75% failure rate? Can you live with that?
According to several recent studies the success rate of organisational redesign efforts is somewhere between 25% and 30% – and that means that up to 75% of them fail!
Do you know of any reorganisation that was completed on time and under budget? We were recently called in to advise one company which was into week nine of a reorganisation planning exercise that was supposed to be finished in two weeks!
One observer blames the poor success rate on the dominance of the ‘sticks and boxes’ approach where executives shift boxes on an organisation chart, bolt on more resources that were lobbied for by a zealous executive, or cut costs across the board. Most of us have lived through one of these experiences. However, we have observed that the sticks and boxes approach invariably invites discussions about power, resources and even about incumbency – the current names in the boxes!
Objectives, Consensus, Speed and Learning
Reorganisations require a concentrated effort in the early stages to determine and lock in the most important features of the new organisation. Only then can the details of the sticks and boxes be worked out confidently.
HCR has had success by using prototyping methods to start discussions about reorganisations in a different place – with the expertise you will need to achieve your business strategy. This approach focuses attention more on the objectives of the organisation in a highly visual form while still getting agreement on a significant amount of detail on issues of structure.
Our prototyping workshop:
- Creates a prototype design in the form of a highly visual map of the strategic expertise you will need to achieve your business objectives;
- Moves through a series of iterations of the expertise prototype, with each iteration adding levels of the traditional ‘sticks and boxes’ to the map, and finally;
- Overlaying information on salary budgets, working relationships and communication.
We hold off moving the sticks and boxes until almost the last steps! Then and only then is it safe to tackle distribution of jobs, resources and costs.