An Organization Redesign Process

Before you begin any organization redesign process, be mindful of this underpinning principle .... When redesigning an organization if you make a change in one area it has an impact on other areas.

Simple analogy: if you put mag wheels on a car and do nothing to adjust the steering, braking and suspension of the car it will not perform to it's optimum.

This is why the following three principles must be understood by anyone who is about to undertake any type of organization redesign.

Lets take a look at how this works.

Let's say you decide to improve business results by moving a significant proportion of team members' salary package from 'pay by the hour' to a performance based bonus.

What would be some of the organizational systems that could be impacted by such a change and that you will need to ensure don't hinder the success of this change? Let's take a quick peek:

• The Information System - The quantity of information given to team members may need to be increased. The speed at which they receive it and their ability to use that information to improve results may need to be enhanced. You may need to implement a robust performance reporting system so people can see immediately how they are tracking and make whatever adjustments are necessary to improve performance.

• The Training System - You may need to implement new skills training for people to enable them to understand how to interpret information. You may need to train them in new skills that enable them to do their jobs more effectively. You may need to train them to think like business owners and entrepreneurs.

• The Organization Structure - Departments may need to be integrated or roles significantly changed so that artificial/turf barriers don't get in the way of the program working.

• Decision-making System - The way decisions are made and the level at which they are made may need changing. Authority to decide might need to be taken down to lower levels so that people are able to make decisions that enable them to more quickly influence/improve results.

• Tasks and Technologies - May need to be improved in order for the bonus system to achieve its objectives (which is to improve business performance).

Not making adjustments in interdependent systems is sure to make any organization redesign sub-par.

Unfortunately many times I've witnessed people come and benchmark against organizations I've worked for, pick up on elements of our organization design and decide to implement those elements and then fail miserably. Why? Good question! Well...

They may have seen that we paid for performance --- but not fully grasping the three principles of organization design -- they may not give enough emphasis and consideration to how they need to change/enhance other interdependent systems to enable the program to succeed.

So let's take a look at an organization redesign process that helps you to think about the various systems (and done well will help you to build a high performance culture)

Identify The People Who Are Responsible For Driving The Organization Redesign Process:

Organization Leader: Generally the most senior person in the organization who sets the direction for the change process and names and appoints the members of the Steering Team.

Steering Team: Generally consists of a cross section of key (senior) leaders, decision-makers and stakeholders from within and external to the organization. For example, if your workplace has a strong union presence then you would do well to have a senior union organizer as a member of this team. This team is responsible for:

• Identifying and appointing the Design Team
• Establishing boundaries and guidelines for the Design Team
• Approving Design Team recommendations and
• Ensuring the Design Team has the resources (particularly time and money) they require to get the job done

Design Team: Typically consists of 6-12 people, from a diversity of functions. These people should come from both leadership and front-line ranks. The team should include at least one person who is on the Steering Team (this person is the bridge between the two teams -- a tricky role so make sure you get someone really, really good at influencing and thinking at both strategically and grass roots practicality levels.).

The Design Team's role is to:

• Do the work of analyzing the current design and then making recommendations for the new design choices

• Regularly reporting back to the functional teams (see below ... Implementation Teams) on the design choices being recommended

• Get input from the Implementation Team about the recommendations being made ... (information to and involvement of everyone who is going to make the organization redesign process actually come alive is critical! ... Red bandage critical! When it comes time to implement you don't want the people who are actually mostly impacted by, and responsible for, making the change happen to be surprised//confused/suspicious/angry/annoyed at not being consulted.

Implementation Team: As indicated above these are the people who are actually going to have to use the new systems/ideas/organization redesign. They are responsible for implementing the design choices recommended by the Design Team (and approved by the Steering Team) so that the organization transforms from its current state to the new high performance state.

If you haven't kept them on board throughout the process ... if you haven't asked for and/or listened to their input then expect your organization redesign process to fail!.

Renewal Team: A team set up after the Implementation who, on a regular basis (e.g. yearly) monitors and assesses to what degree the organization redesign does what it was intended to do. This team makes recommendations for further changes as required.

Consultant: Recommends and trains the Design and Steering Teams in how to use the design model. The Design Team training is in far greater depth helping them to understand and learn the tools to be used during the re-design process.

Provides overview training to the Implementation Team. All teams must understand and have commitment to the organization redesign process. If this is not achieved at all levels, then the organization redesign process should not go ahead.

Throughout the organization redesign process offers suggestions about best-practice design choices and points out design flaws the Design team may overlook. Helps the team stay focused and on track.

Describe The Vision

Firstly the Design team describes the Vision for the Future. The organization's Internal Compass (the Behaviors, Values, Principles and Mindset will be clearly defined at the end of this body of work.

However, it is important that the members of these teams stay open to this being modified as the Design Team delves further into the re-design process.

Review Current Design Choices

Next time is spent analyzing the external environment, social and technical systems and identifying the symbols, rituals and legends that create the current culture of the organization and keep alive beliefs about 'how we work around here'.

The interactions of the various systems and organization design choices you have previously made will either make it easier or or disrupt the cultural changes you are attempting to implement.

In analyzing the external environment the Design team needs to be aware of the needs and expectations of:

• Customers (current and potential),

• Stakeholders (share-owners and their representatives - e.g. boards of directors),

• Influencers (regulators, suppliers, unions, government etc.),

• Competitors and Best-in-class organizations

Recommend New Structures, Symbols and Systems

Once the Design Team will has reviewed all the elements within the current organization design they can now begin recommending the changes that need to occur in order to achieve the desired Vision.

At this stage of the organization redesign process it is critical that a communication plan is put in place to enable feedback between all team members of the organization.

Success Criteria: Nominate the outcomes desired in these four categories: Customer, Stakeholder, People, Community

Culture: Identify the values, behaviours, skills and characteristics that the people working within the business must have. Generate the guiding principles that encourage people to use these behaviours and skills, in order to achieve the vision and mission.

Strategies to Influence: Determine the strategies needed to manage and reduce variability and demands from the external environment. This enables you to meet both the requirements of the external environment as well achieve your desired performance outcomes

Key Performance Indicators: Choose KPI's which will deliver the business performance required, along with inspiring the behaviours and characteristics expressed in the Culture.

Technical System: Analyze and re-design in terms of how tasks are performed, technologies required and the layout of buildings/facilities so that the People and the Technical systems are unified to produce high performance.

Structural System: Design the structure for each of the three teams: Front-Line, Resource (Management) and Strategic so that they foster the culture required to deliver high performance.

Decision-Making & Information System: Establish what, where, how decisions are made. What information is needed to make those decisions and how it is captured, stored and shared.

People System: Define the Competencies, Job Design, Selection, Induction/Orientation, Learning, Performance Contracting, Career Development systems that support the new organization design.

Reward System: Choose how people's contributions are recognized and rewarded and ensure the system encourages people to focus on organizational goals. Read more on rewarding employees

Renewal System: Decide how you will regularly review your business and make any design changes needed to ensure continuing optimum performance.

Develop an Implementation Plan: This identifies who is responsible for implementation, time-lines, resources required, potential bottlenecks and contingency plans.

Execute the Plan:

Implement The New Culture

Here's where the rubber hits the road in your organization redesign process. If this part fails then the rest of the process has been for naught.

Implementing the changes can be a challenge - which is why before you begin the organization redesign process you must ensure that there is deep commitment to the changes by the leadership team and that the Implementation Team is kept abreast of Design Choice recommendations (and the reasoning for them) every step of the way.

When the Implementation Team is kept involved in the process and has input to the Design Team, implementation happens much more quickly and seamlessly.

The leadership teams must take a very active role in changing the workplace culture. They help people to let go of the past behaviors and mindsets and encourage people to adopt the new ways to success.

The leaders spend time talking ... talking ... talking about the benefits of the change, both to the individuals and the teams as a whole.

Ensure that progress is tracked and measured regularly and that all wins are celebrated.

This is a very short overview of what is a dynamic and intricate organization redesign process. On the changing workplace culture page you may like to review the pitfalls to watch out for.