Top 3 Signs Your Change Program Needs OD Expert
You wouldn’t use a hammer when you need a screwdriver, but all too often, it is assumed that organizational change management (OCM) practitioners can effectively carry out organizational design (OD) activities. OCM and OD are two distinct fields with their own theories, methods, and toolkits. However, there is an increasing expectation that OCM practitioners have a basic understanding of OD. A good starting place for every OCM practitioner is to recognize the signs of the need for organizational design so that you can identify when to call in an OD expert for help!
OD vs OCM
First, it’s important to understand the difference between the fields of organization design and organizational change management. Let’s start with some basic definitions:
Organization Design is the redesign of structures, processes, technology, data, culture, and people processes in order to mature business capabilities, increase customer experience, or decrease labor costs so that the organization can achieve its strategy and vision
Organizational Change Management helps organizations, teams, and individuals navigate and adopt change while maximizing productivity and morale so that the organization can achieve its goals
It simply wouldn’t make sense to use the PROSCI OCM methodology to redesign an organization, nor would it be effective to leverage the Galbraith Star OD model to implement a technology change.
Signs of Organizational Design
Second, organizational change management practitioners should be on the lookout for the following signs that your change program may require organizational design expertise.
1. A new strategy
In the early stages of a project, the OCM practitioner typically does some sort of change risk and readiness assessment where they seek to understand the scope and magnitude of the change at a 30,000-foot level, how ready the organization is for that change, and the associated risks. If during that assessment, you uncover plans for a new vision or strategy, if you hear execs talking about a strategy session, you can bet that there is going to be an organization design t some degree involved. Examples include, extreme change, such as a software firm deciding to go into a new market or product line like selling pet food, requiring a new business model to increase revenue or market share, or change to a lesser degree, such as a new strategy for a function within the organization, requiring updates to the operating model. Either way, these are sure signs that OD is coming!
2. Significant change requiring new capabilities
Organizations undergoing significant change requiring new capabilities need to be thinking about impacts to its organizational design.
“Never had before” organizations: never had an ERP and are now implementing SAP S/4Hana, never had a CRM and are now implementing Salesforce.com, never had artificial intelligence nor machine learning and are now standing up a data platform
Manual organizations: operating primarily in a manual stage and using “small” technologies, tools, and processes that are now unable to sustain its growth
Middle maturity organizations too: Use multiple systems for each function, Peoplesoft for HR, another system for finance, and yet a third system for manufacturing, and decide to move these to a single system such as Oracle
All of these organizations will be required to stand up new capabilities, new teams, bring in new roles, release existing roles and perhaps create new organizations to support these changes, signaling the need for new organizational designs.
3. Mergers and acquisitions
No matter what your role is in an M&A, if organizational design is not being talked about, it’s imperative that you start the conversation! Far too often, upon receiving approval to proceed, the execs of the acquiring company go off into a room, draw an organizational chart on a white board, decide what talent stays and goes without a talent assessment, and slam it in. That’s a “lines and boxes exercise,” not organizational design. While some organizations succeed despite themselves without truly reexamining their organizational design, many have horrible results and ultimately fail to capture the value that the M&A was trying to capture in the first place.
Although organization design may not be your wheelhouse, be on the lookout for and prepared to recognize these signs that indicate organization design is afoot. If you’re not the right resource to address the need, make others aware of these signs so that the organization can get the organizational design expertise that it needs.
This is part one of a three-part blog series focusing on the intersection of organizational change management and organizational design.
Top 3 Signs That Your Change Program Needs Organizational Design Expertise
Three Organizational Design Actions Every Organizational Change Management Practitioner Should Take
How To Transform From An Organizational Change Management Practitioner To An Organizational Design Expert
Contact ChangeStaffing to learn how our consultants can help with both your OCM and OD needs.
A very special thanks to Kelley Rainwater, Transformation Expert, Founder and Lead Instructor, Institute of Applied Organizational Design & Transformation, for her thought leadership and for collaborating with us on this blog series.