7 Most Common Organisational Shortcomings (and How To Overcome Them)

Why do organisations stagnate despite having tech and talent?

Systemic hurdles are the primary cause of organisational stagnation. Even with best in class technology and talent, companies fail when they do not address underlying issues like decision latency, silos of knowledge, and misaligned governance.

"A bad system will beat a good person every time." - W. Edwards Deming

Good thing is, poor system design shows clear symptoms. Initiatives almost always exceed their budget, timeline, and scope, despite the generous paddings.

So, what's causing these issues? Let's delve into 7 most common reasons that will make you nod your head.

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1. Seeking Certainty in Fast-Moving Markets

We live in a volatile, uncertain, complex, and ambiguous (VUCA) world. But our brains are certainty-seeking machines. Therefore, while the tendency to plan and estimate huge pieces of work upfront is mentally comforting, it doesn't increase accuracy. In fact, it increases cost by introducing large amounts of rework, usually in later stages of projects. Teams start drowning under untested assumptions and changing priorities, making plans a heavy burden. The current becomes stronger than how fast teams swim so to speak.

So, while pixel-perfect roadmaps look pretty and comforting, they are often output-focussed, and become outdated before the execution starts. Instead of building value for customers, teams find themselves in arbitrary number games, imaginary critical path battles, and PowerPoint artwork to paint a picture of certainty that doesn't exist.

In complex environments, "The Plan" is just a wishlist at a point in time, aging like milk.

The sheer volume of moving parts, dependencies, shifting market trends, and changing technology landscape are existential threats for organisations with excessive lead times.

Continuous customer feedback paired with continuous delivery is the recipe for eliminating waste while delighting your customers. No one wants stale results.

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2. Silos of Knowledge

When information can't flow freely, it creates congestion.

Think of busy people. Their calendars are packed with meetings. They keep accumulating information in those meetings all day every day. They have answers, but no time to share them with others, making them bottlenecks.

It's also common to have departmental silos, not just individual. IT builds solutions without knowing what good looks like, resulting in underserved customers and wasted dollars.

Establish ground rules and guardrails that help centralise, retain, and enrich knowledge. If individuals can risk business continuity, that's more a ticking time bomb than a business.

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3. Context Switching

Multitasking is a lie we tell ourselves to feel productive while we’re actually just stalling the value stream. Our minds do not multi-task, they switch between tasks, which can cost as much as 40% of productive time. ¹

Context switching is a result of poor prioritisation, poor visibility of roadblocks and dependencies, and uneven workload across a value stream.

When teams start less, they finish more.

It may sound counterintuitive. But juggling less work means less meetings, sharper focus, more time on execution, and more results. Starting new work to avoid idle time is a natural tendency, it's a utilisation win, but a productivity loss. ‍

When "resource" utilisation is the main metric behind how people are assigned to work, flow efficiency goes out the window. Just like a congested highway, 100% utilised, but jammed. Check out Little's Law and Kingman's Formula for better understanding of why high utilisation hurts organisations.

Establishing value-driven prioritisation is the first step towards eliminating context-switching. It's crucial to define what "value" means first, as it can be financial, strategic, operational, or reputational or a mixture of all.

Once the funnel is more picky, less work gets through it, meaning less distraction, and faster delivery of what really matters.

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4. Misaligned Processes and Governance

Legacy processes designed for a 1990s waterfall world are still being applied to modern cloud-native teams. Software is no longer shipped on CDs via vessels; it is deployed across the globe within seconds with a single click. Therefore, "we have always done it this way" does not translate into stability; it translates into stagnation.

Software delivery has evolved, but corporate governance is still stuck in the age of the fax machine.

Continuous learning is not about adding more timeline padding because the previous projects are delayed; it is about understanding what is causing the delays and addressing those.

Value-stream mapping, business process modelling, and process mining allow organisations to see their system in action. Some organisations create their digital twins to simulate the impact of potential changes ahead of time, virtually. e.g. Many mass lay off decisions are made based on short-term cost reduction, crippling organisations in mid to long term. An operationally mature organisation would be able to gauge the impact.

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5. Decision Latency

This is the approval "ping-pong" the majority of organisations face. It is the frustration of a two-day task taking two months because it needs the "blessing" of six different stakeholders who are not even involved in the daily execution.

Bureaucracy prioritises checklists over guardrails, and detection over prevention.

Mapping and measuring business processes reveal where decision delays hurt most, helping organisations minimise their time-to-market.

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6. Metrics That Measure Nothing

Let's take "velocity" as it's one of the biggest buzzwords. Teams are being pressured to "go faster" (output) without anyone checking if they are actually moving the needle on business outcomes (impact). You can have the highest velocity in the world, but if you're driving in the wrong direction, you're just getting lost faster.

Anything can become a vanity metric if measured in isolation. e.g. tracking customer acquisition without having retention in the picture, checking lines of code written and number of deployments completed without understanding their collateral impact.

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7. The "Agile" Costume Party

Organisations that say they are "agile" but still demand fixed-scope, fixed-price, and fixed-date delivery. It’s waterfall with "Stand-ups" and "Sprints."

Agility isn't a set of ceremonies you perform; it’s a capability you build by modelling the right behaviours. It's the ability to pivot without losing an arm and a leg.

Pivoting efficiently and effectively is a competitive advantage that makes or breaks businesses. Doing that well, agility will pay off. Stuck in terminology with no substance, it'll punish.

Practitioners who are experienced in systems thinking, organisational design, and operational excellence help organisations create a shared purpose that drives agility and innovation.

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Need help with levelling up how your business discovers opportunities and delivers on them?

Get in touch for a free consultancy session that will give you applicable steps to make impact.

References

¹ American Psychological Association, March 20, 2006

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