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Principles of Organization Design

By Exforsys | on January 31, 2016 |
Organization Design

There are numerous frameworks that allows to structure an organization.  However, to design an organization is quiet different because there is no such thing as a design blueprint that anyone can simply follow without taking necessary steps to ensure that the design structure will work for a particular organization.  Blueprint Designs even makes it more complicated knowing that the design is ineffective, this will lead the organization to serious consequences which may ultimately result in business failure.

Fortunately, there are four guiding principles that will assist employers in making an organization design. These principles, if followed correctly, will bring a well-laid out design which could strongly aid in helping the organization achieve every single objective and goal they have. The four principles are as follows:

Principle 1: Form Must Follow Function

Every organization design should be aligned to the people, metrics, and processes that will support the organization’s strategies. What is needed is for an organization to look beyond their charts and current practices, and instead concentrate on activities that will help identify the individuals and group of individuals who are responsible for planning, sourcing, making, and executing processes. This principle necessitates that there needs to be a focus on the tasks they perform instead of their position or name.

The creation of an organizational design is not about making new titles or making changes on the organizational chart, but rather, it is chiefly regarding form following function; it is the integration of individuals and group of individuals who are responsible for carrying out the various organizational processes.

Principle 2: Each Process Needs Accountability

The promotion of activities and programs that capitalize solely on performance in specific departments with the use of metrics can easily highlight the weaknesses of employees or departments, which can leave gaps in their roles and responsibilities. This is why principle #2 is essential- because it ensures that each role is clearly defined, and every employee and department knows the responsibilities they have. To implement this principle, there has to be a strong leader who will be held accountable for the success of the organization. This person will be in charge of mediating different functions while maintaining the mission and vision of the organization. In the same way as there is this one person who will take full responsibility of the organization’s success, there should also be individuals or groups who will be held accountable for each process that runs within the organization. Their responsibility is similar to that of the executive in charge of the overall organizational success, but in a smaller scale.

Principle 3: Identifying and Developing Core Competencies

Principle 3 tackles on the importance of being able to identify core competencies of the organization, which are what sets it apart from competitors. Core competencies make an organization unique and sustainable, and by focusing on how these can be developed will make a big impact on the business. It is therefore very important to clearly and accurately identify what makes the organization different, and what are the things that it does very well, in terms of skills, products, technologies, expertise, abilities, knowledge, and processes and make sure these are effectively communicated and carried out to every individual in the organization. If an organization does not have well-defined and well-developed core competencies, it will be difficult to survive in business.

Principle 4: Organizing Required Skills

Principle 4 on the other hand, conveys the need to organize the skills required by the organization, and not merely to develop the skills that it currently has. This entails the need to identify what skills are required for each function, determine whether these skills are possessed by the employees, and be able to create action plans that will enable the organization to acquire these skills over a certain period of time. The organization should ensure that such measures would be properly addressed in their organization design in order to achieve optimum results.

« « What is Organization Design?
Organizational Design Characteristics » »

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Editorial Team at Exforsys is a team of IT Consulting and Training team led by Chandra Vennapoosa.

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