6 Perspectives on Organisational Design

John Phillips

Organisation design needs to consider a number of factors, not just the reporting manager for each role. Critically, the design must support the purpose, strategy, and processes of the organisation.Ifyou want to move away from "silo" behaviour, increase agility, and enable cross team innovation and collaboration then you must ensure that your organisation supports these initiatives.The design needs to enable decision making at the right time by the right people at the right levels, provide incentives that supports culture, behaviours and performance objectives, the measurement of personal, operational and organisational performance and enable talent development.Put simply, your organisation design describes how your team will line up and how you want them to play on your field of business.

Organisational Design is not just deciding who reports to who

Learn from sport – different structures for different player strengths, team strategy, and opponents.

Let’s look at 6 perspectives to consider in organisational design

1. Stakeholder Relationships.2. Decision Making.3. Process Support.4. Measures.5. Incentives & Rewards.6. Talent Management.

Who does the person report to? Who do they need to work with internally and externally?What is the nature of their relationship with each stakeholder? What are the key exchanges?“Formal” relationships for the 'standard' view of the organisation design, but don’t forget those that are essential but external to the organisation

Stakeholders

Are the decisions being made as near to the point of impact as possible, by the person best informed and able to make them? Does the decision making process provide appropriate autonomy and authority levels?

Decisions

ProcessWhat enterprise level processes will the design need to support? How does the design support these processes?

MeasuresWhat measures will be required to monitor progress and performance? Do the measures align with the overall organisational objectives? Do the parts add up to the whole?

RewardsDoes the incentive and reward scheme align with strategy and structure across the organisation?Does the scheme encourage desired results and behaviour? Is a total view of rewards (not just financial) considered?

TalentHow will the design help the organisation to sustain itself?How will the design support attracting, developing, promoting and replacing talent?

What's Next?

Test the design from each perspective and refineStart at the top and work with the business managers at each relevant level (1, 2 and some of 3 in general):• Take each of the 6 perspectives, review and test the organisational structure• For each cross-department function and process, make sure all the dots join up• Make sure the manager sees owns the design of their team structure - they are not a tenant of

an HR vision • Develop the story about the structure - describe how it supports the strategic objectives for the

organisation.• Test the story - is it authentic, simple to understand and believable?• Cascade down - share the story with each manager and get them to share it with their team -

make sure everyone "gets it"

Key Point: The reporting manager must understand and buy into the structure around them -this is not an exercise in theory but a meaningful statement of intent - this is "how we're going to work around here.“…. And remember that being fit for purpose is a constant effort. How will you know when your design is less optimal? Doesn’t meet market challenges, enable strategy execution? Do you need new players, or a new team structure?