In the last article of our series Organizations that Work we introduced the idea of a Pain Point and shared three of the six Pain Points we hear most often, together with case studies that demonstrate how effective organization design can address a number of business issues.
If you missed that blog you can find it here.
In this article we’ll share the other three Pain Points together with their case studies.
In each case study, we will share:
- the symptoms of structure misalignment experienced by our clients (their pain point)
- our approach to organizational design leveraging scientifically proven design principles, and
- high impact business results achieved by our clients through the alignment of structure and strategy
Pain Point #4: Value Stagnation
Sometimes as organizations grow, they sometimes drift away from their ideal design. Cracks begin to show. Managers report that they feel like they’re “always in the weeds”. Senior leaders report that they can’t get to their long-term work because they’re “always putting fires out”. People in the organization forget who is accountable for which decisions, and organizational boundaries become blurry. Managerial leaders and their direct reports find themselves competing for work. Escalations increase, slowing the organization down. Everyone seems too busy to do the right work.
In this case, we explore how a carefully designed and implemented organization structure with clear roles and accountabilities ensures that every layer of management is adding value to the work of the layer below. We’ll review our approach to helping a major Canadian financial institution restructure to ensure that every managerial layer added value, increasing the overall effectiveness of the organization. Our approach involved coaching and re-focusing the leadership team on their general management work. The result: revenues for the business doubled in three years, two years ahead of schedule.
For a more detailed read of this case study, click here: Case Study: Structuring to Create Value
Pain Point #5: Sluggish Response
In an environment that is increasingly uncertain and ambiguous, and where the nature of competition evolves rapidly, markets can change on a dime. As competitive strategy evolves, so too should structure. The organization you had that was so good at delivering on last year’s strategy may not be the organization you need to capitalize on your new strategy. A change in strategy can often create confusion and ambiguity about roles and decisions as role holders try to adapt to the new strategic realities. Sometimes, the organization itself gets in the way. Perhaps it was designed or evolved in a different competitive environment. Or perhaps the growth was more organic and less intentional.
When this Canadian telecom company’s strategy called for increased agility, a leaner operating model, accelerated speed to market and increased focus on service delivery and customers, the CEO realized that the organization he had wasn’t the organization he needed. Decisions of any consequence were escalated to the top, resulting in a sluggish and risk-averse organization. In order to achieve the new strategy this CEO needed an aggressive and focused marketing and sales capability; effective end-to-end customer service across all market segments; and nimbleness in developing and deploying new technology, products and services. Read how we helped this organization reduce their go-to-market cycle time by 66%.
For a more detailed read of this case study, click here: Case Study: Structuring to Increase Velocity
Pain Point #6: Bureaucracy
How do you decide if an organization is “too big to manage”? Often organizations add roles to address short term issues or projects. Over time, this can build up extra layers in the organization, which creates additional work for management and redundant roles. How can we ensure that all of these layers are adding value to the work of the layer(s) below? Sometimes as well, these extra roles evolve into functional “pockets” that artificially fragment work into different sub-departments, requiring extra co-ordination work across the organization. Is the issue really the size of the organization? Or is it perhaps, how it is structured and managed?
Our approach with this large municipal government was to assess the scale of its largest department—which some had said was simply too big. After conducting our analysis, we created a design that helped the organization restructure from 9 layers deep to 5, eliminating 4 extra layers that were not adding value, and which were increasing its bureaucratic practices in the process. The new, streamlined organization design for the Department was implemented to support the strategic pillars of the City. Regrouping the work of planning, building and maintaining infrastructure significantly improved project co-ordination and resulted in reduced costs and faster execution of city-wide infrastructure projects.
For a more detail read of this case study, click here: Case Study: Structuring to reduce bureaucracy
This blog is part of our ongoing series Organizations that Work. To see all of the blogs in the series that have been posted so far, click here.
Every Tuesday over the next few months, we will be posting blogs that take you from the pain of poor organization design, to identifying the root causes, to the benefits of undertaking strategic organization review. We will discuss the steps needed to effectively align your structure and work with your strategy, and we’ll discuss the processes that take out the guess work and help you to get it done. Through it all we will discuss how to lead the change from start to finish.
This blog was written by Ed McMahon, managing partner at Core International Inc. If you’d like to speak with us about how we can help you on your journey to an organization that works, please follow us on LinkedIn or book a call directly with one of our partners.
Our approach draws on several bodies of work including Stratified Systems Theory, the work of Dr. Elliott Jaques. For more on Dr. Jaques and his work visit the Requisite Organization International Institute at ROII Requisite – ROII Requisite.