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Structure for Global Complexity

In a tightly coupled world with converging economic, energy and environmental forces, a well honed organization structure is a key to innovation, flexibility and adaptability. Structure follows strategy, and embodies the ability to master complexity. An innovative organization is an entrepreneurial organization, regardless of its size or history.

Organization Design

The key to navigating complexity is getting work done at the right level. This simple idea is based on the science of Global Organization Design, sometimes called Requisite Organization.

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The ability to manage complexity is a measurable function of cognitive capability, or capacity for information processing, Organizations need to be designed with clearly delineated levels of hierarchy, so that each level can define the context for those it manages in a way that adds value.

A first line manager provides the annual context for the day to day, month to month operating personnel. Middle managers pull units together to provide coherent functional performance on a two year rolling time horizon. General managers integrate functions in a plant or program looking two to five years down the road. Business unit managers lead strategically with a seven-year vision. And in larger companies, or major government departments, corporate CEO or top officials guide the long term positioning of the portfolio looking 10 – 20 years down the road. Any more than these six levels in a large organization are usually too many: fewer or flatter is simply not enough. Smaller companies can operate with four or five levels, very large companies with seven or even eight.

Getting these levels right is the first step in organizing for innovative flexibility.

Organization design defines:

  • how many levels any organization requires;
  • the fundamental accountabilities and authorities needed by real managers;
  • how to measure levels of responsibility objectively - from CEO to first line supervisors; 

  • the essential functions required at each level throughout the organization; 

  • tasks at the right order of complexity at each level of organization; 

  • systematic information, planning and control processes specific to each organization level; 

  • how to help managers appraise the personal effectiveness of subordinates and relate these appraisals to fair pay; 

  • a fair differential pay structure tied to organizational levels and to measured differential in level of work; 

  • a procedure for appraising the potential capability of people in a just manner for career development and for the growth of a rich talent pool; 

  • how to recognize the work of individually contributing specialists, and to position them in the organization where their creativity and innovation can pay off; 

  • an approach to leadership and to delegation, that ties leadership and management together into one working entity.

To ensure our capacity to advise clients on organization design, we actively support the Global Organization Design Society. The GO Society services as our research and development lab keeping our methods abreast of the best in the world.

Click here to learn more about the GO Society...Global Organization Design Society

Download Adobe Reader document... Global Organization Design Report
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Management Talk Radio Interviews
Click here for radio interview Global Organization Design: With Dr. Ken Shepard of Toronto, President of Global Organization Design Society, will explore the breakthrough ideas of requisite organization, describe how the methods are being applied throughout the world by members of the Society, and the up-coming international conference in Buenos Aires, Argentina.
Click here for radio interview Accountability in Organizations. Everyone wants accountability but no one wants to hold anyone to account. Herb Koplowitz, President of Terra Firma Management Consulting, explores the benefits of accountability, why it is so rarely practiced, and what needs to happen for accountability to add to organizational effectiveness, efficiency and trust.

Business Process Engineering

The second step in organizing for innovative flexibility is enhancing strategically important business processes. Aligning accountability and authority along strategic business processes ensures responsiveness. Then improving the processes themselves, such as reducing cycle times, hones them as competitive weapons. Raising the level of management in these strategic processes can be a route to sustained competitive advantage.

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Change Management

We used to think that organization was a logical, rational thing. If we got structure aligned with objectives and staffed with the right people, everything would be fine. The "in search of excellence" movement taught us that emotion would give us the energy to do what we aspire to do, and that relationships among people were key. An we have come to understand that the gut level, largely unconscious, is where resistance to change lies.

They say that making organizational change is like performing an appendectomy on a man carrying a piano upstairs. Order in chaos is achieved through well designed processes which coordinate and sequence proven methods of organizational change and development, such as visioning, gestalt practice and team building. This ensures more complete communication and precise control over the pacing of change, which are of great value to the Chief Executive Officer.

And change continues. It’s not enough to be tight and lean and stripped. Companies need to be flexible, adaptable, and agile to anticipate changing markets, absorb new technology, track shifting customer needs and parry competitive thrusts. Good change processes can create virtual slack, recognizing the need for human interaction on multiple levels, embracing emotional as well as rational factors and unconscious as well as conscious processes.

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Organization Culture

The important thing to understand about resistance to change is that it is an artifact of corporate culture and is largely unconscious. Culture is about the way we do things around here. It reflects things that have been decided, and have dropped below the level of awareness in the organization. Cultural variables really don’t show up until managers try to change the way things are done.

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Management Talk Radio Interviews
Click here for radio interview Aligning culture and strategy in entrepreneurial companies: With Claudia Chowaniec, President of Precept Inc., an Ottawa-based management consulting company, and a founding member of the New Management Network. She speaks with Jay Lawrence, the CEO of Infonium, an innovative high tech company that builds software for hospitals, health systems, and governments to improve administration and accountability.  Their conversation focuses on the value of utilizing Culture Check, a short, focused  culture pulse¹ survey instrument (see www.culturestrategyfit.com) to determine how the young company’s supportive work culture contributes to its strategic success.
Click here for radio interview Don't Make Organizational Changes in a Cultural Vacuum: With Mark Bodnarczuk of the Breckenridge Institute in Boulder CO, exploring the importance of understanding culture in companies, why ignoring it may solve one problem while creating another and how to get a handle on cultural variables.

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Don Fowke and Joshua Fowke with Stephen Armstrong CIUT Radio talk about Requisite Organization Listen Here


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