By Mark LaScola, Managing Principal.
I’ve been doing this work for more years than I care to name. I’ve seen success, transformation and inspirational leaders of all kinds. I’ve also seen visions stall, falter and come unstuck.
Today I’d like to share one scenario where organization design didn’t play a part beyond the initial transformation but it should have.
It should have played a role in supporting ongoing business-as-usual decisions to ensure a consistency in the design and a fit-for-purpose approach. It’s time to stop thinking of organization design solutions as one-time processes that occur when big change happens.
Organization Design Governance is the next big thing in supporting your vision. It is the integrated and ongoing process of ensuring a business is fit-for-purpose and aligned with its design and operating model intents, for the long term. Beyond business integration, beyond a transformation project and beyond a scope of change.
The need for Design Governance comes from two very essential underpinnings:
1) A company’s business design and operating model ensures it is able to achieve its business strategy and competitive advantage simply and eloquently, and
2) Company’s suffer from vertical and horizontal fragmentation as you get on with the day job.
Consider this scenario.
The CEO of a growing social media company hires a new Chief Marketing Officer (CMO). Let’s call the new CMO, John. During John’s first 90 days he reorganizes his group, combines a couple of teams and adds another role to move the levels of managers from three levels to four. John also has one employee, who he has identified as mission critical, who is on the verge of leaving due to concerns about pay. But they are at their pay grade ceiling as an ‘individual contributor’, so John’s hands are tied to give this ‘at-risk’ employee a pay increase. So John, in his infinite wisdom, gives this employee a raise based on giving him one new direct report, thus moving him from an individual contributor role to now a role leading people.
We’ve all experienced these scenarios where new leaders which to achieve results and where vital resources need protecting. You work with what you have available to achieve the ultimate outcome of consistency in the team. However more support should have been available to John in understanding how Design Governance could have helped him avoid crossing boundaries and potentially merging work that could have a knock on affect beyond his team. In this scenario he could have impacted other stakeholders’ responsibilities and ultimately customer value.
Working with experienced HR Business Partners and Organization Development professionals within the organization, as part of induction and ongoing support, could have helped John understand how his team impacts the overall operating model.
In this scenario, John could have played a crucial role in Design Governance by working with the wider leadership team to ask the question of “are we fit-for-purpose”? John’s colleagues and peers could then have collaboratively looked at ways of introducing a variety of solutions from both reward programmes and a wider approach to people and talent.
Design Governance must be considered on an ongoing basis, as both a support to business-as-usual decision making, and to ongoing business planning.