How to develop an Organization Development & Design discipline? Here's how you start...

Ever started building a house? If you did, here are three things, aside of many other things, you certainly thought about:

1. Get a budget plan. My Chinese laundry man always said to me when in the states: No ticky? No washy!
2. Know what type of the house you want (concept), and therefore also keep in mind the future usage of it (your kids, parents, hobby room, dentist practice at ground floor, etc...?)
3. Ensure you can built, how and what (compliance, regulations). Ever seen people losing their homes because they built in a forest without building permits? I did ;)

And that's what Organization Development & Design is about: it is both the process and the product of planning, designing, and developing organizations. I, therefore, prefer to call the discipline Organization Architecture.

Unfortunately most Organization Architecture functions you find in organizations do start with building the roof and walls of the house, before considering to develop the disciplines of planning & designing.

So where do you start? Apparently with planning & design: planning the data management strategy of the organization structure & people and design of the organization based on position & identity.

Based on position & identity control, and the design of your organization data strategy & processes will allow the organization to develop in a controlled manner its systems, processes and culture.

In summary, the Organization Design data, system & process is fundamental to develop an Organization Development discipline that is concrete and objective.

Click here to view my other publications on LinkedIn Pulse.

#linkedintips #linkedinchallenge #linkedin Tip@LinkedInPulse

About the Author: 

Frederik Haentjens is the Organization Development & Design professional and owner of the blog site www.boxolog.com

I like to share my passion and experience on Organization Development & Design. So don't hesitate to contact me by emailfred@boxolog.com or follow me on Twitter@Boxolog.

Only 20% of the HR professionals are...

.... and here I will quote: "20% of the professionals are exceptional, adding value that helps organizations move forward, 20% of HR folks are locked into a fixed mindset and lack either competence or commitment to deliver real value, and 60% are in the middle.". (Dave Ulrich, HRB July/2014).

The above quote was a part of a response of Dave Ulrich in the 2014 article It's time to split HR where Ram Charan proposed to split HR into two parts:
1. HR - A. The HR Administration would report to the CFO
2. HR - LO. The part of HR that takes care of Leadership (L) and Organization (O) would remain under CEO and provide strategic Human Capital Advisory to the management.



Dave Ulrich is a big defender of HR, and he has a prominent place in the "HR Hall of Fame". He speaks mainly to the minds and hearts of HR professionals. But his HR guru status didn't stop him to admit that HR can be split. His three-legged stool HR model (business partner, operations, excellence) clearly distinguished a "split" between the intelligence and machine of HR. We all know that 80% of the HR function is to maintain and execute Human Capital plans. In today's well-developed technology world also HR operations are (or can) (almost) fully automated and can be executed by support and operations units. And HR operations can be centralized with other organization operations, and doesn't require a "unique" set of skills to maintain and execute the HR transactions.


Anyway, we could discuss in how far HR can be split or retooled, but here are a couple of conclusions that even prominent people like Ulrich will not disagree with:
1. HR excellence doesn't require the "volume" and quantity of resources that you mind find today in traditional HR departments (or let's call them personnel). We might end with 20% of the actual HR staff that exists today
2. HR units are often overstaffed due to the fact the operations are not always equipped with the latest HR tools, are over-bureaucratic and paper based. Some re-tooling and technology might help us save 80% of the operations costs. Also, some centralization of operations (including HR) will help to optimize and simplify things.
3. The CHRO is often crippled by his overloaded by HR administration & compliance, pay & legal tasks (labor issues, administration, compensation). The CHRO focus should be limited to leadership (or talent), performance (or capability) & analytics. That's it!

My response to Blow up HR: I wouldn't blow it up, but I would split it intelligently enough, because: only 20% of the HR professionals are dealing with HR issues, the remaining 80% are administrators.

About the Author:

Frederik Haentjens is the Organization Development & Design professional and owner of the blog site www.boxolog.com

I like to share my passion and experience on Organization Development & Design. So don't hesitate to contact me by email fred@boxolog.com or follow me on Twitter @Boxolog.

He is my boss! Wrong!

It frequently happens that a person isn't sure who is his boss. Strange you'd say? Not really. In previous blog posts, I discussed the importance of report lines and the multiple options an organization has to define the report line (see: Wanna know who's your manager? Follow the Money line!)

In this blog post, I like to discuss the importance of organization structures, in relation to Performance Management. The relationship is very simple:
He who is your boss is the one who agrees with on your objectives, measures, reviews and gives you feedback.

Unfortunately, many organizations mess already up in the beginning. More primary performance systems request the manager and employee to validate their report line in the system. It happens too often that the relationships aren't precise or even incorrect. And incorrect input... well... garbage in, garbage out. And you don't want people to set irrelevant objectives with managers that aren't going to manage them correct?

Solution:
First, ensure that you manage organization structures through a database (see: drawing organization charts is a waste of time).
Second, built a relationship between the organization structure, position based of course, and the performance hierarchy.

Keep also in mind the following principle rule of objective setting:
Objectives are primarily set against the position, and secondly to the incumbent. That way, when staff move to other areas during the year, the calibration of previous and new objectives can be controlled and managed.

A final thought:
Your reward team often coordinates the performance management process (as money is often what motivates, wrongly). In some organizations, it's organized by talent, as performance drives development (or was it vice versa?). But maybe organization development can also drive performance management and ensure alignment with structure, strategy and finance? Who will tell ;)

What is an Org Chart supposed to tell you?

I have seen all types of Organization Charts in my life. Not to say the most boring thing to look at. Although, there are some exceptions.

One of the most exciting organization diagrams I've encountered is the one of Walt Disney, showing the varied synergistic relationships between the divisions of Walt Disney Productions in 1967. Needless to say, a synergy chart for today’s Walt Disney Company would require a much bigger piece because it's more like a flowchart than anything else.

And that is what an organization chart (or diagram?) should look like: the reflection of the functions in relation to each other. So when reviewing organization charts, you better understand the "logic", look for the gaps and overlaps, and most important, can we deduct from the charts, what the organization is supposed to achieve?

Below another Organization Chart from Walt Disney. It was developed in 1943, five years after it was founded. The chart visualizes how a story from Walt (Disney) get's developed into animation, music and further in the creation of an animation movie, get's cut and produced. On the other end of the chart, you can see the customer, which is part of the organization chart (!!) watching the final product: a new animation movie.

Today's organization charts, seem not to tell you a story, but give you a blunt and dull view of who reports to who. It is not supposed to tell you anything, except who is the boss, and who manages who. In that sense it would be useful to redefine what is Organization Development and Design as a specialism (see also my previous blog on what is organization design) in order to showcase the value add of organization charts and what they are supposed to tell us. 

Structures suck!

"Guess our structures suck!?" Wasn't the first time an executive expressed his feelings about the organization structures ;) But why did it take him/her till the end of the year to tell me that? As this is something new?

My standard reply would be: it's your structure, deal with it! As if my babysitter would be responsible for the bad behavior of my kids?!... BTW they behave very well ;) But of course I didn't say that.

But let me be a good babysitter on your structures and tell you this: your structures suck only because you don't feel control over your operations, because you don't know who is doing what, and you started realizing you needed to micro manage your teams. But that you knew already? What is the solution Sir!?

Let your OD specialist help you. To start with: the visualization of your structures, and the analysis of span of control, layers in your organization. And than let him ask you three questions:

1. In how many steps a decision is made? Checker checks maker steps? What are the layers in your organization, how fat is the management layer and do your managers manage anything except the process? Do you have talented managers who you can trust and delegate and provide you sufficient reporting on progress and result?
2. What roles take accountability (note: hope only 1) and what roles are responsible to execute tasks? Who is doing what basically. Are we all too busy executing or are we all relaxing and observing how our monitors turn in sleeping mode? The span of control isn't the span or responsabilities.... remember that ;)

And here starts now an interesting discussion about structures that will lead us to many many more meetings and discussions about what is the role of the business, strategy and HR (or is OD not part of HR anymore?) on your structures that suck! :)

(De-)Centralization

Fred, have a look at our operating model. Should we centralize or decentralize?
Wasn't the first time I got this question. And  the first 2 things an OD consultant would do is:

1. Benchmark against other companies in your industry and region
2. Google for business cases, articles and studies on centralization and decentralization

But I gave up on Google long time ago and don't trust in OD consultants (although I am myself a consultant half the time), because best practice doesn't matter in these type of cases.

So what was my response? And by the way, don't use this as best practice ;)

Look at your organization as follow:
1. There are functions that control, these need to be centralized due to the nature of the roles within these functions. 
2. There are functions that develop and produce. If your industry is simple by nature and your product universal for all markets, keep it centralized. If innovation is core, then decentralize it by region or segment.
3. There are functions that are supporting the processes. I advise a hybrid model where you a) centralize the units that look at effectiveness, or so called continuous improvement of the process and support (your center of excellence). And b) decentralize the support processes to ensure efficient execution and close response time to the front functions like sales and marketing.
4. The functions that sell are by nature close to market (except if you are Amazon) but that wouldn't be fully true because even close to market principles apply for e-commerce.

In addition I always highlight the risks and opportunities of centralization of core control, product and process:
1. Centralization increases complexity of the decision making. Why? Because the dealing with decentralized functions (and most organizations are developing themselves to become decentralized to reduce the show stopper called "control") require dual and triple reporting lines from department to group/holding structures. 
2. Centralization allows high control on process and execution, but also control on cost. But the high effective central control is conflicting with business values that encourages innovation, entrepreneurship and self-deployment of staff and teams (strong statement isn't it?).

And one important note to complete my reply:

Always make sure you map the core values of your organization (implemented or wish list values) to the way you like to structure the organization! They might be conflicting with the way you like the organization to operate.