ORGANIZATIONAL DESIGN CONSULTING
Not too many years ago, poorly managed and marginally competitive businesses could succeed. Not anymore. Aggressive competition, demanding customers, new technologies, global markets and now a severe downturn in the economy are putting unprecedented pressure on companies to rethink the way they do business.
Many organizations are floundering, even going out of business. Others are changing the way they operate and getting tremendous results. The leaders in companies that are achieving success are regaining their balance by resetting their strategies, refocusing on their most important customers, and improving performance by redesigning how they go about doing business.
As companies grow and the challenges in the external environment become more complex, businesses processes, structures and systems that once worked become barriers to efficiency, customer service, employee morale and financial profitability. Organizations that don’t periodically renew themselves suffer from such symptoms as:
- Poor performance and results
- Inefficient workflow with breakdowns and non value-added steps
- Redundancies in effort (“we don’t have time to do things right, but do have time to do them over”)
- Fragmented work with little regard for good of the whole (Production ships bad parts to meet their quotas)
- Lack of focus on the customer
- Silo mentality and turf battles
- Lack of ownership when things go wrong (“It’s not my job”)
- Lack of information or authority to solve problems when and where they occur
- Cover up and blame rather than identifying and solving problems
- Delays in decision-making
- It takes a long time to get something done
- Systems are ill-defined or reinforce wrong behaviors
- Mistrust between workers and management
Organizational redesign is a step-by-step methodology that eliminates or minimizes these conditions and improves the overall health and responsiveness of a business by better integrating people with core business processes, technology and systems. We take you through a process to identify dysfunctional aspects of work flow, procedures, structures and systems, realign them to fit current business realities/goals and then develop plans to implement the new changes. The process focuses on improving both the technical and people side of the business.
A well-designed organization ensures that the infrastructure of the organization matches its purpose and goals, meets the challenges posed by business realities and significantly increases the likelihood that the collective efforts of people will be successful. The process leads to a more efficient organization design and significantly improved results:
- Excellent customer service
- Increased profitability
- Reduced operating costs
- Improved efficiency and cycle time
- A culture of committed and engaged employees
- A clear strategy for managing and growing your business
Below is an overview of our approach to organizational redesign which targets and improves several dimensions of business performance.
The Transformation Model
We utilize the transformation model as a framework to help leaders understand their organizations and also guide a successful redesign effort. The model reduces the vast complexity of an organization to seven key elements that must be understood and aligned for a business to be successful. Alignment implies a holistic or systems point of view that finds the best “fit” between all organizational elements.
These seven elements form the “big picture” or context of an organization and ultimately determine its success. When we talk about organization design we are talking about the relationship and balance between each of these variables. The purpose of the design process is to create and successfully implement a streamlined and effective organizational design perfectly aligned with your organization’s philosophy and desired results. Many organizations, in spite of capable and well-intentioned people, fail to realize their potential because the structure, processes, and systems of the organization are barriers to efficiency and common sense decision-making.
Environment. Organizations, like all living systems, can survive only to the extent that they maintain harmony with their external environment. This includes being sensitive to the evolving needs and perceptions of customers, understanding changes occurring in technologies, knowing what the competition is doing and knowing the legal, social and political climates. Most organizations eventually die because they fail to keep up with changes in their environments.
Strategy. There are two parts to strategy. Business strategy identifies the reason for being of the business as well as the core competencies, objectives and factors critical to its success. A well developed business strategy tells the organization where it is going and guides it like a ships rudder in a stormy sea. An Organization strategy (core ideology) is the “being” or character of the organization. It has to do with who we are and not just what we do and includes the mission, vision of the future, values and guiding principles. A clear organizational strategy helps transform a company or office from a normal work place to one that inspires people and brings out their best.
Core Process. Flow of work through the organization. It is the sequence of events or steps necessary to get a product out the door or deliver a service. It usually cuts across department or organizational boundaries. It is, or should be, the focal point around which all other business unit activity is organized. Understanding, streamlining and properly supporting the core business processes is the central job of any organization.
Structure. How people are organized around the core business processes. It moves beyond box charts to understanding the boundaries, roles, responsibilities and reporting relationships among people. It is a sort of template that determines not only relationships but coordination of tasks and allocation of resources. The proper question about structure is not whether it is the right one, but whether it fits with the rest of the organization (core process, strategy) and helps rather than hinders performance.
Systems. Interrelated tasks or activities that help organize and coordinate work. Examples include recruiting and selection, training and development, how people are promoted, communication/ information sharing, decision making, how people are rewarded, planning/goal-setting, personnel policies and procedures, performance feedback, etc. They are usually “owned” by management or special support functions and cut across the entire organization.
Culture. How the organization really operates—leadership style, worker attitudes and habits and management practices that make up the distinctive “personality” of the organization. It is like the air that permeates everything and is both cause and effect of organization behavior. Culture mirrors the true philosophy and values that the organization actually practices. It is a measure of how well an organization has translated its philosophy (organizational strategy) into practice.
Results. The organization’s current performance which the success or health of an organization and are therefore the starting point for understanding how well the organization is functioning. Results indicate where the organization is strong and what it needs to keep doing, as well as where it is weak and what it needs to change. All other elements are the cause of results. Not being clear about current or future results is like being lost at sea; even knowing where you want to go, you don’t know how to get there.