Strategic Organization Design: Getting the Basics Right

Strategic Organization Design: Getting the Basics Right July 9, 2021Leave a comment
Executive drawing an organization chart

One of the most common concerns raised by employees (yes, managers too!) is as simple as it is complex.  Organization structure and design, reporting lines and levels of authority should be straight forward and well understood by all.  Yet, in companies large and small, team members often cite the same question: “what is it that’s expected of me?”

As a professional football fan, I often see this phenomenon played out at the end of each season. Following a disappointing season, changes in leadership is often at hand for teams that have underperformed or simply need “a different voice in the locker room”.  General managers, head coaches and in some cases, entire staffs are shown the door, some not even lasting until the season ends.  To be sure, the pressure to perform at the professional level is intense and under scrutiny by owners, the media, and fans with a penchant for expressing their disappointment via social media and in other creative ways.  As a student of organizational leadership, I find it interesting that so many of these teams continue to put in place structures and systems that seem illogical and almost certain to bring about confusion and internal strife.

Here are a few examples.  One team has the both the head coach and the general manager reporting directly to the owner, because that’s how the owner wants it.  That structure has proved dubious over the years and no wonder.  Both the coach and GM are in competition for the favorable attention of the owner.  When problems arise, each is more likely to blame the other.

One team GM hired an assistant coach before the head coach was hired, this even though the assistant would be a direct report of the head coach going forward.  Others have the coach all but select the next general manager, the person to whom he (the coach) will report.  One coach had a habitual problem with a talented but troubled player.  His answer?  Make the player the captain of the team.  And on it goes.

In their seminal book Strategic Organizational Design, authors David Nadler and Michael Tushman address many of the structural challenges and problems facing organizational leaders.  Their research strongly suggests that more attention be paid to organizational design, and how it evolves and changes over time.  This will bring about more clarity and confidence in employee roles, responsibilities, reporting lines and expectations.  The positive impact on organizational culture in well-designed organizations is dramatic.  Fact is that well-designed organizations tend to attract and retain high performers.  Conversely, companies who struggle with or ignore strategic organizational design provide a convenient and comfortable hiding place for underperformers intent on avoiding responsibility at all cost.

How about your organization?  Do people understand what is expected of them?  Is their responsibility and decision-making authority clear?  Does the design and structure of your company match the strategic intent of the enterprise?  Is it the subject of review during your strategic planning sessions?

For more information on how your company can benefit from a comprehensive review of organization structure and design, send me an email at joe@ajstrategy.com.

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