Both systems have their downsides. The simpler system generally has fewer, and that makes it preferable in many ways. But there could also be a different simple system that has fewer downsides.
It's important to first think of the active system at play and its influences on people, and second, try to improve it without disconnecting the model from reality.
This is a hard problem, and is one of the reasons leaders and managers need systems thinking skills above all.
> Both systems have their downsides. The simpler system generally has fewer, and that makes it preferable in many ways.
[Citation needed]
Also, I find the version with paperwork better, because that creates a documentation trail. If someone is routinely favoring certain people or groups, documentation makes that easy to expose. As opposed to the "word of mouth" system where it's likely impossible.
Also, looking for proof in a complex system will often lead you down the path of least resistance (the path for which it's easiest to find supporting proof; not necessarily the best path). So asking for proof is just evidence of a lack of systems thinking at play.
Ability to understand your specific system and guide it is the far more important factor.
You ask for a citation for an opinion (see: "preferable") then proceed to share your own semi-claim without a citation.
Though probably not intended, saying "Citation Needed" can be off-putting and wastes time in discussions where if you spent a few extra seconds, you could ask a more thoughtful question. For example, your abridged quote has numerous elements and the target of your critique is unclear.
I agree with your comments in a general way, but argue that in many organization, the system with the fewest overt rules and processes devolves into a complex set of covert rules and processes.
It appears simpler at first glance, because the complexity is deliberately hidden. The oft-quoted example concerns “structureless” organizations:
This is not universal, but something to guard against: That the “simpler” system is not, in fact, a structureless environment where manipulative individuals will create an invisible complex system.
It's important to first think of the active system at play and its influences on people, and second, try to improve it without disconnecting the model from reality.
This is a hard problem, and is one of the reasons leaders and managers need systems thinking skills above all.