens, change becomes necessary. And it will probably be more effective if it starts by understanding why people developed those ways of working in the first place.

A team working around a procedure may not be resisting the organisation. It may be trying to meet a need the procedure does not cover. Someone who concentrates decisions may not be seeking additional power. They may simply have become the only point where certain information is available.

Naturally, individual interests, resistance to change or behaviours that are simply not appropriate can also exist. Understanding where a practice came from does not mean accepting it without question.

It means creating the conditions to decide better what should change, what deserves to be kept, and what new capabilities the organisation needs to build.

Perhaps one of the greatest limitations of many transformation efforts lies exactly here: we set out to redesign structures and processes without sufficiently understanding the relationships, knowledge and behaviours that let the organisation work at all.

The org chart is still necessary. But it should not be mistaken for a complete picture of the company.

To change an organisation, we first need to understand the organisation that actually exists.

This line of thought is also behind some of the questions we explore in Ariadne.Synapse, a conceptual project of the Aetheris laboratory that seeks to understand how to make visible the organisational relationships, dependencies and dynamics that org charts cannot represent.

Ariadne.Synapse