Is an Org Design Effort Right for You... and is Your Organization Ready?
How do you know if an organization design effort is the right solution, right now? And if it is, what do you need to have in place to successfully execute the challenging process of organization design? Read more for our guidelines to help answer these two questions.
Is an organization design effort the right solution right now?
Leaders typically embark on an organization design initiative for several possible reasons:
M&A: A merger or acquisition event has occurred and two (or more) organizations need to optimize their talent while ensuring that the capabilities of each team are aligned with their goals and strategies.
New Leadership: New leaders may evaluate the design of their organization when they step into the role. Some questions they ask include: Are the right capabilities organized under the right functions and leaders? Does each capability area have the needed skillsets on the team to be able to deliver now and into the future? How do we want our teams organized to achieve our goals?
Change in Goals / Strategies: Companies re-evaluate how they are operating, their strategies, and their goals to increase market share and revenue. A redesign may be needed to make sure that they have the right functional teams in place and the necessary capabilities to achieve their strategic direction.
Need to Improve Efficiencies: There might be an opportunity to reduce costs and improve productivity by redesigning how a team operates, especially with the introduction of a new system or technology. KPIs could be indicating that the team is not fully leveraging its abilities. Organization redesign helps analyze and identify where inefficiencies exist. It could be that critical capabilities are missing or insufficient.
Desire to Drive Innovation: Is the team hitting all goals and functioning optimally, but there is a need to drive greater innovation to ensure relevance and success for the long-term? Creating or enhancing a culture of innovation could be key to making that happen. An operating model and organization design that values innovation and designates space within structures and processes for it, can ensure that the team continues to meet its goals while also enabling team members to innovate.
If an org redesign is right for you, the next step is to evaluate readiness. This is a critical conversation we have with clients during initial discussions because if you, your team, and your infrastructure are not ready to go through the design process, then you will face unnecessary risks.
How can you know if you are ready to begin an organization design effort?
We evaluate readiness using three categories:
Stakeholders:
Do we have the right leadership involved?
Is the leadership team aligned on the need for organization design and is each leader prepared to invest the time and effort this will require to be successful?
How does our culture inform how we communicate during this process?
How can we reinforce our values through the way that we treat people as we do this work?
Resources:
What internal expertise do we have that we can commit to this project? It is important that the internal resources have the time to focus on this work. Their leaders need to be on board with the project, understand the importance of it, and have a plan in place to support the day-to-day work so that their SMEs can participate in the organization design process.
What external support do we need to address our internal gaps? This can include organization design experts as well as project management, change management, and technology experts. It is critical to not cut corners when evaluating the team you need -- at the end of the project, you will be glad you made the decision to bring in the right people to support you and your team.
What does HR need to be ready? While this effort will likely require support from multiple functions, HR plays a critical role. Going into the design with clean data, including current state job architecture, organization charts, compensation information, and HR system information, will enable a more effective and efficient process. Having the right people in place both in skill and bandwidth to support the HR related work will play a critical role in success.
Plan:
Do you have an organization design project plan?
Do you have a change management plan to support the project at every phase?
Do you have a plan to communicate (when appropriate) with stakeholders?
Do you have a plan to support business-as-usual while the organization design work is underway?
At Switch, we have conversations with leaders at every stage of the organization design consideration process. We help you identify if organization design is the right solution at the right time and, if it is, we help you prepare for the work so that you can be successful. Reach out if you would like to have a conversation with us about your organization design needs. We’d love to talk with you.
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