Last month, I read an article from Harvard Business School professor and disruptive innovation expert, Clayton Christensen. In it, he argued that the reason why it's so difficult for existing businesses to capitalise on disruptive innovations is that their processes and their business models, which make them good at the existing business, actually makes them incredibly bad at competing in this new working climate.
This got me thinking about organisational development and design; because while these are two of the most fundamental roles within an HR professional's remit, or so I believe, they are talked about very rarely. In fact, run a quick search online and the first few pages are filled with academic papers about the topics; rather than best practice insight and examples of the concept working in reality.
I find this particularly strange though I guess unsurprising. While my job title specifically includes organisational development, very few of my peers have the same (though of course a job title isn’t everything; it’s merely an interesting viewpoint). I would also argue mine may need to include 'design' as well in the future…
So what is the difference? In simple terms and how it truly relates to what we do, organisational development is about developing talent in the right way to address the right needs of the business. Organisational design is ensuring you have the right people focusing on the right things so they are empowered to solve the right problems in the right way aligned to the business strategy, culture and values. In a way they are very similar however, what differs is the thought process.
When you really think about it, both ODs relate to absolutely everything – engagement, development, purpose, values, culture, external markets, behaviours, procedures and processes. Yet, organisational design is the foundation of the business and, in this uncertain and ever changing business environment is absolutely critical to the success and growth of a business.
As Christensen alluded to in his article, if you have the wrong design then it makes it incredibly difficult for you to challenge and be a progressive business in an increasingly competitive marketplace.
Org design: the game changer of the future?
In survey after survey, I read about how the majority of CEOs anticipate significant disruption to their businesses over the coming years as a result of external worldwide factors; such as consumer behaviour, competition and economic instability.
To stay ahead of these trends, those surveyed recognised the need to change an organisation’s design. This is particularly interesting - OD isn’t necessarily viewed as a ‘people’ initiative. At the highest level, it’s seen as the game changer in an organisation’s ability to compete and move forward.
Therefore, if this is true, the starting point of any OD conversation has to be the strategic initiative of the business; and not the organisational chart, which should be the last thing you think about. In my opinion, one of the main reasons organisational design goes wrong, is because leaders are too caught up with getting the traditional hire structures right; focusing on the past and ‘how we’ve always done it’ without considering the future.
Link your OD to your business aims
What is the imperative of the business? If you’re a retailer, it may be selling shoes. In hotels, it’s rooms and restaurants. So how do you design your organisation to achieve that objective? How do you set up the business to deliver the goods or rooms to sell to the end user? How do you understand the underlying context as well as physical and emotional reasons why a customer is purchasing from you?
In our environment, we talk about the guest journey; looking at each interaction, touching point, moment of truth and enhancing it so it fully supports our overarching vision. But, what does this mean as we grow our business and change it either through our people or technology?
Let me give you an example: for years, in hotels, we have operated traditional engineering departments. As you would expect, we recruited talented employees who specialised in décor, painting, carpentry, plumbing and general maintenance. hen technology began playing a larger role in our hotels. Items such as WIFI, iPad controlled lighting, guests travelling with their own technology and even automated toilets. This ‘new world’ of guest-centric technology required a whole new knowledge and skills set for our traditional engineering workforce.
So we went from having the right people to support the building itself, to needing new job descriptions, efficiencies, role structures and skills to support what we have become. This created additional departments with employees whose knowledge and skills vastly differed from in the past. Now, IT and engineering work seamlessly into a whole new design of how jobs are completed.
HR's role in design
When you truly start seeing yourself as a designer of people, roles, communication, structures and eventually the hierarchies (or lack thereof) you soon realise that the potential to solve problems in different ways is quite limitless in the future.
And taking this approach works. There are already great examples of the positive affects this can have on guest engagement and financial returns in the private medical sectors, such as the Mayo Clinic, and within the true ‘test, learn, implement and grow’ cultures seen at famed companies such as Google and Facebook.
So ask yourself as a people leader:
- What sets us apart now and in the future?
- What is our sense of purpose? How do we make a difference for our guests, employees and owners?
- How do our people currently make decisions in our business?
- How do they manage information and adopt new behaviours?
Our evolution continues… channel your inner designer and make it a reality.