Next month, WWC is taking on an office at Formation – the workspace at The Star: The Dallas Cowboys practice field. This is a dream office for us. But it is also so perfect for what we do. We create winning teams through expert organizational design.
What is Organizational Design?
Think of your organization like a winning football team with players, co-captains, and you as the head coach.
Your employees are the players, each one playing a specific position like quarterback or linebacker. These positions equate to specific roles and responsibilities within the organization. Each player has their own skill set and tasks to perform – just like employees have specific tasks based on their job description.
Your middle managers are your co-captains. They’re responsible for coordinating the players on the field, ensuring that plays are executed correctly, and reporting back to the coach. They translate your strategies into actionable plays.
As the CEO, you are the head coach. You map out the strategy and the plays you want to run on the field. You decide who gets to be in the starting lineup and how to use your resources. Your staff of defensive and offensive coordinators, they’re your upper management, helping you develop strategies and make decisions.
Think of your Business Plan as your Playbook.
Your playbook is your business plan. It outlines your strategies, tactics, and plays. Each player needs to understand it, know their part in the plays, and how they contribute to the overall game strategy.
Internal communication is like the signals and calls made on the field. It needs to be clear and precise, so every player knows their role in the next play. Miscommunication can result in mistakes, lost yardage, or even turnovers. Think about your business. How many times has miscommunication led to delays, lost revenue, or missed opportunities?
Culture = Team Spirit
The culture of your football team is akin to the culture in your organization. It’s the “team spirit,” the unwritten rules and attitudes that define how your team – your employees – acts and responds. Whether it’s a winning mentality or a never-give-up attitude, this culture drives how your team performs on the field and in the market.
Rewards and Consequences
And finally, the disciplinary actions, bonuses, contracts, and the trades – these are your systems of rewards and consequences. They’re what you use to ensure players stay motivated, perform their best, and maintain discipline.
Get the right team design, and you’ll have a Super Bowl-winning team. Get it wrong, and you’re languishing in the basement of your division. (No jokes about the Cowboys here – we are on the Quest for Six)! Organizational design is no different.
The Nuts and Bolts
Organizational design is a thoughtful and strategic framework that relies on several key elements:
- Organizational Structure: This is the backbone of your organization defining the hierarchy and layers of management. It establishes clear lines of reporting and communication, ensuring everyone knows their role and responsibilities.
- Work Specialization: Each individual in an organization brings their unique skills and expertise. This element of organizational design allows for each person to utilize these skills in a specific role, which empowers them to do what they do best and contribute meaningfully to the organization.
- Departmentalization: This is the process of grouping individuals and roles into functional units or departments. This enables better coordination, fosters teamwork, and promotes a sense of belonging amongst individuals who share common tasks and objectives.
- Centralization and Decentralization: This aspect pertains to decision-making authority. Centralization puts decision-making power at the top, while decentralization disperses it throughout the organization. Both have their merits and the choice depends on the nature and needs of the organization.
- Span of Control: This refers to the number of employees that a manager can effectively supervise. It’s about balancing the workload and ensuring that each team member receives the right amount of guidance and support.
- Coordination and Integration: This involves orchestrating all the moving parts in your organization to work in harmony. This ensures smooth cooperation between departments and individuals, enabling them to work towards a common goal.
- Rewards and Penalties: In order to motivate and engage your workforce, institute a fair system of recognition and accountability. It’s all about rewarding good performance and addressing any issues in a constructive manner.
- Organizational Culture: This is the spirit of your organization. It’s the shared beliefs, values, and norms that shape how your team members interact and behave. A healthy, positive culture inspires loyalty, drives engagement, and promotes productivity.
At its core, organizational design is about creating an environment where each member of the team can thrive and contribute to the overall success of the organization. Want to talk through your game plan? Connect with us for a complimentary discovery call.
Some Books to Read on Organizational Design
- “Organization Design: Simplifying Complex Systems” by Nicolay Worren: A comprehensive guide to understanding the complexity of organizational design in the modern business environment.
- “Designing Your Organization: Using the Star Model to Solve Five Critical Design Challenges” by Amy Kates and Jay R. Galbraith: This book provides a practical approach to organization design with a focus on the ‘Star Model’ framework.
- “Organizational Design: A Step-by-Step Approach” by Richard M. Burton, Børge Obel, and Gerardine DeSanctis: This book offers a step-by-step approach to organizational design with a focus on designing and managing organizations as dynamic systems.
- “Reinventing Organizations: A Guide to Creating Organizations Inspired by the Next Stage of Human Consciousness” by Frederic Laloux: Laloux presents new models for organizations that align with more evolved stages of human consciousness.
Helpful Articles to Read:
- “The 5 Classic Mistakes in Organizational Structure: Or, How to Design Your Organization the Right Way” Organizational Physics
- “10 Principles of Organization Design” from Strategy+Business
- “The Importance of Organizational Design” Harvard Business Review
- “Organizational Design: The Rise of Teams”, Deloitte Insights (2016): This article discusses the shift towards team-centric organizational designs, highlighting the benefits of this structure.