The SPS organizational structure has sought to learn from the international experience of corporate management since the 1980s. For 60 years after Alfred Sloan implemented the bureaucratic structure at General Motors in the 1920s, large companies were engaged in perfecting bureaucracy. In the last 20 years, many of the most dynamic among these, have been busy devising innovative forms of going beyond it. The search for an alternative to bureaucracy is, of course, as old as the concept itself. However, until the 1980s this remained the preserve of marginal, radical dreamers or impractical romantics, working on a small-scale. The first mainstream challenge to bureaucracy can be traced to Burns and Stalker’s 1961 path-breaking work The Management of Innovation, which described an “organic” form of organization: more team-based, more flexible and less mechanically rule-bound than traditional bureaucratic hierarchy. Companies, and this includes some of the largest, most successful ones, have come a long way since then. As Michael Rothschild (1998) says, starting in the late 1980s, “well-managed large firms began flattening and decentralizing their traditional vertical hierarchies”. At SPS, we have learnt from this extremely rich and exciting experience. We summarize below some of the key features of the SPS structure and refer to some of the world’s biggest companies that have inspired us to move in the direction we have.

In organizational design, we take inspiration from the words of Dee Hock, Founder and CEO Emeritus, Visa International, one of the world’s largest commercial enterprises, which he describes as a “complex, self-organizing, non-linear, self-governing, adaptive system” (Durrance, 1997). We may not have reached there yet, we probably never will, but this best expresses our aspiration.

At SPS, we believe that the inherent and fundamental limitation of bureaucracy derives from its foundation in the specification of offices: people are responsible only for their own jobs.

We have, on the other hand, sought to move towards an organization whose master concept is that, “everyone contributes their best for the success of the whole”. This is a deeply interactive, consultative organization where consensus is created not merely through acquiescence to authority or rules (as in a bureaucracy) but through institutionalized dialogue (Habermas, 1991).
Dialogue is defined by the use of influence rather than the exercise of power. The ability to persuade matters more than the position of power (Parsons, 1969).

The ability to persuade depends on a number of factors — knowledge of the issue, commitment to shared goals and proven past effectiveness. Not official position per se. We are inspired here by examples of highly creative corporate giants like 3M, where new recruits are taught to challenge supervisors and are told to learn from tales of innovations that happened in the process (Tetenbaum, 1998). This is not, thereby, an egalitarian system. There is a hierarchy but not one embedded in permanent offices. It is, rather, based on the consent and perceptions of other members of the organization.

Employees at the junior-most (1-3) levels have direct, unmediated access to those at the senior-most levels (5-6).
We follow the new management ideal that sees the maintenance of “tension within healthy bounds” as the key to any creative and dynamic system (Tetenbaum, 1998).  Greater emphasis is placed on principles rather than rules, which are the hallmark of a bureaucracy. This encourages flexibility and creativity in response to challenges.

This does not mean absence of rules but can still create the danger of intentional or unintentional abuse of flexibility. This demands periodic and rigorous reviews and discussions of the principles to be certain that they accurately capture what is needed and have indeed been truly understood and internalized at all levels.

• This can be seen a very specific raison d’etre for the Core Team level, whose primary responsibility it is to initiate reviews and ensure continual dialogue across the organization.
• The regular interface of people across teams also acts as a corrective to possible abuse of flexibility.
• The fluidity of such an organizational structure also demands that decision-making processes must be frequently reconstructed — they cannot simply be “read” from an organogram. The answer to the question “who to go to?” is decided more by the nature of the problem, less by positions of power. Deciding how to decide or what may be termed “meta-decision-making mechanisms”, are evolved through cross-divisional and cross-level committees (inspired by the example of a Shell-Sarnia plant in Canada).
• The functioning of an organization like SPS is summed up in one much-abused word: process. Carefully defined and understood, this has stood the test of time for us, as for so many corporate giants across the world. Our process has 3 essential elements:
  • Bringing together stakeholders
  • Creating a dialogue
  • Achieving consensus on a path forward
• Each of these is an extremely challenging task but this is what characterizes all of SPS work, internal, as well as external, such as the one followed in our watershed (water use agreements) or SHG work (forming federations), or in the networking with our NGO partners (SVO)
• An effective process ensures the ability to make binding decisions without authority being vested in permanent offices. Rather than evoking the authority of a fixed office or position, it brings together those with knowledge and interest (stake) in a problem, to work out an agreement on the way forward. The ultimate decision is one that has high legitimacy and is characterized by great trust and understanding among those involved. The method may involve a committee or a sequence of steps etc. But what we achieve finally are decisions more effectively binding and more deeply internalized than those of a bureaucracy.
• Having practiced this for years, we are fully aware of the difficulties of implementing such a process. It takes a huge initial investment of time and energy. What we have also arrived at is a practical compromise: not every decision needs to go through the entire protocol. In general, it is the most difficult ones (where, for example, there are conflicts to be resolved or disciplinary action to be taken) that mandatorily require going through the full process. What is necessary though is that every decision be made according to the principles that have been developed through such a process. Stakeholders must be able to understand the values being evoked in each case of their immediate concern. Ensuring this is again a key core team role.
• It is also clear that not all people are suited to this kind of challenging work environment. Such employees generally tend to leave fairly rapidly as they desire a context where they can simply follow rules. On the other hand, SPS is an extremely attractive destination for young people seeking a challenging physical and socio-economic environment, as also an organizational structure that demands and enables great initiative from them.