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What Is an Organization?
For this post, the term organization is used very generally. It could apply to your company, your actual organization (the superset of multiple teams with somewhat aligned charter), or if you work for a large enough company, your team itself. Essentially, it's a unit of control, something big enough that has a lot of inertia, is difficult to change, and there is still a single person responsible for it (with several to many deputies serving at their pleasure).
Most importantly, this organization is responsible for some thing or things, the results of which are how they are judged. In this way, it could almost be considered no different than a very stubborn person that (ideally) has substantial output.
Incentives of an Organization
The purpose of an organization is to co-optimize the following 3 categories:
1. Adapt to changing internal business requirements
2. Minimize costs (this is actually not a purpose but an outcome of the people in an organization)
3. Management of results
Simple isn't it? As a technical leader, part of your responsibility is to direct efforts aligned with the incentives of your organization. Let's go over the above in a bit more detail.
Incentive 1: Adapt to Changing Business Requirements
The first incentive is to adapt to any changing business requirements. Now, this can be very easy. If you've worked for a massive, well established company that produces essentially the same thing year-over-year, the changing business requirements may be minimal, thus the incentives are to remain essentially the same.
Consider an example: the company needs to provide value to it's shareholders by either (or both) increasing market share and lowering costs on established product lines. As an engineering organization, your role is to impact the latter. Thus, the main requirement will be to have consistent results (e.g. quality) with continued lower costs, thus the performance of the organization is aligned with the company's.
On the other end of a spectrum, the Company is beginning to launch a product in a Completely new space. In this case, the business requirements are likely not very well defined (and maybe changing frequently) but the incentives are still to deliver on the whatever the business requires. This will likely result in frequent pivots, metric changes, and all the associated downstream churn within the organization to hit these.
Let's consider two other common examples of changing internal business requirements: growth and re-organization. Hopefully, you are working somewhere where growth is something that your organization is dealing with. As this series will show, that means a lot of opportunities for you. Growth often means that the company is doing well and needs to scale and/or adjust it's output and is investing internally to achieve this (the requirement). Organizations within it are incentivized to fulfill this because if they do not a) their output will not meet expectations resulting in negative individual performance reviews and if persistent b) changing leadership / organizational structure to accomplish the goals. Beyond just the human fear of failure, organizational changes also impart substantial cost on the organizations themselves.
Growth
Growth can be categorized in two primary ways:
The organization itself is growing (i.e. Head Count growth)
When small, this is a more trivial challenge. When an organization is growing by a large amount, it will stress the underlying structure of the organization and if not handled properly, will impact overall results.
If growth is large, there are very tangible costs: it will require substantial effort in onboarding new folks adding to both IC and manager workloads; managers will have too many reports, making them less effective; new engineers will not have sufficient context to be independent operators requiring existing resources to support additional work while new people are onboarding.
Despite the challenges, the organization needs to handle this additional burden on top of continuing to deliver excellence.
The output of the organization is growing (or needs to grow)
The simplest example is the number of different products your organization is launching doubles (say 2 to 4).
The immediate challenge is that this is likely either completely decoupled from actual head count growth or leading it enough that the head count growth cannot meaningfully help deliver the additional products. This is the proverbial "1,000 pounds of shit in a 10 pound bucket" problem. Again in the simplest embodiment of this, it means that the organization must get more efficient (streamline existing processes), learn how to prioritize, work longer hours, identify some investments that will result in immediate benefit, or some/all of these four. These type of requirements are especially true for "black space" problems (problems which the company has already organized to solve), which we will discuss in a forthcoming post.
In a more challenging scenario, the organizational output must grow but the current structure (i.e. team scope, processes, etc) does not readily suit this growth. An example of this is releasing a substantially new product to a substantially new market. While you might be doing essentially the same thing (i.e. building a server), the design, support, logistics, timing, etc might be completely different.
Therefore, the organization needs to figure out how to augment itself in some way to adapt to this growing / new need while still servicing the existing needs. This is called a "white space" problem and if this is not handled properly, it can really negatively the overall output of the organization. This will also be discussed in more detail in upcoming posts.
No matter what, having growth in your organization means that your org needs technical leadership. While there still is technical leadership requirements as growth approaches zero, it will be minimal and likely already filled, minimizing your personal growth opportunities. Depending on your current organization's growth requirements, different technical leadership requirements are needed to be successful.
Re-Organization
This is more of the effect of some changing business requirement (i.e. the organization is institutionalizing a "white space" solution, past leadership failed and a new leader wants to re-org to better position the org for success, etc) but still worth considering.
In this case, the new (or substantively changed) organization needs to get it's legs and start delivering results. The organization may be completely new, under new leadership, or incorporated with a different organization.
The incentive of the organization is simple: get to a successful steady state where teams have clear charter and responsibility addressing real and meaningful business needs.
There's also is lots of opportunity for technical leadership here as to get to the status quo, the status quo must be created and the technical leaders (in partnership with senior organizational leaders) are responsible for this.
Incentive 2: Organizations Minimize Costs
The next major incentive of an organization is to minimize costs. While minimizing financial costs may be critical to the organization, this one will focus on *internal* costs.
To start, what are the common *internal* costs an organization faces?
Cost 1: Head count churn
It is both costly to lose an employee and it's costly to onboard a new one. Consider how long it takes for a new employee to make meaningful contributions. 9 months? 1 year? If that new employee is replacing someone who has left, there may be additional gaps between the old employee leaving and the new one starting. That is a lot of time the organization is short staffed. Even if there is some overlap, training and onboarding will still take up a substantial amount of effort.
Cost 2: Growth
Yes, growth itself is a cost as substantial effort may be required to fulfill the growth. Consider the categories of growth mentioned above: all of them put strain on the organization and that strain is modulated by the amount of growth realized.
But what is the "cost" of growth? Some examples include:
- Deprioritized and undelivered but important deliverables
- Human-hour churn on more ambiguous "white space" problems
- Time spent onboarding / building onboarding processes
- etc.
Note that some of these costs have an associated long term value proposition (if executed well) but there's still a material cost during the investment period.
Cost 3: Re-organizations
This one should be more self-evident. While the intent of a re-org may be to have some long term value to the company, in the short term, it will be at best challenging and (more likely) a big fucking mess.
The costs of re-organization are mostly a lost efficiency of operation, likely dropped morale, and probably some lost head count resulting in a lower output.
Minimizing these Internal Costs
Perhaps the most important characteristic of an organization is that it's made of people. And people [don't really do change well](https://www.psychologytoday.com/us/blog/the-truisms-wellness/201701/why-we-resist-change). For a variety of reasons, human's thrive by normalizing and habituating the things they do frequently. It's estimated that 40% of our waking hours are habituated (2). This has been an evolutionary feature for us.
But it can work against us, if it's not managed. As mentioned earlier, the above "costs" of an organization all have some long-term value (if well-intentioned, well-planned, and well-executed). But the organization itself will resist these naturally as the people will.
Consider Growth. Growth is a quintessential aspect of a healthy business or organization. Unless it's been injected by poor leadership (e.g. hiring where it's not needed), it likely reflects that the organization has been successful. But consider the costs: people will have to deprioritize things (which are probably already important), people will likely have to work longer hours, and people may work on items well outside their expertise and scope.
These are all painful. Consider the engineer: they were probably hired due to having a specific skill set. They onboarded and - given that they are still retained by the company - offer a clear value. They have probably even gotten good at what they do, enabling them to provide continued more value with the same or decreasing effort. This is the process of becoming an expert.
Growth changes that. While in the long-term, this successful engineer may utilize the change that growth offers has an additional exercise in their process of delivering more value to the company (their professional growth), it means that they will have to change. The very things they have developed to make their life simplier and easier will have to be stopped.
And this is just an engineer. They entire organization is made of people and they are all resistent to this change.
As such, the organization will *organically minimize these internal costs*. As a technical leader, your responsibility is to have a growth mindset (enabling you to more flexibly adapt to and instill change) and to be effective at change management. Both of these topics are for later in this series.
Management of Results
This one should be self-evident. To some extent, your organizational leaders have some metrics by which all of the work of everyone in the organization contributes to and by which they are actively being judged. For better or worse, these metrics represent the "health" of your organization to senior management.
Understanding and managing these numbers is both your responsibility and your path to success as a technical lead.
References
1. https://www.psychologytoday.com/us/blog/the-truisms-wellness/201701/why-we-resist-change
2. *The Power of Habit* by Charles Duhigg
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