Every company, whether it’s a tiny start-up or an established megacorporation the size of a small metropolis, dreams of the day when a perfectly streamlined, productive workflow will characterize the everyday working lives of their employees. The reality is that most companies don’t know where to start to achieve this standard of operations. Sure, we know that productivity can be promoted and efficiency maximized on an individual level and even a hierarchal level, but what about at the level of the organization in its entirety? Welcome to organizational design, a concept which takes known patterns of effectiveness and applies them to corporations as a whole.
Organizational design, by definition, is the way a company structures its business operations. There are many types of organizational design (read more). In assembly-line structure, each employee does one very specific task to specifications over and over again while a manager or foreman oversees. This works well for some companies but in our technological age, this type of work is insufficient for the complex problems facing organizations today. Unless appropriate organizational design is built into the structure of the company, organizations face inefficiency and sub-par productivity. Even if they don’t, the chance to maximize operations should excite companies and encourage them to revamp their current organizational design structure in order to empower their employees to do more work more quickly.
One of the first examples of modern-day organizational design is the American organization the National Aeronautics and Space Administration (NASA) which revolutionized the concept of organizational design in the 1960s, during the race to put a man on the moon. According to Zach Ferres on entrepreneur.com, NASA was one of the first companies to throw out organizational charts and enforce information sharing. Because of the time-sensitive and complex nature of the project, the organizational design had to complement the work needed. In short, the project was too large and had too many moving parts for it to work linearly.
In the assembly-line model, the project would have been drawn up completely, then passed down to lower-tier workforces who would attack their individual tasks. Instead, the organizational design of the moon landing project dictated that many teams work simultaneously, a revolutionary concept in the world of organizational design. In order to accomplish this, the moon landing project did one major thing differently: it defined holistic organizational goals and put the power to accomplish them in the hands of the whole organization and not just a few management positions.
Breaking Down Mission Statements
Organizational design is about breaking down the effects of organizational structure and analyzing how they work together to create an efficient workflow. One of the major ways companies can begin moving toward an inclusive, team-oriented organizational design is by adopting well-defined organizational goals and a strong, company-wide purpose. This “mission statement” or “compass” or whatever term you assign it becomes the thesis for the company’s operations. Everyone in the company views their jobs under this organizational design feature, resulting in a unified purpose and goal.
Breaking Down Organizational Design: Team-Work
In prior years, common organizational design dictated that companies would search for people who could complete very specific tasks exceptionally (or at least functionally) well. Employees would come in, do their one job, and then go home. Nowadays, however, the types of projects that are being completed in the global marketplace require hordes of people with a broader array of skills. Turns out, this type of organizational design is more efficient and productive, anyway. When you have a selection of employees who have overlapping skills, you present the opportunity for your teams to cooperate and collaborate in an inclusive effort. Employees who really enjoy one type of work and not another might be able to have their first choice, since someone else on the team might share the same skills.
Take the Walt Disney affiliate Pixar, for example. According to an article in the Harvard Business Review, Pixar emphasizes the importance of community in all that they do. They facilitate lasting relationships, foster a culture of honesty, and empower employees at all levels to own their part in the company and make decisions that impact the final product. This decision-making ability is one of the key portions of strong organizational design. When portions of a project need to be handed off for approval and re-approval time and time again, the company wastes valuable time and pulls ownership away from the employee or team actually doing the work. Shift to an organizational design that trusts your employees to make decisions and you’ll find your company experiencing an overall increase in productivity.
Structure for Success
The organizational design of your business is core to the effectiveness and productivity of the work your employees are doing. By incorporating well-defined purposes and diversifying your teams, you company will be well on its way to an organizational design that promotes productivity and thus profit for many years to come.
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