What is Organisation Design?

An interview with Jonny McCormick, Principal at LanciaConsult, Belfast

Q: What is a typical Organisation Design project?

A: It’s going to sound a bit cliché I’m sure…but there isn’t really a typical Organisation Design project. This is because organisations undertake Organisation Design projects for such a variety of reasons - making it both complex and exciting. Whilst the rationale for undertaking Organisation Design can be varied, there are some “common elements” that will be fairly typical: 

• Building an organisation that responds to new contexts - Organisation Design Is often about helping organisations adjust to a new reality - that could be a macro-economic development; a new market opportunity; an innovative breakthrough; or a host of other drivers. Good Organisation Design helps organisations respond to these changes by ensuring their organisation Is “right sized”, with the right capabilities, the right culture, and the right ways of working to respond.

• Engagement with leaders and managers to build a fit for purpose organisation - Organisation Design cannot be done in isolation if it’s to be successful. Consultants being locked away in a room with limited ability to engage with leaders, managers and others in the business is going to lead to all parties being frustrated. The best Organisation Design projects know which leaders, managers, and others to engage to make the project a success. One of the biggest barriers to implementing new organisation designs is a lack of consultation and buy-in throughout which can lead to lots of revision, rework and repurposing when we could be getting on with implementing. 

• Aligning designs with strategic objectives - the way you organise people and teams should enable and accelerate the delivery of your strategy. Organisation Design can happen at multiple levels - it could be just a team, a group of teams, a function, a business unit, a market, a region, or the whole organisation! 

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Q:  Why do organisations undertake an Organisation Design project? Is it usually due to internal or external factors?

A: It’s not always as simple as just an internal or external factor that drives the need for Organisation Design, but it can have a material difference on whether the event was predicted or completely unknown.

• Internal, known - this Is simply an internally driven need for Organisation Design that was known about. A good example of this is in the event of an acquisition and integration. Buying another business and folding It Into an existing organisation is, unsurprisingly perhaps, an excellent driver for Organisation Design to ensure that the new organisation is “right sized” and new capabilities are fully utilised for the benefit of the new entity.

• Internal, unknown – these instances could be as simple as a “key person” leaving in an unexpected way or on an unpredictable timeline. In Organisation Design we typically try to avoid these single points of failure, but they can inevitably creep in over time, and you might not realise it until you’re confronted with the situation.

• External, known – these external events, whilst known, can have a ripple effect into organisations. A good example here is the impact of Brexit. Shifts in public policy, import/export, and regional positions can lead to changes internally. Think for example of a consumer goods organisation based right here in Belfast, Northern Ireland. Navigating uncertainty around Europe could lead to organisations’ needing new capabilities and organising around new customer realities.

• External, unknown – we all know the example I’m going to lean on here, right? COVID forced changes that organisations couldn’t possibly have predicted. Changes to physical location, collaboration, ways of working, culture, systems, tools, and technology can all have a knock-on impact forcing the need for Organisation Design changes. For example, as some organisations noticed the benefits of remote and hybrid working, they opened themselves to new talent pools that necessitated structural changes; or the introduction of new technologies could force a shift in IT org structures; or even in instances where consumer preferences changed, the organisation needed to evolve to respond to this.

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Q: What about when an organisation changes its strategy or goals? This seems like a sensible time to invest in Organisation Design. Is it?

A: When an organisation’s strategy, goals or purpose evolve (or go through wholesale change!) it’s prudent to look at the organisation design that supports the delivery of the strategy. It might not always need to change, but, more often than not – it does!

If your organisation has changed its strategy recently a good question to ask is “are we organised to deliver this?”. If the answer is no, it’s time for Organisation Design. When you’re approaching your design, it’s important to align your design principles (these are simply the things against which you assess the effectiveness of the new design) with the delivery of the new strategy. For example, if your new strategy includes “understanding our consumers more deeply and being more responsive to their needs” and your organisation has functional silos in product, marketing, sales, and customer service it might mean that you’re missing an opportunity to bring these teams closer together for the benefit of delivering your strategy more effectively.

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Q: What about when businesses and organisations are looking to consolidate and reconfigure?

A: Consolidating or reconfiguring your organisation can often be associated with layoffs. Sometimes this is an inevitable part of Organisation Design. When an organisation has sprawled for too long, or decision making for critical decisions has been delegated too far into the organisation, or maybe costs have spiralled out of control and the organisation isn’t viable without a rethink, or an organisation simply doesn’t actively manage their organisation design, it might mean that reducing the size of the organisation is necessary. It’s not always nice, or enjoyable, but sometimes that’s the reality of it!

It's not always the case though – sometimes you simply need to redesign because you’re not using the full range of capabilities, or a new design could release latent potential.  

In these instances, it’s really important to tie the rationale back to the delivery of the strategy. This is ultimately the reason you undertake any Organisation Design – to deliver the strategic outcomes of the organisation. It can be tempting to get focused on the “close reason” – e.g., “we need to cut costs”; or “we deliver too slowly”, and while these things might be true, they can seriously damage the organisation if it’s seen as the only reason for the change. Leaders who keep the north star in mind and constantly reiterate are much more successful in navigating the sometimes-murky waters of Organisation Design.

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Q: Why is LanciaConsult the best to deliver a successful Organisation Design project?

A: There’s a few reasons I think LanciaConsult are the team to pick if you’re thinking about Organisation Design:

1. We have people who have “been there” and “done that” – our team are experienced, not just in designing an organisation that fits with the design principles, but in implementing the designs they make. We won’t leave you to do the hard yards yourself.  

2. We work with you to design the right solution – we pride ourselves on working closely with the people in your organisation who need to be engaged in the process. Our style is:

• Collaborative – we work with you to answer solve your challenges
• Challenging – we will ask the hard questions from a place of partnership and care
• Creative – we bring new ideas and fresh thinking to help solve complex challenges

3. We make your challenges, our challenges – we are deeply invested in our clients and helping them solve their challenges. We don’t critique from a place of being removed, we jump into the trenches with you and roll up our sleeves. Our people are committed to helping your organisation get the right specific solution – we don’t copy and paste solutions from elsewhere because every context, culture, and challenge is nuanced.

Want to find out more about how we can help you with your Organisation Design project? Get in touch today!

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