Resources / Transformation

What is Organisational Design?

  • 4 min read
Vern Norrgard and Roy Stapleton
on February 15, 2022

Organisational Design

It’s about the structures people work in, principles with which they’re organised, and how those parts will connect and maintain focus on delivering value and realise the benefits of all the great people who work in the organisation.

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Why do Organisational Design?

Enabling the most efficient work

Over the last few years, we’ve heard many examples of people feeling overburdened, overworked, and spending a lot of time in meetings, particularly online meetings. It’s difficult to see how this time contributes positively towards delivering outcomes for an organisation. 

The structure of an organisation will influence individual’s decisions about where we invest our time. Anyone in a business wants to know that their choices purposely drive towards something they can recognise as valuable. 

With an Organisational Design, you can achieve this at the individual level, the team level, the portfolio level, and the organisational level, and it doesn’t have to be by accident. 

Inject Autonomy

Another significant shift could be to inject more autonomy within your teams to solve complex problems. People hierarchically led tend to find it harder to combine skills aligned to valuable outcomes or solve problems. In contrast, a top-down flow of work into teams that are enabled to make decisions creates an opportunity to leverage that collective. However, to get to the outcomes organisations are looking for, it has to be designed intentionally. 

In our recent podcast on Organisation Design, Roy Stapleton gives a great example of this situation.

“I have been working with a client for the last couple of years. That client had a very clear goal around how they affected society and invested in sustainable outcomes for their society.”

“Really beautiful goal. It was a vision that I’m sure many people in that organisation felt very strongly about. In fact, in their engagement surveys, it is one of the key reasons people work for that organisation. However, when we started to do the organisational design, we realised that, ultimately, there weren’t that many people committed to their actual job doing that work. It was pretty much primarily voluntary. It was beyond the capacity plan of other work. They were committed to the rest of the time; it was certainly aspirational.”

“However, in terms of the effort linked to those outcomes, there wasn’t a lot going on in reality. So doing an Organisation Design, you’re able to highlight that need to invest proper time, real capacity, and thought in how we create the opportunity within the organisation to go after this very important visionary goal.”

Creating an environment for agility

One of the crucial aspects of the many interaction and connections in a large organisation is understanding how we create dependencies and handoffs. Once established, we need to remove friction from those systems as much as possible. We want people to actively connect with each other to solve problems and create value. 

We see many organisations designed historically in a steady-state situation, have not reviewed their structure for a while. We’re now in a fast-evolving continuous change state environment and therefore need to make sure we’ve got purposely designed organisations optimised for that situation.

To achieve true agility for a whole organisation, we need to create a structure that Agile can operate. Even with optimum Agile teams, if the environment constrains them, the value they’re trying to deliver will not be realised.

Going through the Organisational Design process will ensure the teams are set up to thrive.

When is the best time to do it?

Suppose you’re considering a transformation; create an Organisational Design early to ensure you are set up for success and benefit from the many knock-on-effects of the decisions you make. 

If you decide that you want to organise teams into specific sizes and draw from particular work sources, that will affect how you organise your people around those value items; therefore, it is beneficial to do it in the early stages of a transformation. 

Suppose you have already started your transformation journey, then the moment has not passed, now is the time. 

Roy – “There is no best or worst time because regardless of what moment your organisation is in, why wouldn’t you want to ensure that alignment exists?”

Impact on teams and leaders

Taking a participatory approach to how you go about forming new structures will improve the acceptance of change and the rate of that change. 

You want to get decisions as close to the teams trying to solve those problems, so bringing them into the conversation of restructuring as early as possible is a positive trend in Organisational Design.

Roy recalls successful transformations worldwide like Dutch organisation Buurtzorg, a home nursing company.

“They’ve done transformative things that have immediately impacted their teams from the beginning, specifically by design. Halving the size of the teams, they realised how empowering it was to give them absolute autonomy, resulting in delivering the patient’s outcomes they needed. So they now have a principle that says don’t let them get too big once they get to a specific size, dividing like a cell.”

“An organisation today making that decision, consciously made to do, would have a transformative effect on those structures and the entire culture.”

How to implement

Begin with empathy and consider the people’s perspective going through that organisational change because it can be quite confronting.

The initial approach might be to lock yourself away in a room because it feels more comfortable presenting the correct and most apparent answers. Organisations that have made successful shifts into vastly different designs have achieved that by involving more people and making it an inclusive process.

Your people will support a change when they understand why it is necessary and their role in that change.

Participation of a cross-section of people involved in the process has proved time and time again that involving people in solving the problem will not only endorse it, but they will also often come up with a better solution.

Need help?

EPiC is a transformation specialist, and we have experienced enterprise coaches who can help your organisation through this journey. Get in touch and let us know what problems you’re facing, and we’ll see if we can help.

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