Adaptive Organisation Design and Good Jobs

Complexity is driving new organisational forms. According to Mercer, 96% of executives are planning structural changes in the next year. The main reasons cited by C-suite leaders for these changes are the need to combine support functions into shared services, the need to augment roles, the need for building a more networked organisation, a continued flattening of the structure and decentralising authority. But more than any other reason, business operating models are being disrupted like never before.

BCG proposes six factors regarding organisation design that drives organisational performance:

• Agile ways of working
• A value-adding corporate centre
• Clearly delineated profit and loss (P&L) responsibilities
• A flat management structure with a strong frontline focus
• Effective use of shared services
• Strong support for people and collaboration

Agile ways of working is the most critical of these factors. Agile companies are up to five times more likely than their peers to become top performers. The organisation design changes need to respond to the complexity and speed of the business challenges in the new world and need to be looked at with a new paradigm. We need to move from seeing organisations as machines to seeing organisations as organisms where leaders lead from the middle, not the top and where resources are fluid, teams are built around end-to-end accountability and boxes and lines become less important.

The idea is to move from hierarchy to heterarchy with teams cross-linked around specific focus areas, responsibilities and capabilities. We also need to use different approaches for different organisations and even within organisations depending on context and maturity. Organisations need to be designed with the whole business eco system in mind. The design has to enable diverse entities to be integrated into a cohesive network based on a clear understanding of how value is created. It is also critical to design an organisation based on the critical capabilities needed to deliver value.

It is important to understand the capability strengths and gaps to use as a base for how the organisation will be designed, the eco system assembled and resources deployed. Many organisations also use network analysis to understand how to leverage relationships and nodes to deliver value in the new organisation design.

Before any work gets underway with designing the organisation, clear design principles need to be agreed. These have to focus on how to create adaptivity and stability in the system in the right balance. What is critical is that the organization is deliberately designed to assemble and deploy resources and services quickly and efficiently in response to diverse options and requirements in demand, supply, markets, business and technology.

According to Gillian Pillans, some of the new organisational models that could be considered include virtual, networked organisations, front-ack organisations and ambidextrous organisations. Virtual, networked organisations can be scaled up and down as needed and can draw on talent when and where they need it. Front-back organisations are those that structure the ‘back-end’ of operations, R&D and supply chain for optimal efficiency, while the ‘front-end’ is designed for customer intimacy, customisation, responsiveness and revenue growth. Finally the ambidextrous organisation involves establishing separate operating units for activities not part of the core business or those that need space to grow and experiment.

Workforce strategies and role design need to adapt to these new models. These strategies include cross functional end to end teams, flow to work staffing pools and platform models.  As Mercer states: Increasingly, organisations are moving away from a narrow definition of jobs, towards a more holistic and agile model around careers, capabilities and contribution. This is critical in an age of automation and artificial intelligence.

People today desire good jobs, not just jobs. Deloitte describes it this way: ”jobs that, without undue intensity or stress, make the most of workers’ natural attributes and abilities; where the work provides the worker with motivation, novelty, diversity, autonomy, and work/ life balance; and where workers are duly compensated and consider the employment contract fair. They go further to describe good jobs as jobs where people can learn by doing and have ongoing development and job satisfaction. A job where they can be involved in creating new ideas and where they can belong to a community. Some organisations are even moving from role-based to fully team-based organisations.

Deloitte argues that “the thoughtful use of AI-based automation, far from making humans obsolete or relegating them to busywork, can open up vast possibilities for creating meaningful work that not only allows for, but requires, the uniquely human strengths of sense-making and contextual decisions.” In the future people will work more on problems than processes. The processes will be managed by machines, whilst we can use our unique human skills. 

Critical to the new organisational and job models, however, will be a retooled culture, agile work methods and adaptive leadership capabilities and mindsets. It is important to remember that a sustainable organisation future is not based on structure alone.