Culture Dive: Incompleteness of Organizational Design

Culture is often seen as optional, something that is done to keep people happy when one has the time or inclination. This is very superficial reasoning for quite a few reasons, one of which being the concept of “incompleteness of organizational design”. The term was coined by Dr. Yeon Choi in his study of organizations and their functioning. His research showed how 2 unchangeable forces affect the design of any organization. The first is quite obvious, ie the unpredictability of environmental circumstances — how changes in the political, social, economic conditions locally or globally can drastically impact the best of companies. The second force is much closer to us and relates to the human nature, or rather its limitations. Dr. Choi says how because human beings are inherently limited in their knowledge (called “bounded rationality), any organization they design will also be limited in its functioning (ie bounded organizations).

Given these 2 forces are permanently at play, all organizations at any given point in time are incomplete, ie faulty / imperfect. They are still able to function only because individuals within the organization choose to act beyond the designed roles / functions. These non defined but critical actions are what drives the organization forward. A strong culture is essential in organizations to have more people taking such voluntary actions without feeling the burden or taken advantage of.

So the next time someone asks why you focus on culture, ask them what they’re doing to counter the incompleteness that exists in their organizational design?