Some carry on in unexceptional fashion, like IBM. And some lurch from crisis to crisis while causing collateral damage to the society around them, like PG&E. How can we identify which institutions belong in each category? What mechanics of institutional health make the difference? And, in a world where functional institutions are now the exception, how do we build more exceptional institutions?
Every institution has an official "Org chart" and set of protocols, but beneath the org chart lies a deposit of "Intellectual dark matter" vital to the institution's function: private social networks, unwritten plans, roles with more or less power than officially stated, and more.
Effective institutions must also solve the succession problem.
As time passes and skilled people retire or die, an institution must find ways to preserve the knowledge and structures that allow it to function.
Existing institutions must solve the succession problem and hand control to people of sufficient ambition and skill.
Many causes of institutional decay are foundational, and it is much more difficult to re-found an institution than to found a new one; it may be more straightforward to create mechanisms that alleviate symptoms within institutions.
Since institutions depend especially on the most skilled people, institutional health is largely determined by what happens to these people.
https://www.city-journal.org/healthy-institutions-are-made-not-born
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