Aligning Organisational Structure with Strategy and Goals
Is your organisation well-designed? And how do you know?
What does a well-designed organisation look like, and how does it feel to work there?
And how is it different from a poorly-designed one?
These are the types of questions we will explore in looking at organisation design.
Many people equate organisation design with an organisation's structure: In fact, organisation design is the process of aligning an organisation's structure with its mission. This means looking at the complex relationship between tasks, workflow, responsibility and authority, and making sure these all support the objectives of the business.
Good organisational design helps communications, productivity, and innovation. It creates an environment where people can work effectively. Many productivity and performance issues can be traced back to poor organisation design. A company can have a great mission, great people, great leadership, etc. and still not perform well because of poor organisational design.
Take the example of a company whose sales department and production department both work well as separate units. Yet they need to communicate about customer needs and have not been organised to do so: Company performance suffers as a result. Then take the example of a company that wants to grow by acquiring new customers. Yet its sales team is rewarded for customer retention instead: Again, company performance is compromised as a result.
How work is done, business processes, information sharing and how people are incentivized; all of these directly affects how well the organisation performs. All of these factors are facets of the organisation's design and each facet is important to organisation's success.
