Shamrock Organisations

Shamrock Organisations - Origins and Introduction

The term Shamrock Organisation was coined by Irish academic and management expert Charles Handy in his 1989 book "The Age of Unreason", in reference to his understanding and interpretation of an organisation’s structures and systems. 

Handy believed that employees were the most important resource within an organisation, rather than the hierarchical structures which controlled them. 

He believed that there were three parts to an organisation: 

1. Core workers
2. Contract workers
3. Peripheral workers 

Handy likened these to the three leaves of a shamrock (see diagram below). These three different groups of workers had different expectations and were managed and rewarded differently.

• The concept of Shamrock Organisations was born through Handy’s belief that work, for the most part, should be primarily made up of short-term contracts, as many little jobs provide enrichment to a higher degree than doing the same thing for one’s entire life. 
• This idea, therefore, maintains a humanistic approach to organisational structure. 
• These three different types of workers should fit seamlessly together in order to produce an efficient and productive organisation.

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Shamrock Leaves

1. The first leaf is as follows:

• The professional core workers: which consist of technicians, senior managers and professionals. 
• Through this group, the organisation’s aims and goals are clearly defined and so they are essential to the growth and continuity of the organisation. 
• The pay of these members is closely related to the success of the organisation and this is reflected in their relationship with the company.

2. The second leaf is as follows:

• The contract workers: formed almost entirely of self-employed professionals and contractors on a project-reliant basis, their pay is based on performance rather than time. 
• Due to the semi-permanent nature of their role, their job carries an inherent risk of insecurity. 
• This group may include individuals who formerly worked for the company – part of the core or peripheral workers – but now provide contractual services to the organisation. 
• As these individuals are not managed directly by the company they are far more flexible with their work than the other leaves.

3. The third leaf is as follows:

• The peripheral workers: comprises the majority of the workforce, contingency employees that perform routine jobs. 
• These are generally part-time and flexible workers, and often have little career path or scope for development within the company. 
• The level of requirement for these positions is derived from the demand generated by the organisation’s products. 
• They are generally rewarded for the periods of time they work (e.g. by the hour), however, work can often be irregular and inconsistent.

4. Sometimes – when applicable, a fourth leaf is included in the model:

• This leaf is less important for many organisations – but, for those that offer a physical product - such as IKEA, perhaps - a fourth leaf can appropriately exist. This leaf is defined by the consumer base doing a degree of work for the company, which is the reality for the aforementioned IKEA who sell flat-packed furniture, as the consumers undergo the construction of their own purchases.

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Shamrock Model Applications

This model is primarily theoretical and can be considered and utilised by management (members of the first leaf), to coordinate, motivate and reward members of staff in accordance with their leaf within the organisation. 

This model enables precision when grouping members of staff, and also serves to establish which areas of the organisation do not require a large volume of human resources or investment. 

Finally, the model can be used to almost seamlessly identify areas in which adjustments are required to streamline the business model.