(Re-)Designing organizations: Lessons from the field

 

Philippa Hardman and Dev Mookherjee share the findings of research that looks at the reality of redesign on the ground.

Added on 13 June 2016 by Dev Mookherjee,Philippa Hardman

Redesigning organizations

Introduction

In more stable days gone by, revisiting the organization design was an exceptional event. In the current turbulent and complex environment, however, the process of redesign has become a more frequent occurrence, and in some organizations is now an ongoing and unfolding process.

Organizations find redesigning both energy consuming and challenging to implement. Moreover, the outcomes of the redesign often fail to resolve the underlying issues these organizations are facing.

Organization design and restructuring has been widely written about, but in undertaking our research, we weren’t interested in theory, however helpful this can be. We wanted to find out about the lived experience of organizations that had gone through a redesign process as our experience of the reality of organization redesigns often seemed to be much more complex, contextual and richly layered than described in textbooks. What had it been like and felt like? What had worked? What hadn’t? What would a senior manager do differently next time, facing a similar need to redesign?

Our methodology

We were curious about how organization design practitioners thought about and worked with organization design, rather than testing out how we thought they should do it. For that reason, interviews were structured but open, with additional questions prompted by stories shared by the participants.

We interviewed 25 senior managers in organizations with over 100 employees, all of whom had been involved in a significant way with the design or redesign of their organization within the last two years.

Key findings

The findings presented below are those which either surprised us most or where there was a clear theme which we felt shone a light on how organization redesign is carried out in practice.

1. Non-HR leaders were more likely to think immediately about restructuring rather than a wider range of design factors.

They therefore miss other, often less disruptive approaches, to address organizational design challenges.

  • “Only [HR] professionals refer to redesign, not leaders”

A significant proportion of respondents described that redesign really meant restructuring, rather than other aspects of design, and tended to turn to restructures when things were going wrong…

  • “when people say we need to restructure the business what they really mean is we’ll take a load of cost out of the business”

Very few respondents described redesign more widely than restructuring, as opposed to Jay Galbraith (2002)¹ who argued that organization design should be much more than restructuring and should also include elements such as strategy, people, rewards and processes.

  • “it’s fundamentally about the way you work. It’s about your governance, your processes, your behaviors, how to interact with your customers”

2. Projects were resourced and led in very different ways.

Very few respondents gave any conscious attention to the resourcing of the design process. Many seemed to select a resourcing model used for other types of projects without a conscious choice or reflection on the implications of the approach taken. Most were highly hierarchical in that decisions were in most cases taken by top team members.

3. The degree of engagement in the process of redesign varies hugely, from involving the whole organization, to involving no-one. Managers acknowledged that engaging people does take more time, particularly in the design phase, because “the people involved also have a day job. You can only push them so far” but that it has advantages in terms of the amount of buy-in that is generated.

  • “I would never restructure my team on my own, without input…in reality people are quite mature, if you take it steady you get to the [best] outcome.”

While experiences varied in terms of the level to which people were involved in identifying the new design, managers were clear about the need to engage people to make implementation a success. 

4. There is a ‘dirty secret’ in organization design, that decision making is often highly political and subjective.

There was a real split in respondents between those who described a very honest and objective process of decision making, and those who believed that the process was a charade – with decisions being made to support people whom leaders already had in mind for roles and structures. A significant proportion of respondents described organization redesign processes which started with key individuals and then moved on to thinking about designs which would fit their motivations.

  • “I think it’s absolutely true that everyone is always saying that we are not designing around names and persons, but in the end it’s always happening.”

5. Move fast or take the time to engage and do it properly?

A recurring theme across all the interviews was that the process of redesigning and reorganizing takes a significant amount of time, often longer than anticipated. Time taken was often spoken about in terms of years rather than weeks and months.

Interestingly, respondents often noted that employees, and those not directly involved in managing the process, may well perceive redesign processes as taking too long. This raises the question of how the gap between the time it takes and the perception that it is too long can be closed. While there may be many answers to this question, it is clear that managing expectations on the time taken and the benefits of doing so are critical for a redesign to be seen as worthwhile.

The full article in the Sping 2016 360º Ashridge Journal discusses implications for practitioners and a process flow showing the stages that practitioners went through during their re-design. 

See the full article

¹ Galbraith, J. (2002). Designing Organizations: An Executive Briefing on Strategy, Structure and Process. San Francisco: Jossey Bass