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Are You Organized to Deliver Value?

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Are You Organized to Deliver Value?

Successful companies tend to grow big.


No real eye-opener there but wait... There's more...

They struggle to stay small. They have a hard time to keep the benefits from staying small.  

The amount of people is growing and departments become larger. To deal with this more layers of management are introduced, making it even harder to keep track of what takes place in the organization, to the extent that people stop trying.

While growing, employees are expected to stay involved and engaged with the company. They should know the company's vision and how to contribute to that.

They can solve some of it with tooling or with process. But that will only get them so far. At a point, there’s just too much information to take in and too many people to keep informed. And this is only within the organization. Customers will notice too. It takes more time to get support or even a timely response.

This is a real challenge for companies. How to stay strong and quick on their feet? How to prevent a knockout?

Casius Clay

Is agile a solution?

Applying agile principles and techniques is one answer to this. Involving teams from the beginning of the project. Do a quick iteration, get customer feedback and adapt. Less micro-management and more self-organized teams. This is a step in the right direction.

Still, there isn’t much alignment happening between those teams. In the software development world, there's product management, and there are product owners. They keep an eye on the product direction. Scrum masters try to accomplish alignment and spot dependencies between teams, which could work if the department is still relatively small. But as soon as it grows bigger it’s hard to keep track of which team was working on what product. And the general expectation stays the same as if they were still a small company. Everybody should know about everything.

There is a case to make for frameworks like LeSS and SAfe. They have interesting concepts that can help to scale agile, but they don’t make things more clear.

SAfe framework

Cell structure

In a book called “Eckart's Notes” entrepreneur Eckart Wintzen shares his insight on managing a company. Eckart tells about how he grew a one-man business into an organization of 10.000 people. He writes about different management principles he used during the growth of his company. One of the principles he called "cell-structure". In his opinion, a company can only stay successful and innovative if its size stays below 50 people. Anything bigger needs to split off  into a new cell. Same as we see happening in biology. A cell as Eckart describes, comprises every resource to become autonomous. He expected a cell to become self-sufficient and make a profit, if not, it would render obsolete. You could argue this concept creates overhead. But compared to an old organization where everybody needs to be informed, I think this overhead just shifts.

What I like about the cell concept is it enables to stay value focused. In smaller organizations, it's easy to tell why things are being done and what value is delivered. You learn quickly if you are successful, customers vote with their money. With a group of 50 people, you still know each other. Giving feedback happens more often and it's clear when someone isn't pulling their weight. Bureaucracy isn't an issue.

Harvard Business Review featured an excellent post on the topic, if you want to create value you need to know the purpose of what you do. This is probably one reason the book of Simon Sinek’s “Start with Why” is spot on and embraced by so many people. It explains the value of knowing ‘Why’. Knowing why is easier with less people. It makes another case to structure around a clear value you deliver.

What about you? Are you still value-focused?

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