Organisation Design: Putting Data in the Driver’s Seat

Brenda: Thank you for joining us. My name is Brenda Kowske and I’m the director of Talent Analytics and insights at Boston Scientific. And I’m joined here today with my colleague Erica Vermeij, who’s the senior manager for workforce Planning in our group. And thank you again for joining us on an important topic, which is org design. Many of us are thinking about our organisational structure right now and being in the People Analytics space. We want to make sure that we’re bringing the right data to the table to do these analyses. So we’re going to talk about what that looks like today and how data helps drive a successful organisational development implementation. But before we get started, I want to tell you a little bit about Boston Scientific. I know when I go to conferences I have a tendency to look for those companies that are similar to my own so I can understand size and scope of the initiatives that they do. Well, Boston Scientific is 45,000 employees strong. We operate in 115 countries with 164 sites, including 16 manufacturing sites for our med device products, and 42% approximately of our sales is out of the US. So that gives you a little bit of an idea of our global footprint. Like I said, we do med device, so we work on improving the lives of those who suffer from various disease states, everything from Neuromodulation to urology and public health. So that is Boston Scientific and like many organisations, we are looking at our structure, really thinking about the future, what is going to make us the most efficient and effective organisation that we can build to achieve our strategic objectives.


Brenda: And when we think about organisational research, we think spans and layers concept from about 20 years ago and a further back and it’s simplistic in nature, we’re looking at team size, we’re looking at layers and you know, isn’t that just what we’re talking about today? And the answer is if only it were that simple. Org Design is an extremely complicated analysis. It is a facilitation process that involves a lot of stakeholders, and it’s absolutely crucial that it’s got the very best data backing it up. So today we’re going to show you a more holistic, comprehensive approach to working on org design in your organisation. So let’s talk about today’s presentation. We know that we’re looking to build an organisation designed for efficiency and agility that’s going to give us on the the edge on innovation in our market. And in order to do that, we’ve put this forward in about five steps which will run you through today. And we’re using this auto car racing analogy throughout to kind of keep us grounded. We’re going to start out by talking about what are some of the signs you might see in your organisation which say, hey, org design is really something we should look at this symptom that we’re seeing. How does design influence it and could we possibly find a solution with a different design? So we’ll talk about that first that will get us going.


Brenda: Then Erica is going to talk a little bit about how we chart a course. How do we structure this initiative with data? How do we measure our organisational landscape so that we know we are intervening in the right places to fulfil that vision of the right design? And then I’ll talk a little bit about how we train the crew, these people that are going to join us, that are impacted by these designs and making sure that we include the right people. So we’re thinking about buy in early and additionally we’re thinking about change management. We’re going to watch for any potential wreckage coming our way. We’re going to measure our way through that as well. And then finally, Eric is going to wrap us up by talking about what a quote done looks like for an implementation such as this and what can be done to kind of improve it and iterate it on it over time. So excited to get started here. Let’s start with an illustrative example. How do we decide that this is the right initiative for us? Well, we were looking for signals or signs or a big green waving flag coming from our organisation. In this case, maybe we’re looking at a simple linear projection on our headcount. This might go over the next, say, several years. And we take a look at that curve and we think about the size of that growth and maybe our revenue growth isn’t quite going to keep pace, we think, to ourselves, wait a minute, if we put these two pieces of data together, this would mean that our operating margins are not in an acceptable space that are operating income might be something that is threatened and therefore we need to.


Brenda: Change this trajectory? Well, that is both a design question and a workforce planning question. But it opens the door to conversations about sustainable operations and scaling practices within the organisation. And that’s exactly where org design fits in terms of an initiative. So, so this just might be one flag. There are many others that might say to you, Hey, we should look at org design as a potential solution here. If you’re having problems with time, gridlocks and decision making and waiting or excessive time spent on communication going up and down the organisation or missing a deadline or slow response times because there’s too much volume in certain constrained areas. If you’re thinking effort isn’t quite what it should be, maybe it takes too much effort to get things done. There’s a high amount of overtime or slack time, too many handoffs or backtracking or duplication of jobs or functions and unutilised information. Maybe we’re putting things out there that never see the light of the day. That is also a symptom that org design might be the right choice for you. And finally, within our people themselves, are there excessive layers of management where small and just small teams where there shouldn’t be? They don’t make sense there. We’ll talk a little bit about that later.


Brenda: Uh, a gap in strategic roles and capabilities and where people really don’t know what role they should play in their organisation and their jobs. There’s performance considerations or underutilised specialists. We’re not really using them to their full potential. And then, you know, unacceptable turnover because it’s frustrating to work in an organisation that’s not designed correctly, which could lead to a poor employee experience. And then finally we talked about headcount growth in our illustrative example. All of these might be evidence that that org design is a solution that you know, is worth looking into when we see these kinds of symptoms, this is where we’re really going to solidify the purpose for going about such a large and complicated initiative. Now, of course, it doesn’t always have to be large and complicated. You can make some small adjustments that are more kind of in a hygiene factor sort of method, but in some cases it’s really taking another look and maybe defining things in a different way. When we do these kinds of initiatives, we want to make sure that they’re driven by purpose so we can communicate that purpose to others. We can measure our success against that purpose and those outcomes that are defined. And we can communicate the success of this initiative to both stakeholders like leaders, but also employees who are a subject to its effects. So with that, I’m going to turn it over to Erica to talk a little bit about how we chart our course through an org design initiative.


Erica: Thank you, Brenda. And by the way, I love your emojis there.


Brenda: Thank you.


Erica: So, yes. So now let’s focus on, as Brenda mentioned, charting that course. And in this race, we really do need to draw that map and plan the path that is efficient and effective for our organisations. And optimising that organisational structure is just part of that larger initiative of strategic workforce planning. And so we’ve put together some of these questions that are great starting points. So this is more holistic as you think about strategic workforce planning. But when we hone in on that structural component, really thinking about if structure is truly driving an efficient strategy for your organisation, is there the right structure so that there’s, you know, a reduction in bureaucracy, an improving communication flow up and down the organisation? Are we effectively serving our clients and our patients? Right? That’s something that’s very important to us and part of our guiding principles. And do we have the best possible employee experience as well as we think about the structural components and thinking about cost efficiencies, Right? What are those trade offs and looking at models comparatively of different structures and really making sure as you’re doing this work, you’re looking holistically at some of those options and then thinking about agility and fast action as well. You know, Brenda talked about really making sure that we we are we’re in the market and we are we’re winning in the market.


Erica: Right. And making sure that that structure actually allows us to do that. And so as we think about organisational design and also the broader kind of strategic workforce planning and looking at all of the levers that you have in your toolbox in order to optimise your workforce, we need to really make sure that we’re weighing those lever strategies against each other, thinking about the cost and the time and the business and talent implications, thinking about engagement and inclusion, right, and making sure that we’re measuring that as well as well as that impact to our customers. And so the blueprint and part of that strategic workforce plan is really all about organisational design and the spans and layers and really designing for efficiency. And this is often the foundation for all the other strategies as well, and really making sure that we balance that. So and we don’t want to start the race without understanding the landscape. So what are those twists and those turns that you’ll encounter, those slick spots along the way, those potholes and of building out a more efficient plan. So keeping that in mind and additionally, we want to make sure we understand what good looks like. That’s important, right? Making sure that we’re putting guardrails in place around those tight curves, using guardrails as principles that will guide you through this work.


Erica: And just to highlight these org design principles, really making sure that you are thinking about fit for purpose. Oftentimes when we go into this work with our internal clients, they’re always asking us, What’s that magic number? What is the business, you know, trying to align to and really making sure that you are looking at the organisations, you’re looking at, the work that those leaders are doing and their employees are doing, and really making sure that you’re right, fitting for the work that they’re doing. And one organisation, you know, may be thinking about a geolocation strategy and requires a completely different structure than an organisation that may be, you know, clustered around well-defined jobs or there may be a maturity in the market as well where an organisation may have smaller teams because they know that they’re going to be building those out. And so really making sure that you have that clear business context and aligning the structure to really support those strategies. Additionally, as we look about kind of the layers and and the management levels within the organisation, typically what we want to see from a from a layers perspective is our senior leaders are going to be at the top of the house and the largest layer at the bottom is really our individual contributors within the organisation and there’s direct correlation within those layers of the organisation.


Erica: So if you start having a number of very small teams kind of in the middle, maybe your organisation instead of looking at that optimal kind of. Pyramid or half pyramid shape starts to look like a much longer organisation and really asking yourself some of those questions. We had a few slides ago around that optimisation and what does that do to agility and communication flow up and down the organisation if you start getting very long? And so really keeping these guiding principles as you go through this work is is definitely important. Another element is, of course it’s important that descriptive statistics are understood by our stakeholders and our leaders and making sure that they have a clear understanding of what they’re looking at and how they are able to interpret the data is definitely important. So as we go through this work, really making sure that you do spend time on the education component. Of course, you can also use inferential statistics and methods like cluster analysis to understand the components of of team effectiveness as well. And but of course we want to make sure that we are truly defining those basics so that the individuals who are doing the work have a very clear understanding of what they’re looking at as well. Also, as we go through this work, looking and looking at the organisation, connecting it to those design principles we talked about and helping the organisation understand maybe our current organisation looks like org A Right, where how do we compare against that optimal shape of that kind of half pyramid, right.


Erica: And do our layers of the organisation align with those management levels. So here in this particular organisation org and org be have the exact same number of employees, but you see an org where there may be multiple layers of, of the same management level where we have VP’s reporting to VP’s and directors, reporting to directors and maybe we have professionals that have that are individual contributors, leading teams as well. And all of a sudden we get that very kind of elongated organisational structure. Whereas if we start to model and we start to think about optimisation and, and how do we build a structure that really does support agility. Here is where we can start looking and saying, okay, what organisation structure might make sense to really support those business strategies? And here we’ve built an example of the same, the same number of employees, but really those that do follow more of those design principles. And then as we go through as well. So one of the things that we do is really start digging into to the data and and really measuring the landscape. So we’ve done a lot of work in this space to really build out dashboards that will support that diagnostic process.


Erica: And the first look at the organisation is of course that more of that Vista view where we have high level understanding of the organisation here, we’ve developed kind of a one page summary with sensing mechanisms built in to really help you understand, listen, where maybe some opportunities where you want to dig into the organisation and where we might not align with some of those design principles. With that, the next phase is to really dig into kind of the diagnostic process and start looking at the spans of the organisation. And here are some great questions you can ask yourself as you’re doing that work around the ratio of small teams within your organisation, right? Do we have a lot of very small teams and low medium span of control and what might that be doing to your organisation? Also aligning with with guardrails around kind of, you know, standard benchmarking and guidance around kind of team size for the type of work that, you know, various functions or management levels are doing and really, really questioning, right? Why do we maybe look different and what would it look like if we optimised digging into the layers component as well, looking at the median span by layers and understanding if those management levels actually follow those layers within the organisation? Right.


Erica: What shape do we have and what might that be doing to some of the things that we talked about? And then the other aspect as well is really looking at internal benchmarking, right? So if you have organisations that may be similar internally within your organisation, a sales organisation for example, where there may be similar types of sales that are happening, similar types of products, and why might they look different and start looking at kind of ratios of leadership and understanding from a structural perspective, you know, what might be optimal or how do we compare against each other as well. And, and so really, really thinking about that or looking at organisations that may be at similar maturity models as well. And then also we want to think about organisational network analysis. So if that structure is efficient, it might serve leaders well to kind of formalise these informal networks rather than structuring against the grain as well. On the other hand, leaders might want to consciously change and efficient ways of working and knowing that the the network, knowing the network will definitely help address that as well. And so this is work in our sites. Maybe we’ll come back to you next year and we’ll talk in more detail really about some of the network analysis we’ll be doing.


Brenda: Great. Thank you, Erica. Yes. Yeah. Um, this brings us to more thoughts about who’s doing this work. Lots of analyses. You know, we know we’ve got the starting line. We’re ready to get going. We understand where some of those opportunities lie. We’ve looked at the numbers, but who is looking at the numbers and what are they going to do next? Well, that gets us to our team. So in this case, you can have the greatest car ever, but if you don’t have the right team assembled, you’re going nowhere. So let’s talk a little bit about our pit crew. And here we’ve used a RACI. This is a pretty traditional framework for assigning roles. You might use something called a rafsky whatever works for your organisation. The point being is that each individual should be selected based on the kinds of work and transitions you want to do and the roles that exist in your function. So I’ll walk you through very quickly. Many of you, I’m sure, are familiar with a with a RACI model, but here I’ve applied it to a hypothetical org design initiative. So first let’s talk about who’s responsible, who’s going to execute this task, who’s doing the work. And there’s kind of two big bodies of work in org design. One is the planner themselves. So the person who is going to be facilitating those sessions, who’s going to be getting those events sequenced and making sure that they happen, that would be your business partner potentially, or a talent management leader, depending on how you have those roles assigned within H.R.


Brenda: Of course there’s us, there’s people who have to bring the data forward. You can use train the trainer approach coaching HR business partners to do this analysis. You may have analysts that are doing analysis for them. It is an analysis intensive initiative. And so having that analytic support is absolutely crucial. Who is accountable? This is the person that’s ultimately answerable to the completion of this initiative and really the decider. The buck stops with the business leader. And this it makes sense because it’s their organisation, so they need to approve what that structure looks like in terms of who needs to be consulted. You’re going to see in a moment that this is going to touch a lot of different people. Whenever someone has a stake in a change, those people need to be in that consulted bucket. So in this case, it might be HR leaders, it might be those leaders who are going to have a domino effect. If we’re going to take one team from one place, we’re going to move it to another place. We need to talk to both leaders, you know, where those who have those teams. And then finally, there’s a group that need to stay informed here. I’ve put those affected C CEOs. So, you know, imagine that your total rewards group needs to think about a different reward structure or maybe it’s HR operations.


Brenda: Who actually needs to do the transactions that will reflect these moves? It is also employees, so we can’t always be entirely transparent as we’re working these plans out. But when the time is right, keeping employees informed is important. I’m going to talk about why in just a minute. We also highly recommend that we use a touchstone model to drive an organisation design initiative. Here we’ve coupled our RACI with Galbraith’s star model, so we make sure that our org design initiative is holistic in nature and we are taking a good look at and managing all of the components or elements in the organisation that relate to org design, including strategy processes, rewards and people. We’ve also structured our training to directly address each of those areas in the star model while keeping the audience in mind. So if the person is only at is at, say, the consulting level, they may need to know generally what some of this means and those doing the work, those responsible might need to go very deep. This might be a training workshop to make sure they have the skills and capabilities to pull off an org design initiative. So we launched things called playbooks. They are modularised so that we can kind of pull them off the shelf and upskill as needed. This is an efficient way of teaching out this content and really kind of any content in your organisation.


Brenda: And you can say here that we’ve designed those modules in accordance with the framework that we’ve rolled out. So that gets us to a pretty solid plan. We got the right people involved and they know their role and we have a solid foundation of what we’re about to do. But this is all going to come down to discussions, facilitated sessions where we bring these data to the table and leaders and their partners make decisions and decide what that new normal is going to look like when it comes to org structure. It starts with the stated objectives. Early on we said start this with purpose. Know what you’re trying to solve for. Define those outcomes. Those outcomes are going to come into play right here in the beginning of this discussion so we can all align to the problem we’re trying to solve. We’re going to use data because there should be some data based rationale for why we’re endeavouring to change the org design. We’re also going to use data when we think about areas of opportunity and that kind of gap analysis, it comes in play there as well. And we’re going to use data to build different scenarios, maybe put up a couple strawman scenarios for people to react to. We’ll look at the cost of those designs. We’ll look at the pros and cons of those designs, and that’s going to help move the discussion forward.


Brenda: Usually it’s HR business partner or talent management leaders facilitating these design sessions with close partnership of their analyst. We’ll finalise that design and then we need to notify those who are affected through that notification process. It is intensive change management time, so we’ll talk about that on the next slide here. And after we in while we’re moving through that change management effort, we’ll be measuring the impacts, the progress, looking for where we might be slipping. Maybe we need to do a tweak or an iteration, and data is going to kind of guide us through to that finish line. So I can’t say enough that while we’re going through this reasonably intensive process that we watch out for crashes and not only do we watch out for those crashes, but we actually drive into the crash. And those of you who follow any kind of car racing know that what we are taught to do is drive into the crash because there’s so much kinetic energy surrounding that crash that the cars will move by the time you get to that spot. Our point here is that we’re going to lean into the change management of this, and that’s incredibly important because we know that changing organisational structure, changing leadership hierarchies and and and messing with people’s livelihoods kind of evoke an emotive response that we want to pay special attention to. It’s scientifically proven that we feel first and we do it for biological reasons.


Brenda: We, if we perceive a threat, say the threat of losing livelihood, being laid off, of losing that trusted manager that we’ve worked with with for so long, perceiving that threat fires up our amygdala and that signal goes straight down our spinal column, which is going to trigger those stress responses that we’re familiar with, the heartbeat, the, you know, sweating and eyes dilated. And we’re ready for fight or flight. It actually bypasses your cognitive kind of judgement and thinking. That does kick in. It just takes longer because your thalamus is going to take in that sensory information. It’s going to travel through your cortex, through your prefrontal cortex, which is your executive decision making. And then it’s going to say, Now do I need to still be in fight or flight? If not, we turn that fight or flight off or it stays on. This is something as people involved in this change, we actually have to actively manage and think about when we put forward data that might have hyperbole in it or on purpose. We are like motivating our response. There comes with some responsibility in that we need to pay attention to human’s response to it and be responsible for that reaction, because that reaction may take us in a direction we don’t want to go. This response is evident through the change curve, and I’m sure you’ve seen something like this before, but we can manage our messages through this change curve to help people along.


Brenda: And really we do want to help them along because it’s going to make for a more successful initiative. When we start in the beginning, we might be sceptical when we learn of maybe a change is going to come. We think, why is this necessary? Bringing data based rationale that same purpose that we all align to in the beginning of this initiative back to those stakeholders is important. Let’s tell them why this is important for the company and for you. What’s the personal impact? What is the personal preparation? Where do you have control? How can you prepare? Having control at work lowers job stress. That’s a fact as well. So let’s tell them where they can prepare. Then we say, Hey, it’s time. We’re going to make this transition and we’re moving through that adoption phase to realising those gains and data can help us there as well as we show people the positive impact of change. So let’s make sure that we are listening to employees throughout this change curve so we can witness and report back on that recovery after maybe, you know, a little bit of a jarring experience as things shift around. Another thing that might help you on your way is a change model. You probably have these at your organisation as well. Putting one up here just so we can talk through it. But again, you’re going to build a case straight off the, you know, straight out of the gates and using data.


Brenda: This case likely will have a message of urgency. The vision that you’re trying to accomplish and the request you’re making of that audience. It’s going to directly relate to strategy. And we’re going to identify those data based drivers and roadblocks to make sure that the strategy of this program, of this org design is set up for success. We’ll communicate this throughout and be as transparent as possible. Now, with some of these things, we need to kind of stay behind the curtain for a while. When we can be transparent, we’ll endeavour to do so. And then also acknowledging those development initiatives that come part and parcel with org design. As you move things around, you may need to build a new skill or capability that actually is also a positive for those employees undergoing that change. So make sure to highlight that. That’s a nice opportunity for career growth. And finally, how are we going to sustain this change? Setting our feet down and saying this is how we operate and measuring the change and the progress throughout so that people understand both where they’re at with that change, but also the benefits we’re receiving from going through this. So that is kind of leaning in to that to that change management effort. And I’m going to then hand it back to Erica to round us out here.


Erica: Great. Thank you, Brenda. And I don’t know about you, but I’ve always wanted to be able to wave the chequered flag.


Brenda: I know.


Erica: Right?


Brenda: So when does that happen?


Erica: Right, exactly. And that’s what I get to do today is so, um, you know, as we think through this. Right. And really, really getting you to the finish line and being able to wave that checkered flag. So as we think about that, making sure that as we as we think about all this work, we want to make sure that we are measuring what matters, right as we go through this process. And Brenda talked a lot about change and making sure that we are measuring pre during and post as well and really understanding the employee experience through that. And if the employee experience is negatively impacted and if you are doing that measure and you’re doing it throughout the process, you have a really good gauge and you know you’re able to iterate as well. And Brenda and I have a have a great experience with this that, you know, with a past employer, we actually went through an acquisition that doubled the size of our organisation and making sure that there was clear measures through that process where you were literally integrating two organisations that were 40 or 50,000 into one single kind of mega organisation. And imagine that impact from a cultural perspective on how each organisation did business differently. Really looking at those two organisations and bringing them together and making sure that you have that optimised organisation and understanding the implementation process as well.


Erica: And was that organisation fully implemented at organisational design is a long term strategy and, and sometimes it takes a long time to do that full implementation. So where are you at and how are you measuring that also to do achieve those outcomes that you set forth to achieve through that? Right? Does your organisation look optimised or is it optimised to support those business strategies? Did you see savings along the way with efficiencies? And is there better collaboration? Right. You know, is there more agility within the organisation to faster decisions? And was the customer experience improved throughout that as well? And then, you know, as Brenda mentioned, right, she talked about how this is iterative, looking at what you’ve done from an organisational design perspective and really making sure you’re thinking about kind of that need for iteration or checking in on it and thinking about things not just from a structural perspective, but what are processes, you know, from our experience as well. If you bring two really large organisations together, processes can. Be very different. Technology constraints can be there as well, where you may be on dual systems and how difficult that might be. Skills and capabilities both building right and could be for career development or what are those things that you need to continue to grow within the organisation and, and again, that cultural perspective.


Erica: You know, one of the things that’s important is really making sure that you’re measuring that organisational health throughout throughout this process as well. And then as we think about that continual iteration, I mentioned it just a little bit, but really wanting to make sure that it’s clear that organisational design is truly a long term strategy. If we are only focussed on organisational design because we need, you know, quick top line efficiencies and really think about that impact on your employees, your patients, your customers. That impact may be very short lived, but really from a long term perspective, does that really get you to the strategies that you need? Right. And iterating on it when you may have leadership changes or process or whatever they may be, But making sure that you’re checking in, you’re iterating, you’re making sure that that org design is really kind of a living and breathing process and thing that you’re doing to meet those strategic priorities of the business. So hopefully that got you to the finish line and and you have what you need and we are open now for any questions that you may have for us.