The organisation chart is one layer; execution also depends on real ownership, dependencies, behaviour under pressure and accumulated attention.
Why it matters when the plan changes
Most organisational change is designed on the chart: new boxes, new reporting lines, new mandates. The chart shows authority well and cooperation poorly. Donald Sull, Rebecca Homkes and Charles Sull found that 84% of managers could rely on their boss and direct reports all or most of the time, but only 9% could rely on colleagues in other functions and units all the time, and a new strategy often depends on the second kind of reliance.
The tension is that the lived system cannot be read off one source. Interviews show what people say, documents show what was intended, and work signals show what happened, and the three disagree in instructive ways. Reading only the formal design produces a clean answer to the wrong question; reading only the lived system loses the mandates that must eventually change.
In practice
A group moves to a shared-services model. The chart shows finance operations reporting to one head. The lived system shows that three country controllers still approve exceptions for their old business units, that month-end depends on one analyst who knows both old systems, and that escalations still run along the previous country lines.
Evidence
84% of managers said they could rely on their boss and direct reports all or most of the time.
Donald Sull, Rebecca Homkes and Charles Sull, Why Strategy Execution Unravels and What to Do About It, Harvard Business Review (2015)Only 9% of managers said they could rely on colleagues in other functions and units all the time.
Donald Sull, Rebecca Homkes and Charles Sull, Why Strategy Execution Unravels and What to Do About It, Harvard Business Review (2015)
What it cannot tell you
The distinction is a reading discipline, not a measurement. Reconstructing the lived system depends on which sources are available and permitted, and it can overweight the most vocal accounts, so any reading of it carries gaps that should be marked rather than filled with confidence.
How Atlas reads it
The organisation is read in five layers: formal design; real ownership, meaning who decides, delivers and is consulted; dependencies; operating patterns under pressure; and experience and outcomes, where what people report meets what the work reveals. No single source is the organisation. The judgement is formed by reading the layers together, against the strategic demand.
Questions
Formal design: roles, reporting lines, mandates, governance, incentives and stated priorities. Real ownership: who decides, delivers and is consulted. Dependencies: the handoffs and commitments the strategy relies on. Operating patterns: how people decide and escalate under pressure. Experience and outcomes: what people report and what the work reveals.
Because it records authority, and much strategic change depends on cooperation across it. Donald Sull, Rebecca Homkes and Charles Sull found in 2015 that 84% of managers could rely on their boss and direct reports all or most of the time, while only 9% could rely on other functions all the time.
At interfaces: between two roles, between a role and its mandate, between a team and its dependencies. Donald Sull and his co-authors found commitments from colleagues in other units typically not much more reliable than promises made by external partners, which is where decisions keep travelling along old routes.
No single one. Interviews, documents, assessment evidence, short check-ins and work signals each show part of it, and the disagreements between them are informative. A view built from one source alone should be marked as partial, and where the signal is insufficient the honest rating is blind.
No. The formal design is where durable change is made: mandates, roles and incentives are what a leader can actually redesign. The lived system shows where that design is already being worked around, and which formal change would remove the workaround rather than add another layer on top of it.