The document discusses strategies for scaling organizational structures in agile environments, emphasizing the balance between hierarchical and networked approaches to enhance communication and innovation. It compares efficiency and effectivity, centralization and decentralization, and highlights the importance of flexible team structures and continuous adaptation in response to rapidly changing contexts. Management 3.0 is presented as a mindset focused on leadership and organizational design, integrating classical management principles with modern insights and practices.

1. Scaling
Organizational
Structure
© Happy Melly One BV
(Original Management 3.0 Foundation Workshop Material)

2. Grow Structure:
Many teams operate within
the context of a complex
organization, and thus it is
important to consider
structures that enhance
communication.

3. What is the best
organizational structure?
How do we scale the
business in an agile way?

4. 4
An organization should operate like a city. Some parts
emerge bottom-up while others are designed top-down.
The art of management is finding the right balance between
these two approaches.

5. Hierarchies versus Networks
In a hierarchy, rules and processes create
predictability, facilitate coordination, and
reduce cognitive load because people have
proven responses to routine situations.
In a network, there is collective intelligence.
The crowd, with its many connections
between members, can be smarter and
more innovative than a central authority.
– Hayagreeva Rao and Robert I. Sutton, Scaling Up
Excellence: Getting to More Without Settling for
Less

6. Knowledge work requires specialization (going deeper)
but innovation requires generalization (spreading out).
The economies of specialization make functional division
the most common. But innovation requires
us to do things we’ve never done before and thus
innovation is incompatible with the functional
organization.
– Peter F. Drucker, Management
– Burton, Obel, DeSanctis, Organizational Design
Specialization versus Generalization

7. Efficiency versus Effectivity
Efficiency is a primary focus on inputs,
use of resources, and costs. Effectivity
is a focus on outputs, products or
services, and revenues.
You can achieve efficiency only in
predictable, stable environments. You
need effectivity when environments
are complex and changing fast.
– Burton, Obel, DeSanctis,
Organizational Design

8. Centralization versus Decentralization
Centralized decisions are coordinated, limit
waste, and lower average costs by managing
the use of fixed resources.
Decentralized decisions are quicker, with local
information that is probably better in
ambiguous and fast-changing contexts.
– John Roberts, The Modern Firm
– Tim Harford, Adapt

9. 9
Exploitation versus Exploration
Innovation is more usually successful when an autonomous unit is
charged with exploring a disruptive, innovative idea.
However, in the rare cases where organizations are able to combine
exploration and exploitation, the successes are usually larger.
– Jens Maier, The Ambidextrous Organization

10. Hierarchies
Specialization
Efficiency
Centralization
Exploitation
Networks
Generalization
Effectivity
Decentralization
Exploration
balance
(ambidexterity)

11. Learn more about structures that enhance
communicaFon at a Management 3.0 Workshop!
www.management30.com/events/

12. What are common
patterns for balancing
organizational structures?

13. T-Skilled People
Hire “generalizing
specialists” who go
deep in one area but
also branch out in
other areas.

14. Value Units
Organize people around cross-
functional core processes and
value streams, supported by
shared specialist units.

15. 15
Small Teams
Team members become less productive as the size of the
group increases (The Ringelmann Effect). Therefore, keep
teams small, but large enough to cover a value stream.
– Jacob Morgan, The Future of Work

16. Semi-stable Teams
The best-performing teams are those that stay intact as a
group. However, a small but steady variation in membership
is healthy even for stable teams.
https://www.forbes.com/sites/davidburkus/2016/06/15/write-then-keep-re-writing-your-org-chart

17. Replace Job Titles
The concept of a fixed
job is obsolete. Instead
of a steady job, expect
continuous adaptation
and responsiveness to
meet the needs of the
moment.
– Tom Coens, Mary Jenkins

18. Communities of Practice
A community of practice (CoP) is a group of people with a
shared concern, interest or passion, who deepen their
knowledge and expertise in this area by interacting on an
ongoing basis.
– E. Wenger,
R. McDermott,
W. Snyder

19. Open Allocation
Let employees pick and choose the
projects that interest them most
instead of being told what to do and
what teams to be part of.
http://www.forbes.com/sites/quora/2012/11/26/what-is-open-allocation/

20. Double Linking
Liaisons are like ambassadors who serve to connect teams.
Make links between dependent teams but always keep a low
number of dependencies.

21. 1
2 3
Team Number One
It’s normal for people not
to work exclusively on just
one thing. The brain needs
some diversion.
But people should know
which team is their first
priority.

22. Local Rules
Every team should be
allowed to differentiate
themselves and operate
according to their own
local rules, as long as the
rules are in harmony with
their environment.

23. Management 3.0 is not another framework, it’s a mindset, combined
with an ever-changing collecFon of games, tools, and pracFces to help
any worker manage the organizaFon. It’s a way of looking at work
systems.
Management 3.0 examines how to analyze that system to come up with
the right soluFons for beZer leadership across organizaFons.
Management 3.0 FoundaFon Workshops are all about principles and
pracFces. Combining the best of classical thinking with a fresh approach
and new insights. All embedded in a social context and in the networked
businesses we work in today.

24. Book your Management 3.0 Workshop today and improve your
Leadership Skills.
Visit www.management30.com
info@management30.com
www.management30.com