2. INTRODUCTION TO ORGANIZATION DESIGN
•Organization Design is a process for shaping the way organizations are structured and run.
• It involves many different aspects of life at work, including team formations, shift patterns,
lines of reporting, decision-making procedures, communication channels, and more.
• Organization Design – and redesign – can help any type of organization to achieve its goals.
Sometimes, a large-scale reorganization is necessary. At other points, more subtle shifts in
structures and systems can ensure that an organization continues to thrive.
3. IMPACT OF ORGANIZATION DESIGN
An organization's design must be right for it to operate efficiently and effectively, and its
structures and systems need to be aligned with its core strategies. There are many
potential benefits to having a design that suits the business and its people, and the
environment in which it operates. For example:
• Increased efficiency.
• Faster and more effective decision making.
• Improved quality of goods and services.
• Higher profits.
• Better customer relations.
• Safer working conditions.
• A happier, healthier and more motivated workforce.
• Greater preparedness for future challenges.
4. SUCCESS IN ORGANIZATION DESIGN
• Synchronize design with strategy.
Regardless of the precipitating factor, the reorganization must align with the
organization’s strategy and business priorities in the simplest way possible.
• Clarify roles and responsibilities.
Of all the organizational capabilities most required for a successful reorganization,
this set—clarifying roles and responsibilities, assigning accountabilities, and determining
decision rights—is one of the most difficult to get right.
• Deploy the right leaders and the right capabilities.
In reorganizations, a common pitfall is tailoring the redesign around the individual
capabilities of a few important executives. Another pitfall is overlooking the capabilities
required for the new design to succeed.
5. SUCCESS IN ORGANIZATION DESIGN
• Lower execution risk.
Execution is by far the most important capability for achieving a successful
reorganization—applying a step-by-step, disciplined approach to implementation is crucial to
avoid missteps.
• Don’t wait for a crisis to reorganize.
Reorganizations that take place prior to a crisis have a much better chance of
success. During a crisis, the odds of a successful reorganization are only 50/50.
6. FAILURE IN ORGANIZATION DESIGN
• Inadequate support Leadership.
Organizational change does not succeed without leadership support. And lip service is not
enough. Leaders must champion and model the change for the rest of the organization, in both what
they say and do. They must be active, consistently supporting the change teams as they design and
implement changes. Forbes magazine supports the fact leadership support plays a crucial role for
the success of organizational change, saying that successful change initiatives start at the top and
organizations should "set up a top-level team of experts, reporting directly to the CEO"
• Lack of resources
Lack of resources is one of the most common reasons why organizational change fails in
most organizations. It has to get implemented, and then tested, refined, and reinforced. This
generally is a longer, and costlier endeavor than most change leaders realize. If you don’t plan and
resource the latter phases of change, you’ll not realize the full benefits you set out to achieve
7. FAILURE IN ORGANIZATION DESIGN
• Priority Focus on Systems vs. People.
Leaders often focus more on the system changes than the people that have to make
and live with them. Don’t forget that while you need to have systems in place, it’s the people
who matter most. “Sustained change is always driven by people,” says Lee Colan in his article
https://www.inc.com/lee-colan/10-reasons-change-efforts-fail.html“Even implementing new
software successfully is more about the people who will use is, install it, train it, and support it
than it is about the system itself.”
Be sure that your leaders equally prioritize and attend to the system changes AND the
people
8. Organizational Design: When and Why?
There are three common "triggers" for Organization Design:
1. Something's changed, either inside or outside of the business :
• Perhaps you've bought some new technology, or a rival has entered your territory. Maybe an
important piece of legislation affecting your business has changed.
2. You've set new strategies or goals :
• An organization might take the strategic decision to approach its work in a different way for
any number of reasons. It might also change the ways it measures success.
3. The current design no longer works.
• Many aspects of change affecting an organization are gradual. But, in time, a "tipping point"
is reached.
