The six fundamental problems of organizing [Martela]

Photo by Josh Calabrese on Unsplash

This paper has been open in a tab for a few weeks now so I can’t recall how I stumbled upon it:

What makes self-managing organizations novel? Comparing how Weberian bureaucracy, Mintzberg’s adhocracy, and self-organizing solve six fundamental problems of organizing

To answer this question, the author, Frank Martela, has been building on work by Puranam et el. First, he adopted their definition of an organization:

(1) a multiagent system with (2) identifiable boundaries and (3) system-level goals (purpose) toward which (4) the constituent agent’s efforts are expected to make a contribution.


Then, he expanded their taxonomy of four universal problems that any form of organization, by definition, must solve, into six. These fundamental problems of organizing are something that I’ve grappled with lately, and I like what Martela has to offer (mapping to the Corporate Rebels taxonomy in parentheses):

  1. Division of labor: task division (CR: Org structure)
  2. Division of labor: task allocation (CR: Task allocation)
  3. Provision of reward: rewarding desired behavior (CR: Motivation)
  4. Provision of reward: eliminating freeriding (CR: Motivation)
  5. Provision of information: direction setting (CR: Strategy)
  6. Provision of information: coordination of interdependent tasks (CR: Coordination)

The two “division of labor” problems are identical to the Corporate Rebels taxonomy.

Compensation receives its appropriate place as a standalone fundamental problem, broken down to rewarding the desired behaviors and eliminating the undesired behaviors (freeriding). My one tweak, in light of my recent explorations, would be to use slightly less behaviorist label such as “provision of value” or perhaps “motivation”.

While at first, it seemed strange to group strategy and coordination together as one seems more strategic (pun intended) than the other, it actually makes sense, since they both have to do with creating shared context: knowing how to orient my work by understanding where are we trying to go together and what everyone else is doing to get us there.

And, if you were curious about how bureaucracy, adhocracy and self-managing organizations differ in their approaches to solving the six fundamental problems of organizing, here’s the answer:

Source: Martela (2019)
The six fundamental problems of organizing [Martela]

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