On Organizational Design
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BusinessPundit has a thought provoking post entitled "Management By Tweaking". Part of the post says:
... That leads me to wonder, why are we so concerned with massive change if it might not be needed? When things aren't going right, companies often have reorganizations, layoffs, etc., and I'm not sure that is always necessary ...
My personal experiences with getting organizational design training on the job has generally been bad. Although I am all for learning on the job, I have found that few companies can provide good foundational training in this area.
Unfortunately, I also suspect that organizational design theory may be a weak point for some business schools. At the University of Chicago, I took an elective course entitled something like the "Strategy and Structure of Organizations" (an invaluable course for me), but it was not a course chosen by most students who instead wanted pure strategy courses that might help them with the strategy consulting jobs at firms like BCG, McKinsey, and Bain.
Some of the most useful principles I've encountered in organizational design include:
- Organizational structure stems from strategy
- Functional organizations may be used to share resources across a variety of areas
- Business unit organizations may be used to define self-sufficient units / money machines
- Differences associated with financial control organizations versus strategic control organizations should be deliberately implemented.
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