The fundamental task of organization design is, as it always has been, helping a leader move from defining strategy to putting in place an organization that enables the strategy to be executed predictably.
When a company adopts a significantly different organization design, a critical part of the implementation process needs to include putting in place leaders who lead in a way consistent with the new value proposition and who will take steps to strengthen corresponding cultural norms.
A few years ago Dave Ulrich, a management thought leader from the University of Michigan, made a comment I found both insightful and profound: “ Every leader needs to have a model of organization design.”
Although that kind of redesign is still required periodically, leaders today are more typically confronted with the challenge of how to find cost efficiencies in certain parts of their organization to invest in other parts of the organization that drive growth. As a result, organization design is no longer just a big bang event.
Certain activities are crucial to delivering on the value proposition. As a result, they should be owned by the company and given the greatest possible resources. Conversely, there are functions and activities where an extra dollar of investment doesn’t help the company win in the marketplace.
Business strategies are lofty, typically long-term oriented, and often aspirational. By contrast a compelling value proposition describes succinctly how the company will compete successfully against its competition—and implies the critical activities around which the organization should be designed.
John Beeson is Principal of Beeson Consulting, a management consulting firm specializing in succession planning, executive assessment and coaching, and organization design. He is also the author of The Unwritten Rules: The Six Skills You Need to Get Promoted to the Executive Level (Jossey-Bass.).