Methodical Organizational Design: A Structured Approach PPT

This PPT slide, part of the 21-slide 9 Principles of Organizational Design PowerPoint presentation, outlines "Principle 3," which emphasizes the importance of a methodical approach to organizational design rather than relying on intuition. The left column details current practices that often lead to unsuccessful outcomes. It highlights that many organizations base their new structures on intuitive decision-making and gut feelings, which can result in ineffective organizational blueprints. This approach tends to lack a solid foundation, leading to misalignment with strategic goals.

The middle column presents a principle-guided approach. It suggests that organizations should assemble the right leaders with an open mindset to explore various options. This involves reviewing potential organizational design choices through a structured lens, establishing criteria that align with strategic aspirations. This method encourages a more disciplined evaluation of options, which can lead to better decision-making.

The right column provides a case example of a large public pension system. Initially, its leaders believed a new organization was necessary based on product lines. However, they were challenged to reconsider their strategy. Ultimately, they developed a functional health, pension, and investment model that has proven effective over 5 years, resulting in significant cost savings and new product launches.

The impact section emphasizes the establishment of a flexible operating model that integrates strategy, people, and other assets. This flexibility is crucial for adapting to changing circumstances and achieving long-term success. The slide effectively illustrates how a structured approach can lead to better organizational outcomes, making it a valuable consideration for executives looking to enhance their organizational design strategies.

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Organizational Design