TL;DR Organisations’ Culture Part 1: Tight vs. Loose and what does it mean?

TL;DR

Tight companies. A few most important characteristics.

  • Excellent at planning even a year ahead, and better at risk management, although it comes with a cost of flexibility and speed.
  • Extensive rules and processes where even creativity and innovation requires planning and behaviours are more predictable.
  • Predictable and risk-averse.

Loose culture and the main differences.

  • Poor planning may come with a cost to the motivation teams and predictability in execution.
  • Inclusive environment, high in openness without well-defined roles.
  • Risk management usually is reactive rather than proactive.

You can probably figure out where your organisation sits at this stage, but do you know why? So let’s dig a little more into these two types, and I will bring some examples to help you understand how these apply in the real world. The second part of this post will cover a concept of tight looseness and my experience with this approach, which adds some shades of grey to this black & white comparison.

What is a tightly structured company?

High-street banks are another example. These are highly regulated environments, and one of the main priorities is to maintain the risk. That translates to a high number of processes, red tape and a very extensive organisational structure. They want people to behave predictably. Unfortunately, it often comes with too many mid-level managers who want to be involved to feel essential yet don’t want to make any decision to avoid responsibility.

Any organisation where mitigating the risk is critical will be tightly structured — air traffic, oil & gas, health organisations like hospitals. They all end up with many processes and procedures to follow, and very often, there is not much freedom or creativity. Don’t see this as something negative. You would want to fly on your holiday with a crew that follows the most restrictive safety procedures rather than the one that might take too much risk and put your life in danger.

By the way, flying is the safest way of travelling. Unfortunately, the aviation industry’s success has been built over decades of accidents and the death of many people — I guess that’s another idea for a post about feedback loops and learning from mistakes.

Deep structure, defined roles and politics…

Planning, risk management and lack of flexibility…

This is often why tight organisations have such a problem with flexibility. Management tends to stick with the plan, and it’s hard to make a more significant change without involving dozens of people, often including some CxO to make the call. Furthermore, it can lead to a sunken cost fallacy with overspending on massive projects as they are blind to their failures. The pinnacle of such situations is a meeting where employees raise their concerns, and all they hear back is, “This project is too big to fail”. Well, it already failed…

Where creativity and innovation need to be a process…

Group thinking is more valued, and there is less space for individuality and direct contribution. You are likely to be a cog in a big machine. Organisations can avoid harmful side effects by implementing more rules to help with creativity, innovation, and flexibility, usually at a higher cost. You can often see big tight organisations spinning up small startups next to them — that’s an excellent way to bypass the self-imposed and restrictive rules.

Slow but predictable…

So how about loose organisations?
Are they any better?

How loose culture looks like?

It is where most startups begin their journey. Primarily due to necessity as people often need to be able to do more than one job. A small team doesn’t require overgrown processes and rules as communication flows easily. The majority of companies become more controlled and with more restrictions later in their life, and rarely do they consciously choose to stay loose. Netflix is an excellent example of the former. They continue growing flexibly, giving people autonomy and believing they will always Do The Right Thing. This very loose approach requires a lot of guts and trust in the team from the leadership.

Innovative, brave and unpredictable…

One thing worth remembering, where there are no rules, we will find a black sheep that will try to abuse the system. However, how the person has been dealt with will predict the success of loose culture and the freedom everyone enjoys.

Bad planning meets flexibility and experimental approach…

“Plans are useless, but planning is everything” — Eisenhower

This flexibility in commitments, in some instances, result in faster delivery and execution. Teams are truly agile and can focus where the leadership needs them without impacting the rest of the organisation. No processes to update, no approvals required, just get stuff done. But, unfortunately, disaster management is often reactive than proactive. Nobody pays attention until things go wrong, and that’s why loose culture rarely is used in places where risk management is a priority.

Inclusive and not that well defined…

Loose roles often can introduce a lack of accountability and ownership, where both managers and employees tend to avoid taking responsibility for unexpectedly emerging problems. It will be hard for the leadership to manage it, and that’s where new rules and processes appear — the company slowly evolve into a tight-looseness culture. In general, it’s easier to become just a more tight company and find the sweet spot than introduce looseness in a very tight and controlled organisation.

Where does it leave us?

Now… There is something called tight looseness, and I will cover it more in the next part of this post. Stay tuned

I am a London-based software engineering consultant and change-maker who helps companies solve genuine challenges and remove limitations. From guiding how a healthy organisation looks like, including the best structure, attitude and culture, to find the right balance between creative freedom, processes and true passion amongst teams. The #oneteam culture is at the core of everything I do and everything an organisation should strive for to succeed.

I help individuals to become better leaders and professionals. I’m coaching and mentoring software engineers and teams to help them reach their goals and prepare for the future unknown. I went through this journey myself, and I understand how hard it is to let go of who we are to become who we want to be.

https://www.andrewwinnicki.com/

Highly accomplished and results-oriented professional with background in leadership, software engineering, automotive, photography and design.