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Guidelines for organizational restructuring

When business owners, leaders and human resources professionals identify the opportunity to restructure their organization, they often wonder where to begin. Organization design need not be complex, so long as you follow some essential guidelines.

Strategy drives organization design and a firm’s unique value proposition determines its strategic advantage. When you think about value proposition, consider your firm’s offerings: what does your firm offer that is distinct from other firms, and how do you share those offerings? Once you are clear on your unique value proposition, use it to support your strategy. For example, if you differentiate yourself by customer service, your resources and structure should demonstrate how you provide value for your customers.

Adjust your structure to maintain flexibility over time. Change is constant, so your structure will need to move with the changing market landscape to remain optimized. Ongoing organization structure reviews are important to make sure it remains effective.

Implications of a reorganization

Consider is the functional alignment and interactions in your design. Spend time thinking about the functions that need to work closely together, processes that require co-ordination and the information flow between and across departments to effectively deliver on your value proposition.

Often leaders choose organization designs they are familiar with and apply them to their existing structure, or design the structure around current staff. These are not the best paths forward. Silver bullet structures do not exist; organization design must be customized. Prepare for an exercise in trade-offs and weighing options that leads you to the best method to deliver on your value proposition.

Alignment

Gone are the days when a handful of senior executives huddle in a corner office to create an organizational structure. Involving leaders and employees at various levels in the organization is critical to determining the optimal organizational structure needed to deliver on goals and objectives and gain support and buy-in. Vision and strategy become clearer by engaging others.

Hiring a consultant

If you are not getting the counsel you need, seek support from an external organization design professional. An organization design change is too critical to undertake without an expert to help you navigate.

Hiring an external consultant brings expertise in organizational design, offering a new perspective gained across various companies and industries. Plan for a period of ramp-up time to allow the consultant to learn your organization culture and dynamics. Your colleagues and network will often provide a rich source of consultant referrals.

Restructuring works exceptionally well when change implications are clearly identified and mitigated throughout the organization design process. Create a detailed change plan prior to implementation and contemplate the impact of the change upon each employee or group of employees.

Lack of alignment from leaders around planned organization design changes can derail a restructuring effort. Gain buy-in and support as you move through the design process and ensure that you have a C-suite champion. Opportunities can be lost without this essential partner.

We encourage your feedback about how these organization design guideposts will help you effectively navigate the process. Stay tuned for organizational change management and leadership development strategies to create awareness and gain support for change initiatives.

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Nikoleta & Associates

Business Strategists, Leadership Development Designers, Executive Coaches at Nikoleta & Associates
With an attitude that encourages growth, Nikoleta & Associates provides executive coaching, leadership development and change management services to clients in multiple industries including construction, consumer packaged goods, professional services, technology, financial services and health care. Through their blog posts, the dynamic team at Nikoleta & Associates offers practical advice for organizations on effective leadership strategies that align to business goals.Read more
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