Edward Lorenz coined the concept of the butterfly effectin 1972 at a science conference. Although at the time he didn’t literally mean the flap of a butterfly can lead to a tornado in another country the analogy helped us to think of how small changes in one part of a system may lead to large effects elsewhere. Organisational structure can be like this particularly when separate departments make decisions without proper cross-functional consultation.
Small changes can and do affect leaders, individuals and teams in significant ways. Incentive schemes are one such area where a small change in a policy or structure can have positive or negative effects on organisational performance.
Much has been studied and written about organisational culture and the effects of employee engagement. Changes to reporting structure, office layout, communication channels, KPIs, appraisal systems, competency definitions, and many other aspects can have a profound impact on culture and engagement. Hence no change to organisational structure should be looked at in isolation.
Sometimes established organisations can be stifled by excessive bureaucracy, multi-layered hierarchy, and complex reporting structures. In this situation it can be useful to consider four fundamental foundation questions;
- Do we have a good understanding of the current and likely future dynamics of our market?
- Do we have good insights into the buyer behaviour of our current and future customers – including how they prefer to interact with the organisation?
- How should we best position our brands/offerings to meet the market and customer needs?
- Is the organisational structure built for the honest 85% of employees (rather than building structure for the small percentage of employees who may be tempted to do the wrong thing)?
Finally, when answering these questions, the organizational structure should be arranged in the least complex way possible. Simplified structures help remove ambiguity, communication barriers and other barriers that erode the connection with customers and market.
Many corporate leaders and employees have the right intentions, but it can be overwhelming when you consider how everything is affected from leadership styles, to organizational structure, to employee engagement, to customer service and marketplace.
Ma Yansong
Idea2outcome can help simplify the organizational structure.
Idea2outcome is ideally positioned to help with ideas and solutions to introduce small changes to organisational structure that can lead to sustained, increased performance. Idea2outcome can provide assessment, insights, and solutions across the following areas;
- Competency frameworks
- Incentive scheme creation or assessment
- KPI setting/Goal creation workshops
- Role definition workshops
- Business communication
Call now and see if we have the ideas that will help you achieve a positive outcome.