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Smart design: New approach in corporate reorganization
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Illustration of a workplace. (Shutterstock/File)
R
eorganization is a powerful tool for changing the trajectory of a business and enhancing its performance. But keep in mind that the business world of the early 21st century is radically different from that of the early 20th century, in two key respects.
First, organizations now have to operate in a vastly more complex environment — one of globalization, hyper-competition, revolutionary technologies and elaborate regulation. Second, in most companies the nature of work has changed: from algorithmic work — that is, clerical or manual labor — to knowledge or heuristic work.
In a survey conducted by The Boston Consulting Group, almost 80 percent of respondent companies reported undergoing reorganization exercise, about half of which is a large-scale, enterprisewide reorganization initiative.
However, reorganization efforts all too often disappoint. Survey respondents rated fewer than half of the reorganization efforts as successful. The underlying reason for such a low success rate: all too often, the companies’ leaders relied on organizational frameworks that have become outmoded and ineffective in today’s business environment.
If reorganization efforts continue to overlook the two aforementioned major changes in the world of work, they will continue to fail. A new approach is needed, one that is better suited to the realities of the world in which companies now operate.
Called Smart Design, the new approach to redesigning an organization, which is far more appropriate for the new business environment, has behavior at its core. It involves identifying and explaining the current behaviors of the workforce, defining the desired behaviors — those that would improve company performance — and generating the new behaviors by creating contexts that are conducive to them.
Smart Design approach involves three main steps — the why, what, and how. The “why” is defining the purpose of the reorganization. The “what” is determining the behaviors that will support that purpose and design the organization in such a way as to promote those behaviors, using a broad range of design elements. While the “how” is making it happen.
