Company Structure & Culture

Formal Structure:

The particular structure adopted is designed for use by private companies limited by guarantee, which have more members than they have directors. Although it assumes that the directors (and, in time, employees) will take most day to day decisions about the company’s business, it also gives the members a strong role in controlling the overall governance of the company.

Essentially, it solidifies the concept of democracy into the organisation's management and structure. It keeps the organisation open and enhances the opportunity for community involvement. It also allows the flexibility to enable the organisation to grow with both it's users and the wider community.

The guarantee means that every Member of the Company undertakes to contribute a sum not exceeding £1 to the assets of the Company if it is wound up. This will provide for payment of the debts and liabilities of the Company and for the costs, charges and expenses of winding up.

As noted above, the directors are responsible for managing the company's business. Any decision which the Directors take (as a group) must be either a unanimous or a majority decision. A simple majority will be sufficient to make most decisions, and in the event of an equality of votes the Chair will have a second or deciding vote.

However, the Members may, by special resolution, alter the scope of the Directors’ functions or require the Directors to act in a specified manner. In addition, all directors will stand down at the first AGM and elections will take place among members. Members also have the power to appoint directors by ordinary resolution. This power ensures that the organisation will continue to operate in the manner and direction favoured by its members.

The asset lock provisions inherent in the CIC model give confidence to those wishing to fund the company that the assets and profits will be devoted to the benefit of the community. While the CIC annual report ensures transparency and that those affected by and benefiting from the CIC’s activities are properly recognised as stakeholders.

The community interest statement shows how activities will be for the benefit of the community and how this will be achieved. The community interest test, " whether a reasonable person might consider the CIC’s activities are carried on for the benefit of the community" has to be passed and is overseen by the CIC Regulator to ensure continued adherence to approved objectives.

Structure Diagram: see Business Plan: Structure Diagram.

Diagram Notes:

At first glance the diagram implies a top-down approach, with power cascading down from above. However, this is stylistic only. As can be seen, Members occupy the place at the head of the hierarchy. Since the membership is the grassroot support, bottom-up is perhaps a better description of the power structure.

Informal Structure:

In his book The Hidden Connections Fritjof Capra (2002) shows how life is interlinked by complex networks. The definition of a living system as a network means that the phenomenon of life has to be understood as a property of the system as a whole; life cannot be ascribed to any particular component, but only to the entire bounded network.

This fundamental understanding of living systems becomes particularly interesting when we consider the dominant metaphors prevalent within management theory. Essentially, the medium of organisation and management is metaphor. Management theory and practice is shaped by a metaphorical process that influences virtually everything we do. The main contrast is between viewing organisations as machines or as living systems.

The machine metaphor has been an integral part of a mechanistic paradigm that was formulated by Descartes and Newton and has dominated our culture for several hundred years. The first mechanistic theories of management were the classical theories of the early twentieth century, in which organisations were designed as assemblages of precisely interlocking parts, linked together through clearly defined lines of command and communication. This view of management as engineering was perfected by Frederick Taylor (1911) in his Principles of Scientific Management.

The principles of classical management theory have become so ingrained that for most managers the design of formal structures, linked by clear lines of communication, co-ordination and control, has become almost second nature. To appreciate the profound impact of the machine metaphor it is useful to contrast it with the metaphor of organisations of living systems.

To run properly, a machine must be controlled by its operators, so that it will function according to their instructions. Accordingly, the whole thrust of classical management theory is to achieve efficient operations through top down control.

Living beings, on the other hand, act autonomously. They can never be controlled like machines. To try to do so would be to deprive them of their aliveness. A machine can be controlled through instruction; a living system can only be disturbed, be influenced.

So, with the above in mind, the organisation will tend to view things systemically, through the lens of the 'living system' metaphor. This will also provide the basis for the management style.

McGregor (1987) developed what has become a classical management model when he argued that the style of management is a function of the managers’ attitude towards people and assumptions about human nature and behaviour.

Theory X assumes that people are generally lazy and have to be coerced, controlled, directed and threatened with punishment. A perspective largely shared by the ‘machines for making money’ metaphor.

Theory Y assumes that work is as natural as play and rest and that given the right conditions people will exercise self-control and self-direction. Theory Y is largely representative of the ‘living being’ metaphor. Influence and disturbance, not control, are seen as the key ways to motivate behaviour.

The organisation will tend towards the Theory Y view, with recognition that any model is likely to be restrictive and, being largely contextual, situations should be approached with an open mind.

People should be empowered by organisational forms, not restricted. This will require the organisation to be flexible and responsive to the needs of all of its stakeholders and will result in organic growth that is in tune with the needs of users. This will be achieved through a regular, transparent two-way process that gives people definite channels of influence and information.

The long-term organisational aim is participatory self-management. Participatory in that every actor is treated the same and welcomed into decision making by the norm. Self managing in that every actor has control over what impacts them in the same amount and manner as every other actor.

This approach utilises and calls forth full self-development from all actors, where each will be fully involved participants, not only in rote and tedious labour, but in decision-making processes. This will help move staff and users away from seeing themselves as passive victims of social processes, towards seeing themselves as active agents of change. This kind of self-development is an essential part of the organisational ethos.

Culture:

Organisational culture is the pattern of basic assumptions that a given group has invented, discovered, or developed in learning to cope with its problems of external adaptation and internal integration, and that have worked well enough to be considered valid, and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems.

Culture arises from a complex, highly non-linear dynamic. It is created by a social network involving multiple feedback loops through which values, beliefs and rules of conduct are continually communicated, modified and sustained. This system of shared values and beliefs create an identity, based on a sense of belonging. People’s behaviour is informed and restricted by their cultural identity, which in turn reinforces a sense of belonging.

In this paradigm, culture determines what a group monitors in the external environment and how it responds to this environment. In this vein, Culture is a strategic phenomenon: strategy is a cultural phenomenon. The two are inextricably linked and interdependent.

Schein’s (1985) model views culture as having distinct, interacting levels and represents one of the dominant cultural metaphors. The Onion has a number of skins from the visible surface outer layer of artefacts and products to deeper layers of norms, values, attitudes and hidden assumptions.

Another ‘classic’ metaphor has been used to explain culture: the iceberg, with an (overt) visible top that represents the facts: the technology, the price, the written contract of a negotiation, and a (covert) invisible bottom of emotions: the human relation, the unspoken and unconscious rules of behaviour.

The overt culture refers to the rational, formal influences and indicators - observable symbols, ceremonies, stories, slogans, behaviours and physical settings. The covert deals with all those soft, irrational areas - relationships, feelings, assumptions, beliefs and underlying values.

Both of the dominant metaphors within organisational culture point towards the same things. The unconscious, covert, taken-for-granted assumptions at the heart of the organisation’s culture are the “timeless guiding principles for behaviour, decisions and actions” (Thornbury, 2000, p23).

You cannot create a new culture. You can’t even change a culture; you can only set the stage for the culture to evolve.

So, what does this mean for our organisation?

It means we accept that organisational culture is a vital determinant of success. It means we recognise the varied and constantly evolving nature of culture. It also means we understand that prescriptive, top-down, approaches to setting the culture are likely to be superficial at best and unsuccessful the rest of the time.

So, how have we set the stage for our culture to evolve?

Well, as shown above, there are certain things we can consciously influence - through transparency and openness we can encourage a similar culture within the organisation.

Values show culture at its most superficial level. They will be written down in the Mission Statement. Goals, structure, standards and procedures, services and management style are all overt indicators of preferred culture and will provide direction, especially in the early stages.

Beliefs will be more specific and will be communicated openly throughout the organisation. Beliefs will become visible through communication and through the way that staff and users are treated.

Taken-for-granted assumptions are the real core of an organisation’s culture, they are the aspects of organisational life that are difficult to identify. It is these underlying assumptions that determine ‘the way we do things around here’. These will obviously be the most difficult things to proactively control since they are 'soft' and depend on more than rational, detached, analysis.

Understanding that values, attitudes and beliefs, leadership style and behaviour, power-politics and conflict resolution, informal groupings and feelings, perceptions and assumptions all impact on the mental models that people build, which in turn provide the basis for their behaviour, should help the culture to evolve in ways that match with - and reinforce - company values.

The organisation has sought to be as open as possible from the beginning.

Initial ideas were openly discussed and presented to the Town Council (as representatives of the residents of the town). These ideas were then refined by Tom Barker, before presenting them to the community in an open "Making it Happen" meeting. People have been actively encouraged to get involved and the Steering Group is a representation of this.

The intended positioning of the organisation has been clear from the beginning:

"As a non-profit, community-centric, organisation. Ethical, ecological, and community-owned, our raison d'etre is to improve the ICT facilities available to our community."

The creation of the company has also been thoroughly thought through to ensure the company is as open and inclusive as possible. Essentially, it solidifies the concept of democracy into the organisation's management and structure. It keeps the organisation open and enhances the opportunity for community involvement. It also allows the flexibility to enable the organisation to grow with the users and wider community expectations.

- TB 4/11/05