As result of greatly reduced demand for products and services, organisations globally, regionally and locally are revisiting their business strategies and models as well as their operating models, before restructuring their organisation’s resources and capabilities. By doing this, they aim to improve their performance.
A significant number of organisations are opting to carry this out themselves. And as with all DIY efforts, the results are mixed and varied. The aim of this article is to provide brief summary of best practice in organisation design and employee effectiveness.
There are clear and connected steps to take when undertaking such major exercise. Before an organisation considers any change, it’s crucial that the basic elements (shown above) that are core to the organisation are clear, agreed and understood. Once this is done, the organisation can confidently move to the first step in clarifying and adjusting its structure.
The importance of structure While structure itself will not ensure successful strategy implementation – poor structure can impede success. The key priorities of the organisation need to be reflected in the structure, and in turn the structure needs to organise, motivate and empower employees to achieve the strategy.
This can only be achieved through clearly defined and articulated accountabilities for each role. Jobs need to be defined by focusing on their contribution to the organisation and delivery of the strategy.
This is shift from focus of defining the ‘how’ of the job which focuses on tasks, activities and processes, to understanding the ‘why’ of the job, focusing on its unique contribution to the organisation, and the ‘what’ of the job, focusing on the key areas of accountability and their outcomes in organisational success terms.
Having this high level of job clarity is essential to not only improving, but maintaining performance. It is also one of the critical elements of an engaged and enabled workforce.
Engagement is not enough Contrary to popular belief, it is important to note that employee engagement doesn’t always necessarily link to effective performance. Many organisations will identify with the notion of having high levels of employee engagement, but still struggle to achieve their desired levels of performance. Alternatively, they have areas of the business where engagement is not high but performance is. Organisations that focus solely on engagement are likely to be disappointed by the extent to which improvements in this area can translate into enhanced performance.
Hay Group’s extensive global research reveals that the missing link between engagement and performance is enablement. We have found that organisations with high levels of engagement and enablement outperform their competitors, by 4.5 times.
Enablement can be defined as ‘support for success’, it is about providing your employees with means, structures, tools, processes and the wherewithal to undertake their jobs effectively.
Inevitably, vital part of enablement is job design – how the job is designed, its focus and how it links to other roles in the organisation – ensuring that it fully leverages the potential of the job holder. Enablement is greatly impacted by structure and organisation design.
We find one of the most significant consequences of DIY organisation design is the unintended negative impact on enablement.
Ian MacRae is managing director of Hay Group New Zealand, the New Zealand branch of the global management consulting firm. Sam Dawson is with Hay Group Insight Pacific.
