The importance of Org Design

Think of a time when you were in a high performing team; when you were busy (maybe really busy) but you were solving a big challenge, and it felt like you were achieving a lot in a relatively short amount of time. I'll take a bet that at least two things were true.

First, and most importantly, it was clear to all of you what you were trying to achieve -maybe you were even trying to get out of a hole, or fix something that had been broken, but either way, everyone on the team agreed on the overall direction.

Second, it's likely that people played to their natural strengths, meaning it seemed like the right team member was doing the right thing, whether through a wealth of experience in that field, or just quickly-established norms.

With a bit of distance, and some objectivity, the ingredients seem simple -but most likely the experience you thought of was memorable because it was so unusual. According to McKinsey's research, less than a quarter of organisational-redesign efforts succeed. Forty-four percent run out of steam after getting under way, while a third fail to meet objectives or improve performance after implementation.

Here's the truth that far too few companies embrace -it needn't be that way. You can actually design the conditions for success which result in a high performing org with happier, more loyal employees. Let's look at the two conditions mentioned earlier: Clarity and Right-Fit.

First, Clarity. It was clear what you were trying to achieve -ironically, multiple execs have told me their happiest times were an ostensibly stressful situation, because it removed any ambiguity about the required outcome. Think of the early days of Covid -it quickly became apparent that a vaccine would be required; with that ultra-clarity multiple teams got to work, in the UK the first vaccine was delivered less than 9 months after the first lockdown (about 1/20th of the normal cycle).

The clearer the goal, the faster people can get there. As a leader, you might consider how specific you've been. Sure, perhaps you paid a shiny consulting firm an excessive amount to come up with a complicated strategy -but how well could your employees repeat it? More importantly, could they relate it back to their day to day roles?

Experiment 1: Take a blank piece of paper and write two sentences. In the first sentence, set out what your company is trying to achieve. In the second, describe how you're going to do that. Don't add extra sentences, don't include corporate speak or hyperbole -use as plain language as you can -the same way you might describe it to a friend with no connection to your business.

If you can do this, congratulations, you've just written your mission and strategy! If you can't, you might ask yourself how the team you manage could ever hope to do so.

Secondly, Right-Fit. With the right people in the right place, things start to click. People perform competently (hopefully expertly), and a sense of reliability grows, which builds trust, that often engenders a happier work environment which ultimately becomes more productive. Of course, that kind of Nirvana is rarely sustainable -eg. in startups everyone can be required to do anything, or perhaps busy periods mean folks take on extra responsibilities, which they aren't so comfortable with.

That's fine in the short term, but the longer a sub-optimal situation is allowed to live on, the more people start to bend their circumstances back to what they're good at. In an org diagnosis session last year, a great account manager told me why she wasn't hitting her sales targets: "Yes I know I should be out finding new clients, but I really enjoy working with existing ones, I'm really good at that". This 'square peg in a round hole' is all too common -the earlier you can spot these and make changes, the better -for everyone.

Experiment 2: Divide another blank piece of paper into three columns. In the first column write the skills which will be essential to achieve your strategy from experiment one. For example, if you wrote something about increasing sales, then perhaps you might include, 'Sourcing leads', 'exceptional selling' and 'closing repeat business'. If you're expanding your product or service offering, then perhaps you need 'innovation' and 'partnerships' and so on.

In column 2 think of everyone in the organisation and score the level of proficiency you would give your current team as a whole for that competency out of 10. In the third column score the individuals performing the related tasks today (again out of 10). If it helps, you can now plot those numbers on an x/y axis but that's not essential.

What do the results tell you? 8,9 and 10 in both columns mean the right people are doing the right things and you're on the way to further success. High scores in the first column, but a few low scores in the second suggest some folks are in the wrong position -a common example is the target driven sales person who moves into a management position, and forgets to do any managing. High scores in column 3, which aren't matched by the org mean you have a few superstars. So how are you going to retain and motivate them? -how can they be mentors to the rest of the org? Low scores in both? You have a problem -let's talk.

Of course, there will be other elements to successfully designing your organisation -notably how do you structure your team, or their time? How are you measuring success? You'll also need to think carefully about how the processes between individuals or teams work -is it clear where work gets handed off? Who has decision making power? How do those decisions get made?

However, hopefully from the two experiments above you can start to see the advantage of being deliberate in your org design. Planning your key elements thoughtfully should result in a happier, more productive workforce, who are better able to withstand the bumps in the road when they inevitably arrive.

If you'd like to hear more about how this process works and how you can design your organisation to be more resilient, please check out our webinar on the topic here.

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Dom Foley spent 20 years at Google, helping leaders and HR teams more thoughtfully design their businesses, and manage through change. After helping countless leaders internally and externally, he set up Yellow Sneakers, who provide innovation in People Strategy, and would love to help you and your business in the next phase of growth ([email protected]).