Organizational design — the formal and informal…

I just came across this gem of a thinking model for “organizational design” challenges and opportunities; this exhibit is straight out of a recent Strategy+Business article you can find here.  I think this is a great way to think through things — in business we most often tend to spend the bulk of our time on the “formal” model with structures, key performance indicators, compensation plans, and the like; we often don’t give nearly enough MAU’s (management attention units — a great term I picked up from a client some years back!) on the “informal” side, and yet that seems to be the real enabler of true high performance for organizations.

In “engineering speak” I would suggest that getting the formal side “approximately right” is necessary, but not sufficient. The “turbo-charging” comes through tackling the informal side and getting it to mesh with the business strategy and the formal design.  Definitely not a trivial task….