Change doesn’t instantly mean re-structure
Whether it’s a result of pain that needs to be addressed or opportunities you are responding to, an immediate response from many leaders or business owners is to go straight after structure.
While structure does not of itself create the capability to do the work you need to do, it does directly enable or disable the organisation’s potential to do so.
Good structures enable the delivery of activities that differentiate your organisation from the competition; less effective ones disable your ability to execute.
Even though structure isn’t the only lever available for effecting transformational change in organisations, it can be a significant one.
Two good rules of thumb to remember are that:
1. Strategy defines the required work, which should define structure; and
2. Don’t stop your alignment efforts with structure (I have previously talked or written about the Rubik cube metaphor for organisational design)
But if you are intent on looking to just focus on structure here are 10 tips to get you going:
- Build Roles and Structures around the Work (Not Vice Versa) - First, understand the work that needs to be done. Then, group this work in the most appropriate way to give you the aspirational outcomes you need. From there you will be able to design the roles and structures that best supports its delivery. This should stop the immediate conversations around just moving lines or boxes, or the common trap of designing incoherent structures around people.
- Separate Strategic Work from Necessary Work - Avoid grouping or organising work that directly contributes to your strategic advantage with work that does not. Often the urgent, reactive work diverts attention away from the important, strategic work of leaders. At a very simple level for example, this could be grouping your product development work alongside the product maintenance activities. One is about market insights, innovation, customer testing, the other is running an efficient returns/ repairs team. Sure, the teams need to share updates, learnings, defect insights, etc. but don’t put them together, as their focus is very different.
- Structure Back-Office Work for Efficiency - Do this important but necessary work in the most efficient way possible. I was working with a client recently who had five people in a payroll function re-entering paper timesheets, with all the potential risks, to then process weekly pay – automate that!
- Don’t Copy Your Competitor’s Structure - Design your structure to facilitate your unique capabilities and strategy. For example, if your point of difference is local connections, why aggregate all of these regional activities into a centralised team in another part of the country just because your competitor is (e.g. think about the Advisor versus Claims Teams of some insurers). They will have a different strategic driver for this. Please note, it’s a different conversation for non-strategic work.
- Consider Virtual Delivery Options for Performing Work - Assess how different types of work can best be delivered. In a world where we have all got used to working from home, meeting online, etc. challenge the current ways of working to identify what can be done differently. For example, I still fly round the country for full day workshops but will advocate clients save money for travel if it’s a short two-hour session and we can deliver an outcome just as effectively online.
- Design for End-To-End Process Ownership – be clear around the desired outcome you want, map the current process and then challenge the value of every step. Are senior leaders involved too many times, does work bounce between too many teams, are we using technology as best as we can and, lastly, is there a clear overarching owner?
- Empower Your Organisation from the Bottom Up - Push decision making to the lowest level possible within the organisation. During covid we have seen an overreach through every level of the business, and with senior leaders that often means they have become too operational. Get out of the detail, ensure your managers have the capability and ‘guiderails’ to work within and then truly empower them to get on with it.
- Minimise Role Confusion – Too often the tensions or ambiguity within an organisation can be solved by clarifying who needs to be involved in a process/ decision and the role they play (e.g. someone thinks they are accountable for the outcome, when really they only need to be consulted for input). Identify the key ‘hot spots’, get those involved in a room and define the decision rights to accomplish the work. The outcome will be less confusion about who is responsible for what, and the potential avoidance of a restructure.
- Link Across Boundaries – Often the tension within an organisation is at the point where work ‘crosses a boundary’ between multiple teams (hence the reason ‘agile’ structures have taken hold – another article). The easiest way to solve this is to identify the people or groups whose work is interdependent. Then, design ways of linking them across boundaries. For example, agree service level agreements around delivery times, define decisions rights, review the processes to ensure efficient hand off’s, define meeting cadence, and/ or look at creating cross functional teams with agile ways of workings (or move directly into an agile structure).
- Change the Work to Change Results - If you want to change results, be willing to change more than just structure and reporting relationships. Often when a restructure happens the focus is on ‘lines and boxes’ not being clear on the activities that need to be done, how these can be better grouped to deliver the required outcomes and then what that means for the types of roles we need. From there you move into the types of capability you need and whether that currently exists in your business.
Successfully changing an organisation takes more than just structural change but if that is the important lever for you right now then hopefully these tips will help you to do that piece right.