Earlier this year, a comment on a Reddit thread discussing mass layoffs at a major Canadian bank caught my attention:
“When I first started, there was a lot of collaboration and informal networks. You got things done by helping folks out, who would then help you out when you needed it… Porter gets in there and calls in the McKinsey consultants, who tell him that the bank needs to kill this collaborative vibe, in favour of internal competition and a more commercial approach.” — @ArmedResponse - Reddit(opens in a new tab)
The comment resonated with me because I see this pattern played out at large companies as Agile continues its slow death and transformation into a process-heavy, efficiency-driven project management way of working.
In this death spiral, ways of working that don’t fit into a corporate playbook are rejected and replaced with corporate agile operating models focused on explicit roles, team structures, processes, and metrics. Consultants sell the models, executives buy them, and Agile Coaches implement them. Meanwhile, the teams have no power. The goal underlying these models is to remove variability and uncertainty from the system.
If you’re efficient, you’re doing it wrong.
The core assumption underlying these models is that more structured, ordered systems are more effective.
But processes designed to make an organization more “efficient” with more explicit, defined procedures actually make it slower, rigid, and fragile.
Informal Structures and Adaptive Capacity
OpenSpace Beta describes three distinct, co-existing structures inside every company:
- Formal Structure: Positional power, hierarchy, formal authority, organizational structure, and control through compliance.
- Informal Structure: The domain of human relationships, social influence, and trust.
- Value Creation Structure: Where value creation happens. Reputation and mastery.
For an organization to satisfy its customers and survive changes in its environment, it’s not enough to rely only on the formal structure. Meaningful outcomes require the collaboration and coordination that come from the informal and value-creation structures.
These structures give a system its adaptive capacity, its potential and readiness to change in the face of new situations and surprises. Explicitly designed processes squeeze out informal collaboration and eliminate the value-creation networks, restricting people’s use of adaptive capacity. Instead, that capacity is spent on the cognitive load of rule following and navigating the formal structure.
It is an organization’s people and their ability to self-organize, collaborate and adapt across the lines of the org chart that keep the system running. This unstructured, human “gap-bridging” is what makes organizations resilient. Through the lens of an explicitly designed model, these organic and emergent networks are seen as deviations from the normal, desired, structured ways of working.
Trust and Shared Experience Come First
Organizations that rely on consultants who eliminate informal networks end up with systems based only on what people can see and measure. They overlook the intangible factors that drive real team effectiveness, such as self-organization, initiative, relationships, and trust. These qualities cannot be designed, controlled, or measured, but they enable teams to be more adaptable than formal processes can.
Instead of relying on heavy documentation and formal meetings, individuals in high-trust teams can anticipate what’s needed in a given situation and how people will act. They develop a shared way of looking at problems that lets individuals act on their own judgment while still pulling in the same direction.
No formal structure or framework can mandate this way of working. It grows organically and slowly over time as teams work together and face challenges together. This dynamic coordination is what gives teams the speed and flexibility to handle complex environments—capabilities that explicitly designed processes cannot fully prescribe or anticipate.
A Better Way to Manage: Cultivation Over Control
Standardized agile operating models don’t make teams more productive. Instead, they limit their ability to coordinate and adapt. Management’s goals should shift from installing systems to enabling the organizational factors that support informal structures and practices.
The goal is to create the right environment where desirable, value-creating behaviours can emerge. These capabilities include:
- Responsible-Autonomy: Instead of imposing standardized workflows and templates, let teams design and adapt their own ways of working within their area of control.
- Shared Context: Instead of relying on written rules and formal roles, build trust and shared purpose by working together and tackling real challenges.
- Psychological Safety: Teams need the safety to run experiments, learn from what doesn’t work, and pivot. Environments where the boss or the formal process prevents experimentation limit learning.
Don’t fix behaviours by designing more processes or implementing a new framework. Create an environment where teams have the freedom to get messy, do things differently, collaborate, and connect. Create an environment in which the organization’s social texture supports the work.
