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...
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...
Interview with Amy Kates – HR Revolution Middle East Magazine
Amy Kates is interviewed by the HR Revolution Middle East Magazine after providing organization design teaching in Egypt. read more
The Role of Organisation Design in Business Strategy – Amy Kates
What value can Organisation Design bring if it’s done well?
How can we check for alignment of our organization, even when we are not intending to do a re-design?
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.
Amy Kates – Helping People Collaborate
Amy Kates is featured by Cornell University ILR School on why Organization Design is important to HR.
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...
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,...
Bridging Organization Design and Performance: Five Ways to Activate a Global Operating Model
Bridging Organization Design and Performance is a handbook for leaders looking to enhance the success of their organizations and themselves. Companies that compete globally require organizational operating models as robust as their strategies. Many companies have...
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...
What is Organization Design? (A Five Minute Animated Overview)
A five minute animated overview of the two core models in organization design: Galbraith's Star Model and Kates Kesler's Five Milestone Design Process. A perfect introduction to answer the question, “what is organization design?”Inteview with Amy Kates...
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,...
Leading Organization Design: How to Make Organization Design Decisions to Drive the Results You Want
About the Book Organization design is front and center as companies expand their reach into emerging markets and as they attempt to channel scarce resources away from yesterday’s priorities into innovation and other new growth opportunities. Today’s organizations are...
Designing Your Organization: Using the Star Model to Solve Five Critical Design Challenges
Amy Kates and Jay Galbraith's new book focuses on special applications in organization design including designing around the customer, coordinating across geographic borders, designing a successful matrix, designing for innovation, configuring the corporate center,...
Designing Dynamic Organizations: A Hands-On Guide for Leaders at All Levels
By Jay Galbraith, Diane Downey, Amy Kates Published by AMACOM October 2001 List Price: $27.95. Available here. "Designing and implementing organizations to meet the demands of today's fast-paced business environment is one of the most daunting challenges faced by...
The Nature of Organization Complexity
Building Internal OD
How can Human Resources, Organisation Development, and Strategic Planning practitioners better support their new leaders during changes of leadership?
What are the respective roles of Human Resource, Organisation Development and Strategic Planning in Organisation Design?
The Organization Design Toolkit for HR
Cornell Advanced HR Certificate: Leading Talent Optimization
Organization Design: What the OD Practitioner Needs to Know
(Kates, Practicing Organization Development, 2010)
Amy Kates Chapter Twenty-Three in Practicing Organization Development, 2010 Organization design is a field that is of increasing interest to many organization development (OD) professionals. Businesses are developing ever more-complex strategies that often require...
Building Internal Organization Design Capability: Intel Case Study
(Kates and Stepp, ODF Webinar, 2012)
Current Topics in Organization Design
Have you designed your change and project management capabilities?
Change management is not just a skill or a process. It is a capability that needs to be designed. In an earlier post focused on transformation governance, we explored the importance of clearly defined Transformation Office infrastructure, well-resourced design...
Is Strategy still Relevant to Organization Design?
The axiom has always been to start with a clear strategy if you want to design a sound organization. But, is detailed strategy work even relevant in a world where the external environment is continually changing, requiring companies to regularly shift direction and...
Too Little, Too Late: Why many Diversity and Inclusion efforts fall short
Diversity and Inclusion programs and initiatives are ubiquitous. While many organizations are making strides in the right direction, too many fall short of their goals and aspirations. Perhaps the biggest obstacle is that too many people still think about...
Start Slow, Finish Fast: Rightsizing Your Organization the Right Way
When organizations are looking to find cost savings, people costs are typically a significant portion of the budget and an attractive target for cost reduction, but beware! Reductions in staffing levels can destroy or erode organization capabilities or “muscle” that...
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...
Greg Kesler: Collaborative Organization Presentation
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...
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...
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...
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...
The Tower and the Square in the Collaborative Organization Model
We recently had the opportunity to speak at a conference of the top 300 leaders in one of our client companies. They are 14 months into completing a major realignment toward global brand business units as well as the redesign of all enterprise functions, aimed at...
Does Everyone Need to Agree? How to Make Better, Faster Decisions
Article
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...
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...
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...
Design Smart Decision-Making into the Organization (and Forget RACI)
Leaders of every company struggle with decision rights, defined as the allocation of power and authority across organizational boundaries. It doesn’t matter the starting point. Highly cooperative cultures report no problem having good discussions, but run into trouble...
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...
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...
What Business can Learn from the Non-Profit (and Vice-Versa): An interview with Special Olympics CEO, Tim Shriver
(Kesler, People & Strategy., 2011)
Greg Kesler People & Strategy, 2011 Peter Drucker argued more than 20 years ago that businesses and non-profit organizations could learn a a great deal from each other. As today's businesses seek globel relevance and more sustainable roles in communities around...
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....
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...
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...
Transformation with Speed: How to accelerate to the future state
We coach our clients to take a thoughtful approach to design work and do believe that time spent up front involving people in shaping the future organization accelerates implementation. However, once a new framework is set and the leader announces the change, then...
Activating the Global Operating Model
(Article, Kates Kesler, 2015)
Companies that compete globally must have sophisticated strategies and plans for sustaining competitive advantage in the face of new challenges, ongoing technological change, and uncertain economic and regulatory environments. Large multinational companies must...
Operating and Organization Model
The Organization Model – The design link between strategy and organization chart
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...
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...
Design an Operating Model that Ties the Organizational Piece Parts Together
We recently worked with the CEO of a company who, supported by a large consulting firm, had launched heavy-weight business units in an effort to create greater accountability and agility. An articulate white paper was distributed across the leadership team that argued...
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...
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,...
LEADx: How should you deliver bad news to a client?
Podcast and Article
Ensure Success by Predicting Failure: Testing Design Solutions with Premortem Analysis
After weeks of assessment, analysis, and discussion, your design team has arrived at a comprehensive solution that will create an organization with the right structure, roles, governance, process, and metrics to deliver on the business strategy. As the sponsor or...
Organization Change: i4cp Interview with Amy Kates
i4cp (Institute for Corporate Productivity) recently interviewed Amy Kates on organizational change. Download insights from Kates Kesler's experience guiding change in large complex organizations.
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...
Communicating Organization Change: Separate the Presentation of the Model from the Announcement of the Leadership Team
Whether called a redesign, restructuring, or reorganization, for most employees organization design is synonymous with the appointment of leaders into new roles. The announcement email typically begins with “I am pleased to announce my new leadership team….”...
Talent and Leadership
Chief Ecosystem Officer – Taking Customer Centricity to the Next Level
Many of our clients are asking how to utilize organization design mechanisms to take customer centricity to the next level. Customer centricity is defined here as creating unique product value propositions and strategies to deliver against unmet customer needs....
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...
Talent Prediction 2018: The New Role of the Business Unit Manager
CEOs (and activist investors) are pushing for simpler organizations with more autonomous, accountable business units. This call to action comes around every few years. Nelson Peltz’s ultimately unsuccessful bid for a seat on the P&G board was predicated by a...
Talent Prediction 2017: The Ability to Navigate Complex Organizations
Organization design is the number one topic on the mind of business and HR executives who responded to Deloitte’s 2016 Global Human Capital report. We are not surprised. Over the past 10 years, we have witnessed a tremendous increase in strategic complexity across the...
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...
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...
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...
Using a Re-Organization to Test and Grow High-Potential Leaders
(Kesler and Kates, Leadership Development, 2009)
By Greg Kesler and Amy Kates in 2009 Pfeiffer Annual: Leadership Development Edited by David Dotlich Leadership development is predominantly a matter of giving the right people the right experiences at the right time. Doing this well is difficult, which is why...
Why the Leadership Bench Never Gets Deeper
(Kesler, Human Resource Planning, 2000)
After decades of succession planning practices most companies remain frustrated with the depth of their leadership bench. Ten Insights About Executive Talent Management Ten Insights About Executive Talent Management Greg Kesler Human Resource Planning The record is...
The Challenges of General Manager Transitions
(Kates and Downey, Filling the Leadership Pipeline, 2005)
Filling the Leadership Pipeline - Chapter 3 Amy Kates and Diane Downey Editor: Robert B. Kaiseer Center for Creative Leadership, 2005 There may be nothing more important to an organization’s succession efforts than building a strong cadre of general managers. Yet...
Roadmaps for Developing General Managers
(Kesler and Kirincic, Human Resource Planning, 2004)
Greg Kesler and Paul Kirincic Human Resource Planning, 2004 General management talent depth is an obstacle to growth in many large, multi-divisional corporations across diverse industries. Succession-planning practices usually stop short of producing real...
Setting the Leadership Agenda for Executive Talent Development
(Kesler, Global CEO Magazine, 2004)
Gregory Kesler Global CEO Magazine, March 2004 For many companies, leadership bench strength and succession management – the availability of strong and deep pools of executive talent, able to assume a number of varied leadership roles at various levels -- is a major...
Leadership Roles – Design Firms to Grow Talent
(Kates, Leadership Excellence, 2008)
Amy Kates Leadership Excellence, 2008 The most powerful element in a succession plan is the set of experiences that develop managers on the job. Nothing prepares someone to take on a leadership role better than a stretch assignment with the right support and feedback....
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...
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....
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...
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:...
The Automotive Industry Then and Now: A Case for Aligned Incentives
Even though the U.S. presidential election is over, historians will be evaluating the role that the automotive industry played in its outcome for years. An equal share of economists’ attention will be given to how the U.S. government bailouts contributed to what...
Aligning Reward Systems in Organization Design
(Schuster and Kesler, People & Strategy, 2011)
How to Activate the Orphan Star Point Michael Schuster, Ph.D. and Greg Kesler October 20, 2011 Michael H. Schuster, J.D., Ph.D. is professor of Management Strategy and Chair of the Management Department, U. S. Coast Guard Academy, New London, CT. He is also managing...
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...
Matrix Part I: The Nature of Organizational Complexity
(Greg Kesler)
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....
Design for Conflict: Make Tension in the Matrix Work to Drive Business Results
For years, leaders have tried to create smooth-running organizations where complexity, tension, conflict and overlapping lines of authority are at a minimum. Organizational simplicity is great when the business is simple – when there are only a few products, serving a...
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...
Three Success Factors for Managing the Matrix
The Balanced Matrix and the Rebirth of the Country Manager
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...
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...
Making the CMO Role Successful: Pay Attention to the Operating Model of the Company
Across multiple industries and geographies, the CMO role is the shortest tenured in the c-suite, slipping to an average of just 43-months in 2019, according to a research from executive search firm Spencer Stuart. Brands listed in the graphic below lost or...
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...
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...
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...
Response to Ram Charan HBR Article – “It’s Time To Split HR Up”
Ram Charan’s provocative article (It’s Time to Split HR, HBR, p 34, July-Aug 2014) voices a common frustration we hear both from business executives and frankly, HR leaders themselves. Despite stated aspirations to be forward looking thought partners on matters...
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...
(Re)Designing the HR Organization
(Kates, Human Resource Planning, 2006)
Amy Kates' article on new models for structuring the HR function was awarded the HRPS Walker Prize for outstanding article of 2006. (Human Resource Planning) Amy Kates Human Resource Planning, 2006 Many HR functions have gone through the process of transformation over...
Designing Organizations for Digital Success: Strategic Digital Marketing
Designing Organizations for Digital Success (Kates, Strategic Digital Marketing, McGraw Hill, 2013). "Digital" work and decisions often fall between the marketing and technology functions. Amy Kates' chapter in this new book on digital marketing helps leaders of...
Redesign Functions to be Integrators
(Kesler and Kates, Leading Organization Design, 2010)
Greg Kesler and Amy Kates Jossey-Bass Leading Organization Design, 2011 Functions (including HR, finance, IT, legal, marketing and supply chain) can serve as the mortar that holds the building blocks of a closely related portfolio of businesses together. The HR...
Designing an Integrated HR Function: What the CHRO Needs to Know
(Kates, Boudreau, and Galbraith, The Chief HR Officer, 2011)
Amy Kates, John Boudreau, Jay Galbraith Chapter published in The Chief HR Officer, 2011 One of the most important decisions a CHRO makes is how to design the HR function. The design of the organization – structure, power, roles, decision processes, reward systems, and...
A Model and Process for Redesigning the HRM Role, Competencies and Work in a Major Multi-National Corporation
(Kesler, Human Resource Management, 1995)
Greg Kesler Human Resource Management Journal, 1995 The Case for Repositioning the HR Function For more than a decade human resources management has aspired to be a business-partner to general management. Fulmer (1990) characterized the new role as the "right hand to...
Implementing Major Change in the HR Organization
(Kesler, Human Resource Planning, 2002)
The Lessons of Five Companies Greg Kesler Human Resource Planning, 2002 The Drive for Major Change in the HR Function For more than a decade, human resources management has recognized the need to act as a business partner to line leaders (Galbraith, 1992; Ulrich et...
Four Steps to Building an HR Agenda
(Kesler, Human Resource Planning, 2000)
HR Strategy Revisited Greg Kesler Human Resource Planning, 2000 Today's business growth strategies provide a new window of opportunity to shape a more meaningful HR agenda. A practical but thoughtful approach for tying HR strategy to the growth plans of the company...
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...
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...
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...
How Coke’s CEO Aligned Strategy and People to Re-Charge Growth: An Interview with Neville Isdell
(Kesler, People & Strategy, 2009)
An Interview with Neville Isdell Greg Kesler People & Strategy, 2009 Although the brand still held enormous value and cash flow was good, Mr. Isdell’s daunting task was to turn around an icon in trouble—to return The Coca-Cola Company to growth. Mr. Isdell’s...