The Laws of Organisation Design

Written by

Sergio Caredda

Posted on

September 10, 2024

Edited on

October 1, 2024

The Concept of Laws in Social Science

In social sciences, the concept of “laws” is quite different from how laws are understood in the natural sciences, like physics or chemistry. While laws in natural sciences are universal, consistent, and predictable, the idea of laws in social sciences is more nuanced due to the complexity of human behavior, culture, and social dynamics. Durkheim was the first to observe that, in sociology, we can identify patterns that resemble laws, but that are different that natural sciences (Durkheim, 1895). This of course applies also to those statements or observations that we define as “laws” and that apply to Organisation Desingn.

Let’s see some characteristics of Laws in Social Science:

Social Laws are Probabilistic, Not Deterministic: Unlike natural sciences, where laws (like gravity) are deterministic, laws in social sciences are more probabilistic. They suggest tendencies rather than certainties. For example, the law of supply and demand in economics explains a general pattern, but it doesn’t predict exact behavior in every case.
Social Laws are Contextual: Social science laws are heavily influenced by cultural, historical, and social contexts. Human behavior is shaped by norms, values, and institutions that vary across societies, meaning that a “law” in one context might not hold in another.
Social Laws are Contingent on Human Behavior: Laws in social sciences are based on patterns of human behavior, which are subject to change over time and can be influenced by individual and collective decisions. Humans have agency and can act in unpredictable ways, which complicates the idea of universal laws.
Social Laws are Generalizations, Not Absolutes: Instead of firm laws, social sciences tend to work with generalizations, tendencies, or patterns. These are based on empirical research and observations but don’t hold true in every situation. They describe typical rather than inevitable outcomes. A key contributori to this point is for sure Max Weber, who clearly underlines the role of individual behaviours in the development of shared patterns (Weber, 1921).
Social Laws are Subject to Change: Social science laws are more flexible and subject to revision or change as societies evolve. Unlike physical laws, which remain constant, human societies change rapidly, meaning that what might appear as a “law” at one point could be obsolete in a different era or cultural context.

Do Laws in Social Sciences Really Exist?

There is even a major debate if Laws really exist in Social Science. Some argue that social sciences do not have “laws” in the strict sense of the word (a challenge that was brought forward for example by Karl Popper [1963]), but rather broad generalisations that apply most of the time. Others maintain that some social patterns are so robust and consistent (e.g., economic principles like supply and demand, or sociological patterns like the diffusion of innovations) that they can be considered laws in a looser sense (Elster, 2007).

However, the existence of truly universal laws in social sciences is often questioned because human societies are so diverse and dynamic (Hempel, 1965) that it’s difficult to find rules that apply across all cultures, historical periods, or contexts (Kuhn, 1962).

Chief Justice John Roberts famously questioned the status of economics as a science during a 2015 case involving the Affordable Care Act (King v. Burwell, 2015). He argued that economics (and by extension other social sciences) should not be treated the same as natural sciences because its theories and principles are subject to greater uncertainty and disagreement.

Roberts’ skepticism reflected a broader critique that social sciences do not produce the same kind of firm, testable laws as the hard sciences, especially as most of them are hedged, i.e. subject to a number of conditions that do not make them truly valid. He saw two critical elements in particular:

Unreliability and Disagreement: Social sciences, according to this view, involve a greater degree of subjective interpretation, and the models or theories economists (or other social scientists) propose are often based on assumptions that can be disputed.
Lack of Predictability: Roberts’ critique reflects the idea that economics, in particular, fails to predict outcomes reliably. Unlike a physical science, where experiments can be repeated with the same results, economic or social science predictions often fall short due to the complexity and variability of human behavioor.

What about Organization Design?

In the context of organisation design, the concept of “laws” is similarly nuanced, as it is in the broader social sciences. While there are general principles or “laws” that guide effective organisational design, they are not rigid or universal. Instead, they reflect patterns or tendencies that tend to lead to certain outcomes, but are influenced by a range of internal and external factors.

There are however a number of principles, that in some cases have been defined as “laws”, that are useful observations to be taken into account when designing an organisation. Some authors often suggest the application to Organisation Design of laws defined in other domains (physics for example), but also these are sometime questionable in their concrete application as these often assume a deterministic view of organisational behaviour, which is difficult to concretely experiment in reality.

The Laws of Organisation Design

Each law that I have examined has a specific page that you can access to. Here below you will find the coincise formulation of the law, and a summary of its content applied to organisation design.

1. Conway’s Law and Intentional Design

Any organization that designs a system (defined more broadly here than just information systems) will inevitably produce a design whose structure is a copy of the organization’s communication structure.
— Melvin Conway (1968)

Conway’s Law suggests that the systems organisations build will reflect the communication structures within those organisations. This principle highlights the importance of aligning team structures and communication patterns with the system architecture to produce cohesive, well-integrated solutions. It applies broadly, from software development to organizational design, and is a powerful reminder that organisational structure and system design are deeply interconnected. It also serves as the best demonstration and support for the application of intentionality in Organisation Design. Finally, the proposal of a corollary to Conway’s Law suggests that other effects (such as Customer Service) can also be fully interpreted as linked to this law.

2. Parkinson’s Law

Work expands to fill the time available for its completion. — C. N. Parkinson (1958)

Parkinson’s Law serves as a caution against the inefficient use of time and resources in both personal and organisational contexts. It highlights the tendency for work to expand to fill the time available, leading to procrastination, complexity, and inefficiency. By understanding this principle, individuals and organisations can take steps to manage time more effectively, set realistic deadlines, and avoid the pitfalls of unnecessary bureaucracy and overwork, as well as design of unnecessary roles.

3. Law of Triviality

The time spent on any item of the agenda will be in inverse proportion to its importance. C. N. Parkinson (1957)

The Law of Triviality highlights a common pitfall in organisational decision-making: the disproportionate focus on trivial issues at the expense of more significant and complex matters. By recognising this tendency, you can prevent bias in decision-making, and ensure you don’t create separate decision making structures that would only increase the relevance of triviality in decision making.

4. Goodhart’s Law

When a measure becomes a target, it ceases to be a good measure. — C. Goodhart (1975)

Goodhart’s Law is a powerful reminder that while metrics are essential for guiding and assessing performance, they should be used with caution. When metrics become targets, they can distort behaviour, erode the quality of outcomes, and lead to unintended consequences. Therefore, it’s crucial for organisations to set targets thoughtfully, considering the broader goals and the potential impact of over-focusing on specific measures.

5. Brooks’s Law

Adding more manpower to a late software project makes it later. — F. Brooks (1975)

Brooks’s Law serves as a cautionary principle in project management, warning against the naive assumption that more manpower can always resolve project delays. It highlights the importance of understanding the underlying causes of delays, the potential downsides of adding more resources, and the need for careful management of team dynamics and communication as projects scale.

6. Hackman’s Law

The effectiveness of a team is determined by the sum of its members’ abilities and the quality of their interactions — J.R. Hackman ( 2002a)

Hackman’s Law underscores the importance of the structural and contextual factors that influence team performance. It challenges the common belief that assembling a group of highly talented individuals will automatically result in a high-performing team. Instead, it suggests that careful attention to team design, sizing, support, and processes is crucial for achieving optimal performance.

7. Larman’s Laws of Organizational Behavior 🆕

Organizations are implicitly optimized to avoid changing the status quo middle- and first-level manager and “specialist” positions & power structures. — Craig Larman (2012)

Larman’s Laws of Organisational Behavior provide a valuable lens through which to view the challenges of implementing change within organisations, particularly in the context of agile transformations. They emphasise the deep-rooted nature of resistance to change, the role of power structures and culture in shaping organisational behaviour, and the need for patience and systems thinking in driving meaningful transformation.

These laws are particularly relevant for leaders and change agents looking to implement agile at scale or drive other significant organisational changes. Understanding and addressing the dynamics highlighted by these laws can increase the likelihood of successful and sustainable change.

8. De Geus’s Law 🆕

It takes a long time to build a river company. But if you have a river company in place, you can demolish it in less than 12 months. Simply follow these easy steps:
Declare that the company isn’t profitable enough. Henceforth, your goal will be a specific amount of return on capital employed.
Develop an action plan in which all assets will be trimmed back across the board to meet these goals.
Follow the plan.
— Arie de Geus, The Living Company, p. 126-127

In organisational design, De Geus’s Law emphasises that prioritising short-term financial gains over long-term sustainability can lead to the rapid decline of even the most resilient companies. This principle is reinforced by a broad body of literature in management and organisational theory, including works by Peter Drucker, Jim Collins, and several academic research, all of whom argue that long-term adaptability, learning, and flexibility are crucial to an organisation’s survival. Organisations that over-focus on trimming costs and meeting financial targets at the expense of their culture, talent, and innovation capabilities risk undermining their ability to thrive in the long run.

9. Metcalfe’s Law

The amount of value created by a network is proportional to the square of the number of connected users. — R. Metcalfe (1980)

Metcalfe’s Law, when applied to organisations, emphasises the exponential increase in value as the number of connections within and outside the organisation grows. This principle highlights the importance of fostering collaboration, communication, and innovation through well-connected networks. However, it also comes with challenges related to complexity, security, and scalability, especially if read in conjunction with the effects of Brooks’ Law.

10. The Law of Constraints

The performance of the system is determined by its weakest link. — Eliyahu M. Goldratt (1984)

The Law of Constraints emphasises the importance of identifying and managing the bottlenecks that limit the performance of any system. By focusing on these constraints, organisations can make targeted improvements that lead to significant gains in efficiency and output. This principle is widely applicable across various fields, including manufacturing, project management, supply chain management, and strategic planning. It also can be expanded in a wider formulation to encompass organisation design elements, thus becoming a framing concept into the impact of inconsistencies in design and outputs of an organisation. Understanding and applying the Law of Constraints can help organisations achieve their goals more effectively by ensuring that their most critical limitations are addressed first.

The Pareto Principle

For many events, roughly 80% of the effect comes from 20% of the causes. — Pareto Principle

The Pareto Principle can be a valuable tool in organisation design by guiding leaders to focus on the 20% of activities, resources, or customers that drive the majority of outcomes. Whether applied to prioritising key processes, aligning teams, or improving decision-making, the principle encourages organisations to concentrate their efforts where they will have the greatest impact. However, careful analysis is required to identify the correct high-impact areas, and care must be taken not to oversimplify or ignore the remaining elements that contribute to the organisation’s overall success. Particularly, in many organisations we need to account for the coexistence of Long Tail Effects, and we need to ensure we can balance well the effects and impacts on prioritisation efforts with finding growth opportunities exploiting scale effects that is today enabled by technology.

The following articles will be published over time.

Law of Requisite Variety
Law of Alignment
Law of Self-Similarity
Law of Synergy
Law of Minimizing Interface Complexity

If you’re thinking that one law or principles is missing, and want to suggest one, please use the comment form below. Thank you!

How to Apply the Laws of Organisation Design

As mentioned earlier, all these laws are not immediately applicable and need to be contextualised. My effort in documenting these, with also notes from actual experience, is that are often useful as principles to keep in mind when designing an organisation, or to structure our observation around some common patterns of organisational behaviours.

The individual articles are structured to offer some actionable insights in terms of:

Key Components of the Law and how it affects organisation design elements (or, if coming from a specific discipline, how its effect can be translated to an organisation).
Impacts on Organisation Design, where relevant, and particularly for laws that are derived from other fields.
Application and Countermeasures, where relevant, with suggestions on how to counteract negative effects (if any) on organisational behaviours outlined by the law.

The main actions will also be summarised in a cheat-sheet that will be made available as soon as the publication of articles is concluded.

Conclusion

Laws applied in Organization Design represent generalisations of impacts or behaviours that are useful in the assessment of an OD project, or to track the reasons for specific organisational behaviours. Rather then considering them having universal validity, these laws are good to challenge biases or assumptions or to anticipate patterns of behaviours that are common in many organisational settings. They can also be useful in terms of communication towards stakeholders, being sure we constantly keep in sight the fact that all these laws are subject to human behaviours, thus are ultimately very sensitive to all aspects of human interaction, including culture.

On a final note: keeping things in perspective

All in all, I believe we need to ensure we are keeping things in perspective when interpreting and applying these laws (as well as other social science principles).

Two “laws” come to help here. The first is Sturgeon’s Law, which is a general reminder (also top of mind for me in my ramblings) that a lot of what we read is in reality crap.