We often use the term “organizational muscle” as a way to bring the concept of “capabilities” to life.
It is a useful analogy. If execution of strategy is the goal, then the organization is a means to that end. The measure of success of any design is what it allows the organization to “do” better than the competition.
Both muscles in the body and capabilities in the organization:
- Turn energy into motion using positive tension
- Require coordination and collaboration to outwardly express an idea or intention
- Become stronger through deliberate and focused training and practice
- Are long lasting, self-healing, and able to act voluntarily (by conscious thought) or involuntarily (without conscious thought)
Developing organizational muscle is about careful design, blending the integration of structure, skills, processes and networks.
Why is organizational muscle so critical today and for the future?
- Speed and adaptability increasingly define competitive success…at a time when growing complexity makes them harder to achieve
- The best performers continually fine-tune their organizations to learn to move quickly and flexibly, often turning organization itself into their competitive advantage
- Execution makes the difference — increasing the ability to make good decisions and making them happen is what separates high performing organizations from the rest.
Many organization design practitioners build the concept of capabilities into their work, and as leaders are exposed to the concept, they quickly grasp the value of focusing on capabilities. The challenge is to build the necessary components to ensure successful organizational development through several cycles to ensure the muscle is conditioned and developed to deliver.
We suggest three ways to build organization muscle:
- Design…the organization (structure, roles, processes, metrics, and talent profiles) against the capabilities.
- Create accountability…make capability development part of the accountabilities of the leadership team. We find it useful to have executive committee members sponsor enterprise capabilities. This builds interdependence across the team.
- Practice…build the discussion of capability into the forums for planning, business performance review, and learning.
- Measure…use capabilities as leading indicators of strategy execution; measure tangible progress (for example, reduced product design to launch time might be a measure of increased new product development capability)
Like all successful enterprises, building organizational muscle requires a complex set of related activities to be designed and developed consciously in order to achieve optimum performance.
Crucially it requires leaders with the vision and ability to sustain development across a number of iterations necessary to realize the benefits. Give line managers space to let go of today, fall a little then re-learn to realize the necessary coordination to drive better decisions and speed of execution.
Sukhvinder (Win) Dhat
Kates Kesler European Practice Leader