How Functional Information Changes During Organisational Transformation
When organisations change, what actually changes?
Most leaders answer with familiar categories: behaviours, culture, processes, systems, structures, strategy.
But beneath all of these sits something more fundamental — something that explains why change succeeds in some organisations and stalls in others: functional information.
Functional information is the patterned, relational information that shapes what a system can do. It determines viability, constrains behaviour, enables action, and structures the Adjacent Possible. When functional information changes, the organisation’s capability changes with it.
This article explores how functional information shifts during transformation — and why readiness is the key to making those shifts deliberate rather than accidental.
1. Transformation begins when functional information becomes unstable
Every organisation has a set of stable informational patterns:
how decisions are made
how people interpret risk
how teams coordinate
what is rewarded
what is avoided
what is considered “normal”
These patterns create a predictable field of possibility.
Transformation begins when these patterns no longer fit the environment. The organisation senses mismatch:
old assumptions stop working
old processes create friction
old narratives lose credibility
old capabilities become insufficient
This instability is the first signal that functional information must change.
2. New functional information enters through pressure, insight, or disruption
Functional information changes in three primary ways:
a) External pressure
Market shifts, policy changes, technological disruption, or competitive threats introduce new constraints. These constraints reshape what is viable.
b) Internal insight
Leaders or teams recognise that the current informational patterns are limiting. They introduce new interpretations, new priorities, or new ways of working.
c) Disruption
A crisis, failure, or breakdown forces the system to abandon old patterns and adopt new ones rapidly.
In all cases, the system is confronted with new information that has functional consequences.
3. The system must reorganise around the new information
This is the heart of transformation.
Functional information doesn’t just “arrive” — it must be integrated. Integration requires:
new interpretations
new decision pathways
new coordination patterns
new emotional responses
new norms
new capabilities
This is where readiness becomes decisive.
A system with high readiness can reorganise quickly and coherently. A system with low readiness resists, fragments, or collapses into confusion.
4. As functional information changes, the Adjacent Possible expands
When new functional information is successfully integrated:
new options become viable
old constraints dissolve
new capabilities emerge
new futures become reachable
This is the expansion of the Adjacent Possible.
Transformation is not a leap into the unknown — it is a reconfiguration of what is possible from here.
5. Behaviour changes last because functional information has changed
This is why behaviour‑first change programs often fail.
Behaviour is the surface expression of deeper informational patterns. If functional information remains unchanged:
behaviours revert
culture snaps back
processes decay
systems are bypassed
strategy is ignored
Lasting change happens only when the underlying functional information shifts.
6. Transformation stabilises when new functional information becomes the new normal
Once the system reorganises around new functional information:
decision‑making stabilises
coordination becomes smoother
emotional resistance decreases
new behaviours feel natural
the Adjacent Possible expands again
This is the point where transformation becomes self‑reinforcing.
The organisation has not just changed — it has become capable of different things.
The Clean Synthesis
Here is the essence of the process:
Transformation is the reconfiguration of functional information. Readiness is the capacity to integrate new functional information. Agency is the activation of that integration in real time.
This is why readiness is not a “soft” concept. It is the core capability that determines whether an organisation can adapt, evolve, and thrive in a moving environment.
Why this matters for leaders
Leaders who understand functional information stop focusing on superficial change. They begin to ask deeper questions:
What information is shaping our behaviour?
What patterns are constraining us?
What new information must we integrate?
How ready are we to reorganise around it?
What will become possible once we do?
These are the questions that drive real transformation.