How to Renew Your Organization

death desert.jpeg

Whipping down the streets of Washington D.C. in a taxi, I was dreading my arrival at a recent business acquisition.  I mistakenly believed that my organizational design role was to break the hearts of these leaders.  Twenty years earlier, they had founded a company in their garage and now they had made it big, having been purchased by a Fortune 100 company.  I erroneously thought that my role was to deliver the news that their small company ways of doing things would now have to completely change.  They would need to assimilate to the mother ship!

I glanced down at the final piece of research I had gathered in preparation for this meeting.  It was the Ichak Adizes model of an organizational life cycle (Ichak Adizes, www.adizes.com, 2017).  This holistic and intuitive approach fundamentally changed how I approach recently merged companies, as well as how I engage with all smaller entities within larger organizations.

The Adizes model of an organizational life cycles provides a metaphor for viewing the stages of organizations.  Adizes wisely observed that the basic principles for managing organizations as they mature are similar to living organisms.  We have all exclaimed in frustration at some point that managing our staff is like trying to deal with a bunch of unruly kids.  Adizes took this statement usually made in jest to a whole new level!

Adizes pointed out that the predictable and repetitive patterns of behavior that humans experience as they grow and develop are similar to what organizations experience. As a result, just as you develop ways to help your teenager move from adolescence into adulthood, you can leverage similar strategies at an organizational level.  One can reflect on the characteristics of the organization at each stage and, more importantly, identify prescriptions that will assist the organization to move to the next stage.  This model, metaphorically, allow long standing bureaucratic organizations to detour and in some cases even avoid death.

The organizational implications and lessons that fall out of Adizes model are wide and deep.  However, my main concern was that I was about to be dropped off at the door step of the founders of the small company that we had recently acquired.  Wasn’t there a more positive message that these leaders should hear as we become the same company, working towards the same goals?  This is where Adizes learnings about why large mature companies buy small growing companies is invaluable.

Adizes maintains that the large bureaucratic companies desperately need the small innovative companies in order to grow and stay alive.  While established companies often times have a great deal of cash and strong financial statements, they have many factors working against them.  Adizes points out that they tend to:

  • Be interested in reducing risks
  • Reward employees who follow directions versus innovate
  • Value uniformity and consistency

This push towards maintaining the status quo is exactly what brings down many of these organizations.

Enter the newly acquired kid on the block…  These small nimble organizations typically offer growing technology in new markets.  And most important, they have flexible ways of thinking and working, quickly embracing new strategy.  This provides an agility injection into the staid bureaucratic organization.

Based on this line of thinking, you can probably guess the end of the story.  I did inform the founders, who it turned out still acted more like teenage rebels than leaders, that I would be helping them introduce more structure and control.  They understood that this was an important part of their growth and development.

However, the larger, more amplified message was that our now combined companies needed their innovative products and new markets.  And most importantly, we needed to tap into their agile approach of doing business and infuse some of that bias for action into our increasingly unadventurous culture.

I had falsely believed in a compliance focus in working with newly acquired companies.  I was all about sticking pins into them for their own good.  Adizes helped me realize that the actual opportunity lay in bottling up the innovative thinking and approaches that the smaller companies offer and infusing them into the larger bureaucratic culture.  This strategy offers big wins as the ripple effect positively impact a hundred times more employees than are housed at the acquisitions.

In the years following my mergers and acquisition role, I have applied the Adizes approach in working with all types of small, innovative departments and teams within larger organizations.  As I help these groups grow and accomplish their larger objectives, I make sure to avoid squashing their agile thinking and approaches.  In fact, I help them find ways to capture these innovative approaches and embed them into the larger organization.

With mixed results Americans spend millions of dollars a year on products which claim to help us stay young.  The Adizes approach offers a tonic that really does allow old dying organizations to reclaim youth!

Note: The views expressed in this blog are my opinions and do not reflect the views of my employer.

Organizational Structure: Start with Design Principles

House project

It would be foolish to design a home without first thinking through your needs. How much living space do you need? How many bedrooms?  What style do you like?

However, organizations are built each and every day without considering these types of fundamental questions around what the design is attempting to accomplish.

In order to create organizational structure, the key is start with design principles which are statements about what the design should provide.   It is critical that these design principles guide the entire design process since they focus us on creating an organization which accomplishes our objectives.

Below are ten organizational design principles from groups that I have consulted for:

  1. Build depth of leadership capability
  2. Be more agile via delivering faster
  3. Create cost efficiency
  4. Optimize people and system resources
  5. Enable process efficiencies
  6. Create best in class customer satisfaction
  7. Foster better service delivery
  8. Increase manager accountability
  9. Enable collaboration between departments
  10. Build internal change readiness

For example, I helped design a very different type of structure for the organization hoping to increase leadership skills versus the organization seeking to deliver products faster. In order to improve leadership, we crafted a structure that would challenge leadership to gain new skills, knowledge and abilities.  While at the organization looking to deliver products more quickly, we streamlined the structure resulting in more agility.  Clearly, depending on outcomes, the types of functions created, how they are organized and the roles and responsibilities within those functions are going to be very different.

Design principles are the foundation for trade-off decisions.  The design principles provide leadership with a tangible way to surface and discuss competing interests and outcomes.  Leaders are able to clearly state the improvements that they want to see as a result of the design.  This allows for a robust discussion across parties helping leadership gain consensus around the primary outcomes. [JayGalbraith.com, 2016]

I typically have leadership rank the importance of design principles since it allows them to evaluate the value of various design solutions.  I have found this to be the most effective and fastest way to determine which outcomes are most important to leadership.  We can then more easily determine whether an organizational design that is functional, divisional, strategic business unit, matrixed or project based will result in the best outcomes.

Jay Galbraith [JayGalbraith.com, 2016] makes a strong case for the importance of robust design principles.  He says that the criteria should be debated, rated, and kept prominent throughout the design process.  As a result, design principles are a topic in each and every conversation that I have with clients about the new design.  Clients find that as a result of this ongoing exploration of the principles, their understanding of what they are driving towards via the organizational design and how to get there becomes clear.

Questions:

  • Imagine that three years from now the Wall Street Journal [WSJ] names your organization the best in your field. What is the WSJ saying about you that makes you the best?  [This will provide you with clues as to your design principles.]
  • How can we best organize our work and people in order to accomplish our strategy?

Note: This blog reflects my thoughts and not the opinions of my employer.

Organizational Change Management Employee Assessment Tools

employee-action

Organizational Change Management (OCM) is essentially about People Readiness for an upcoming work place change. The practice can involve working with leadership, employees, internal customers and other parties to ensure that they are prepared for a new product, service, technology tool, etc.

However, it is important to focus on the readiness of the employees who are end users of the change being rolled out. It is critical to work with these employees to build understanding and support of the change, ensuring they are prepared and feel involved and supported.

We will explore three key assessment tools one can leverage in order to measure the degree and type of change employees are facing. Stakeholder Analysis, Business Impact Assessment and Gap Analysis.

The data gathering for these assessments can involve quantitative research such as an analysis of business documents.  However, the data is most often gathered via qualitative research methods such as interviews and surveys.

We will discuss the purpose of each of the tools and a template example will be provided. The first tool is a Stakeholder Analysis.

Stakeholder Analysis – Description

Stakeholder analysis is particularly useful when you need to anticipate the reactions of, or seek support from, various stakeholders. In this context, a stakeholder is any person, group, or entity that that can influence the success of, or is impacted by, the change effort.

Leader and Department-level analysis is particularly important since it helps one develop a point of view on what changes need to take place at the various levels for success. It highlights anticipated reaction, what stakeholders need from the strategy, what the project team needs from stakeholders and a plan to address.

Template Example

The below Stakeholder Analysis worksheet provides a structure for identifying and examining your key stakeholders and their definition of success.

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Business Impact Assessment – Description

The business impact assessment will help you target your change efforts during large change projects. These changes may be significant in terms of the number of people impacted and/or the magnitude of change involved. In such cases, the severity of change rarely hits all departments with the same amount of impact. This tool helps you determine where to focus your change efforts in order to help prepare the maximum number of people, in the most critical areas.

Template Example

In the below business impact template the departments which are impacted by a change have been plotted. The numbers of people impacted by the change are indicated on the Y access, while the magnitude of change is plotted on the X access. As a result, the department that will experience the most significant change are located towards the upper, right hand portion of the image. The template provides a visual depiction suggesting that the Departments in this area will require the most change resources.

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Gap Analysis – Description

The gap analysis provides important intelligence in terms of how the organization will be affected, the type of change at hand, and the most appropriate change strategy to employ. Findings at this phase include change management theme gaps to address for success: E.g.: Training, Collaboration, etc.

If I had to select just one change tool to employ, this would be it. The gap analysis tells us the areas where employees impacted by the change will be challenged the most. This allows us to design targeted solutions resulting in employee readiness.

For example, if the analysis shows that employees will struggle most with technology tools that suggests a very different change intervention involving developing capability around technology, as opposed to addressing soft skills like communications or collaboration.

Template Example

In the below template example the various departments are listed across the table Department 1 through Department 8. The various change themes which will be challenges for employee adoption are listed in the first row. The triangles indicate the departments which will experience these challenges. In this organization all Departments will experience a change challenge in the areas of communications and collaboration.

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Conclusion

As our organizations experience increasingly significant levels of change, figuring out how to roll out projects which accomplish the organizational results we seek is critical. The tools outlined in this blog will provide you with the data and knowledge to design change interventions which will help ensure employee readiness. There are many important change activities that we can tackle, however, ensuring that employees can and will implement the change is clearly the most important step towards a successful roll out of a critical organizational initiative.

The Foundation of Organizational Design: A Strategic Approach for Success

Concept of building the brick wall

Good organizational design has the ability to transform an organization’s culture and accomplish business goals beyond anything imaginable.   As a result, many organizations allocate significant time and resources to this design process.  However, impactful organizational design can be done more efficiently and effectively if one goes about it in a strategic manner.

We will explore the overall definition and purpose of organizational design.  Understanding the scope of organizational design and knowing when and when not to tackle this endeavor are key prerequisites for success.

Definition and Scope of Organizational Design

Organizational design is:

The deliberate process of configuring:

  • Structures
  • Processes and policies
  • People practices
  • Culture

.       To create an effective organization capable of delivering on the Organization’s Vision/Strategy/Goals. [Adapted from jaygalbraith.com]

A key aspect of organizational design is determining where formal power and authority are located.  This is the traditional organizational chart with boxes representing grouping of work.  These structural components determine the hierarchy and resulting relationships within the organization. These formal components are important since they channel the energy of the organization and provide an identity for employees.

A key point of this definition is that in addition to the structure, one should also pay attention to processes and policies, people practices and culture.  Too often organizations craft the formal structure and never get around to the organizational mechanisms which are the underpinnings of the overall structure.  Only establishing boxes on an organization chart is akin building the foundation of a house without putting in electrical and plumbing.

The processes allow decision making and work to be carried out effectively and efficiently.  The policies help clarify how the organizational components are interrelated for an extra boost of productivity.  Finally, one cannot emphasize enough how people practices and culture impact the ability of the organization to accomplish valuable work in a manner which empowers employees.

When to Tackle Organizational Design

Another key aspect of organizational design is knowing when to dive into a redesign effort.  Many leaders believe that organizations need to be redesigned every few years regardless of what is happening in the organization and around it.  I have consulted for organizations which have successfully operated with the same organizational design for decades.  On the other hand, I have advised organizations to dive into redesign within a year of a previous design effort due to the below types of changes:

  • Growing/expanding/shrinking
  • Change in strategy
  • A crisis or significant events
  • Organization around you has changed
  • Change in external environment (such a regulation)
  • Lack of performance
  • New leadership

The following points emphasize how critical it is to be clear about why a redesign is being launched:

  • It is important for leadership to know the reasons why the redesign is needed. The rationale for the redesign helps define the outcome.
    • For example, I worked with a nonprofit organization which launched a redesign due to lack of delivery and a change in strategy. As a result, we measured the success of our effort via organizational performance moving forward.
  • The root cause of the redesign also helps shape the redesign strategy.
    • For example, a redesign in a government organization was launched due to changes in the external environment, including regulatory changes, which required an outward focus. We crafted a design process with mechanisms for measuring and monitoring the impact of external factors such as government policies and third party stakeholders.
  • Finally, articulating the rationale for the redesign will help employees embrace the effort and necessary changes.
    • For example, it was important for employees at a business to understand that a redesign effort was being launched due to a crisis.  These employees gave us the benefit of doubt knowing that the organization’s survival, and as a result their jobs, were predicated on the success of the redesign.

Next Steps

We have established the definition, scope and rationale of your redesign effort.  In future blogs we will explore how to carry out the actual redesign.

Key Questions:

  • Why is your organization tackling an organizational design? How will these reasons impact your design outcomes?  How will these reasons impact the design plan and processes?  How will these reasons impact how you will explain the rationale for the redesign to employees?
  • What is the scope of your organizational design? How will you ensure that you design not only the structure, but also processes and policies, people practices and culture?

Note: The views expressed in this blog are my opinions and do not reflect the views of my employer.

 

Applying Organizational Development Methods to Product Design for Better Outcomes

product design

Designers are incorporating human centered design into products for our common good.  Wendy De La Rosa, Lead Behavioral Strategist at Irrational Labs [@wdlrosa, #SXSW, #hackingbehavior] says that human centered design involving combining user centered design principles with behavioral science for the good of human kind.  Many of us have benefited from this discipline in form of the FitBit which is designed to help one stay motivated and improve health by tracking activity, exercise, food, weight and sleep.

Chris Risdon, Head of Design, Capital One Labs, Capital One [@ChrisRisdon, #SXSW, #humancentereddesign] makes the compelling case that designer have the potential to positively impact the behavior of hundreds and thousands of consumers through product design.  While products can influence many citizens in terms of volume, the extent to which products influence complex behavior is limited.  Most of the applications today, such as the FitBit, send a single data point to the user in the hope that they take a specific action.

This is where organizational development methods can make a significant contribution.  Organizational practitioners, like designers, leverage behavioral science.  However, instead of applying these principles in the design of product, we apply these learnings to the creation of workplaces.

What the theory and practice of influencing human behavior in the workplace lacks in volume, is made up in impact.  Organizational interventions transform human behavior on a regular basis in complex aspects of work including structure, processes and people practices.

Below are some organizational development tools and examples of their impacts:

  • Structure: Jay Galbraith’s emphasis on leveraging design principles in the creation of organizational structure helps ensure that the design accomplishes the desired outcomes. The principles are statements about what the design should provide.  These principles guide the design process, provide criteria for making trade off decisions and keep all parties focused on creating the same outcome.  This organizational design methodology has allowed me to take a dozen independent marketing groups within a Fortune 100 company and align them for quick response to customer demands and other unexpected challenges. [jaygalbraith.com]
  • Processes: Edward Deming’s Plan-Do-Check-Act [PCDA] continuous improvement circle has provided the framework for managing improvement projects.  The method helps employees stay focused on data collection and analysis driving them towards identifying and solving root cause.  Outcomes of leveraging this method includes savings millions of dollars, along with better quality products and services.  [http://asq.org/learn-about-quality/project-planning-tools/overview/pdca-cycle.html]
  • People: ‘Start/Stop/Continue’ is a straight-forward group exercise that can lead to increased effectiveness and efficiency. As the name suggests, the goal is to reflect on programs, activities and processes and come up with three distinct categories of future state action.  I have had employees report back that this simple exercise has been transformative in terms of getting groups of people more aligned and working in a more collaborative fashion towards their objectives. [https://www.mindtools.com/pages/article/SKS-process.htm]

Building organizational design methods into products and services may result in impacting complex human behavior in ways that are unimaginable today.  For example, prompting consumers to identify their design principles, follow the road map of Plan-Do-Check-Act and reflect on what they need to Start-Stop-Continue doing may provide practical approaches for better outcomes.

These tools, in addition, to the hundreds of similar methodologies leveraged by organizational designers can result in shaping consumer behavior for more impact.  Possible outcomes include people becoming more reflective about how they can create more success, carry out day-to-day activities more effectively and efficiently and collaborate with others in new and improved ways.

These outcomes would far outweigh the value provided from a simple stimulus and response such as our FitBit buzzing once we have reached out daily goal.  Organizational design approaches may allow us to accomplish Steve Selzer, AirBnB Experience Design Manager [@SteveSelzer, #SXSW, #frictionhumancentereddesign] vision of a world where products help shape positive social values and successfully navigate an increasing complex and changing world.

Reaching this utopian state will require that we dive much deeper into behavioral science and organizational development is a great first place to mine approaches.

Questions:

  • How can we communicate the value of organizational design methodologies to the product design world?
  • What organizations and people are well positioned for the challenging work of embedding these behavioral science approaches into products and services?

Note: The views expressed in this blog are my opinions and do not reflect the views of my employer.

 

 

 

What True Employee Engagement Looks and Sounds Like

Mikado

As leaders we seek to create a calm work environment which is programmed.  All of our actions should be by design based on logic as opposed to spontaneous actions based on emotion.  We have been led to think that employees work together best in quiet, rationale and controlled spaces.

However, the reality we experience is vastly different.  Some of the most productive, innovative thinking I have experienced has resulted from dynamic work teams.  These have been conglomerations of employees coming together to solve difficult problems.  We sometimes operated on emotions which, at times, have verged on the edge of chaos.

For example, during a global roll out of SAP software team members participated in animated discussion, loudly challenged others thinking.  We even found ourselves at times shouting and at other times on the verge of crying.  Being on this roller coaster was one of the most challenging, productive, rewarding and downright fun work teams I have ever experienced.

This is where a great deal of robust, open dialogue to seek understanding takes place.  In these electric environments there is no need to survey employees regarding their level of engagement.  Rather, one can simply walk into the room and see and hear the engagement.  One can:

  • See employees who are actively collaborating with one another for understanding
  • Hear employees who are having lively conversations which at times can get loud
  • Experience conversations which take twists and turns no one could predict!

Employees who are truly engaged are ‘in the moment.’ They are internalizing the topic at hand in real-time through the most enjoyable and effective method of learning which is experiential.

Mihaly Csikszentmihalyi called this type of optimal experience ‘flow’ – the state in which people are so involved in an activity that nothing else seems to matter.  This researcher discovered that when people are in a state of ‘flow’ the experience itself is so enjoyable that people will seek to carry out these activities even at great cost, for the sheer sake of experiencing ‘flow’. http://www.amazon.com/Flow-Psychology-Experience-Perennial-Classics/dp/0061339202

Csikszentmihalyi’s finding that people experience the best moments of their life when their body or mind in stretched to its limits in an effort to accomplish something difficult and worthwhile has significant implications for us as leaders.

This suggests that it is not always advisable to create manageable workloads for employees.  It also calls into question ‘dumbing down’ tasks so that they can be easily accomplished.  Rather, the research on ‘flow’ proposes engineering a much more dynamic, unpredictable work environment, where employees will inevitably be stretched and challenged in ways that we cannot even imagine.

Proactively creating this type of unruly work environment may go against much of what we have learned.  It may seem downright counter intuitive to good leadership practice.   Our paternal instincts to protect our workforce may kick in.

However, think back to your most rewarding and fun teaming experience.  Chances are that you were in a state of ‘flow’ which resulted from a work environment that was anything but calm!

Questions:

  • Why do you resist creating work environments which are dynamic with new priorities and directions emerging in real-time?
  • How can we create work environments where employees feel ‘flow’ on a regular basis via challenging work environments where they are stretched beyond their limits?

Note:The views expressed in this blog are my opinions and do not in any way reflect the views of my employer.

How To Obtain True Employee Engagement

Intelligent toddler girl wearing big glasses while using her laptop

Intelligent toddler girl wearing big glasses while using her laptop

We agree that engaging our employees is one of the keys to organizational success.  In fact, most organizational improvement, at some point, involves actively involving our teams of  employees.  We have been told countless times that this is the ‘secret sauce’ for improving our products, processes and culture.

The key question is: How do we truly engage our employees in their work?

Engaging our workforce in authentic conversation is not as easy as it sounds.  I have worked with peers who have claimed to be experts at drawing out our workers. I once tested this claim by tracking the amount of time my peer talked (95% of the time) versus team members talked (5% of the time) at a session with the specific outcome of ‘hearing’ from the employees!

How then do we ensure that our teams of employees are heard and fully engaged as they deliver on the important work of designing new products, creating better processes, reshaping our culture, etc.:

  • Cultivate Understanding of the Work and How It Will Impact Them
    • To achieve a high level of commitment and avoid resistance, involve those impacted in the development of the work itself.
    • Enable our teams to understand the dynamics of the work being carried out, new behaviors required of them and how their actions will contribute to success.

 

  • Assess the Level of Change Required By Our Teams & Make Adjustments
    • Continually assess change readiness levels over the course of the journey and adjust work and change management activities to address issues and gaps.
    • Our leaders should be accountable for making sure their teams are understanding and internalizing the work in their respective organizations.

 

  • Align the Organization to Enable and Sustain the Work
    • Explore the following elements of the organization: structure, culture, people, rewards, work processes and management processes.
    • Ask, ‘Do the above areas encourage or discourage employee engagement and the new/changed behaviors required to achieve the goals?’ Focus on areas that have the greatest influence on desired results.

The above advice involves grappling with complicated organizational dynamics.  However, the first easy thing leaders can do is simply to talk less and ask employees more questions.

Had my talkative peer I mentioned above reached even a 50 – 50 split between his air-time versus the amount of time employees shared their thoughts, we clearly would have gained more insight from our workforce.  Start by asking more questions.  It is that simple.

Questions to consider:

  • How should we evaluate the success of employee engagement?
  • How can we further transfer ownership of the work to employees?
  • What is standing in the way of you asking employees more questions?

Note:The views expressed in this blog are my opinions and do not in any way reflect the views of my employer.