Organization Design Challenges
Read this article for a practical look at the challenges consultants hired to redesign an organization face. The consultants did not focus on what model they should choose but more on the process or phases of the major steps in the redesign. Any company that wants to redesign its organization will face the same challenges and decision-making points. Thus, it will help to consider how the redesign is undertaken. The first step is to analyze where the organization is currently and then consider whether a new organizational model is needed or if the current one needs to be adjusted.
Key findings
Results
Only around three out of 10 respondents indicated that it is often or always a challenge to create a common understanding with the client or decision maker with regards to the project mandate, or identify who the real stakeholders for the project are (see Table 1). In contrast, nearly six out of 10 respondents stated that it is often or always a challenge to create realistic estimates regarding the time and resources required to complete a project (Fig. 1). The second most challenging task is to find relevant cases from other comparable organizations; five out of 10 respondents indicated that it was often or always a challenge (Fig. 2).
Table 1 Items in the survey divided by section, with some descriptive data (the scale used was 1-5)
| Part/design phase | No. | Item | Average | Std. Dev. | Often or always a challenge: |
|---|---|---|---|---|---|
| Scoping the engagement and preparing the project | 1 | Creating realistic estimates regarding the time and resources required to complete the project | 3.6 | 1.0 | 58% |
| 2 | Ensuring that the project team is composed of people with relevant and complementary skills and experience | 3.1 | 1.1 | 39% | |
| 3 | Finding relevant cases from other comparable organizations that we could learn from | 3.5 | 1.2 | 54% | |
| 4 | Creating a common understanding with the client /decision maker regarding the project mandate | 3.0 | 1.1 | 33% | |
| 5 | Identifying who the real stakeholders for the project are | 2.7 | 1.1 | 24 % | |
| Analyzing the current organization | 6 | Understanding the implications of the organization’s strategy for the organization | 2.9 | 1.1 | 33% |
| 7 | Identifying the strengths and weaknesses of the current organization | 2.5 | 1.0 | 18% | |
| 8 | Identifying the mandates or goals pursued by the different sub-units in the organization | 3.0 | 1.1 | 37% | |
| 9 | Understanding the formal governance processes and reporting relationships in the current organization | 2.7 | 1.0 | 21% | |
| 10 | Understanding how people collaborate and/or exchange information across units in the current organization | 3.4 | 1.0 | 55% | |
| 11 | Documenting how the organization utilizes its resources (e.g., in different units, work processes, locations) | 3.3 | 1.0 | 47% | |
| Developing the new design | 12 | Gaining consensus among stakeholders for a set of design criteria (or priorities/principles for the new model) | 3.2 | 1.2 | 42% |
| 13 | Ensuring that the client or decision maker does not make a premature commitment to a preferred model before exploring alternative options | 3.5 | 1.1 | 59% | |
| 14 | Identifying the consequences of the tentative or proposed organizational models (e.g., consequences with regards to coordination, resource utilization, costs, productivity, employee morale) | 3.3 | 1.1 | 47% | |
| 15 | Ensuring that the client and key stakeholders feel a sense of ownership toward the selected model | 3.1 | 1.1 | 39% | |
| 16 | Ensuring that managers and employees (people outside the design team) understand the rationale behind the decision alternatives (i.e., organizational models) | 3.5 | 1.0 | 55% | |
| 17 | Incorporating suggestions and concerns from stakeholders when revising the tentative/proposed model(s) | 2.7 | 1.0 | 23% | |
| 18 | Helping participants in the process see the larger picture, as opposed to “protecting their own turf” | 3.7 | 1.1 | 62% | |
| 19 | Ensuring that the decision maker(s) reach a decision regarding the preferred new organizational model | 3.2 | 1.1 | 42% | |
| 20 | Ensuring that the organizational model that is selected meets the design criteria (or priorities/principles) established earlier in the process | 2.8 | 1.1 | 27% | |
| Implementing the new organizational model | 21 | Operationalizing the selected organizational model (e.g., identifying new roles, defining sub-units and interfaces, formulating key performance indicators (KPIs), etc.) | 3.3 | 1.1 | 49% |
| 22 | Staffing the new organization (i.e., allocating people to new roles, or having people apply for available roles) | 3.2 | 1.0 | 41% | |
| 23 | Adapting the infrastructure (e.g., IT systems, buildings, offices) to the new organizational model | 3.5 | 1.1 | 52% | |
| 24 | Conducting other interventions aimed at achieving changes in knowledge, attitudes, or behaviors to support the new organizational model | 3.5 | 1.0 | 55% | |
| 25 | Evaluating whether the new organizational model achieves the intended effect | 3.8 | 1.0 | 65 |
Fig. 1 Results for item 1 in the survey
Fig. 2 Results for item 3 in the survey
