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 deliver more value at less cost.
In other writing, we detail how the company operating model sets the context and how to use the function design framework to guide the placement of work from global to local and across business units and markets.
Here we share three practices that speed adoption of new functional designs.
- Use the business strategy as the anchor
- Design end-to-end networks
- Designate clear partners across structural boundaries
1. Use the business strategy as the anchor
It may seem obvious that functions exist to serve the business. Yet, many function leaders get distracted by a desire to bring world-class “best practices” to the business. This is the wrong starting point.
If functions are in support of the company and its operating units, then the growth strategy of the business must be the starting point for determining the design requirements. Do this by translating business growth objectives into actionable function-wide capabilities – that is, what the function must be able to do exceptionally well in order for the business to “win” (for example, build global brands, curate customer experiences, or ensure a pipeline of mobile, global talent). Then, design structure, processes, metrics, and talent fit for purpose to activate these capabilities.
Anchoring on the company growth priorities helps function leaders make tough choices about the sequencing and pacing of organization change in the context of all the current work that needs to be delivered.
With this approach, the business is more likely to support and adopt function change initiatives.
2. Design end-to-end networks
Most functions are complex systems, including high volume transaction and service delivery work alongside high value policy and decision support expertise. When the work is done piecemeal, opportunity is lost to strengthen the whole system.
The scope of the design project should be comprehensive, at least during the initial assessment phase, and include:
a) All expert domains within the function
b) The lifecycle of work – from strategy, to program design and development, through delivery
c) The varied roles that execute this work – from strategic functional advisors, to expert designers and consultants, to shared services providers
d) The locations and layers where work is done – at the corporate center, in operating units, and in geographic markets
When such a comprehensive lens is applied, smart decisions can be made about where in the organization work should be done (at what layer and in what location), what must be owned and what can be rented, how to connect expertise across boundaries, and how to use the function as the network glue across business and geographic units.
3. Designate clear partners across structural boundaries
Most business processes such as new product launch, staffing, and annual business planning are executed by multiple departments each contributing work, expertise, and decisions. Make sure individuals can readily identify their partners across structural boundaries, including those outside the function. For example, when Business Development wants to establish a new subsidiary, a corporate tax specialist is likely going to need to work with the regional finance business partner to set it up. If Finance has just been redesigned, this might be a new relationship with new players in the jobs.
Mapping these relationships and investing in clear roles, responsibilities, and decisions rights as part of the design activation goes a long way to creating speed. We like the image of “docking stations” – the nodes where functional staff connect together to collaborate to get both routine and project work done.
Treating these three principles as primary design questions to be asked and answered throughout the design process will help ensure that you architect a function that can be successfully activated, and which is capable of driving incremental value for the company and businesses it serves.
Michele DiMartino, Partner