Month: August 2018

Developing the transition plan

(Each of my blogs in August is an edited extract from my book Organization Design: the Practitioner’s Guide.  This is the fourth – from Chapter 6)

Imagine that in the design phase the high-level design team has determined that the organization should no longer be a bureaucratic hierarchy, but be a ‘flatarchy’

The characteristics of this flatarchy are very different from those of the current organization. As part of the design work, the design team has developed a ‘from–to’ description

Your task now is to develop the detailed design of the ‘to’:  how many people, what are their skills, what will they be doing, how will they be working, what technology will they be using, what work processes will they be following?

Start by arranging a ‘kick-off’ meeting with the people who worked on designing the high-level model and the people who are going to take this model and work it into a detailed plan for the transition that takes the organization from current to new design.

Think of the kick-off meeting as like passing the baton in a relay race between one team and the next. The difference is that the designing group tends to be one team (although that is not always the case) and the planning group tends to be several work teams, (although, again, this is not always the case).

The kick-off meeting should:

  • Review the work that has happened to this point.
  • Confirm the chosen high-level design option (consider retesting the design for workability and capability to deliver the future state).
  • Log any amendments, new ideas, issues and concerns.
  • Identify obvious areas of work to close the gap between the current and new design
  • Setup teams to work on each area of work with a designated team lead.
  • Do a very high level scope of each team’s work and develop the broad-brush initial actions and outputs envisaged by each work stream. Use activity cards or a Kanban board to keep track.
  • Schedule the next few meetings.

Each team’s task is to work out what, for their part of the system, has to happen to move from the current state to the new organization design. Their work must align with the work of each of the other teams to deliver something that is more than the sum of the individual parts.

Working through this gap-closing exercise to carry out all the tasks and activities needed and putting them into a project plan with milestones and resources required takes time and is an iterative process that starts during the kick-off meeting. Judging how much time is reasonable to allow for transition planning depends, among other factors, on:

  • the scale and complexity of the design project;
  • the level of comfort staff feel with more or less depth of detail and planning; and
  • whether stakeholders are willing to start transitioning some aspects of the design ahead of others.

Borrowing some of the methods of agile methodology and applying them to the transition planning is one way of speeding up this phase and entering the transition phase.  For example, the concept of ‘minimal viable product’ is helpful. In software development, this relates to a point when a new product is developed with sufficient features to satisfy early adopters. The final, complete set of features is only designed and developed after considering feedback from the product’s initial users.

For this phase of organization design, consider what are the absolutely key things that have to change in order to move from the current to the future desired state (determined by impact, or consequences of not changing, etc.)  Plan these first, and then start to action them as you continue with the transition planning.  Starting to act as planning proceeds prevents people from getting stuck in the planning.

Another agile concept that can be usefully applied during this detailed design work is that of ‘sprints’. One organization introduced a hybrid of agile methods, including sprints, to OD projects and explained the approach through a series of ‘Rough Guides’ – one for each phase of the design method. The Guide to Transition Planning opens with the statement:

We are increasingly familiar with agile methodology and terminology. Agile is an alternative to traditional PM, typically used in software development. It helps teams respond to unpredictability through incremental, iterative work, known as sprints.

This Guide shows you how to use the agile methodology and terminology in the transition planning phase of an OD piece of work.

In this approach, transition planning teams work in a series of sprints with daily stand-ups.  An OD lead and the project manager hold daily stand-up meetings with OD leads from the work streams. The OD team members keep track of consistency across the pieces of work and, as the detailed planning proceeded, liaise with the project manager on what should go on the plan.

At the end of each two-week sprint the teams meet in a workshop to review progress on the design, discuss what they have learned and/or tested, and agree the objectives for each team for the next two weeks. Usually after a 3 or so 2-weeks sprints most aspects of the high-level design have been detailed, tested further, verified and validated, and an implementation plan is ready to be signed off.

In a more traditional approach, each team lead reports weekly to the project manager and OD lead, who co-ordinate, monitor and support their activity. A straightforward and useful way of capturing weekly progress is through ABCD reports, where A = Achieved this week; B = the Benefit this activity has brought to the project implementation planning; C = any Concerns or issues that have surfaced during the week; and D = the planned activity for the coming week (to Do).

This is a simple format for keeping the detailed design teams on track and feeding information to the project manager that will go into the plan. Each team lead completes it for their team. The team leads circulate their updates to one another for discussion at a weekly face-to-face or telephone meeting with the project manager and OD consultant. Following the meeting (when actions have been agreed), the project manager consolidates the information in one document and circulates it to the project steering group members, along with the plan on a page from the starting phase to refer back to and discuss/amend in the light of reported progress.

As this detailed planning work proceeds, the project manager focuses on three things: ensuring that each work stream is delivering to target, populating and updating the transition plan, ensuring alignment with any parallel initiatives or other work going on in the organization that will affect the new design but is outside its scope.

Making the connections with interdependent projects and work is helped, not only by formal governance, but also by encouraging informal collaboration and transparency across the organization and asking questions, for example: ‘Are we making the connections?’, ‘What are we missing?’, ‘What are the possible impacts of what I am doing on other aspects of work I know about?’ Also ask employees to raise an alert if they see a ‘join the dots’ opportunity that may be being missed.

The ‘product’ coming out of the detailed designing usually includes the following:

  • a developed, articulated and communicable vision of the new organization;
  • clearly described and agreed business objectives and measures;
  • the detailed organization structure (levels, layers, spans, linkages, co-ordination mechanisms);
  • mapped core business processes/workflows with interdependencies and hand-off points;
  • defined units of work that feed into roles and jobs;
  • descriptions of the jobs and person specifications with decision and authority levels;
  • descriptions of ways of working (behaviours, principles, protocols);
  • a transition/implementation plan that closes the gap between the current and the new design state with a timeline and metrics.

How do you do the detailed planning to move from a current to a new design?  Let me know.

Image: Planning v improvisation

Evaluating organization design work

(Each of my blogs in August is an edited extract from my book Organisation Design: the Practitioner’s Guide.  This is the third – from Chapter 8)

In organization design work there is often little appetite to evaluate whether the work has led to performance improvements.   But there are many benefits in doing an evaluation, for example:

  • It focuses the OD work on the context of the business strategy, because it forces people to answer questions like ‘Why did we do this?’, ‘How will are we achieving the return on investment in doing it?’ and so on.
  • It defines improvement in both qualitative and quantitative terms, and ties it closely to achieving business objectives using measures that feed into the overall organization performance measures.
  • It puts the design work in a timeframe and helps the client see what outcomes might be expected as ‘quick wins’ and what results will take longer to achieve and measure.
  • It places accountability for improvement in the hands of the line manager – which usually means a close eye is kept on progress and quick decisions are made if called for.
  • It fosters sharing of learning on successes and failures in OD work
  • It enables issues to be identified and action taken as needed.
  • It identifies where there are opportunities to take things further and deliver greater benefit than originally thought.
  • It suggests routes to building organizational resilience: that is, ‘the ability of an organization to anticipate, prepare for, and respond and adapt to incremental change and sudden disruptions in order to survive and prosper’ (Denyer, 2017).
  • It assesses whether and how the design is solving organizational problems and adding value as it does so.

Assuming agreement to conducting an evaluation, follow these seven steps:

Step 1 – Agree the evaluation need

  • Work with the business unit to help define what success would look like, not just at this point but into the next year or so. Because the context is changing all the time, there is a need to judge whether the design is on the right course to meet the goals set at the start, and if it will continue to do so as new goals emerge – or, if this is looking doubtful, what action to take.
  • Make sure that the sponsoring manager considers how the new design contributes to the overall organizational strategy and goals – and what other interrelated factors need to be considered when making OD changes in their area. This is important because it helps people remember that their piece of work is one element in a whole system. Clients often forget that what they do in their part of the organization is interdependent with other parts.

Step 2 – Agree who the evaluation is for and why

  • Discuss the reasons for doing the evaluation: as well as determining whether the new design is delivering the intended outcomes, there may be a need to decide something, seize an opportunity, learn something new or to assess the return on OD investment.
  • Agree who the audiences are for the information from the evaluation (e.g., customers, bankers, funders, board, management, staff, customers, clients, etc.). This will help decide what evaluation tools to use and how to present the information from the evaluation process.
  • Consider the kinds of information appropriate to the intended audiences. For example, is it information to help understand:
  • Encourage people to question the metrics they are currently tracking: are they inputs, outputs or outcomes? Quite often effort goes into measuring the wrong things or measures something that will encourage perverse behaviours.

Step 3 – Choose the evaluation methods

Determine which of the three types of evaluation data to collect: quantitative (numbers), qualitative (words and observation), or mixed (numbers, words and observation). The choice depends on the context, as each type of data has advantages and disadvantages, and none is perfect. Any data captured should be valid, current, relevant and reliable.

  • Assess the tools available in the market for design evaluation. Some tools will be better than others for particular jobs.
  • Bear in mind when making evaluation tool choices:
  • From what sources should the information be collected? For example, employees, customers, clients, groups of customers or clients and employees together, programme documentation?
  • How that information can be collected in a reasonable fashion? Through questionnaires, interviews, examining documentation, observing customers or employees, conducting focus groups among customers or employees?
  • When is the information needed? By when must it be collected? What resources are available to collect the information?
  • Agree, at an organizational level, a ‘basket’ of measures that leaders can pick from so that you will be able to compare one organization design with another. This ensures some consistency across the organization.
  • Ensure you pick measures which can be tracked on an ongoing basis, preferably from before the design work began, through its progress into the new design and beyond. This means thinking carefully about measures that will be appropriate throughout the life cycle of the design.
  • Avoid measuring the same thing in two different ways, so review any measures that are already in organizational use (e.g. on leadership, innovation, collaboration, etc.) to check that they are the right ones, and develop measures that fill any gaps.

Step 4 – Agree how the tool or tools will be applied

Remember, almost any tool, quantitative or qualitative, can be applied in a number of ways. For example, the choice of a quantitative survey raises a number of questions: should it be paper-based or web-based? Should it be administered to a sample of the population (what type/size of sample?) or to the whole population? Should it be at one time point or several time points, or should it be a continuous real-time data collection?

Step 5 – Prepare the ground for success

Be aware that there can be unexpected consequences of applying an evaluation tool, as the context is usually complex. For example, deciding to do a skills-level analysis could result in trade union intervention if it was felt the results of the analysis would be used to select individuals to make redundant.  Identify and manage the risks of things going wrong.

Step 6 – Decide who will do the evaluation

Selecting the right people to evaluate the outcomes of the design work involves finding those who are some or all of the following:

  • members of the department/consultancy conducting the review;
  • people with working knowledge of the business area under review and its processes;
  • people with relevant technical knowledge;
  • strategy planners with knowledge of the organization’s business strategy and the OD’s contribution to it;
  • people involved in meeting the objectives of the new design but not directly involved in its design and planning.

 Step 7 – Agree how the evaluation findings will be communicated and to whom

Evaluation yields different types of information and knowledge to share with other project teams and with stakeholders. Many large organizations describe themselves as ‘siloed’ and have difficulty learning from their own members. Communicating evaluation findings to the different stakeholder groups, using a variety of communication channels, helps spread good practice and develop common values and consistent approaches.

There are some common problems that may be encountered in evaluating but these can be minimized by:

  • harmonizing the measurements across business units (preferably in the assessment phase);
  • establishing protocols for capturing and retrieving design work documentation
  • making formal agreements with departments/BUs to participate in the review process (as part of the business case).

Done systematically, the evaluation will yield actionable information on things that must be addressed to optimize the new organization design.

Do you evaluate your organization design work outcomes?  If so, how?  Let me know.

Image: https://patternedpetals.com/home/2017/12/5/art-through-time

What triggers organization design work?

 (Each of my blogs in August is an edited extract from my book Organization Design: the Practitioner’s Guide.  This is the second – from Chapter 4)

Organization design work starts in many different ways. Sometimes a practitioner is presented with a new organization chart and told to ‘make it like this’; sometimes it can be a casual conversation that results in a piece of work; at other times, it can be a feeling or statement that something needs addressing (an opportunity or a problem); and frequently it can be a planned piece of work developed out of a particular strategy – for example, a merger. Sometimes it is the practitioner who starts the conversation: ‘Does this need design work?’, and sometimes it is either the client or someone else in the situation who raises the question.

Almost without exception, behind the question ‘Does this need design work?’ is a changed, changing, or predicted-to-change organizational context. It is this context of change that is the trigger for design work. The question ‘Does this need design work?’ enters someone’s consciousness either as a reaction to a changed context or as a recognition of a current context in flux or as a prediction of an about-to-change context. In the example below, a consultant was approached by a board member of a multisite educational organization in the Middle East. The consultant summarized their discussion as follows:

‘You are clear that the Institute does need to change. It is federally funded and has a commitment to operate efficiently, offer a high-quality educational experience to students, and create ecosystems of innovation and entrepreneurship that help take the region into twenty-first-century growth and productivity. The government has stated that your emphasis now has to be on building future-facing capacity, capability, and hard and soft skills in the local workforce in order to reduce reliance on expats. What you are looking for, at this point, is support in:

  • Taking the agreed strategy and, from it, developing an implementable operating model and OD
  • Developing the detailed implementation plans with success metrics
  • Executing the plans and measuring the benefits realized by the new operating model and OD
  • Ensuring that Institute staff, students and stakeholders understand the need for change, how it is to be achieved, and their role in making the change successful. [/]

In this example, the conversation on design work was triggered by the recognition of a political and economic context currently in flux, resulting in the need to create ecosystems of innovation and to reduce reliance on expats by building local capability.’

In most cases, organization members are able to identify current and short-term context changes, but they have a harder time with long-term horizon scanning. However, this is what is most likely to sustain an organization’s existence and keep it thriving. Amazon’s CEO, Jeff Bezos, is well known for his rare skill in holding a long-term perspective, which has led to Amazon’s huge success. Amazon is continuously designed and redesigned with the long-term perspective in mind. Every year Bezos reissues his 1997 letter to shareholders stating his position on long-term thinking. The full letter is long, but its main point is that Amazon cannot realize the potential of its people or its companies unless it plans for the long term.

The desire to work to short-term around OD work is attributable to several factors, including the requirement to hit quarterly earnings targets, lack of management or leadership time to reflect and discuss a longer-term future, constant ‘firefighting’, being rewarded only for immediate results, and/or not caring about the future of the organization because current decision-makers will not be part of it.

Short-term design can be useful to help address an immediate problem – providing the problem is solved and is not just the symptom of the problem. Often, though, short-term decisions on design can compromise longer-term value and bring the risk of having to ‘unpick’ the work and redo it (See: Silverthorne, 2012).

One of the roles of an organization designer is to help clients and other stakeholders understand the risks of responding only to short-term triggers and to understand the value of taking a longer-term view. Ron Ashkenas, consultant and author, offers three points for developing and then optimizing designs that have a longer-term horizon (5–15 years).

‘1    First, make sure that you have a dynamic, constantly refreshed strategic ‘vision’ for what your organization (or unit) will look like and will achieve 3–5 years from now. I’m not talking about a strategic plan, but rather a compelling picture of market/product, financial, operational and organizational shifts over the next few years. Try to develop this with your direct reports (and other stakeholders) and put the key points on one page. This then serves as a ‘true north’ to help guide key decisions.

2    Second, make sure that your various projects and initiatives have a direct line of sight to your strategic vision. Challenge every potential investment of time and effort by asking whether it will help you get closer to your vision, or whether it will be a building block to help you get there. Doing this will force you to continually rebalance your portfolio of projects, weeding out those that probably won’t move you in the right direction.

3    Finally, be prepared to take some flack. There may be weeks, months or quarters where the results are not on the rise, or don’t match your (or analysts’) expectations. Long-term value, however, is not created in straight lines. As long as you’re moving iteratively towards the strategic vision on a reasonable timeline, you’re probably doing the right things. And, sure, you can always do more. But just make sure that you’re doing things for the right reasons.’

It’s important to keep communicating to stakeholders, as Bezos does, the reasons for taking a longer-term approach and to be continuously designing the organization.  It helps to back up the communication with narrative and quantitative information that ‘provides a holistic picture of the business, describing the economic, environmental and social performance of the corporation as well as the governance structure that leads the organization. By embedding environmental, social and governance (ESG) data into financial reports, a company achieves an effective communication of its overall long-term performance’ (Silverthorne, 2012).

People in organizations weak at horizon scanning, future thinking and forecasting can look for help in various quarters. As Thomas Frey, World Future Society, points out:   ‘Since no one has a totally clear vision of what lies ahead, we are all left with degrees of accuracy. Anyone with a higher degree of accuracy, even by only a few percentage points, can offer a significant competitive advantage’

Whether your perspective is short-term or long-term, the thing to bear in mind is that:

‘Any organizational structure should be temporary. Organizations have no separate existence; they function as tools of the business. When businesses change their priorities … then organizations must be changed, sometimes even discarded. That is why it is so wrong to encourage employees to identify with the organization – they need to identify with the business. If you are a Bedouin, it’s the difference between the tent and the tribe. As for building an organization, I think [Henry] Mintzberg got it right when he suggested that two things must be settled – the division of labor and co-ordination after that. But again, any division, any organization is always temporary.’ (Corkindale, 2011)

Do you think organization design is triggered by changes in the external context?  Let me know.

Image Hot topic: trigger points – myth or magic?

 

A leader’s role in organisation design and development work

(Each of my blogs in August is an edited extract from my book Organisation Design: the Practitioner’s Guide.  This is the first – from Chapter 9)

Leaders play a critical role in three ways in relation to organisation design and development (OD & D) work: stating and explaining the ‘why’ of design or development; supporting people in making sense of the context that the OD & D work is responding to; and telling the stories of how it is going. Here I discuss these three aspects.

There is no value in doing OD & D work if the ‘why’ of doing it is not clear to people. Too frequently, unfortunately, the ‘why’ is not obvious – ‘if things are going nicely, then why change them?’ is a common response to proposed OD & D work. Reasons for doing OD & D work that are rather vague, for example, to be more adaptable’, ‘to be fit for the future’ or ‘to be more competitive’ are not enough to convince people that the value to be gained from OD & D is worth the effort.

It is an organization’s leaders to state the ‘why’ do an OD & D piece of work in words that are meaningful to stakeholders so that stakeholders understand how the new design will affect them.

Simon Sinek, who wrote a book ‘Start with Why’ , says that a ‘why?’ statement has two parts: first, a part that clearly expresses the unique contribution and second a part that conveys the impact of an organization. For example, the UK has a Financial Conduct Authority. Why? ‘To make financial markets work well so that consumers get a fair deal’. The organization’s contribution is ‘to make financial markets work well’ and the impact is ‘so that consumers get a fair deal’

Taking the same approach to an OD & D piece of work in the Financial Conduct Authority, asking the question, ‘Why do OD & D?’ might result in a statement like ‘To make our business quicker at identifying and responding to European Union regulatory changes so that citizens are well informed and prepared when the changes happen.’

A leadership team that spends time really thinking through the question ‘Why do OD & D work?’ – focusing on its impact on the work and the workforce – makes a big difference to the speed at which work can progress.

Explaining the ‘why?’ of  OD & D work helps people make sense of what is going on. Leaders often see more of the context, and have more of the ‘puzzle pieces’, than people who are focused on doing a particular task or role. Having access to the ‘bigger picture’ puts leaders in a good position to make sense of complex environments for themselves.  It is then the leader’s responsibility to help employees understand the ‘why’ make sense of it and put it into their own words so that within a short space of time a reasonably consistent and common view emerges of the reasons for the OD & D activity.

Sense-making is an important part of OD & D work.   People typically become anxious in situations that they are not expecting, or that come across as uncertain and ambiguous. They look to leaders to interpret and make sense of the situation for (or with) them. Failure to do this on the leaders’ part leads to heightened anxiety and multiple individual interpretations of the situation.

Deborah Ancona, director of the MIT Leadership Center at the Sloan School of Management, Massachusetts Institute of Technology, explains how leaders go about sense-making:

This sense-making ability is a particularly important predictor of leadership effectiveness right now. … It requires executives to let go of their old mental models and some of their core assumptions; to take in data from a wide variety of sources; to use the information they have to construct, with others, a ‘map’ of what they think is going on; and to verify and update the map – in part by conducting small experiments that provide the organization with more information.

Researcher Sally Maitlis found that leaders approach their role of supporting collective sense-making in one of four ways:

  • Guided, where they are ‘energetic in constructing and promoting understanding and explanations of events’;
  • Fragmented, where leaders are not trying to control or organize discussions but allowing stakeholders to generate alternative pictures;
  • Restricted, where leaders promote their own sense of what is going on with little stakeholder involvement; and
  • Minimal, when both leaders and stakeholders await some other interpretation of the issues.

If leaders of OD & D work take a combination of guided and fragmented sense-making approaches then stakeholders are more likely to feel involved in the design process. This is tricky to handle. The guiding sets the framework and the outlines; the fragmenting allows for local or individual interpretation within the framework.

Explaining the ‘why?’ and guiding stakeholder sense-making can be supported by storytelling. Be aware that although stories can be an effective and inspirational tool to make sense of what happens in organizations, or to inspire, provoke or stimulate change they can also be used to mask the truth or to manipulate.

Writer Chimamanda Ngozi Adichie, in her Ted talk ‘The Danger of a Single Story’,  reinforces this point, saying: ‘Stories have been used to dispossess and to malign, but stories can also be used to empower and to humanize. Stories can break the dignity of a people, but stories can also repair that broken dignity.’ She follows this by warning of the dangers of a ‘single story’ or (as a common organizational phrase has it) ‘one version of the truth’. (This phrase originally came from the technology world, in relation to having a data warehouse that was the single source of organizational data.)

Adichie goes on to say:

‘It is impossible to talk about the single story without talking about power. There is a word, an Igbo word, that I think about whenever I think about the power structures of the world, and it is nkali. It’s a noun that loosely translates to ‘to be greater than another’. Like our economic and political worlds, stories too are defined by the principle of nkali: how they are told, who tells them, when they’re told, how many stories are told, are really dependent on power.’

For her, ‘many stories matter’ – a single story does not illustrate a complex situation. When telling stories, leaders should recognize that there are many possible stories about the same situation. Effective leaders, who are good as storytellers, neither abuse their power nor tell a single story. They tell many stories – drawn from guided and fragmented sense-making – and they tell these stories from a position of equality and respect, illustrating organizational complexity, a diversity of views, and their own responses to uncertainty. Stories told this way – that explain the why, and acknowledge uncertainty and anxiety – help to build confidence in, and an emotional connection to, the new design. They also demonstrate authentic, transformational leadership.

What would help your organisational leaders do effective OD & D work?  Let me know.

Image: Jane Ash Poitras