If the number of telephone calls we’ve been receiving is anything to go by, the amount of organisation design and restructuring going on in different sectors has increased several-fold over the last year or so. Yet our sense is that organisations find redesigning both energy consuming, challenging to implement and often ineffective in dealing with the underlying issues they are facing.
Added on 26 September 2014 by Philippa Hardman,Dev Mookherjee
For a start there is often the automatic assumption that an organisation redesign must result in a change in the organisation chart showing who sits where in the hierarchy and who reports to whom. Much time, money and emotional energy can be spent reorganising the boxes without taking the time to consider how it will really help to deliver improved results. Even if the restructuring might seem small in the grand scheme of the company’s objectives, the amount of upheaval and confusion caused should not be underestimated. Business as usual can be side-lined as new roles and responsibilities are defined, teams disband and reform and consultation processes are enacted.
An alternative – and often much less intrusive option in organisational life – is to consider existing processes, rewards and performance management systems and see whether the same or better outcome can be achieved by adjusting these instead of changing the structure. Yet this often doesn’t happen: a more common approach to underperformance of an individual or a team is to change the structure and the reporting lines, rather than set new performance measures and be prepared to have potentially difficult conversations when these are not met.
It’s also important to think about who is responsible for leading the restructuring process within the organisation. In our experience this often lands at HR’s door on the basis that it is “to do with people”. Whilst true, this assumption also fundamentally ignores the fact that for a restructuring to be successful, it needs to deliver a structure that is aligned to the organisation’s strategy. It is about meeting long term business goals not about moving the proverbial deckchairs around the organisation. Holding this balance can be difficult if the restructuring is seen to be led by HR and, fairly or otherwise, often not given the priority that it should. We believe that senior leadership, not simply sponsorship, of any restructuring process is vital, given the importance of ensuring that any new structure will help to deliver the organisation’s future direction. After all, with the upheaval involved, restructuring is not something that you wish to be doing on a frequent basis.
Ultimately, of course, any transition to a new organisation design will only be successful if people undergo a personal transition to working in new ways that deliver the strategy. Once the big picture emerges from the senior leadership team or key decision-makers, it’s then important to engage others around how it will work in practice. What changes are needed to processes, roles and responsibilities and ways of working for example? There are complex organisational dynamics at play during any such transition and the likelihood of success will be greater if more of the organisation is involved in that next level of change.
Organisational Design Research: Get Involved
Philippa Hardman & Dev Mookherjee are starting a research project to understand what people think it would have been good to know before they set out to restructure their organisation. We’d like to hear about the triggers for the redesign, the process your organisation followed and how the new structure was implemented.
If you have been involved in a recent organisation design/restructuring process – either leading it or as part of a project team – then we’d like to hear your story. Please contact firstname.lastname@example.org or email@example.com to share your experience.