Organisation Structuring
Organisation Structure Design as a Process (Overview)
In any project aimed at effecting business change, one of the initial requisites from the project team is the delineation of the organizational structure. Modern businesses widely acknowledge the paramount significance of their human capital assets and seek early elucidation regarding the envisaged organizational framework. Chief Executive Officers (CEOs) and executives aspire for a structure that aligns with their vision, typically during the project's nascent stages.
Nevertheless, it is imperative for both the business and project team to appreciate the profound impact that the Organisational Structure exerts on the successful implementation of change within the business. A business is, to a significant extent, a culmination of its people. Therefore, a systematic approach is essential to ensure the implementation of the most fitting structure.
This approach necessitates complementing it with a robust Change Management Method, seamlessly integrated throughout the project, aimed at minimizing disruptions and resistance to change.
Given the inherent uniqueness of each business, it is crucial to recognize that there is no universal formula to adhere to. Instead, each situation demands a tailored blend of factors to address its specific challenges.
Whenever an organizational structure undergoes modification, expansion, or alteration, it becomes imperative to comprehend the factors influencing that specific business's organizational structure. These factors may either work to the business's advantage or pose potential disadvantages.
They are:
- Numbers of personnel
- Customers
- Equipment
- Process
- Product
- Key People
- History
- Time
- Locality
- Geological
- Trends
- Function
- Security / Compliance / Legislation
A comprehensive comprehension of these factors should be facilitated with business executives by the Business Engineer or consultant. Once a clear understanding is established, three potential approaches can be employed to formulate an optimal Organisational Structure.
1. Organisational Structuring using the Function Structure Diagram (FSD).
2. Organisational Structuring using the Object Interface Diagram (OID).
3. Organisational Structuring using the Attribute Dependency Diagram (ADD).
This involves the mapping of leaf node functions, activities, or events within specific clusters to the Organisational Structure. When discrepancies between the Organisational Structure and the FSD, OID, or ADD arise, corrective measures need to be implemented. Each function, activity, or event should have at least one organisational entity mapped to it. Subsequently, the original Organisational Structure is modified to align with one of the aforementioned diagrams. These alterations must consider the influencing factors on the business derived from facilitated sessions with management.
At each valid intersection of the mapping instance, responsibilities can be derived. The nature of these responsibilities is elucidated, and they are incorporated as a further decomposition of their respective organisational units. Following the decomposition of organisational units into responsibilities, the next step involves assigning the requisite resources to fulfill these responsibilities.
A gap analysis is imperative to align the required skill base with the current skills base, revealing any resource gaps to management. Corrective measures need to be implemented accordingly. Each responsibility also possesses a specific skills requirement. By consistently aligning these requirements with the available skills base, management can effectively plan, organise, direct, and control the skills upliftment process within their respective areas.
Upon completion of these procedures, an optimised organisational structure emerges, contributing direct value to the business. The overall functionality of the business improves, fostering more efficient communication between responsible parties.