Some of your most valuable people may be spending a significant portion of their time compensating for the way your organization is designed.
We see it every day in the strategic projects and transformations we help clients lead. The work crosses multiple functions, and each has its own priorities, processes, expertise, and view of how things should operate. Someone has to reconcile those perspectives, chase decisions, translate between teams, repair handoffs, and keep the work moving.
You might call that collaboration. And some of it is. But some of it is a coordination tax: the avoidable time, attention, delay, and rework required to move important work across organizational boundaries.
Organizations Are Designed Vertically. Strategy Is Executed Horizontally.
Most organizations are structured around functions for good reason. Functions build specialized expertise, establish standards, manage risk, and drive performance within their domains.
The challenge is that most strategic priorities don’t stay within those boundaries. Growth initiatives, product development, technology implementations, integrations, and enterprise transformations move horizontally across the organization.
That creates an inherent tension. Processes designed for functional excellence don’t automatically produce cross-functional excellence. A function can make a perfectly rational decision based on its own objectives and constraints while unintentionally making the enterprise outcome harder to achieve.
To be clear, silos aren’t bad. Specialization creates value. The question is whether the interfaces between those functions have been designed as thoughtfully as the functions themselves.
Your Best People Become Human Middleware
When those interfaces don’t work, capable people become the interface.
Every organization has them. They know who to call, where the real information resides, which stakeholders need to be involved, and how to get a decision unstuck. They translate competing perspectives, reconcile disconnected plans, anticipate resistance, and keep initiatives moving.
These people are enormously valuable. But there is a paradox: The better they are at navigating organizational friction, the less visible that friction becomes. In fact, organizations often reward people for becoming exceptional at navigating the maze without stopping to ask why the maze exists.
The work gets delivered, but the true cost—the coordination tax—is hidden in meetings, escalations, rework, leadership attention, and dependence on a handful of people who know how things “really” get done.
Not all coordination is waste. Strategic tradeoffs, technical judgment, risk management, and relationship-building require collaboration. The tax is the portion that creates no additional enterprise value, such as repeated reconciliations, unclear ownership, unnecessary escalations, duplicate reviews, and preventable handoff failures.
AI Is Stress-Testing the System
The coordination tax isn’t new. AI is simply making it harder to ignore. Much of the AI conversation begins with productivity: What tasks can we automate? Where can we make people faster? What work can an agent perform?
But AI forces a more fundamental question: How should this work actually get done?
AI requires organizations to codify work that talented people have historically held together informally. What is the real workflow? Who decides? Which information is authoritative? Where are the exceptions? Which handoffs require judgment? Who owns the outcome?
That creates both an opportunity and a risk. Imagine every function becoming 30% more productive with AI while the interfaces between those functions don’t change. Now the organization generates more analyses, recommendations, decisions, and activity—all flowing through the same broken handoffs. Local productivity could improve while enterprise productivity doesn’t.
Before You Automate, Fix the Work
Before asking where AI can make people more productive, leaders should ask three questions:
- Where does strategic work repeatedly slow down when it crosses functions?
- Where are talented people manually compensating for those breakdowns?
- If we were designing this workflow from scratch today, what would we do differently before introducing AI?
Great execution will always require great people. But those people should spend their time applying judgment to complex problems, not compensating for preventable organizational friction. AI gives leaders a timely reason to examine how strategic work actually moves through the enterprise.
September 3, 2026
