Organizational design includes all aspects of organization such as strategy, structure, systems, culture and their interrelationship. The selected articles provide insights, examples and success factors for successful organizational designs.
How to create a solid organizational design?
Organizational design encompasses all aspects of organization such as strategy, structure, systems, culture and their interrelationship. Also consider the philosophy behind the design on elements such as ‘the human dimension’, competitiveness, entrepreneurship, involvement, reduction of complexity, innovation, sustainability, the ‘Rheinland model’ and social innovation.
The challenge is an organizational design where structure, culture, systems and strategy complement and reinforce each other.
The design of your organization determines how customers experience your organization, how employees perform their roles and managers take responsibility. To realize your ambitions, your organizational design must match your strategy, primary process and stakeholder requirements, for example by organizing your activities in a way that puts the customer at the center.
Trends Organizational Design
Smart organization of your organization’s design is becoming increasingly important.
For the ‘What and How’ of smarter organizational design, see Why We Can’t Do Without Structure. And stop looking, start designing!
Each design has its own dynamics. Let this dynamic work for you as the foundation for better results. It is sometimes about disruptive forms of organization that increase competitiveness. The following 5 trends will put you on the right track.
- Organizational design as a network
- The online media, organizational design and the platform organization
- Startups and Organizational Design
- Organizational design and design
- Strengthen self-organization and management with organizational design
The five trends overlap. There are also organizations that are successful on the waves of several trends. Many platform organizations are a good example of this.
Organizational design as a network
‘Network organisations’. Networks of relatively independent entities are often also intertwined with networks of suppliers and buyers. See our pages on network organizations and on cooperation between organizations.
The network organization also lends itself to social innovation. ‘More responsibility in the implementation’, ‘greater results orientation of components’ and ‘more flexibility’ fit well here. See the Masters in our subject on ‘agile organisation’.
A summary of the insights and experiences gathered in this connection can be found under Innovative organisation.
This type of organization also scores well in innovation: Innovation success for 75% through social innovation. Networking of organizations is facilitated by digital tools. This can lead to the platformization.
The online media, organizational design and the platform organization
The new media affect communication within and between organisations. No organization will escape this. This development is still ongoing. The following points show the urge to experiment and the new possibilities.
The platform organization is a striking look. It has its starting point in online opportunities and has gained a strong, according to many even disruptive, position in a short time.
The trend is increasingly smarter platforms to capture an increasing share of economic activity. With their algorithms, platforms are an alternative form of organizing work. This also means an increasing demand for on-demand freelancers. “If necessary, freelancers gather in teams for a tender or to carry out a complex project together. For example, they find each other via Part-up or in communities that have not yet been formed. On the demand side, it is easier for customers to find ‘the right (woman) man for the job’ due to the wider selection and better matching, often supported by reviews from previous customers.”
Thus, there is the conclusion that in the gig economy the final breakthrough for the self-employed and the end of the traditional organization is imminent. See:
– Organize and manage algorithmically as needed – The organization of the future is already signing up. What do the traditional organizations do?
– The emergence of communities of independent professionals – Why freelancers connect with each other in the gig economy
Startups and Organizational Design
Start-ups usually care very little about organizational design. In the process, among the ‘surviving’ forms of organization and management emerge that inspire effective organizational design, especially for organizations that want to grow and innovate faster. Successful start-ups are characterized by ingenuity, speed, other forms of collaboration and the ability to innovate.
Agility, technical ingenuity and feeling for the customer or target group, these are the factors that determine whether you progress step by step. Estimating budgets, preparing business plans and meeting many experts and important people about this: all a waste of time! Even worse: they are guarantees to fail. You train elan, spirit, inspiration, agility, creativity, determination and enthusiasm.” Source: Interview with ‘serial entrepreneur’ Boris Veldhuijzen van Zanten.
More info: Think like a startup – It’s adapt or die – How to deal with the increasing transparency and the acceleration of change in virtually all sectors.
Organizational design and design
It’s time. ‘Design’ is now definitively transferred to organisations. It claims a broad scope based on the principles ‘Everything is about the customer’ and ‘Only the end user counts’. The following articles give an idea. First, another confusing statement:
‘Organizational design eats strategy & systems for breakfast and culture & structure for lunch!’
Strengthen self-organization and management with organizational design
We are increasingly seeing a build-up of relatively small units with their own responsibility for results. We see this reflected in all the trends mentioned. This inevitably raises the question of how that responsibility and the necessary self-organization can be realized. The issue of horizontal cooperation and coordination also arises.
Control is important; a form that does not flatten autonomy and personal responsibility. It is a form of management where aspects of organizational design such as structure, systems, culture and strategy complement and reinforce each other. This creates the basis for a strong positive dynamic. In small organizations this can sometimes be successful. As organizations grow, we see that people are not aware of this. Three examples:
1. Collaboration is encouraged, but individual assessments and individual goals set the tone.
2. A tech company places decision-making lower in the organization, but direction and framework are more vague than ever.
3. A board member: ‘Self-managing teams are perfect, we’re going to roll them out quickly in our organization.’
Do you feel the contradictions in these measures. This is how you get the energy out of the organization.
If the coherence between the organizational principles is lost, it takes a lot of strength out of the organization. People either believe it or become cynical. It is precisely the art of combining all strength and human energy and focusing on improving results and objectives. It is undeniable that some organizations are better at this than others.
Strengthening both self-organization and leadership seems to be the key. Sometimes healthy internal competition between units can be well combined with forms of coordination and cooperation. For example, some cooperatives within agriculture and horticulture are characterized by AND individual entrepreneurship of the affiliated members AND central management & collaboration. Network and platform organizations sometimes evolve in this direction as well. The Chinese Haier is a strong example of this,
The following 3 articles provide inspiring concepts and experiences.
- New organization
What about the interaction between technical, organizational and other factors? Do they counteract or reinforce each other?
- Competitiveness and innovative organization
How to organize so that strategy, structure, systems and culture complement and reinforce each other in their effect on behaviour, attitude and cooperation.
- Puzzle pieces: is your organization in balance?
Organizations are puzzles. The big picture is made up of countless separate pieces that fit together. Although: ‘fit together’?
Disruptive organizational forms
Some organizations take advantage of the trends described above to such an extent that their position becomes stronger. Notable in this regard are the companies that attract attention with disruptive technology such as Booking.com, Google and AirBnB. But the underlying organizational design also plays a role. So big a role that organizations that don’t differentiate themselves through disruptive technology may actually have disruptive power at their disposal. It is the organizational form that does it for him. These are organizations that are characterized by a strong dynamic towards an ever stronger position in their market. In healthcare, Buurtzorg.nl is an example in the industry VDL. More examples can be found under Innovative organization and Responsible management. See also: Is your organization agile enough? An extremely powerful example of the latest development is provided by the Chinese company Haier: The Haier case – New Organize as competing monster.
One would think that such forms of organization would be adopted with lightning speed. Forget it. Getting started with a new technology will still work; a new form of organization requires different behaviour. It’s a different cake. It is clear that new technology is now being used extensively in organizations. The rise of the platform organization is a threat to many ‘old’ organizations. The Haier case shows how this threat takes shape in a very concrete way. The following article is also not reassuring: Concert economy – The end of the organization?
Organizational design: insights, examples, tips
Here is a selection of articles on the above topics. Also the latest contributions from the ManagementSite Network, the articles with the most reactions and Tips & Tricks. The ‘related topics’ at the end of the articles provide background information.
The network organization’s knowledge base page provides additional information. After all, many organizations network. Even beyond the boundaries of one’s own organization, deep into the dependency chains within which the organization functions. In this context, a look at the page Cooperation between organizations is also appropriate.