The Finding
Jay Galbraith’s work on organisation design, published in the journal Interfaces, set out to explain why task uncertainty is so closely related to organisational form. His argument, building on Herbert Simon’s work on the cognitive limits of decision-makers, is that every organisation faces a rising volume of information it must process simply to coordinate its own work, and that this volume rises with the number of interdependent parts and the uncertainty of the tasks involved. Past a certain point, no single person or small group can hold the full picture in view directly — the organisation has to substitute some kind of structure or system for the direct, personal observation that worked when it was smaller.
What It Means in Practice
This has a specific and fairly predictable consequence for operational visibility as teams expand. In a small organisation, a leader can often see most of what is happening operationally simply by being present — walking the floor, sitting in on calls, noticing things directly. This is not a system in any formal sense; it is unmediated observation, and it is remarkably effective for as long as it remains possible.
As the organisation grows, the volume of activity eventually exceeds what direct observation can cover, exactly as Galbraith’s information-processing argument predicts. What typically happens next is not a deliberate redesign of how visibility works. It is a gradual substitution: reports start standing in for direct observation, dashboards start standing in for walking the floor, and status updates start standing in for firsthand awareness. Each substitution, on its own, looks like a reasonable, incremental adaptation to growth. Collectively, they change what “visibility” actually means, from direct perception to a curated, filtered representation of what is happening — filtered by whoever builds the report, chooses the dashboard metrics, or decides what belongs in the update.
This is why operational visibility so often appears to decrease even while formal reporting infrastructure is visibly increasing. The two are not opposites. A leader can have more reports, more dashboards, and more structured updates than ever, and genuinely less visibility into what is actually happening operationally, because each layer of mediation between the leader and the work introduces a choice about what gets represented and what does not — choices that were unnecessary when the leader could simply see for themselves.
Where It Varies
By the pace of growth. Organisations that grow gradually tend to build reporting structures incrementally, often without ever explicitly deciding what direct visibility they are giving up in the process. Rapid growth compresses this transition, making the loss more sudden and more noticeable.
By leadership’s own habits. Leaders who maintain some direct, unmediated contact with operational work — even informally — retain a check against what formal reporting says, long after the organisation has grown past the point where direct observation alone could cover everything.
By what gets measured first. The earliest reporting structures an organisation builds tend to persist and shape what “visibility” means going forward, even as the operational reality they were built to represent changes considerably.
By organisational layers. Each additional layer between the point of work and the point of decision-making adds a further filter, so the relationship between formal reporting volume and actual visibility tends to weaken the more layers exist, not the more reports exist.
A related consequence deserves attention: because each individual substitution of a report for direct observation happens gradually and looks reasonable in isolation, there is rarely a single identifiable moment at which “visibility” changed meaning. This makes the shift very difficult to notice from inside the organisation experiencing it — the people making each substitution are, correctly, responding to a genuine growth in volume, and nobody involved is doing anything that looks, at the time, like a decision to reduce visibility. The change is only visible in retrospect, by comparing what leadership could once see directly against what it now sees only through a chain of representations, each with its own choices baked in.
A further misconception worth naming: dashboards and reports are often treated as though they simply make visible what was already true, in a more convenient format. Galbraith’s framework suggests something more consequential — that the design of a reporting structure is itself a set of choices about what gets represented, made by whoever built it, often based on what was easiest to measure at the time it was built rather than what matters most now. Two organisations with identical underlying operations could end up with meaningfully different pictures of “what is happening,” purely as a function of different historical choices about what to report.
For how this pattern presents in other kinds of organisation, see other sectors.
Questions worth considering
- What did direct visibility into operations look like when the organisation was smaller, and what specifically replaced it as the organisation grew?
- Are there parts of current reporting that reflect what was easy to measure early on, rather than what matters most now?
- What is the shortest, most direct path currently available between someone in leadership and what is actually happening on the ground?
- If a report and a direct conversation with someone doing the work disagreed, which would currently be trusted by default — and is that the right default?
More on this topic: Operations.
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