Organisational Structure and Principles

logo_smallThe SPS organizational structure has sought to learn from the international experience of corporate management since the 1980s. For 60 years after Alfred Sloan implemented the bureaucratic structure at General Motors in the 1920s, large companies were engaged in perfecting bureaucracy. In the last 20 years, many of the most dynamic among these, have been busy devising innovative forms of going beyond it. The search for an alternative to bureaucracy is, of course, as old as the concept itself. However, until the 1980s this remained the preserve of marginal, radical dreamers or impractical romantics, working on a small-scale. The first mainstream challenge to bureaucracy can be traced to Burns and Stalker’s 1961 path-breaking work The Management of Innovation, which described an “organic” form of organization: more team-based, more flexible and less mechanically rule-bound than traditional bureaucratic hierarchy. Companies, and this includes some of the largest, most successful ones, have come a long way since then. As Michael Rothschild (1998) says, starting in the late 1980s, “well-managed large firms began flattening and decentralizing their traditional vertical hierarchies”. At SPS, we have learnt from this extremely rich and exciting experience. We summarize below some of the key features of the SPS structure and refer to some of the world’s biggest companies that have inspired us to move in the direction we have.
In organizational design, we take inspiration from the words of Dee Hock, Founder and CEO Emeritus, Visa International, one of the world’s largest commercial enterprises, which he describes as a “complex, self-organizing, non-linear, self-governing, adaptive system” (Durrance, 1997). We may not have reached there yet, we probably never will, but this best expresses our aspiration.
At SPS, we believe that the inherent and fundamental limitation of bureaucracy derives from its foundation in the specification of offices: people are responsible only for their own jobs.