What core belief did you develop that could guide you in the design of a new organization if you had the opportunity?
Upon perusal of the Mumbai article, I realized two major beliefs that would guide me in the design of a new organization if I were provided the opportunity to do so. The first core belief pertains to focusing on the workforce, or the individuals, that I already have and then organizing them appropriately. The second core belief relates to the design of organization, specifically that my business strategy, which includes a mission, capabilities, and competencies, would influence the design of the organization, rather than the other way around. Implementation of these two core beliefs will help to result in the success of a given organization.
In order to implement the first core belief, or the focus on the current workforce, it is necessary to modify the organization’s design to fit the employees’ talents and capabilities while simultaneously addressing any significant skill gaps. Focusing on one’s employees and the organization’s foundation is one of the most successful methods to use when designing any business, as an effective workforce is the backbone of any company’s success. One must always take care of the employees’ needs first, and these needs take precedence over external needs. In today’s times, companies have quickly rid themselves of loyal employees during difficult economic times and recruited brand-new employees, operating under the false assumption that new employees will automatically result in new success. However, with the right system in place, organizations do not need to recruit exceptional talent in order to achieve significant success, as evidenced by the “dabbawalas.”
When implementing the second core belief, or the focus on melding an organization to a particular business strategy, one should design an organization accordingly and determine how individuals will fit within that organizational structure. This type of approach begins with and consistently focuses on strategy, which ultimately yields well-designed organizations that achieve success, both in the short-term and long-term. Transparency and standardization are critical to take into account when designing an organization, and the “dabbawalas” railway system illustrates the focus on long-term needs and strategies designed to address these needs. Long-term focuses will not only help support the business strategy, but also management efforts regarding succession. Lastly, when designing an organization, it is important to take into account the operational environment, specifically the economic, social-cultural, political, technological, and environmental aspects. The “dabbawalas” exemplified this focus when they modified their organizational structure to account for an increased presence of women in the workforce.
What would the structure look like?
While a theoretical discussion of an ideal business structure is possible, the practical implementation of an ideal business structure is problematic. Specifically, effective designs often require focusing more on people or more on strategy. Aside from this conflicted focus, companies must also choose between an array of different structures available, and each structure comes with its own strengths and weaknesses. Moreover, different companies work best with different structures, which further exacerbates the process of organizational design. The most effective organizational designs will focus on the differentiation and aggregation of individuals, jobs, and functions, and this design will also effectively deliver the company’s competitive strategy through its various activities. Organizational design should also take into account integration, which aids in the coordination and conveying of information throughout the workforce.
In general, the traditional hierarchy is probably the most effective model for most business organizations. However, this hierarchy should also partially emphasize self-management to enhance ownership in the company. Partial emphasis is important, as companies based completely on self-management may experience failure and have no clear perpetrator to hold responsible. In addition, unfettered self-management may also lead to employees’ deviation from their tasks, resulting in the organization’s overall negative performance. Management layers in these types of structures should also contribute more value to a company, rather than just serving as a supervisory layer. In other words, management staff should hold several responsibilities, such as the allocation of resources, the provision of functional guidance, the creation of new businesses, the facilitation of linkages or knowledge between different units, and the provision of services from a call center.
In contrast, flat organizations have greater risk tolerance, and this tolerance can be attributed to the management layers’ tendencies to screen data and eliminate decision options. These tendencies result in top managers at multilayered hierarchies having fewer decisions to make and options that have been more thoroughly analyzed, which result in fewer mistakes. Multilayered hierarchies also help provide structure and identification within an organization, and they help outline responsibilities and obligations for employees. It is important to note that increased organizational growth entails stronger management, such as formal work assignments, structured guidelines, and detailed rules, which will help streamline operations. Overall, hierarchies are critical to take into account for the design and implementation of an organizational structure for a company.