What Would Your Organisation Look Like If You Designed It From Scratch Today?

15 Sept

There is something slightly uncomfortable about writing about organisational design at the moment. Across charities, housing providers and other purpose-led organisations, many Boards and leadership teams are facing difficult decisions about funding, services, structures and jobs. Many staff are feeling they are heading towards feeling burnt out.

For some organisations, restructuring isn't an interesting strategic exercise. It affects people's livelihoods, colleagues they have worked alongside for years and services that people depend upon. So this isn't an argument for cutting structures, removing management layers or finding clever ways to employ fewer people.

In fact, it is partly an argument for having better organisational conversations before financial or operational pressure makes the decisions for us. Because there is a question I think Boards and executive teams should periodically be prepared to ask:

Knowing everything we know today about our purpose, customers, risks and strategy, would we deliberately build our organisation in the same way again?

Not because we necessarily want a smaller organisation. But because we should be able to explain why the organisation we are funding is the organisation we actually need.

Most organisational structures aren't really designed. They evolve. Someone joins to solve a particular problem. The organisation grows. A new service appears. Someone gets promoted. Another person takes on additional responsibilities. A new funding stream requires additional capacity. A manager becomes a Head of Service. A Head becomes a Director. Someone leaves and their responsibilities are divided between three other people. A new senior role appears because an executive has become overloaded.

None of those decisions is necessarily wrong. In fact, at the time, each may have been exactly the right response. But organisations don't always stop afterwards and ask whether all those individual decisions still add up to the right organisation. Five years later, somebody opens the organisational chart and says: “This is our structure.”

It is. But is it the structure we would actually choose? That's a different question.

Organisations accumulate history

Almost every box on an organisational chart has a story behind it. Perhaps a role was created during rapid growth. Perhaps someone had particular skills, so responsibilities naturally accumulated around them. Perhaps two functions were combined when somebody left. Perhaps a senior title was introduced to retain a valued employee. Perhaps a role originally responsible for one service gradually inherited three others.

I’ve been in and helped organisations over the years, looking at structures and working in structures, that have just existed because its always been like that. It can be frustrating when you’re trying to understand why, but can also be disheartening that positions have been created for people who don’t appear to have the right skills for the role or to how it is has developed in to.

In an organisation I worked in, a single role had quietly absorbed three additional services over five years simply because the person was capable and willing. Nobody had ever stepped back to ask whether that accumulation still made sense.

There may be perfectly legitimate reasons for every one of those decisions. The risk comes when the organisation stops distinguishing between: “This is how we got here.” and: “This is what we need now.”

Over time, an organisational structure can become a historical record rather than a deliberately designed operating model. So try removing the people This is deliberately uncomfortable.

Take the existing organisational chart and remove every name. We know Sarah is excellent. We know David has been here for twelve years. We know the CEO relies heavily on Priya. We know Tom wants progression. We know losing Amanda would be difficult. All of those things matter enormously when managing people.

But for this particular exercise, temporarily put them to one side. Then go further.

Remove the existing job titles. No CEO. No COO. No Directors. No Heads of Service. No Managers. Nothing.

What remains? The organisation itself. Its purpose. Its customers or beneficiaries. Its services. Its income. Its obligations. Its risks. Its assets. Its strategy. And the outcomes it exists to achieve.

Now start designing the capability required to deliver those things. This is not yet a restructure. And it certainly isn't a redundancy exercise. It is an attempt to understand the organisation before allowing the existing workforce model to determine the answer.

Start with purpose, not hierarchy

The first question isn't: “Who reports to whom?”

It is: “What must this organisation be capable of doing exceptionally well?”

For a service organisation, that might include:

· delivering consistently good services;

· understanding customers;

· managing risk;

· safeguarding people;

· managing property or other assets;

· managing finances;

· leading and developing employees;

· maintaining compliance;

· generating income;

· building partnerships;

· using information effectively;

· and providing good governance.

Every organisation will have its own list.

The important thing is to identify the capabilities before deciding how they should be provided. Because needing a capability doesn't automatically mean needing a department. And it certainly doesn't automatically mean needing a particular job title. Then identify accountability.

Once we understand what needs to happen, the next question is: Who needs to be accountable for what? Not: Who currently does it?

Those are different questions.

Take service quality. Someone needs clear accountability for whether services are good. That doesn't tell us their job title. Take financial sustainability. Again, clear accountability is required. But the scale and complexity of the organisation should help determine what kind of financial leadership is proportionate.

Take governance. Governance capability needs to exist. But how that capability is provided may look very different between a small charity and a large regulated organisation.

The sequence I would use is:

Purpose → Outcomes → Work → Accountability → Capability → Capacity → Structure → Roles → People → Cost

Only then should the boxes start appearing.

How much capability do you actually need?

This is one of the most useful questions in organisational design. Suppose you establish that you need:

· strategic HR expertise;

· governance support;

· financial leadership;

· communications;

· data analysis;

· IT;

· customer insight;

· or business development.

The traditional response is often: “We need a role.”

Perhaps. But how much of that capability does the organisation actually need? Five days a week? Three days? One day? One day a month? For six months? Only during particular projects?

The answer might be:

· a permanent employee;

· a part-time employee;

· an expanded existing role;

· a shared service;

· an outsourced function;

· a consultant;

· a fixed-term appointment;

· technology;

· or a combination of these.

This isn't about finding the cheapest option. It's about matching the resource model to what the organisation genuinely needs.

Management should create value

Management layers deserve particular attention but not because fewer layers are automatically better. They aren't.

Good management creates something. Clarity. Accountability. Performance. Development. Coordination. Quality. Control. Faster decision-making. Better escalation.

And organisations can absolutely have too little management.

When that happens, frontline employees can end up carrying responsibilities they shouldn't be carrying. Problems aren't dealt with early enough. Decision-making drifts upwards. And executive teams become increasingly operational because there isn't sufficient management capacity beneath them.

So the question isn't: “How many management layers can we remove?” It is: “What management capability does this organisation actually need?”

For each layer, I would ask:

· What organisational value does this layer create?

· What decisions happen here that couldn't appropriately happen one level below?

· What does this layer prevent from unnecessarily reaching the level above?

If a layer has a clear answer, that's useful assurance. If it doesn't, that's useful information too.

Would you still create the COO? This is where blank-sheet design can become particularly revealing.

Imagine an organisation currently has:

· CEO

· COO

· Head of Operations

· Operations Manager

· Service Managers

· Frontline employees

Remove the titles.

Now ask: What executive accountabilities genuinely need to exist? What does the CEO need to own? Which operational decisions genuinely require executive authority? What could appropriately sit with a strong Head or Director? What management capacity is required closer to service delivery?

You might end up recreating exactly the same structure. That's a perfectly legitimate outcome. But now the organisation can explain why it needs it.

Alternatively, perhaps the COO role originally appeared because the CEO had become overwhelmed. That doesn't make the role wrong.

But I would want to understand why the CEO became overwhelmed before assuming that the historical solution remains the right organisational answer.

Was it because of:

· too many direct reports?

· insufficient management underneath?

· poor delegation?

· inadequate systems?

· unclear accountabilities?

· rapid organisational growth?

· or work sitting at executive level that should appropriately happen elsewhere?

This distinction matters.

Blank-sheet design helps separate the organisational problem from the historical solution.

Look at where senior capacity is being used

Another useful exercise is to look at the organisation's most senior roles. Not simply what their job descriptions say.

What do they actually spend their time doing? Strategic leadership? Professional expertise? People management? Operational decision-making? Problem-solving? Administration? Meetings? Routine tasks?

Then ask: “Is this where we deliberately want this level of organisational capacity being used?”

This isn't about suggesting that senior people should refuse to roll their sleeves up. Good leaders frequently do things outside the neat boundaries of their job descriptions. But if highly experienced executives are routinely compensating for missing operational or management capacity, that tells us something.

Equally, if managers or frontline employees are consistently carrying significant strategic or organisational accountability without the authority, support or recognition that should accompany it, that tells us something too. Both can be symptoms of organisational design that has drifted.

Look for dependency on individuals

Complete this sentence: “Nobody else could really do that because…”

Sometimes there is a legitimate answer. Specialist professional qualifications. Technical expertise. Particular statutory responsibilities.

But sometimes the answer is: “Because that's just what they've always done.”

That's different.

Good organisational design should make important responsibilities:

· clear;

· transferable;

· understood;

· and resilient.

An organisation shouldn't have to reverse-engineer a role every time somebody resigns. And resilience shouldn't depend on particular people continually going above and beyond simply because the structure relies upon them doing so.

Design for tomorrow as well as today

There is little point perfectly designing an organisation for its current state if the strategy expects it to look substantially different in three years.

Perhaps the organisation intends to:

· double the number of customers;

· enter new geographical areas;

· become regulated;

· increase income significantly;

· develop new services;

· take on more properties or assets;

· or change its funding model.

Organisational design should anticipate some of that complexity. But that doesn't mean recruiting tomorrow's organisation today.

It means understanding:

· What capability do we need now?

· What capability will we need later?

· What will trigger the next investment?

Perhaps one management model works at 30 employees but becomes stretched at 60. Perhaps external financial expertise works at one level of turnover, but eventually the scale and complexity justify bringing more capability in-house. Perhaps geographical expansion changes the management model. Perhaps regulation changes the level of governance, assurance or professional expertise required.

There isn't one universally correct structure. The important thing is knowing why and when yours needs to evolve.

Ask what should stop as well as what should start

Organisational reviews often focus almost entirely on what is missing. We need more capacity. Another manager. A new system. A specialist. Another administrator.

Sometimes that's correct. But blank-sheet design should also ask:

· What work would we simply not create if we were starting today?

· Which reports?

· Which meetings?

· Which approval processes?

· Which duplicated responsibilities?

· Which legacy activities?

· Which services?

· Which roles?

· Which management layers?

This matters particularly when organisations are under pressure.

Adding capacity to an organisation that hasn't first challenged unnecessary work can simply make an inefficient system more expensive. Sometimes protecting organisational capacity means stopping work that no longer contributes enough to purpose.

The blank-sheet Board exercise

If I were running this with a Board and executive team, I would give them the same organisation but temporarily remove the workforce structure. The organisation still has:

· the same customers;

· the same services;

· the same income;

· the same properties or assets;

· the same regulatory requirements;

· the same strategic objectives;

· and the same risks.

Then give them a workforce budget.

Their task: Build the organisation.

I'd ask them to work through ten questions:

What must we deliver?
What capabilities must exist?
What accountabilities must be clear?
What management is genuinely required?
What specialist expertise do we need?
What needs to be permanent?
What could be provided differently?
What should we deliberately stop doing?
What structure supports where we're going?
What would it cost?

Only afterwards would I reveal the existing organisational chart alongside it.

The differences are where the conversation begins. You may discover that the current structure is right This is worth emphasising.

A blank-sheet review isn't designed to prove that an organisation is badly structured. It might validate what already exists. That's valuable.

A Board can then say: We understand why these roles exist. We understand why these management layers are required. We understand where accountability sits. We understand why this level of workforce investment is proportionate. We understand which capabilities we buy externally. We understand where we may need additional capability in future. And we understand how our structure supports our strategy.

That is much stronger than: “This is our structure because this is how we've always been organised.”

The hardest questions come last

Once you've designed the organisation from scratch, compare it with reality. Then ask: “Which roles in our current organisation would we not create in the same way today?”

That doesn't automatically mean those roles disappear. There may be entirely legitimate reasons for the differences. But it forces the organisation to understand its history rather than unconsciously preserve it.

Then ask the reverse: “Which roles or capabilities would we create today that don't currently exist?”

That question can be even more revealing. Because organisational inefficiency isn't always about having too many people.

Sometimes organisations are spending significant amounts on their workforce while still lacking the capability they actually need. And sometimes the answer to organisational pressure isn't fewer people.

It is better systems. Clearer accountability. Stronger management. Better delegation. Different skills. More appropriate investment. Or stopping work that no longer adds enough value.

Organisational design should be deliberate

Structures will always evolve. People change. Services grow. Strategies shift. Funding changes. New risks emerge.

Nobody can redesign an organisation from scratch every six months. Nor should they.

But periodically, Boards and executive teams should be prepared to temporarily forget how the organisation came to look the way it does.

Remove the names. Remove the titles. Remove the history. Start with:

Purpose → Outcomes → Work → Accountability → Capability → Capacity → Structure → Roles → People → Cost

Then compare that organisation with the one you actually have. The objective isn't to create the smallest structure. Or the cheapest. Or the flattest.

It is to create an organisation that can explain why its significant capabilities exist, where accountability sits and how its workforce investment contributes to achieving its purpose.

And perhaps that matters even more when resources are under pressure. Because the worst time to discover that your organisation isn't designed around what it actually needs is when circumstances have already removed your room to choose.

So perhaps the question isn't: “Does our current organisational structure work?” It is: “Knowing everything we know today, would we deliberately build it this way again?”

And if the answer is no, the next question is considerably more important:

What are we going to do about that while we still have choices?