Organization Design

Donald L. Anderson, Ph.D., University of Colorado, teaches organization development at the University of Denver and organization design at the University of Colorado, Boulder. He is a practicing organization development consultant and has consulted internally and externally with a wide variety of organizations, including Fortune 500 corporations, small businesses, nonprofit organizations, and educational institutions. Dr. Anderson’s research interest is in discourse in organizational and institutional settings, and his studies of organizational discourse and change have been published in journals such as the Journal of Organizational Change Management, Gestion, and Journal of Business and Technical Communication. He is the author of the text Organization Design: Creating Strategic and Agile Organizations (SAGE, 2019) and editor of the text Cases and Exercises in Organization Development & Change (2nd ed., SAGE, 2017).

• PrefaceAcknowledgmentsAbout the AuthorChapter 1: Introduction to Organization DesignOrganization Design DefinedOrganization Design Is a Set of Deliberate DecisionsOrganization Design Is a ProcessOrganization Design Assumes a SystemsApproach to OrganizationOrganization Design Is Based on the Organization’s StrategyOrganization Design Encompasses Multiple Levels of AnalysisOrganization Design Is More Than Organizational StructureOrganization Design Is an Interdisciplinary Field of Research and PracticeHistory of Organization Design1850s to Early 20th Century1910s to World War IIPost–World War II to 1960s1970s and 1980s1990s and 2000sThe Case for Organization Design TodayDesign Affects PerformanceDesign Is a Leadership CompetencyToday’s Organizations Experience Significant Design ChallengesToday’s Focus on Agility Is a Design IssueSummaryQuestions for DiscussionFor Further ReadingChapter 2: Key Concepts and the Organization Design ProcessKey Concepts of Organization DesignThe STAR Model of Organization DesignAlignment, Congruence and FitContingency Theory and ComplementarityTradeoffs and Competing ChoicesReasons to Begin a Design ProjectPerformance Is Suffering Because of MisalignmentThe Strategy ChangesThere Is a Shift in Environment or External ContextThere Are Internal Changes to Structures, Functions, or JobsThe Organization Has Made One or More AcquisitionsThe Organization Expands GloballyThere Are Cost PressuresThere Is a Leadership ChangeLeaders Want to Communicate a Shift in PrioritiesThe Design ProcessScope, Approach, and InvolvementTop DownBottom UpDeciding Who Is InvolvedDesign Assessments and Environmental ScanningDesign Assessments: Gathering DataUsing the STAR Model as a Diagnostic FrameworkEnvironmental Scanning: STEEP and SWOTEvaluating the Current DesignEvaluating Alignment in the DesignEvaluating Strategy/Task Performance and Social/CulturalFactors in the DesignGoold and Campbell’s Nine Design TestsDesign Criteria and Organizational CapabilitiesBenefits of Design CriteriaHow to Develop and Use Design Criteria in the Design ProcessSummaryQuestions for DiscussionFor Further ReadingExerciseCase Study 1: The Supply Chain Division of Superior Module Electronics, Inc.Chapter 3: StrategyWhy Strategy is an Important Concept for Organization DesignWhat is Strategy?Sustainable Competitive AdvantageActivity Systems and Strategic TradeoffsTypes of StrategyPorter’s Generic StrategiesTreacy and Wiersema’s Value DisciplinesMiles and Snow’s Strategy TypologyStuck in the MiddleKey ConceptsPorter’s Five Forces ModelCore CompetenciesBlue Ocean Strategies and the Strategy CanvasNew Trends in Thinking About StrategySummaryQuestions for DiscussionFor Further ReadingExercisesChapter 4: StructureConnecting Strategy and StructureHow Strategy Influences StructureHow Structure Influences StrategyDimensions of Organization StructureDepartmentalization or GroupingsThe Purpose of Department GroupingsStructure OptionsAdvantages and Disadvantages of Structure TypesPrinciples of StructureShape/Configuration: Span of Control and LayersDistribution of Power: Centralization/DecentralizationDivision of Labor and SpecializationConnecting Strategy and Structure: RevisitedSummaryQuestions for DiscussionFor Further ReadingExercisesChapter 5: Processes and Lateral CapabilityLateral Capability: The Horizontal OrganizationWhy Developing Lateral Capability Is So DifficultBenefits and Costs of Lateral CapabilityForms of Lateral CapabilityNetworksShared Goals, Processes, and SystemsTeamsIntegrator RolesMatrix OrganizationsGetting the Level of Lateral Capability RightHow to Decide Which Form to UseGovernance Models and Decision AuthorityGovernance and Planning ProcessesDecision-Making PracticesEnablers for Successful Lateral CapabilitySummaryQuestions for DiscussionFor Further ReadingExerciseCase Study 2: Collaboration at OnDemand Business Courses, Inc.Chapter 6: PeopleCase 1: Coca-ColaCase 2: AT&TCase 3: LafargeTraditional Approaches to People PracticesA Strategic Approach to People PracticesKey Positions and the Differentiated Workforce“A” Positions and Pivot RolesTalent Identification and PlanningTalent Identification: Focus on PotentialTalent Planning, Pipelines, and Talent PoolsCareer DevelopmentThe Classic View: Stages of the CareerThe Contemporary View: Boundaryless CareersTalent Development and Learning ProgramsNew Forms of Learning versus Formal TrainingDevelopment Through ExperiencesPerformance ManagementStrategic Analysis and Designing the People PointGlobal ConsiderationsSummaryQuestions for DiscussionFor Further ReadingExerciseChapter 7: RewardsApproaches to RewardsMisaligned Rewards: When Rewards FailUnethical BehaviorCounterproductive BehaviorConflict and CompetitionSlower Change and ResistanceWhy Designing Rewards is so ChallengingMotivationExpectancy Theory, Goal Setting, and EquityIntrinsic and Extrinsic MotivationMotivation-Hygiene TheoryIntrinsic Motivation and Extrinsic RewardsMotivational Impact of Job DesignMetrics and the Balanced ScorecardRewards Strategy and SystemsBasis for RewardsTypes of RewardsDesigning a Rewards System That WorksRewards, Strategy, and Other STAR PointsSummaryQuestions for DiscussionFor Further ReadingExercisesCase Study 3: A Talent and Rewards Strategy at EZP ConsultingChapter 8: Reorganizing, Managing Change, and TransitionsChange and ResistancePersonal TransitionsA Change and Transition Planning FrameworkResistanceReorganizing and Transition PlanningStructure, Reporting Relationships, and StaffingPace and TimingScope and SequencingCommunicationFeedback and LearningOrganizational Culture and DesignWhat Is Culture?Understanding Culture: Competing Values FrameworkLeadership and Organization DesignLeadership’s Role During the Design ProcessLeadership’s Role During ChangeDesign and Leadership DevelopmentLeading New TeamsSummaryQuestions for DiscussionFor Further ReadingExerciseCase Study 4: Reorganizing the Finance Department: Managing Change and TransitionsChapter 9: AgilityWhy Agility is Important TodayContinuous Design and Reconfigurable OrganizationsWhat Agility Means“Change-Friendly” IdentitySensing ChangeAgile StrategyZara and Transient AdvantagesRapid Prototyping and ExperimentationAgile StructureStructure and the “Dual Operating System”HolacracyAgile Process and Lateral CapabilityAgile TeamsGlobal CollaborationPartnerships and Collaborative NetworksAgile PeopleLearning AgilityLeadership AgilityAgile RewardsAgility and StabilitySummaryQuestions for DiscussionFor Further ReadingChapter 10: Future Directions of Organization DesignEmerging Beliefs about Organizations and DesignWork Trends Create Design ChallengesDesign Challenges Shape Design ProcessFuture Trends in Organization Design Theory and PracticeBig DataDigital Technologies, Platforms, and Business ModelsSustainability and the Triple Bottom LineChanges in Organization Design Practice: A Case Study of Royal Dutch ShellThe Organization Design Practitioner Role and SkillsSummaryQuestions for DiscussionFor Further ReadingAppendixOrganization Design Simulation ActivityPart I: StrategyPart II: Structure and Process and Lateral CapabilityPart III: People and RewardsPart IV: ReorganizingReferences