After years of operating in an unpredictable and disrupted business environment caused by COVID-19, climate-related disasters, and the looming threat of recession, many organizations are reconsidering their organization (org) design. Leaders often think of org design as the process for updating the org chart. While structure is a component of it, org design encompasses much more.
What Is Org Design?Org design is a methodology for identifying multiple aspects of an organization (ex: mission, workflow, strategy) and then aligning or realigning them to meet organizational goals in the current business environment. The outcome of the process is a series of recommendations that can be broad and include things like org structure, technology needs, compensation model updates, and policy changes.
Ideally the org design process results in improved business results as well as improved employee engagement.
Gathering the Right InformationInformation gathering is a critical step in your org design process. It is tempting to focus on formal elements like how decisions are made, existing business processes, and defined talent practices. Formal elements are more explicit, often clearly spelled out in policy, procedure, or practice documents.
The informal elements are often much more influential.
Informal But PowerfulInformal elements are implicit. You will not find them on the employee portal or in a policy manual, but they inform how things get done in the organization—and everyone knows what they are. They represent how people intuitively act and are reinforced by the organization’s culture. As a result, they can actually be the most reliable predictor of employee behavior.
The main informal elements to consider are:
- Norms – The standard or expected unwritten rules of behavior.
- Mindsets – The commonly held attitudes that determine how people interpret and respond to situations.
- Networks – The informal lines of communication in an organization, sometimes referred to as “the grapevine.”
Identifying the IntangiblesTo suss out the implicit elements, it is important to talk to people throughout the organization at different levels and in different roles. You can conduct individual interviews, host listening sessions, or send electronic surveys.
Some exploratory questions that you can build on to identify those implicit rules of behavior are:
- What are the unwritten rules of getting work done around here?
- If you were teaching a new employee the ropes, what would you tell them?
- How is information informally communicated here? What’s the grapevine?
- What are the dos and don’ts of getting work done at Company X?How do people think about experimentation here? Are people excited or afraid to try new approaches?
- Are problems dealt with transparently or swept under the rug?
- What are the most effective behaviors that we practice in the organization? What are the most ineffective behaviors that we practice?
The more details and context you can get, the better.
It May Not Be the Same EverywhereThe internal norms, mindsets, and networks may not be the same in all parts of the company. For example, I worked in a global organization. In the US, we were working hard to streamline meetings, eliminating the pre- and post-meeting meetings that often took place. We rolled out effective meeting training that emphasized providing a clear agenda, having honest conversations, and making decisions in the meeting to our New York-based teams.
We had to augment the approach for our teams in Asia where, culturally, decisions are not made during the meeting. Instead, decisions are made in individual conversations before the meeting. The meeting itself is where decisions are formally approved. Rather than trying to fight the broader culture, we acknowledged it and gave other recommendations for making meetings more efficient.
Differences don’t just show up due to geography. You may see disparities in implicit practices across functions or even teams for a whole host of reasons.
Once you have discovered all the implicit elements, you can assess whether they help or harm the organization and determine if and how you want to factor them into your new org design.
To learn more, check out the new ATD Organization Development Handbook. As a contributing author, I discuss this topic in more detail in chapter 6, “Business Alignment: Designing an Organization to Meet Business Objectives”.