Despite a flurry of layoffs at Salesforce, Amazon, Meta, Google, Netflix and other tech giants, the Great Resignation and ongoing labor shortages1 continue to strain companies. With stimulus checks in the past and inflation and interest rates ballooning, customers are tightening their wallets and companies are doubling down on operating efficiency. Productivity is the word of the moment.
These factors and more have fueled a major talent re-shuffle across industries and within businesses as companies reshape their portfolios. New leaders are being hired externally or promoted internally to address the talent gaps. Bloated growth companies are bringing in leaders with downsizing experience, and companies with diminishing margins are hiring leaders that can drive new growth.
New talent often requires new organization thinking. An influx of new talent or change in roles is a good time to prompt a health check of the underlying operating model.
In a study2 of newly hired Vice Presidents, almost 80% of the respondents reported that it took up to nine months to have a full impact in their new roles. 70% pointed to a lack of understanding about norms and practices as the reason. Often these new VPs are being brought in for their fresh eyes. When the operating model is not redefined intentionally and explicitly, however, the new leaders are caught between old ways of working and unclear expectations as change agents.
Most companies grow organically. Leaders add new products and services opportunistically, but rarely do the hard work of evaluating if the core infrastructure and organization support the growth plays. Over time these companies evolve into multifaceted organizations full of unrewarded complexity – such as interfaces and processes that don’t add value to the customer or shareholder and just frustrate employees. It is within these legacy organizations where new hires especially flounder before becoming effective (if at all).
Major talent changes could be just the nudge you need to re-think your organization and engage in the deep conversations necessary to explore options for how work can be done better. Much organization design work is about making difficult decisions between good options. These conversations benefit from having many diverse perspectives including those who know the history and those who come new to challenge that history. Well-configured roles, management processes, decision practices, and metrics – the heart of good organization design – are the foundation of making these conversations successful. As an added bonus, the shared experience of design builds connection and trust, and allows leaders to practice new ways of working as part of the design and change work.
The benefits of deep organization design discussions are powerful not only when there is a “reorganization” but also as part of healthy on-going leadership work. When leaders understand and have collaboratively built the organization, they own the future and feel empowered to make hard business decisions together.
Sara Watson is a Managing Director in Accenture’s Operating Model & Organization Design global practice and a member of the Kates Kesler team.
Heather Oxley is the Interim Chief People Officer for Global Logic and was formerly part of Accenture’s Operating Model & Organization Design global practice.