Human-centred Agile Organisational design

In Jamie Pride’s book ‘Unicorn Tears: Why Startups Fail & How to Avoid It’, he shares the sobering and somewhat disheartening fact that 92% of startups fail within the first three years of their inception. The former CEO of realestate.com.au consistently defies the odds, as he is the founder of not one, but six successful tech startups. He now spends his day on a mission to create better founders as a partner at Humanly Agile, an organisational design and change management consultancy firm. In the latest episode of Platform Diaries, we talk about why he believes organisational design is so important for scale ups, and ultimately succeeding as a startup.

“Organisational design comprises of five key elements,” Jamie tells me. “The way we deploy the talent inside our business in regard to capabilities and roles, how the information flows through the organisation, the DNA of the organisation – which includes mindset, culture, leadership style, how do we measure performance, and obviously the structure.”

Jamie discusses how in the beginning of most startups, people tend to do things by necessity or by accident. When things are in their inception, organisational design takes a back seat and agility is maintained fairly naturally. But Jamie urges people to act with intention from the outset, as not doing so will likely cause growing pains in the future.

“It is worthwhile moving from a structure that is accidental or by necessity and towards a deliberate way of thinking about structure, because it is a competitive advantage and becomes important during the scaleup phase,” Jamie shares.

Seeing as though Jamie had successfully nurtured six startups of his own and consulted with countless more, I wanted to know what the markers of success looked like, and how to figure out if you are on the right track.

“First and foremost, there needs to be a mindset shift inside the organisation. I found that those that become the most successful are the organisation’s where it all starts with leadership,” Jamie tells me.

Referencing earlier in our conversation where Jamie outlined the 5 key elements of organisational design, he argues that although structure is the most prevalent and discussed concept, the DNA of the organisation plays a significant role.

“Leaders who truly buy into decentralised decision making, for example, are fundamental to organisational agility and to effective organisational design.”

The next marker of success that Jamie has observed is organisations that don’t necessarily follow a blueprint, or an “orthodox” approach.

“Organisations that are a little bit more reflective and adopt a test and learn, iterative approach to their design,” Jamie tells me, are organisations that are destined for success.

Jamie likes to refer to the “test and learn” approach to agile as “small iterative experiments”.

“I think organisations can get a lot of benefit from small changes to their ways of working. A way to do this in practice is to ask ‘what are the things that are currently inhibiting us from doing our best work?’ and then conduct an organisational tension exercise.”

From there, Jamie urges people to select an issue such as inefficiency in decision making, a lack of systems or tools, a bias towards opinion versus data or any other challenge that is negatively impacting an organisation.

“Then we try one experiment that addresses one particular issue, without imposing a massive transformation on the organisation.”

According to Jamie, the benefit of this small, iterative approach is that senior leadership are more likely to go for it considering it is lower risk, and it begins to develop a culture of organisational experimentation. This approach teaches them how to fish, instead of merely serving up a solution on a platter.

Jamie thinks that this approach also helps foster a mentality that is necessary in any agile startup: you don’t have to be perfect.

“You can focus on the pain of the day rather than trying to have a long-term commitment that may not always be relevant.”

While it is undoubtable that the future contains flatter, more agile organisations, Jamie knows that this can impact the day-to-day work of employees. This people aspect is more often than not, the biggest challenge in implementing agile.

“People want to know how their performance will be assessed, what it means for their career, and might end up feeling a bit lost when becoming an agile team member.”

A lack of hierarchy moves the goalposts away from promotion and ascension, which can be frightening. He thinks we need to move people’s criteria for success towards mastery, purpose and autonomy.

“Everybody is trying to get to the next rung of the ladder,” he says. “We need to break from that false economy, or the idea that a title change means I have grown. Often tenure becomes a currency, where it should be skill and performance.”

At the heart of it, Jamie argues that organisational design is much about the DNA of your organisation as it is structure. Wondering how your organisation can start becoming agile? Small steps, accepting imperfection and remembering that organisations are human-centered are some of the ways you can join Jamie Pride within the 8 percent of startups that succeed.