,CHAPTER 1
Organizational Structure
Knowledge Bases
In understanding your organization’s main thing (i.e., what your organization does? Why do you
exist?), the employees are the best source of information. The Diamond Principle is at least
partially based on the concept that employees’ knowledge of the organization should grow with
experience in the company. This is a very simple premise, but it forms the basis of the entire
Diamond Principle of organizational structure and people.
The other part of the principle is that the management knowledge chart is reversed, since the
lower-level managers are often the people who worked up through the ranks, and the higher-level
ones are often brought in from outside. As Scott Adams described what I am characterizing as the
top half of the diamond,
As you work your way up the chain of management, you tend to know less and less about the
specifics of a wider and wider scope of activities in the company until eventually you know
absolutely nothing about everything. Then you become chairman, which, as the name implies,
involves sitting in a chair.1
I might not go that far, since I would hope that the chairmen of most companies know, at the
very least, what their respective companies produce, but I would certainly not ask a company’s
chairman about the nuts and bolts of production.
, This forms the diamond structure when presented in a slightly different format.
So the Diamond Principle of organizations can be defined thusly: “Detailed knowledge of an
organization’s operations tends to concentrate in the long-term employees and lowest management
level, shrinking as one moves up or down the organizational ladder.” Remember, though, that the
, employee half of the diamond is based on time within the organization, while the management part
is based on position in the organization’s hierarchy.
Diamonds
What is a diamond? A diamond is basically a lump of coal that has been under pressure over time.
We won’t take the analogy quite that far, but a diamond has an inherently stable crystalline
structure, making an incredibly hard substance. Anyone who has tried to penetrate the corporate
or agency structure to make changes knows that those, too, are often very stable structures that are
incredibly hard. They are also incredibly consistent, consistent to the point of being monolithic.
Flexibility to some degree is vital to any growing, living thing, whether it be a creature or an
organization, or—as Aldus Huxley said—“The only completely consistent people are dead.” So
we have to find a way to get inside that corporate diamond, a way to crack open the processes and
procedures that hold us back from achieving our potential, both as people and as organizations.
Organizations tend to be diamond-shaped when it comes to knowledge and experience of
employees. At the bottom point you have the newest employees, with no experience and no
knowledge of the organization. As the employees stay with the organization, they grow in
knowledge and experience until they hit the staff level just below management. Then they hit the
broadest part of the diamond. Most of them stay there, or leave the organization to start at the
bottom point of another organization. Most of the people very far above that middle band of
knowledge are often appointed, or hired because of politics, connections, and so on, and are not at
that level because of internal promotion.
Have you ever heard the old saying, “It’s not what you know, it’s who you know”? While far
from a hard-and-fast rule, it does carry at least a few grains of truth, especially in positions high
enough to require an appointment. Above a certain level, and many organizations routinely look
without for staff, not within, thus doing their part to form the diamond.
That leaves the knowledge level declining as one moves up the organization’s ladder. When the
CEO/board/agency head level is reached, regardless of the quality of the person, the knowledge
and experience in the organization approaches zero. This means that, contrary to popular wisdom,
you do not achieve the best results by taking an issue to the highest level possible. You take it to
the lowest management level or highest nonmanagement level possible in order to have it resolved
by the most knowledgeable and/or experienced people.
Organizational Structure
Knowledge Bases
In understanding your organization’s main thing (i.e., what your organization does? Why do you
exist?), the employees are the best source of information. The Diamond Principle is at least
partially based on the concept that employees’ knowledge of the organization should grow with
experience in the company. This is a very simple premise, but it forms the basis of the entire
Diamond Principle of organizational structure and people.
The other part of the principle is that the management knowledge chart is reversed, since the
lower-level managers are often the people who worked up through the ranks, and the higher-level
ones are often brought in from outside. As Scott Adams described what I am characterizing as the
top half of the diamond,
As you work your way up the chain of management, you tend to know less and less about the
specifics of a wider and wider scope of activities in the company until eventually you know
absolutely nothing about everything. Then you become chairman, which, as the name implies,
involves sitting in a chair.1
I might not go that far, since I would hope that the chairmen of most companies know, at the
very least, what their respective companies produce, but I would certainly not ask a company’s
chairman about the nuts and bolts of production.
, This forms the diamond structure when presented in a slightly different format.
So the Diamond Principle of organizations can be defined thusly: “Detailed knowledge of an
organization’s operations tends to concentrate in the long-term employees and lowest management
level, shrinking as one moves up or down the organizational ladder.” Remember, though, that the
, employee half of the diamond is based on time within the organization, while the management part
is based on position in the organization’s hierarchy.
Diamonds
What is a diamond? A diamond is basically a lump of coal that has been under pressure over time.
We won’t take the analogy quite that far, but a diamond has an inherently stable crystalline
structure, making an incredibly hard substance. Anyone who has tried to penetrate the corporate
or agency structure to make changes knows that those, too, are often very stable structures that are
incredibly hard. They are also incredibly consistent, consistent to the point of being monolithic.
Flexibility to some degree is vital to any growing, living thing, whether it be a creature or an
organization, or—as Aldus Huxley said—“The only completely consistent people are dead.” So
we have to find a way to get inside that corporate diamond, a way to crack open the processes and
procedures that hold us back from achieving our potential, both as people and as organizations.
Organizations tend to be diamond-shaped when it comes to knowledge and experience of
employees. At the bottom point you have the newest employees, with no experience and no
knowledge of the organization. As the employees stay with the organization, they grow in
knowledge and experience until they hit the staff level just below management. Then they hit the
broadest part of the diamond. Most of them stay there, or leave the organization to start at the
bottom point of another organization. Most of the people very far above that middle band of
knowledge are often appointed, or hired because of politics, connections, and so on, and are not at
that level because of internal promotion.
Have you ever heard the old saying, “It’s not what you know, it’s who you know”? While far
from a hard-and-fast rule, it does carry at least a few grains of truth, especially in positions high
enough to require an appointment. Above a certain level, and many organizations routinely look
without for staff, not within, thus doing their part to form the diamond.
That leaves the knowledge level declining as one moves up the organization’s ladder. When the
CEO/board/agency head level is reached, regardless of the quality of the person, the knowledge
and experience in the organization approaches zero. This means that, contrary to popular wisdom,
you do not achieve the best results by taking an issue to the highest level possible. You take it to
the lowest management level or highest nonmanagement level possible in order to have it resolved
by the most knowledgeable and/or experienced people.
