Implementing a structure that supports your business goals

Jodie | 03 Feb 2023 | News | Change

Curium’s change consultant, Nick Brown has unravelled organisational design and provided key tips for those looking to implement new structures to achieve their business goals.

Having done [almost] every job in the field of change, with over 25 years’ experience, from retail and operations roles to analyst, architect, Project/Programme Manager and Head of function roles across multiple sectors, I’m here to share some insights into organisation structures.

When I was asked “Change Consultancy, why are you here?” It’s simple.

I love the variety. I love that I can leverage my experience gained over the years and use it to help others. I’ve been on the receiving end of a poor change project. It felt like change was done to me rather than me being part of the change and it doesn’t feel good. No one explained why it was happening.

Everybody is important, you need to be as close to the staff as you are to the management and engage with everybody. Make sure everyone’s voice is heard.

Different roles play key parts in the project, no role is less or more important than anyone else, pay or position do not equate to somebody’s input being more valuable than somebody else, it makes no difference. Some may struggle with uncertainty during org changes, usually down to a lack of clarity about the new structure and how it will affect them. That can create stress for employees.

One of the key areas that our customers look to us to support them with is creating a new organisational design for their business or function.

This is a lot more than simple tinkering; it is much broader than that and benefits from having an external perspective to support the process. So, what are the options for restructuring your company and what do we mean by organisational design?

Put simply, it is the process of creating and implementing a structure that supports the goals, strategy, and culture of a company. This can be a business that is growing, one that needs to become more efficient, diversifying, or wants to be underpinned by new capabilities such as digital.

Read on to see our 6 key steps to successfully implement a new model.

Restructuring the business can bring about these changes by aligning the company’s resources and processes with its priorities. Let’s start by addressing the elephant in the room… the fear of change and how employees react to organisational change.

Inevitably people will have concerns about significant corporate changes, ranging from job security worries to concerns of being micro-managed. But that’s not what happens in a successful restructure.

Lots of people don’t like change at first. Employees may resist change because they prefer familiar, established ways of doing things, even if they are not efficient or effective. Be mindful, your employees may be concerned that the new structure will result in decreased decision-making authority or autonomy.

The impacts could lead to decreased morale and motivation, you may see good people leave, but it’s important for companies to address these fears and provide clear communication and support to help employees successfully transition to the new organizational model.

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Options for restructuring a company

Flat/Horizontal

This involves fewer levels of management and a more decentralised decision-making process, leading to greater efficiency and faster decision-making. This structure should increase flexibility, improve communication and collaboration, and reduce bureaucracy. Watch out for staff confusion and decreased accountability.

Functional

This involves grouping employees based on similar skills or functions, promoting expertise and specialisation. If successfully implemented, you’ll see improved efficiency in specific areas, clear lines of authority, better utilisation of specialised skills. If not… you might see decreased collaboration between departments.

Divisional

This involves creating separate business units based on products, geography, or customer segments. It allows for customisation of strategies and approaches for different units, improved responsiveness to specific market needs. Watch out for duplication of resources and decreased efficiency.

Matrix

A company structure where teams report to multiple leaders, designed to ensure focus and keep open communication between teams. This often results in improved communication, sharing of knowledge and insights and the ability to support customers with new innovative products and services. Be aware, there can be a lack of accountability if not manged well and decision making can become slower.

There are some other, more disruptive models out there.

Take the Chinese company Haier for example. Haier is a company known for its unconventional approach to organisational design, promoting a decentralized, self-governing structure referred to as a “platform organisation.” Self managing teams are empowered to make decisions and act as mini-entrepreneurs, rather than relying on top-down decision-making.

Article | The world of change and our industry tips
6 key steps to successfully implement a new model

In order to arrive at the most suitable model, it is key that the leadership team:

  1. Set goals and objectives for the change, with clearly articulated design principles.
  2. Have identified and defined the key capabilities that you as a business need to have to be able to successfully deliver the business plan.
  3. Involve the teams in the planning process, ensuring that changes to roles and responsibilities are defined and understood.
  4. Develop a comprehensive communication plan to keep all stakeholders informed and involved during the implementation process.
  5. Ensure that employees have the skills and resources they need to successfully adjust to the new model.
  6. Continuously monitor the implementation plan and adjust as necessary to ensure that the desired outcomes are achieved.
Reasons to Change

As a Principal Consultant for Curium solutions, there are many ‘pain points’ we come across in businesses that we’ve been able to support.

Companies often find there are inefficiencies due to the structure or the structure doesn’t support changes to ways of working a new system implementation might bring. Spans of control may well be overloaded leading to ineffective team management.

Sometimes the need to change is event-driven.  For example, a merger of businesses or teams.  Or it may be in reaction to the external environment – think Brexit, Covid, regulatory changes.  Winners and losers are defined by their speed of response; seizing opportunity through product, proposition or geography; taking decisive action to manage risk, increase output or reduce costs – all requiring operating model adaptation.

In all instances it is important to assess the options rather than do what you’ve always done. This includes looking at the work that those people do, is this conducive to their actual role and position? Are they where they should be and are their capabilities being used in the most effective way?

Common reasons why businesses choose to review their existing operating models are;

Business growing pains, new ways of working, external impacts or to keep up with digital revolution.

Article | 10 reasons to adapt change
Common mistakes when it comes to restructuring

Failing to involve employees in the process, will lead to change resistance.

Lack of understanding why the changes are needed will result in a lack of buy in from the people. Not considering the company’s culture and values, leading to misalignment, lower levels of motivation and decreased effectiveness, or failing to consider the long-term impact of the changes, which can store up problems for the future or lead to unexpected challenges further down the line.

It is important to carefully evaluate which models are a good fit for the company’s specific circumstances and to be prepared for the cultural and operational changes that may be required to implement them effectively. This will take time to embed and ensure that the interest of customers, employees and shareholders are aligned.

This is where involving an external advisor can be beneficial.

Getting support from us means having an initial conversation to get some clarity on what you are trying to achieve including goals and objectives for the change. The next steps would be a diagnostic lead by us so we can create a strategy.

We share our tools & techniques with clients to  help them be self-sustaining. Getting businesses fully capable to achieve their own success story is what ‘Empowering Potential’ is all about.

We actually plan our exit right from the start.

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