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Published: August 27, 2013
 / Autumn 2013 / Issue 72

 
 

How to Design a Winning Company

Closing the Gap

It took several months to close the gap between the organization that Seabright had and the design that it needed. The first challenge was the board of directors. Because the previous restructuring had been so difficult, Joanna had to convince them (along with some top executives) that this redesign would be different. Next, she set up a handful of working teams—on product development, on customer acquisition and retention, and on information infrastructure—to lay out the details of the new organizational design. Each working team had a sponsor from the top team, ensuring that the most senior leaders would get involved.

Joanna worked directly with the global HR head to revamp the bonus system. She took pains to ensure that all employees understood the new system and what it would mean for them. The formulas were posted on Seabright’s intranet, along with collective scores by business unit and geographic market.

By her one-year anniversary at Seabright, Joanna was able to demonstrate results to the board. Thanks to the efforts of the newly empowered chief digital officer, several new products had sailed through beta testing. Several follow-on initiatives were in the works—all informed by consumer insights and all with a clear strategic justification. It was too early to tell for sure, but the results seemed promising; customer response and retention were favorable, and metrics on employee engagement were trending in the right direction.

Seabright’s organizational blueprint would not fit the needs of any other company. But a process like this one can help any company, ensuring that its strategy, capabilities, and organization are all aligned to support one another.

That quality is often overlooked in organizational design, but it is probably the most important factor of all, and a critical enabler of your company’s ability to deliver on its strategy. 

Reprint No. 00194

Author Profiles:

  1. Ashok Divakaran is a partner with Booz & Company’s organization, change, and leadership practice, and is based in Chicago. He specializes in strategy-driven transformation for product- and innovation-based companies.
  2. Gary L. Neilson is a senior partner with Booz & Company based in Chicago. He focuses on operating models and organizational transformation.
  3. Jaya Pandrangi is a partner with Booz & Company based in Cleveland. Her work focuses on growth and cost fitness strategy as well as sales and marketing effectiveness for consumer products and retail companies.

 

 
 
 
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Resources

  1. Deniz Caglar, Jaya Pandrangi, and John Plansky, “Is Your Company Fit for Growth?s+b, Summer 2012: Organizational design can be an integral part of a more strategic approach to costs, helping companies prepare for the next round of expansion.
  2. Gary L. Neilson, Karla L. Martin, and Elizabeth Powers, “The Secrets to Successful Strategy Execution,” Harvard Business Review, June 2008: Why decision rights and information flow are better starting points for organizational leverage than fixing the lines and boxes on the org chart.
  3. Booz & Company Org DNA Profiler Survey: A short diagnostic tool that explores the formal and informal elements of your organization’s design.
  4. For more thought leadership on this topic, see the s+b website at: strategy-business.com/organizations_and_people.
 
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