Organization Design

Many leaders are rethinking the design of their organizations. They recognize that organization design can be a powerful way to boost performance and keep up with ever-changing markets. Yet many reorganization efforts fail.

What happens in a company is not simply a matter of organization structures, processes, and systems but also one of behavior—that is, how people act, interact, and make decisions. To address this underlying driver of performance, BCG applies a set of levers that transform individual behaviors, encourage new ways of working, and create a purpose-driven organizational culture.

By using this organization design approach, BCG recently ranked as best among market leaders on organization strategy consulting, earning top scores for depth of capabilities, breadth of capabilities, and client impact, according to ALM Intelligence.

  • Changing the Structure and Roles. High-performing companies don’t manage their organization’s complexity by prescribing specific behaviors. Rather, they create a context that encourages optimal behaviors. Critical to success are a flat organization structure, a well-designed corporate center, effective use of shared services, and a strong people strategy that fosters collaboration.
  • Embracing New Ways of Working. BCG analysis shows that new ways of working can make a company a top performer, with faster growth and higher profits than its peers. We work with clients to support organization change through agile ways of working, lean processes, and end-to-end digitization.
  • Aligning Leadership and Culture. Companies with aligned leadership and a purpose-driven organizational culture outperform their peers, attract and retain a diverse workforce with high-caliber skills, and empower employees to collaborate and innovate in agile ways.

BCG incorporated these success factors into our award-winning approach to organization design.

Redesigning More than Organization Structure

Creating a high-performance organization requires not only optimizing an organization’s structure and roles but also changing its ways of working and its approach to building and aligning capabilities in leadership and culture.

Smart Design for Performance

BCG’s approach to redesigning an organization, which we call Smart Design for Performance, has demonstrated great success in boosting company performance, mastering complexity, and enhancing employee engagement. The organization design approach involves three main steps:

  1. Synchronize design with strategy. Regardless of the precipitating factor, the reorganization must align with the organization’s strategy and business priorities in the simplest way possible.
  2. Clarify roles and responsibilities. Of all the organizational capabilities most required for a successful reorganization, this set—clarifying roles and responsibilities, assigning accountabilities, and determining decision rights—is one of the most difficult to get right.
  3. Deploy the right leaders and the right capabilities. In reorganizations, a common pitfall is tailoring the redesign around the individual capabilities of a few important executives. Another pitfall is overlooking the capabilities required for the new design to succeed.
  4. Design layer-by-layer, not just top-down. A cascading approach to design puts companies in a better position for success. Address the needs of each layer, according to consistent design principles, rather than using a top down-only design approach.
  5. Lower execution risk. Execution is by far the most important capability for achieving a successful reorganization—applying a step-by-step, disciplined approach to implementation is crucial to avoid missteps.
  6. Don’t wait for a crisis to reorganize. Reorganizations that take place prior to a crisis have a much better chance of success. During a crisis, the odds of a successful reorganization are only 50/50.

Our Latest Thinking on Agile

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Organization Design for Today’s Needs

The Smart Design approach, paired with our robust set of tools and experts, can help ensure success in reorganization efforts. Learn more about the solution that synchronizes structure with strategy and optimizes the organization for shaping target behaviors and boosting performance.

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