How to design and align your organization and achieve superior business performance
Updated: Sep 5, 2022
All studies on organization design and alignment confirm that more than 90% of organizations suffer from organizational design and alignment issues. The misalignment issues organizations face limit their ability to achieve high-efficiency levels and their ability to innovate and achieve superior business performance.
The subject of organizational alignment has been a complex subject due to many reasons, and the top three are:
Not having a holistic approach to defining all elements of their organizations as organizations ignore several elements when performing organizational development and design tasks.
Organizations may find alignment tasks so complex and may get confused when dealing with all relevant elements at once.
Organizations and their appointed management consultant may lack the required competencies and a suitable framework to follow when performing organizational design and alignment tasks.
How to achieve organizational alignment and superior business performance:
His research lasted more than a decade, Imad Choucair studied this vital subject in his doctorate research and interviewed and engaged with many top executives. Choucair was able to define all 22 organizational design elements and put a framework for reviewing and aligning them. The Framework enables a simple and yet powerful approach as it assigns the 22 elements into four design groups (see Appendix A below):
Group 1: Are the organization's core elements.
Group 2: Are the organization's design elements
Group 3: Are the organization's operating elements
Group 4: Are the business internal and external risks
An organizational alignment project goes through the following five stages:
Stage 1: Document the 22 as-is organizational elements. The outcome is organizational current design blueprint
Stage 2: Identify selected elements to transform and accordingly define the updates required.
Stage 3: Analysis and synthesis of the organization's blueprint to identify the changes required for batter alignment .and performance
Stage 4: Identify a list of projects and, for each project, produce a project charter.
Stage 5: Execute the transformation projects.
Key Benefits
The above method provides vital benefits and include:
Opportunity to have digital transformation initiatives by introducing suitable technology
Simplify the process or organizational design and improvements
Follow a phased approach to realize immediate benefits that can help the organization improve its short- and long-term performance.
Appendix A: 22 organizational elements
Core Elements
1. Vision
The purpose of the organization and why it should exist.
2. Mission
The specific business activities the company performs to realize its vision.
3. Values
The list of values employees and managers live while conducting the business activities.
4. Goals
The list of mid-term and long-term broad business objectives.
5. Stakeholders
The list of the organization's stakeholders, including shareholders and the management team.
6. Resources
The portfolio of the core assets and resources the organization uses to develop and drive the business.
7. legal Framework
The set of records of the legal framework that governs the organization includes the certificate of incorporation, shareholders resolution, and other related documents.
Design Elements
8. Business Model
The plan and methods used to create economic business value and achieve the organization's goals.
9. Job Functions
The core job functions required to drive the business.
10. Individual Needs & Values
The list of the employees and management needs and values.
11. Culture
List of cultural attributes suitable for driving the business efficiently and effectively.
12. Management Systems
The business systems required to drive the business and achieve sufficient levels of control and efficiency.
13. Business Functions
The business functions the organization is supposed to perform to achieve its goals while keeping control.
14. Competencies
The specific set of competencies the organization is required to have to create business value and achieve the required competitive advantage.
Operational Elements
15. Business Strategy
The detailed strategic plan for the organization to win. The strategy includes key business stakeholders, partners, and suppliers.
16. Organizational Structure
The organizational structure defines how work is split among groups for the best business performance and control.
17. Policies & Procedures
The list of policies and procedures to be enforced on managers and employees for the better health of the business.
18. Management Practice
The guidelines govern the managers' decisions while performing their job duties.
19. Leadership Model
Leadership model required for driving the business such as transactional and transformational.
20. Motivational Strategy
The plan to motivate employees for optimal performance at both strategic and short-term operational levels.
21. Performance Mgt. System
Performance management and reward system required to motivate and retain talent.
Internal and External Risks
22. Internal & External Risks
The significant internal and external business risks include Political, Economic, Technological, Environmental, and legal.