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Science, Technology
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Organisational Structure for the Millennium: The Cellular Concept

think-03-08-Organisational Structure for the Millenium-Featured Image

An Idea Out of Necessity
he cellular concept was conceived out of the urgent need for me as a project manager to form an efficient project team to supervise the construction of a smelting plant in Peru from 1994 to 1996. I had to form a team, consisting of professionals from various engineering disciplines, cultural backgrounds and differing language proficiency.


When a conventional hierarchical organisational chart (i.e., tree structure) was presented at a staff meeting, dissatisfaction, especially with the line of reporting, was expressed. A local engineer was unhappy that he would have to report to an Australian engineer of lower qualification and who could not communicate in Spanish. An Australian engineer who was a permanent staff from the headquarters was unhappy reporting to a local engineer who was a temporary employee.


As I listened to these complaints, an idea dawned on me. I drew a big circle on the board with small circles representing each member and conveyed that the organisation’s structure would take this form. I came to refer to this as the “cellular organisational structure”.


Surprisingly, the team members were receptive to this idea and proceeded to work together effectively. Language and cultural barriers were overcome as members willingly helped each other out. The team shared that the spirit of cooperation motivated them the most.


Traditional workplace organisation
The workplace is a collection of people, without natural relationships, working together for a common goal. Thus, an organisational structure is needed for forming relationships to know and perform desired duties. Designations are given to indicate levels of authority and responsibility (Figure 1).

Figure 1

A typical business organisation chart

Whilst this structure provides an orderly display of positions, it shows that some positions are lower in the employment ladder.


In industries where personnel are grouped under functional departments, the heads of the division command respect because they are normally well experienced in the required skills of the departments. However, as the complexity of business competition in a global information-driven economy increases, demand for multi-disciplines and skill specialisation becomes more commonplace. Organisations will increasingly require professionals of different disciplines to perform a task.


The traditional organisational structure is also increasingly exposing its inability to effectively cohere people. If an employee realises that there are no promotional opportunities in the future, dissatisfaction would certainly ensue.


This dissatisfaction can be averted when an organisation’s structure is less hierarchical and when prospective income increment and career recognition are not denied by virtue of personnel position.


What happens when someone who is better qualified or more experienced than their superior is employed? The person may initially be willing to fit themselves to the assigned level but would eventually realise that they can contribute better with more authority. Frustrations from the subordinate and fears from the superior arise if the organisation’s structure does not change to accommodate a particular employee and does not reward subordinates with better benefits than the superior.

Figure 2

Basic cellular structure

Therefore, it is not uncommon to find negative sentiments such as disharmony, jealousy and frequent staff turnover in an organisation with traditional hierarchical structure.

Figure 3

Simplified basic cellular structure

The Cellular Structure
Given the shortcomings of the traditional hierarchical structure, I would argue that the cellular structure is a viable alternative. A chairman (i.e., a leader) is needed for a meeting to run smoothly. In a cellular structure, all members are able to interact with one another in a regulated manner as shown by the 15 communication links amongst them (Figure 2). All participants, except the leader, are at the same level and can contribute ideas especially in their field of knowledge. The result is a regulated synergy of ideas and effective communication.


How would this look like as an organisational structure? Figure 3 illustrates the overall linkage between members and resembles the cellular structure for an organ where each cell has its own important function and is bound in a systematic way to serve
the main body.


The cell is the basic building block for the organisational structure and each cell is given a name.


Notice that a draftsperson is now a member of the Engineering cell. This gives them a dignified place in the chart and the right to speak out on matters, especially those related to drafting instead of the traditional impression of being at the bottom of the organisation without say.


The Board is traditionally a cellular structure with members meeting to decide the company’s policies. As shown by the Deputy Chairman and Managing Director, it is possible for two members in a cell to belong to a cell of higher hierarchy.


Organisations that constantly handle projects may include full-time project managers in the Technical cell or form a separate Project Cell (Project A cell). An employee can advance his career in the organisation by enhancing their skill (become a specialist or senior member in the level) or become a member of a higher hierarchy but not necessarily a leader of any cell.

Figure 4

An organisation using cellular structure

Benefits of Cellular Structure
A good organisational structure by itself does not bring in profits. Rather, it provides a sound platform for human energies in the organisation to be tapped creatively, effectively and efficiently towards achieving the organisation’s goals while avoiding internal frictions.


A cellular structure will also empower members to make decisions and work independently.


The employee’s innovative potential may be realised to the fullest only in a harmonious atmosphere with mutual respect. This requires “a horizontal organisation and process-oriented management”.1 The cellular structure is such an organisational structure, allowing for innovation management.


Change for Better
By adopting the cellular structure, we provide, concurrently, a more equitable presentation of and a fresh look at the organizational structure. The tree with superior-subordinate relationship tends to rely excessively on good leadership or on the heads of departments creating a democratic work environment. More often than not, the leadership may actually contribute to the source of disharmony.


Intense competition in the global marketplace today has resulted in greater degree of specialisation among countries.2 Hence, firms invest in countries with technical expertise and efficient operations. Companies will increasingly have to manage multi-skilled and multi-cultural staff. The cellular structure offers a good way to address this challenge.


I believe that this cellular concept will encourage harmony in organisations. It promotes a better sense of belonging, greater motivation, increase productivity and realises the innovative potential of people in organisations, which are important in this age of complex competition. Suffice to say, companies must have organisational structures that do not create master-slave relationships, but rather, encourage a cooperative team spirit to retain talents.

Guidelines to Establishing a Cellular Structure

A set of guidelines will provide more meaning to the structure:


The structure is only there to provide an arrangement for the members to work together. It defines their teamwork relationship with others in the organisation. If there are conflicts among members, then the structure must be reviewed to project a more equitable arrangement.


Superior-subordinate relationship is best avoided. There are only leaders and members (or colleagues) in the cellular structure. The leaders serve as coordinators or facilitators rather than as persons of higher authority.


The only hierarchy that can exist between cells is that of the Board, Management and Operation cells, i.e., a Board cell is of a higher hierarchy than a Management cell.


Members are rewarded by their contribution to the organisation, their skills and experience, irrespective of age, gender or any other traits that are irrelevant for the function they perform. Hence it is possible that a specialist, who is a member, is paid at a higher rate than the leader of the cell.


The designation, authority and duties of each member in the organisation are clearly specified. Authority and responsibility are distributed appropriately amongst members in a cell.


Leaders are facilitators for the cell. Their duties are to coordinate the works amongst members and stop the passing of the “buck” should things go wrong. They have the authority to assign work to the members. They may be multi-skilled especially in managing others but not necessary specialists in the skills required of the cell.


Regular meetings are to be held by each cell to review the progress made and plan the work ahead.


Members report regularly to the leader on existing tasks. Decisions are made with at least two members in the cell being involved and the leader is informed of the decision prior to implementation. A leader shall call for a meeting to discuss any decision if he or she opines that such a decision will affect other members or cells. If members of the cell uphold the decision in the meeting, they may get it endorsed by the leader of the cell of a higher hierarchy in which they are a member. The decision is then final.


Direct interaction between members of different cells should be encouraged. Inter-cell interactions only through leaders of each cell should be discouraged with the exception of policy matters.


John KC Tan is a retired senior manager, now residing in Melbourne. He has served in various capacities in Peru, Malaysia, Philippines, China and Australia.

APRIL 2018 | ISSUE 3

Visions for the Future

  1. Johannessen, J.-A., Olsen, B., & Olaisen, J. (1997). Organizing for Innovation. Long Range Planning, 30, 96–109.

  2. Archibugi, D., & Michie, J. (1995). The globalization of technology: A new taxonomy. Cambridge Journal of Economics, 19, 121–139.


Leaders and changemakers of today face unique and complex challenges. The HEAD Foundation Digest features insights and opinions from those in the know addressing a wide range of pertinent issues that factor in a society’s development. 

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Leaders and changemakers of today face unique and complex challenges. The HEAD Foundation Digest features insights and opinions from those in the know addressing a wide range of pertinent issues that factor in a society’s development. 

Informed opinions can inspire healthy discussions and open up our imagination to new possibilities. Interested in contributing? Write to us at info@headfoundation

Stay updated on our latest announcements on events and publications

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