Knowledge Base

What is Organization Design?

Designing Adaptable Organisations for Tomorrow’s Challenges

Amy Kates, Greg Kesler, and Gillian Pillans teamed up under the Corporate Research Forum to discuss large complex organisations today and mastering the core tension in organisation design – balancing agility and scale. Organisations have always had to make this...

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What Makes an Adaptive Company… A Few More Thoughts

Martin Reeves sets out three elements of an adaptive company: flexible strategy approaches, leaders able to fit strategy to context, and smart change methods. We would add three more: 1. Horizons of Work Most companies today have to work at three speeds at the same...

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Linkedin Learning – Org Design Video Series

You can now access 17, three-minute videos on the fundamentals of organization design. We share practical insights…a great resource for HR and OD professionals as well as line managers. You can see the first video here.

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10 Common Derailers in Organization Design

The work of organization design benefits from a thoughtful, inclusive process where leaders can iterate and explore alternatives and align on a path forward. The reality is that tight deadlines, fear of broad involvement, and a too-narrow view of the problem to solve...

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Bridging Organization Design and Performance Webinar

The economic recovery of 2010-2015 has triggered a number of high-profile mergers, but even more break-ups and spin-offs among large global companies, particularly those based in the US. Between 2012 and 2014 alone, Kraft, Royal Dutch Philips, Hewlett Packard,...

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Organizational Fitness for Growth: Five Insights for CEOs

Learning from Big Companies We recently completed a study for the CEO of a very well known, global sports-apparel brand company. He wanted to challenge his team, as part of the strategic talent review process, to think about whether or not the company’s organizational...

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Why Organization Design is so Important Right Now

We observe a growing appetite for organization design today among smart business leaders. Here are a few thoughts and observations why. Every business we work with is trying to execute a more complex strategy than they have had to in the past. More powerful customers,...

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Current Topics in Organization Design

Organization Design for Diversity, Equity, and Inclusion

We facilitated a meeting in April 2020 for a team of ten people. In the past such a meeting would typically have the eight co-located members sitting together in a conference room and the other two on video. The pandemic meant that for this meeting everyone was...

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Rwanda: When Government is run like a Business

You should visit Rwanda. Most tourists come to this east African country of just under 13 million people to see the mountain gorillas. But, if you are interested in organization and governance you should also follow how this country is developing economically and...

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Designing the Global Organization

The path to success for the globally-ambitious business has never been easy. Economic shifts, political protectionism, and infrastructure gaps in emerging markets have been obstacles for decades. These challenges are exacerbated for leaders in the twenty-first century...

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Singapore: Using Organization Design to Shape a Nation

Your customers are pushing you to deliver complex solutions of products and services in innovative ways. Sounds like the challenge facing many companies today, no? In fact, this is one of the core strategic challenges facing Singapore. As a visiting fellow to the...

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Organization Design in China

Organization design and development are relatively new fields in China. But, as leaders of local companies become more sophisticated in their strategies and expand outside of their domestic markets, they are facing the same issues we see elsewhere: legacy companies...

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Agile is not the same as Agility

I was recently invited to speak to a leadership team and explain the difference between Agile and Agility. The company is a traditional financial services company, providing trading services to other companies. New product and market opportunities, customer...

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Moving Past the Decentralization vs. Centralization Debate

A recent survey of clients conducted by Mercer earlier this year focused on the types of organization change that business executives are planning to make in the next two years. Eleven different design options were covered in the questionnaire, ranging from flattening...

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Balance Alignment with Agility to Achieve Culture

Calls for organizational alignment have headlined strategy publications for the last 20 years. A McKinsey 2014 paper, “The Aligned Organization,” summed up the claim that achieving real alignment gave an organization a strategic advantage. “It has a clearer sense of...

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The Anchor Layer

Activating global collaboration is difficult and expensive to engineer under the best of circumstances. Unnecessary vertical layering of business units and functions and proliferation of profit centers make it even more difficult. Horizontal connections are more...

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Rewarded vs. Unrewarded Complexity in Organizations

Complex organizations are a result of complex business strategies. But not all complexity is equal. Frans van Houten, CEO of Royal Philips, makes a case for distinguishing between what he calls rewarded and unrewarded complexity. Rewarded complexity drives a...

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Activation and Change

Establishing an Organization Design Transformation Office

Our clients typically don’t run in to issues completing the design phase of their organization transformation. At the start of a project, the CEO states the importance of the design work. Teams are motivated by the challenge and the involvement in the process....

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The Design Process for Activation

The design and activation of a global operating model is a major undertaking that deserves a well–thought-out process and project infrastructure that is likely to be in place for two or more years. We are often invited to work with an executive team on a new...

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The Challenge of Activation

There are only so many ways to design enterprise structure. The gravitational pull to greater complexity, and all the challenges that come with it, is powered by the need for new sources of growth in diverse geographic markets across multi-product divisions with...

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Operating and Organization Model

The Integrated Holding Company: Is Such a Thing Possible?

The demise of the GE business model has called into question the wisdom of trying to find strategic and operational synergies across a diverse set of businesses. GE is stepping away from building an “industrial internet” shared platform and is rapidly paring the...

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Organization Design Process

Organization Change? Think like a Marketer

When the time comes to communicate organizational change, leaders tend to default to Human Resources or Corporate Communications to develop the message. While these teams are often highly skilled at communicating, their lens tends to be mitigating risk, rather than...

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Sequencing a Complex Enterprise Design Initiative

Global companies are typically composed of three dimensions: Geographic market units (regions, countries, or country clusters) Global business units (products, brands, categories, or customer segments) Global operating and support functions (R&D, Supply Chain,...

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Building Organizational Muscle

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...

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Talent and Leadership

The Fit Between Talent and Organization

Talent is priority number 1, 2 and 3 in most corporate human resources functions today. It’s no surprise, forced by a tsunami of tech-enabled business change and global competition and intensified by one of the tightest labor markets in decades. The investment of...

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Developing Leaders and Organization at the Same Time

The best global leadership systems develop people and the organization simultaneously. No other business process has more impact on shaping culture than company-wide talent development forums. Calibration and development councils can become the control centers for...

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The Role of the Executive Team in an Integrated Company

We work with many large, global organizations as they move toward more integrated operating models. One of the key levers in creating real connections across business units, regions, and functions is the redesign of the executive team. It is perfectly appropriate for...

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Aligning Organization Design and Leadership Talent

Talent management and organization design are powerful allies. Most companies still treat them as two separate sets of activities. More companies should make this critical connection when looking for results in the areas of: Driving Major Change: Legacy leaders are a...

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Metrics and Rewards

Using the Right Performance Metrics: Watch out for P&Ls

We regularly work with CEO’s that are frustrated with leader behaviors that undermine enterprise strategy. Simple financial measures, like P&Ls, are an effective way to visibly drive leader accountability, yet they frequently do not match the complexity of today’s...

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The Role of Rewards in Unrewarded Complexity

We work with complex organizations with equally intricate business strategies, but not all complexity results in better returns for shareholders. Simplifying portfolios, processes, and structure seems like a logical way to optimize efficient delivery of strategy....

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The Relationship of Pay Grades to Organization Design

As  global companies seek the benefits of scale, HR plays an important role in the design of organizations and the grading of jobs. But are the two activities connected? And if so, how? Organization Design and Global Grading are interconnected elements within an...

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The Challenges of Performance Management

Performance management is still a puzzle waiting to be solved in many companies. Three types of choices need to be made when designing a performance management system. We find too much attention paid to the second and third set, and not enough to the first:...

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Matrix and Networks

Structuring a True Global Network

Networks, councils, and teams are not a new idea in business. Too often they are set up with good intentions, but not well-designed, or they are allowed to outlive their purpose. When these horizontal teams are empowered to deliver business results and designed and...

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Maximizing Agility and Leverage in the Global Organization

Very large multi-national product companies need to find creative ways to enjoy the benefits of scale while remaining agile. This is especially true in developing markets where competitors can move very quickly with few of the obstacles that big companies face....

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Management Process: Small Clues with Big Consequences

Recently, The Wall Street Journal reported on how Procter & Gamble’s CEO is under scrutiny by investors and the board for a stalling turnaround effort. For me, one of the most thought-provoking parts of this story was reported nearly at its end. P&G's Stumbles...

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Function Design

Best Practices for Redesigning Your HR Function

We regularly work with leaders of complex organizations that are making changes to strategy that have organization implications. It is natural for them to want to jump right to organization charts and begin moving boxes and lines. However, we advise our clients to add...

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Designing Functions to be Integrators of Complex Organizations

Functional organizations are the mortar that holds the building blocks of a complex organization together. And they are often the source of capabilities that help businesses compete, to innovate, and to deliver complex solutions to customers. The HR function builds...

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Transforming Global Functions

We regularly work with leaders of complex, global companies who want to transform one or more of their functions (Finance, HR, Marketing, Supply Chain, etc.). The objective is typically to build new capabilities that will fuel growth while configuring the function to...

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Corporate Center Design in Complex, Global Companies

“How are you adding value?” That’s the question Neville Isdell, Chairman and Chief Executive Officer (CEO) of the Coca-Cola Company, asked the functional leadership of the company in March of 2005. Isdell challenged his corporate leaders to rethink how they were...

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Center-Led Functions

  We look at functions as “capability builders” – charged with building the processes, systems, and talent that can identify and move knowledge, ideas, and insights into the strategic decision making of the company. Therefore, the thoughtful design of business...

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Organization Design Lessons from the Supply Chain

What do General Motors’ Mary Barra, Apples’s Tim Cook and Intel Corp’s Brian Krzanich have in common? All are high profile examples of a current trend to elevate leaders with substantial supply chain experience to the CEO’s office. Boards are beginning to realize that...

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Other

Culture in the Time of Covid-19

In the time of Covid-19 all conventions are challenged. We are struck with the headline in today’s paper, “To Curve the Coronavirus, Hong Kong Tells the World Masks Work.” We’re dazed by this reminder of the overwhelming power of culture in the way people think and...

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Jay Galbraith Obituary

Jay Galbraith: 1939-2014  At Kates Kesler we are mourning the passing of Jay Galbraith on April 8, 2014, at age 75. Jay’s Star Model™ transformed organization design and his work forms the basis of the frameworks and methods that we use every day in our...

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Greg Kesler and Larry Bossidy Talk Org Design

Greg Kesler was recently a featured speaker at the World 50 Supply Chain executive forum, where he and Larry Bossidy spoke to members on how organization design helps to drive global supply chain strategy in companies like Coca-Cola, Nike, Royal Dutch Philips and...

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