Strategy execution starts with organisation design
Strategy answers how we will grow and compete in our market and defines what we need to be able to do better than our competitors
These days, some topics come out in the discussion of corporate circles so often that they have become a part of corporate gossip.
These are: the organisation was good but new leadership is destroying it; new leadership is not getting systemic support; the organisation has invested a huge amount to formulate business strategy but nothing is changed; there is no alignment in parts of the organisation; we are being pulled back for unknown reasons; what amount of intensity in actions required to achieve goals is not leveraged; parts of the organisation are becoming powerful to achieve partial goals instead of organisational goals; decisions are not been taken timely and appropriately; we are not getting relevant information to act, most of the people are dissatisfied, and so on.
If we minutely observe the above scenarios, we will see most of the scenarios match organisations that are executing a new strategy.
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Strategy is leveraged for the greater interest of an organisation. Then, why are the common chaotic scenarios being seen? Is it that the organisation starts executing strategy ignoring organisational readiness?
Strategy answers how we will grow and compete in our market and defines what we need to be able to do better than our competitors.
In simple words, strategy defines and prioritises some elements of an organisation as its potential and ultimate strength. The organisation builds these over the years. Eventually, the elements become the unique capability or weapon of the organisation to do better than its competitors.
Therefore, when an organisation leverages a new strategy, some elements of the organisation get priority and leaders also focus on reinforcing those continuously in the same direction.
Chaotic and dysfunctional situations arise when strategic priorities misalign with structure, decision-making processes, communication processes, reward and evaluation processes, people processes, management processes, business processes, etc, but still leaders keep leveraging in the strategic direction continuously.
Organisation design ensures the strategic priorities in the structural system, management system and business system, and considers a model for systemic wholeness.
It also leverages design drivers as control, accountability, coordination, integration, leverage resources and cost, learning and motivation, specialisation and management attention, and design elements as decision making, communication, power allocation, interdependency, alignment, leadership roles, etc in the process of designing organisation.
Finally, the organisation turns to a shape that moves in the same direction.
It seems the whole organisation sings and dances to create a great melody. This is the very primary step of successful strategy execution.
There are many models that represent a set of organisational elements like star and 7s. Each model ensures systemic wholeness.
For example, the elements of the star model are strategy, structure, process, rewards, and people. If we consider the set of elements, the systemic wholeness is ensured. We can use any model in constructing organisation design.
We can craft an example. An organisation dreams to be number one in the retail industry. Its strategy is to be unique in the "customer shopping experience" in 3 years. The strategy prioritises front-line people and processes.
If we consider the star model, the strategic priorities need to be aligned with structure, process, rewards, and people. Design elements and design drivers must be leveraged in the process of design. Then the whole organisation will work in the same direction.
Misalignment with strategy creates a huge collision in the system. Leadership roles lose their productive hours managing collision and aligning processes in the strategic direction. Eventually, time and efforts on strategic actions are lessened. The strategic journey can be misdirected to somewhere else.
The design makes an organisation ready for not only strategy execution but also for new energy flow in the system. A new way of working creates excitement and strives to open many positive doors. So, strategy execution must start with the organisation design.
Syed Mohammed Nurul Afsar is the chief executive officer of Transformational Change Consulting. Email: afsar.odcp@gmail.com
