sustainability org design

Sustainability and Organization Design: Is there a Connection?

I have written more than 100 blogposts, covering a wide range of topics related to organization design.

But so far, I have not tackled the issue of sustainability.

I have hesitated, I must admit, because so far, I haven’t seen anything new.

Of course, to implement a sustainability strategy, a firm will have to make organizational changes, including structural ones.

The changes are often difficult to implement (see this and this article). 

But the repertoire of management techniques is a familiar one, and consists in such things as setting goals, defining responsibilities, and aligning the incentives with the goals.

 The things you would do to get any strategy implemented.

 But there might indeed be something unique about sustainability as a challenge.  

 I was reminded of this recently while reading the book “Mission capitalism”, written by Mariana Mazzucato, professor in economics at University College London.

 Mazzucato is characterized as “left-wing” by some commentators but I think most of her proposals will be viewed as sensible to people across the political spectrum.    

 Her first point is that to tackle climate change and other sustainability problems, we can learn from how grand challenges have been tackled before.

 So in the book, she describes how Preseident Kennendey established the mission to put a man on the moon.

 She explains in some detail how NASA handled this challenge from a leadership and organizational point of view.

 And this is where it gets interesting.

 It was not enough to create technological innovations: NASA had to radically re-design its organization as well.  

 Among other things, NASA had to ensure sufficient coordination across different units and sufficient communication across vertical layers, as well as effective collaboration with suppliers.

 This had to be done in a system of 300.000 people. 

 The organization was re-designed into program offices and centers. Centralized planning was combined with decentralized project execution. Many innovations in engineering management were also introduced.

 I was curious to find this definition of systems management, provided by George Mueller (the then head of the office of Manned Space Flight):

It is almost as if he describes the concept of an organizational digital twin, 60 years before the term was coined. 

(By the way, also in more modern times, NASA’s organization has been examined by researchers, e.g., see this study). 

But back to my earlier point: What Mariana Mazzucato is saying is that organizational innovation is critical to handle grand challenges.    

In particular, she argues that governmental agencies need to pursue bolder and riskier goals, and create more dynamic internal structures to implement them. 

A second point she makes, which is also related to organization design, has to do with the use of missions-oriented management. Here, she is not so much thinking of missions as “organizational purpose” (as we do in our field), but as the big goals that must be accomplished to handle a particular challenge (say, a plastic-free ocean).   

The key principle is to define the missions so that the outcome is clear, while allowing different types of solutions. As she writes in an article (Mazzucato, 2018, p. 811):

Although Mazzucato is mainly concerned with how the government can practice such mission-oriented policies at a macro level, her example from NASA also shows that this is relevant at a more micro level.

 For example, a key element of the Apollo program was to specify the goals but allow internal units (as well as suppliers) to come up with the solutions.

 We can ask ourselves how such a model can be implemented within an organization. 

 As an example, if “A plastic-free ocean” is defined as a key mission at the societal level, then it seems clear that this macro-level mission must be broken down into company and even product-specific missions, for example, “Plastics free packaging for our consumer products”.

 And as with a mission at the societal level, we of course need to break it down into more specific requirements – and ensure that we have the organization in place to realize it.  

 Image by Freepik

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