Organizational Design Transformation – Top 10 Trends

By | March 12, 2016

In a recent Forbes article, Josh Bersin suggests that today’s digital world of work has shifted organizational structure from the traditional functional hierarchy to a “network of teams.” Bersin refers to a recent Deloitte study of people challenges in business in coming to this conclusion. According to the study, the top 10 trends look like this: 

Structure

Only 26% of large companies are functionally organized and 82% are either currently reorganizing, planning to reorganize or have recently reorganized to become more client focused. A startling highlight is that only 8% believe that they have the optimal structure in place and just 4% plan to maintain status quo. Further exploration with company officials disclosed a belief that the functional structure was obsolete. A network of teams structure can be managed well in today’s global economy due to the use of digital technology…and the bottom line is that this approach appeals to Millennials who are focused on innovation!

Book How to Change Things When Change is Hard

NEWS BULLETIN:

Today’s successful leaders possess the competencies to inspire and align their team and excel in connecting teams together and sharing information!!!

 

Story!

In the book Team of Teams, General Stanley McChrystal describes how he dismantled a functional structure in the US army during the war in Iraq to achieve success. He built teams, empowered team leaders to take charge, and leveraged digital technology to help those teams coordinate their activities. Has your company transformed into a story of “coordinated but distributed operations?”

Leadership

90% of companies revealed that leadership is a major problem and almost 2/3 of all respondents believe that the problem is urgent. The majority of our front-line supervisors grew up in the functional structure where they were promoted due to their subject matter expertise rather than for their leadership competencies. We have a leadership problem because we don’t have leaders who are agile, who learn fast, and who are connected within the organization. Today’s leaders need to have on hands-on leadership skills and be able to lead their team and collaborate across teams to achieve business outcomes.

 

NEWS BULLETIN:

Today’s leadership has moved away from “positional leadership” to “team leadership” focused on expertise, passion, energy, and empowerment.

Culture

86% of companies rate this trend as “important.” At least 50% of today’s workforce is made up of millennials who are looking for mission and values at work. Working in small teams requires a shared culture to ensure that strategies, programs, and compliance take place in a consistent way. The constant question for business leaders around the world is “what is culture and how do you measure and manage it.” Unlocking the secret to building a culture of high performance is job #1 for business leaders.

Engagement

85% of companies rate this trend as “important.” Today’s employees are active on social networks, openly sharing information about their company and their boss. Employees who are not engaged and inspired at their work tend to drift away and can result in low performance and customer service. With this in mind, leaders can build employee engagement by opening up two-way communication channels where employees can constantly provide feedback and express concerns. This strategy can provide leaders with the ability to immediately spot problems and design solutions in a collaborative way with employees that will result in employees who are more productive and aligned…employee engagement at its best!

Learning

This topic was identified by 84% of companies as important and this rate increased by 10% over the previous year. Two important shifts must be recognized. Employees choose jobs where they are enabled to continuously train and educate themselves. Companies must provide a comprehensive set of learning experiences on the job…notice that we are not talking about “courses!” It’s about opportunities to develop which is the second shift. Employees are focused on career development and professional development. Skill development is the key in today’s “network of teams” organization. High performing organizations can only attract the best of the best when they provide professional skills, technical education, and career development.

Design Thinking

Empowering people through shared goals and a team-centric structure requires this new organization to be designed to help people get things done. We need to focus on designing HR, learning, and talent programs to make work simpler, easier, and more developmental. Really the design is focused on the user, the employee.

New Model for Management

Change is upon us…there is a major change in management thinking. Team leaders must have the competencies to inspire and empower teams to succeed. There is no room for executives who operate in the old fashioned, hierarchical structure. They must see their role as one of a facilitator and strategist. This new model impacts what high performing leaders do, who is promoted to the executive level, and reward systems are designed to help leaders contribute.

 

NEWS BULLETIN:

Performance management is changing. Gone is the once per year annual performance review. More and more companies are shifting from the old “numeric rating” toward programs that focus on conversations to facilitate feedback, encourage coaching, and an evaluation of people’s contributions to the organization as a whole.

 

Discard the Organization Chart and Focus on Talent Development

Increasingly, organizations operate less like a top-down bureaucracy and more like a sports team. This approach is shifting the focus away from an organization chart due to the obstacles that “job titles” and “job levels” create for organizations that look to redesign their programs for career development. The organization chart tends to foster and support the old hierarchical structure where employees are forced to think that they can only progress in the company by moving “up” in the company. Companies need to forget about the whole idea of “high potential” and, instead, empower all employees to grow through continuous development and challenging assignments. Decreasing the number of layers within the company can support this “network of teams” approach.

Digital HR

This trend represents a new focus on HR solutions that help people get work done. This shift will mean that HR has to understand and learn how to build feedback, coaching, goal setting, and development programs that are “app” friendly, are easy to use, and fit into the work that is being done.

Designing the New Organization for the People

It’s really about thinking of “businesses as collections of people”…with a focus on operating the way we as people like to work. It’s really quite simple…humans naturally like to communicate, collaborate and operate in small groups. Of course, we like to part of the bigger picture but our first goal to connect with people we like, respect, and can enjoy. Today’s leaders are quickly finding out that their road to success is found in their ability to tap into the power of every individual and every team while being alert to how the network of teams can be brought together to fulfill on the needs of customer and the organizations as a whole.

Let me know what you think!!

As a Project Management Professional (PMP) and Prosci Change Management Practitioner with ten years experience, I would love to hear from you…please leave a question or comment! Here is a link to my profile.

Stay tuned for my next blog as I look at some of the top trends in organizational design…

Cheers,

Miles

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About Miles

Hey everyone, I am Miles and I have been learning about and “practicing” change management over the past 10 years. During this period, I have learned, applied, evaluated and started over…learning from evaluation, applying lessons learned, evaluating…what seems like a million cycles. I have tried just about every change management approach on the planet and each of them has pros and cons recognizing that not one organizational change initiative looks exactly the same.

4 thoughts on “Organizational Design Transformation – Top 10 Trends

  1. Giancarlos

    Hi Mr.Miles 🙂
    Honestly, I think the same…its all about people and his mind, thats why I think mindset is one of the most important think this days.
    Nobody know exactly what is leadership and how important it is.
    I have been read the book “how to influence people” from John C. Maxwell, and is incredible what can you do with a great leadership.
    Thanks for the post Mr. Miles…
    Cheers,
    -G.C

    Reply
    1. Miles Post author

      Thanks for taking the time to comment! You are bang on with the importance of our mindset. Do you agree that it is possible to influence people for results when you have great leadership skills?

      Miles

      Reply
  2. Jason

    Things sure are changing in the roles of leadership. Lot of great information here and it is very much needed today. Like you said there is a change taking place when it comes to the leadership role and the leadership style. Leadership is a hard role to fill today and much of the problem stems from young adults coming along that haven’t had good training in regards to communication to get their ideas across. Our digital world has made communication impersonal and if we can’t connect with one another we won’t get anywhere. Thanks for the info Miles. God bless!

    Reply
    1. admin

      Thanks for your comment, Jason. You are absolutely right about the need to foster our ability to connect with one another. Cheers!

      Miles

      Reply

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