Hi – I am new to Concentra and lead the organisation design practice. Over the coming weeks I will outline some key tips that I have learned in doing organisation design work as respectively a consultant and employee on the outside and inside of organisations. I really would like feedback so to know whether these tips are useful and relevant to you in your day jobs, but also on your experience and views to further build on learning.
The first tip is to ask at the start of a project is: ‘do you really have an organisation structure problem’. This may seem a strange question to ask from a consultancy that wants to support (and sell!) organisation design services to clients, but no one wants to do wasteful and irrelevant work. This is no different than energy companies wanting to sell you insulation to reduce your fuel consumption! It enhances reputation and it is the right thing to do as there is nothing gained in trying to make a fast buck.
The reason for asking the question, ‘do you really have an organisation structure problem’, is that so many organisations do not do this and instead believe that reorganisation will be an all-embracing panacea for their problems. So often senior managers have a real and immediate problem such as to reduce costs, integrate an acquisition, or ‘go for growth’, and they come to the immediate conclusion that the current organisation structure is not fit for purpose. I have met numerous COOs and Heads of Department who have so called ‘magic weekends’ and who come in on a Monday morning having done some really hard work in dreaming up a new organisation chart. They share this with their senior colleagues to get input but often the subliminal decision to reorganise and restructure has been made and the die is cast.
HR is also often not involved until it’s too late, and even then its role is frequently about the consequences of reorganisation (e.g. hiring, redundancy, job evaluation and grades on the new structure chart), rather than whether there should be a reorganisation and whether there are more effective interventions to deliver organisational success. In fact, to stand up and say to a senior colleague that they have the wrong solution with a new organisation structure requires a lot of courage; and even if they do it is generally about changes to the proposed structure rather than whether it needs changing in the first place. I will focus on the role of HR in organisation design in a future blog post, but for now I propose to share some suggestions on what should we consider doing first rather than change structure, with all the associated upheaval.
I use a simple checklist of non-structural levers to improve organisational effectiveness. These are listed below in the table and are ranked in terms of my experience of their increasing levels of impact to the organisation. Some of the boxes are naturally interrelated, but simply if I tick more than a few than I know the solution is more than just changing the structure.
Of course, there may still be an organisation design and structure issue but at least by reviewing the above you will know there are other aspects to consider. It will also place a check on the propensity for redesigning all our problems away through new structures. One recent HR Director in a food company told me he saw this as an important sanity check on the process of non-stop restructuring and reorganising. The analogy of constant rearranging the deck chairs on the Titanic is a powerful one!
An earlier blog by Rupert Morrison is also highly relevant. He states that “it is what is in the box that counts, not where the box is”. The point here is: What are people responsible for? What do they need to be good at? And so on, and not just what is their reporting line. The reporting line, i.e. structure, is only a tiny part of the overall jigsaw.
In summary, if you need to do structural change you should do so, but this is not a universal panacea. You shouldn’t change structure just because you think that it will bring about effective change in itself. Changing organisation structures is inevitably highly disruptive to organisations, so you should think whether there are other issues and solutions. If you come to the conclusion that there is still an organisation structure problem then this must also be solved in systematic way which will be the subject of future tips on organisation design.