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A Great Organization
Mar 20, 2006, 8:16a

Lately, I've been spending some time thinking about what it takes to make a great organization. By "organization", I mean a group of individuals who come together to achieve a shared goal; I'm not trying to figure out the best way to organize my CD collection :).

If you want to create long-lasting change in the world, I believe that building a great organization which shares your goals is absolutely critical to success. And building a bad organization just isn't worth the time. Ultimately, no matter how productive or brilliant we may all be as individuals, our power to effect change grows exponentially when we unify our goals and coordinate our actions. Why lift a car by yourself when you can get 10 people to help?

So here's what I've come up with so far; it's by no means meant to be definitive - I've been thinking about this a lot and just wanted to get something out there.

Qualities of a Great Organization:
1) Individualistic: a great organization's top priority is to take care of its individuals. Specifically:
a) Individuals are continuously trained and continuously learn
b) Individuals find their work rich in meaning, purpose, knowledge, challenge, principles and values
c) Individuals have high psychological ownership of their work
d) Individuals feel appreciated

2) Effective: a great organization accomplishes its goals

3) Competitive: a great organization responds well to competition

4) Innovative: a great organization improves the world in creative ways

5) Growable: a great organization is able to grow to accomplish its goals, funded by a lucrative business model

6) Unifying: a great organization collaborates well with others and brings together organizations and individuals with shared goals

7) Scalable: a great organization can scale to include billions of people

8) Resilient: a great organization survives and learns from significant setbacks

9) Permenant: a great organization spans generations

These dimensions can be used to rate the types of organizations (corporation, government, non-profit, etc.) that exist today as well as specific organizations within each category. I may take up this task in a future post. Most importantly, though, I think these characteristics are critical when deciding which organization to join in a specific area, or deciding to build a new one because the existing organizations don't satisfy the criteria above.

Thoughts, comments, ideas?

Read comments (3) - Comment

Alvaro - Apr 15, 2006, 2:44p
I think you undermine your proposed benchmarks by saying specifically, "funded by a lucrative business model." It seems like you're referring to a commercially driven organization, but then at the end of your post you say "corporation, government, non-profit, etc" and I don't believe that non-profits should be judged by how "lucrative" they are per se.

This comment is really just a technicality, nothing serious. Otherwise, the rest of the benchmarks sound really interesting, if obvious (and even foo-foo).

I'm curious to know if you had a specific organization in mind when you created this list.

Nikhil - Apr 18, 2006, 9:33a
Hey Alvaro,

Hope you're doing well. What are you up to these days? Still working in DC?

Thanks for leaving a comment on my blog.

I've been thinking about how to build a great organization a) as I've watched Google increase 10x in size and b) because I have ambitions to start and build an organization in the future.

I agree that the point about having a lucrative business model may be contentious. However, I've observed much greater success in organizations that have a healthy business model than those that don't. Google is a prime example of this - it's able to fund a bunch of great products that wouldn't be able to pay for themselves on their own (e.g. Maps). The US government is perhaps the king here - it has the most ingenious, lucrative business model: take a cut of every transaction. The budget for this coming year is $2.7T, based on, i think, ~$2.1T in revenue. This enormous revenue source is critical for it to fund whatever it wants, be it multiple wars, international aid, universal health care, or whatever.

In contrast, I've observed that non-profits are generally no where nearly as effective at achieving their goals as organizations with lucrative business models. Of course, they frequently take on more difficult goals, but I don't think that's the critical difference.

However, I also believe that corporations, while they do a lot of good, also do a lot of bad because they are focused on generating profits.

I'm hopeful that there will develop a next generation of organizations that is neither "for-profit" or "not-for-profit" or "government", but actually just "for-good". I'm not sure how exactly such an organization sustain itself and what the mechanics would be, but I'm hopeful that a) someone has already developed such a notion, or b) I can work to develop and implement such an organization.


Charles - Nov 4, 2006, 2:08a
you must also study the dysfunctions of organization. Max Weber is the great pioneer of this study, and many others have continued his work.

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