Requisite Organization

A Total System for Effective Managerial Organization and Managerial Leadership for the 21st Century

Elliott Jaques

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351551311
• Edition: 2
• Topic: Commerce
• Subtopic: Commerce Général

Based on Elliott Jaques latest research, this is a thorough revision of a book that has established itself as a classic in its field. Jaques has written a practical high-level, how-to book, that applies to all kinds of working organizations - industrial, commercial, service and public. He sets out a totally new way of doing business. Step by step, he builds up the concepts, and then introduces the working procedures to enable CEOs and senior executives, managers, and HR specialists, to develop requisite organization for themselves - in other words, organization which enhances creativity, productive effectiveness, human satisfaction and excellent morale. Requisite Organization challenges all of our current methods and assumptions in the field of organization, leadership and management, and presents a unified total management system built upon a rigorous theoretical base, Stratified Systems Theory. Any enterprise can gain a competitive edge in the short-term by introducing new products and services. In the long-term, however, an adaptive and successful enterprise calls for soundly structured organization with effective staffing and managerial leadership at every level - a requisite organization.

Part 1 Section 1
Introduction Scope of the Book

This section describes the thrust of the book: the design and development of organizations that can release human creativity and imagination—and how a true scientific approach can help.

A Major Finding: Human Nature Explains Hierarchy

The Main Difference Between This Second Revised Edition and the First Edition There are many differences between this revised edition and the first edition of Requisite Organization. Much water has flowed under the bridge since 1989, new developments have taken place, and new knowledge has been gained. For example:

• The whole book has been totally reorganized into three main sections: human nature; organizational structure; and managerial leadership processes.
• Personal effectiveness appraisal methods are reformulated.
• The notions of primary and secondary sets have been replaced by complexity of mental processes.
• Individual career development and selection processes have been elaborated.
• The principles of functional alignment have been re-written.
• There is a more central emphasis upon effective accountable managerial leadership
• And so on.

The most extensive change is the far-reaching finding obtained in a recent study¹ by Kathryn Cason and myself, with respect to the nature of human capability and the reasons why the managerial hierarchy exists in the first place. It is such a fundamental finding, that I hope I may be excused for referring to it as "the big finding."

This finding was obtained in a controlled and systematic study of mental complexity, carried out for the US Army Research Institute for the Behavioral and Social Sciences (ARI) in a company in the USA and one in Australia. What we were able to demonstrate in this study is as follows:

1. There is a hierarchy of four ways, and four ways only, in which individuals process information when engrossed in work; which we named declarative, cumulative, serial and parallel processing.
2. This quartet of processes recurs within higher and higher orders of complexity of information.
3. Each of these processes corresponds to a distinct step in potential capability of individuals.
4. Finally, and most significantly, our study showed a .97 correlation between the universal underlying managerial layering of the managerial hierarchy and each discrete step in complexity of mental process (and thus, potential capability).

The major conclusion from this finding is that: The existence of the managerial hierarchy is a reflection in organizational life of discontinuous steps in the nature of human capability.

This conclusion, and the work that goes with it, will be seen to:

• Explain the continuous existence of the managerial hierarchy in all post-tribal societies for the past 3,000 years (and suggest that it is likely to be around for the next 3,000 years).

• Provide a solid foundation for achieving a method of making an accurate match between individual capability and role complexity in filling positions, and therefore, also, of laying the basis for effective managerial leadership.

Kathryn Cason and I believe that this breakthrough in what is referred to these days as "cognitive psychology" will usher in a new era in our understanding of managerial organization and leadership, and of human nature in general. Its impact will be found throughout this new edition.

Achieving Effective Organization for Sustained Success

There exists a widespread assumption in management circles that effective managerial organization development can be achieved in one of two possible ways. The first way is to improve given processes, as in re-engineering or work-out programs, or in broad band-grading processes. The second way is to improve each and every manager individually, as for example by: finding the so-called core competencies in a company and teaching these competencies to everyone; or by developing "learning organizations" by helping individual managers to learn how to learn; or by teaching managers how to handle and react to authority; or by teaching employees how to work together in "self-managed teams;" or by exhorting everyone to be more trusting.

Both these approaches have led to a restless flow of wasteful and futile fads and panaceas. This failure comes about not because of human sloth, greed or stupidity, but because the organizations and the managerial procedures in which the various cures are tried, are so badly designed. Overcoming this problem requires not slogans and gimmicks but the development of a thorough-going understanding of the nature of the organizations we use to get our work done. There is hardly a corporation anywhere that does not have the potential for a surge of upwards of fifty percent and more.

What is urgently needed is to come to grips with the fundamental problem of the organization of our managerial systems. Common belief that hierarchical systems "used to be satisfactory for mass production work in the first half of the century" is quite simply wrong. They have never been soundly organized. It is my aim to set out what my experience and studies over the past fifty years have shown to be necessary.

My view is that the way to managerial leadership is through the development of the organization itself. Get the organization right, and the people and the managers who give leadership to them will be enabled to work together in full collaboration and with constructive mutual trust. Given half a chance, people are keen to get on with their work, and to have work to get on with. What is missing is an adequate organizational framework within which to work and to cooperate with each other.

In summary, what I shall describe are the following interacting components of a total managerial organizational system.

1. A universally-applicable organizational structure, comprising a hierarchical system of managerial layers, a system of accountability and authority in lateral working relationships, project teams with accountable leaders, and the establishment of specific functions at given organization levels.
2. A system of detailed managerial leadership processes, comprising: immediate manager-subordinate leadership via team working, context setting, just-in-time task assignment, personal-effectiveness appraisal, coaching, and merit recognition; manager-once-removed leadership, via mentoring, career development, talent pool analysis and development, equilibration of subordinate managerial leadership; and organization wide values and symbolic leadership.
3. An equitable differential structure using pay levels tied to the structure of managerial layers, and pay bands for roles within these layers giving the bands within which individuals are paid in accord with their immediate manager's judgment of effectiveness.
4. A newly-discovered system of evaluation of individual potential capability which taken together with the person's commitment and skilled knowledge, gives entirely new and practical meaning to the notion of getting the right people in the right position, and for career development.

I call such conditions requisite organization. The term requisite organization means doing business with efficiency and competitiveness, and the release of human imagination, trust, and satisfaction in work. These conditions are essential for the effective managerial leadership systems in any decent free-enterprise democratic society.

Under-Estimating the Importance of Organization

There is a widespread, almost universal, under-estimation of the impact of organization on how we go about our business. If a serious engineer was told about a new process that could add 50% to 200% to a company's bottom line, he or she would feel duty bound somehow to get this news to the CEO. But it is not so in the HR and organization field. The potential for such improvement does not seem to mean anything. Or it is assumed that it is not possible. So I repeat. There is enormous waste of effort in even the best organized companies. The gains for those who achieve a requisite total organization system, with effective accountable managerial leadership are large.

You may think, as is all too commonly believed, that organization, or "too much organization," undermines the innovative adaptability and initiative you would like to have. It is bad organization that does so. Good organization has precisely the opposite effect. Creativity and innovation, like freedom and liberty, depend not upon the soft-pedaling of organization, but upon the development of institutions with the kind of constraints and opportunities that can enable us to live and to work together harmoniously.

Requisite organization means doing business with efficiency and competitiveness and the release of human imagination. I refer to all kinds of business: free-enterprise competitive industrial, commercial and service business; and central and local civil services; health and education and other social services; and defense.

In modern industrial societies most business work is done by means of one type of hierarchical organization. It is the structure and function of organizations of this type which I shall be addressing, in all their colors and complexities. These organizations are ubiquitous: but their nature remains shrouded in haze–and they do not even have a consistent name. Let us take up the task of dispelling the haze.

Requisite Organization, Managerial Leadership and Society

One way of looking at this book is to see it solely as a book about management. That is a perfectly proper view. And I aim to satisfy it.

But there is also a wider view. This wider view may not interest every reader; but it should. It has to do with the vital importance of requisite managerial organizations, and of requisite managerial leadership within them, to the achievement of trust in our society. The simple fact is that managerial organizations have become the most important of the social institutions of the modern free enterprise democratic society.

Consider their impact. In the economically developed nations anywhere from 75% to over 90% of those who work for a living, do so for a wage or salary in employment in a managerial hierarchy. They spend 40 hours every week, for 30 to 50 years. The differential economic wealth of families is distributed mainly by the salary system.

Nearly everyone's career is fixed by employment opportunity and the goodness or badness of judgments of managers. And we are talking of lifetimes—for over 125 million people and their dependents the USA, 30 million in the UK and in France, and hundreds and hundreds of millions of others throughout the rest of the world.

All of the above has to do with those who are employed. If you add to it the impact upon the 5%, 10%, 20%, 30% and more who are unemployed, in various countries, plus the chronic employment insecurity and anxiety of those who are employed, it becomes possible to get some sense ...