Getting Structure Right: The Impacts of Poor Organizational Structure – Professional Growth Systems

Getting Structure Right: The Impacts of Poor Organizational Structure

Simply stated, the management function of organizing entails determining how the work of the organization, both strategic and typical day-to-day tasks, is to be accomplished.  Organizing entails defining jobs, authorities, reporting relationships and the processes to be deployed to get the products and sub-products of the organization produced.

In Creating High Performers, three of the 7 Questions asked of direct reports to assure they have what they need to do their job deal with structure:  

  • Do you know what is expected?
  • Do you know what good performance on those expectations looks like?
  • Do you have sufficient authority to execute what is expected of you?

Suffice it to say organizational structure is generally not well understood or defined.

Examine management literature and you find that little is written on this subject, unlike subjects such as leadership or planning.  Among consultants, structure is considered rather an art form, meaning there is no accepted blueprint for how to get it right.

The Impact of this Gap

Here are some surprising findings re. the impact of this gap upon organizational performance:

  • Informal polling of employees we have trained indicate that on average only 70% of their potential contribution to their organization is being realized
  • CEO’s find themselves overwhelmed, in part, because they have not properly defined or adhered to the structure
  • Productivity is stalled because employees are unclear who to go to with questions or issues, and they don’t feel empowered to act on their own
  • Managers adopt a wasteful habit of assigning tasks to multiple individuals to assure that they get done
  • Organizations are unable to determine the root cause of performance deficits because the structure is ill defined or inconsistent
  • Often, the seven basic functions of any organization and their sub-functions have not been clearly assigned, resulting in work finding itself on the CEO’s desk rather than handled elsewhere in the structure

What’s the Norm?

When asked about organizational structure, most executives hand you an organizational chart and consider it done.  These charts do depict who reports to who, how many layers there are to the structure and help to determine whether or not managers have more direct reports than is recommended.  But, they rarely depict how the organization actually functions, the result of which is a series of work arounds that place a burden on high performing individuals.

Job descriptions, as most commonly practiced, define in general terms what one is to do, what experience and education are required, etc.  These are useful for purposes of defining where a job sits in the pay structure of the organization, but they don’t answer the critical elements of the 7 Questions.  Specifically, employees need to know what they are to produce (end products) rather than what they are to do (effort).  They need to know what authority they have.  They need to know what data will be examined to determine if they are performing well. I will be discussing specifics on job descriptions in a future blog.

In most organizations, processes that define how employees are to work together to produce the products/services of the organization are a) not defined, b) not optimized, c) not consistent.  The end result here is that best practices remain unknown and performance is compromised by 20-60% in most cases.

Now What?

Hopefully, these findings have gotten your attention, and you are asking yourself how your organization stacks up to the norm and how many of your employees can give an honest “yes” to the three critical questions detailed in the 2nd paragraph above.

This is the first of a series of blogs that will delve into each of these organizational elements in more detail.  Watch for future posts in the coming weeks. We welcome hearing of your own experience and questions. Contact us to start a conversation.