Navigating the Informal Organization


February 14, 2007

by Marshall Goldsmith and Jon Katzenbach

The purpose of my column is to help you get from “here,” wherever you are in your journey through life and career, to “there” wherever you want to go. (And maybe help you think of a “there” that you had never before considered!) This week, I’m reaching out for help from a close personal friend and one of the greatest organizational thinkers that I have ever met, Jon Katzenbach. Jon is an author, the co-founder of Katzenbach Partners, and a former director at McKinsey. Not only has he had a remarkable journey through life, he has helped lots of other people – including me – along their paths.

I recently asked Jon how individuals, everyone from frontline workers to mid-managers to executives, can move forward in their careers by doing a better job of leveraging the “informal organization,” the networks of relationships and interactions that may not show up on the organizational chart, but may be the true drivers of what’s really happening. Here are edited excerpts of our chat:

We’re here to talk about how our readers can do a better job of navigating what you call the informal organization. What do you mean by that term? 

The formal organization is simply the org chart and its companion processes and programs. It starts with a hierarchical skeleton. In most companies, there’s a CEO sitting on top and horizontal compartments, often by geography, function, or lines of business. And then there are the lines of report connecting them, showing how formal responsibilities are distributed throughout the organization, along with formal processes to manage work and information flows and incentives. Clearly, these are essential elements of any well-functioning organization.

Then there’s the informal organization, which is almost never explicitly stated. It encompasses all the connections and relationships that aren’t on the org chart but relate to how people throughout the organization actually network to get the job done. The formal side of an organization establishes an overarching framework, but it’s the informal organization that fills in the gaps of what the formal isn’t doing. Unfortunately, most managers leave the informal organization to instinct or chance.

And that’s why it’s important for individuals, at any level of the company, to understand how they can use the informal organization to be successful? 

Exactly. Individuals need to understand their informal networking opportunities – and to learn how to navigate in those networks. Frontline and mid-level workers can learn to be more effective at working in and through the informal network, while upper-level managers can learn to be more effective at shaping, using, and integrating it with the formal organization.

By mobilizing the power of the informal organization, companies will benefit from faster decision-making and improved execution, as well as from having more highly motivated employees whose behaviors are better aligned with organizational goals and strategies. The end result is better performance.

What skills and behaviors would you say are most critical for learning how to do this in today’s complex organizations? 

For frontline employees, I would say it’s critical, particularly in your first few weeks and months, to keep your eyes and ears open so you can learn who the “go-to” people are. That is, when a manager makes an assignment, look at not only who gets the assignment but also look at who that person reaches out to for help in getting it done.

In many organizations, the “go-to” people are seldom defined by formal position or role. Nonetheless, they have become very critical “nodes” of the informal networks. They’re the ones that everyone else looks to when they’re under the gun to get something done. And you will find that they’re spread throughout almost every organization. If you’re an entry-level employee, try to find out who these nodes are and pay close attention to how they work, because your goal should be to access them effectively, and eventually become one.

What about mid-level and upper-level managers? Given their positions, shouldn’t they already be good at working the informal organization? 

They should be, but seldom are. As managers advance in the hierarchy, they may start to lean more on the formal organization. In short, they may overlook the importance of continuing to balance the formal with the informal, and this balance is the key to achieving peak performance. For mid-level managers, that may mean gaining a better understanding of some more nuanced aspects of using the informal organization, such as disciplined teaming and cross-structural collaborating within a highly matrixed organizational structure.

You need to learn to map your informal organization, as well as how to interpret that map and use the knowledge to motivate and integrate informal interactions and behaviors that matter to performance. This information is invaluable: Mobilizing the informal organization is an underutilized but powerful lever for driving performance.

Jon, thanks for sharing your thoughts. I think we can all see now how having a better understanding of the informal networks in your organization can improve your odds of getting to where you want to go. 

Thank you.