The re-organisation: plague, platitude & perversion

February 21, 2007

I have the privilege this week of attending the Finance Family Forum of a major North American company. I first worked with them around this time last year at the same meeting and in the same location when I was with them for a day. A few months ago I did a whole day strategy session with them, This year I have been allowed to sit in on their various discussions over three days and run one session each day using Cognitive Edge techniques. Today it will be The Future Backwards, tomorrow a general session on innovation. Yesterday was a refresher on sense-making. Now it is unusual for me to be working with the Finance Function, in most organisations they are the holders of the purse strings, the custodians of Newtonian measurement and the nay-sayers to innovative ideas. Here it is the opposite, in that the finance function is seeking to gain understanding of new and radical ways of thinking by which it can help the business. I also like the idea of the Finance function being a family (which they are, its not just a nice nice name). I almost gave up my long dislike of golf in order to be more fully integrated yesterday, but instead resisted and walked into Phoenix to add to my collection of Starbucks City Mugs (two on this trip with Atlanta on Monday).

Either way, to get the point and the title of this posting. In his introduction yesterday the CFO said two things that I admired:

  1. He was proud of the fact that in ten years he had not re-organised. Hee felt re-organization was often an excuse for putting off responsibility, rather than accepting it
  2. He was pleased they had retained a divisional structure, allowing the Finance community to become intimate with the business, rather that requiring the by business to conform with the needs of finance. Yes it carried a cost burden, but the value contribution more than compensated for that.

Now there were other things in his talk, and the contributions of the rest of the family that were valuable but those are the items I want to share today. To me it represents wisdom in the true sense of the world rather than opportunism. To be blessed with a wise, rather than an opportunistic leader is a blessing. It contrasts well with other organisations,
Now what follows is drawn on my own experience and that of other people I have talked to, but it is not intended to represent any particular company. That said in the last ten years most people in large corporates will have been re-organised between five and ten times. The normal cycle goes something like this (assuming a calender year end:

  1. Around about September rumors start to circulate of change. Things have not gone to plan (not the same thing as not going well) l this year. The consultants may be called in and meetings start to take place. If you are not a part of these meetings your status has dropped.
  2. Towards the end of October everyone knows that something is up and much energy goes into political maneuvering and positioning.
  3. Towards the end of November or early December the new organisation is announced, generally with the inner circle being reshuffled into the top posts. December is then a frantic period in which people try and bury the kitchen sink in the numbers to make the next year easy. Political players soon slot into the main jobs, while those who care about the customers are sidelined.
  4. Layoffs are made for the Christmas season, and then january and most of February is spent in the final allocation of clients, staff and the like. It is at this point that all sorts of nasties, not anticipated during the idealistic design stage are discovered and parts of the re-organisation are themselves re-organised
  5. By late February things have settled, but them people realise that the Q1 numbers are not looking good, as everyone has been internally not externally focused
  6. March and April represent the only periods in the year when people focus on the core business
  7. By May Q2 is not looking good. In June and July lots of meetings are called and a consultancy firm (often the same one for reasons I have never understood given they are generally responsible for the mess) are called in
  8. In August plans are in full swing, with the inner circle already starting to position themselves and in September rumor starts to sweep the organisation
  9. Go to 1 above

Sound familiar? It is not just commercial companies either, government of late and even the voluntary sector have adopted what we might, with irony, call industrial best practice. In effect the re-organisation has become a plague which comes annually with the monsoon. It is of course accompanied by wonderful statements and aspiration goals, otherwise known as platitudes . It also generates multiple perversions such as the target hopping executive who never takes responsibility for their annual move to asset strip a new area and the indifference to customers and employees which is the exact opposite of a family.

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The Cynefin Company (formerly known as Cognitive Edge) was founded in 2005 by Dave Snowden. We believe in praxis and focus on building methods, tools and capability that apply the wisdom from Complex Adaptive Systems theory and other scientific disciplines in social systems. We are the world leader in developing management approaches (in society, government and industry) that empower organisations to absorb uncertainty, detect weak signals to enable sense-making in complex systems, act on the rich data, create resilience and, ultimately, thrive in a complex world.

Cognitive Edge Ltd. & Cognitive Edge Pte. trading as The Cynefin Company and The Cynefin Centre.


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