Organizational Design of Design Organizations
Of late, much has been written regarding the organizational design of design organizations (can I just say, I love writing that), especially in regards to the emerging roles of Design Ops and Design Strategy. Given the mission critical role design plays in delivering business value, it’s exciting to see these conversations taking place. Over the past decades, other professions such as engineering and marketing gone through similar transformations, and they have all benefited from their thought leaders sharing their experiences, specifically the business gains to be realized by rethinking traditional organizational models for these functions. Design leaders drawing on their personal experience to offer advice and to share different perspectives on how design can be most effective—as a function, rather than a process, is a clear milestone.
No one changes for the sake of change
However, reading these articles it's unfortunate that most authors choose to leave out information critical about their justification for these organizational changes. That is, they talk about the final state, but they leave out the business drivers that led them to change their organization in the first place. They don’t discuss what drove these restructurings, or how they actually went about designing their organization; nor do they include any post mortem discussions highlighting the various business benefits brought about by these changes, especially missing are the benefits afforded by addition of new functional areas (i.e. design strategy, design ops.). While these articles are often written by very seasoned design executives, people who have led global teams, and understand businesses operate on ROI, they present these organizational models as de facto, fully formed, well understood, out of the box solutions. One-size-fits-all as it were.
Ironically, it has been pretty much the mission of every designer over the last 30 years to convince their colleagues and leadership that one size in fact does not fit all. We have all had the conversation with our boss about some cool interface widget they saw on another app and why it doesn’t belong the app we are trying to ship. The design profession has made great strides in the cross-industry adoption of user-centric, or customer-centric, development processes. Design has focused companies on the users’ needs and lead the way in tailoring solutions to best address those needs near-term and long-term. Design has also been a champion of leveraging data to make informed choices, whether its user research, A/B testing, or the MVP approach; design embraces the idea of start small, learn, iterate and improve. Collectively this type of an approach gives everyone in the company the confidence that things are moving in the right direction. So, I can’t help but ask, where is this approach in these discussions about designing design organizations?
If only Duncan Hines made Org Charts...
Don’t get me wrong, I love articles about design organizations and it’s important to share our best practices and learnings, I just feel its unfortunate most of them are written like recipes: take 30 designers, add 5 design operations people, and 4 design strategists, bake in an offsite for three days and ta-da!
While I celebrate their successes, I have worked and consulted with dozens of companies around the world of every shape and size, none of them have ever followed a prescriptive approach to their organizational model. Yes, to be sure, there are common, broad patterns within organizational design but there is also extensive tailoring required to adapt those patterns to each company’s individual culture, market segment, business model and corporate objectives. The size of the different teams is equally dependent on several key factors; industry segment, operational and accounting models. What is their horizon? Are they focused on net-new customer growth or sustaining customers? What type of innovation drives their segment? Technology? Supply Chain? Distribution? Services? No two companies are a like when it comes to planning their organization, who does what, how it's resourced, how it's funded, or even the specifics for how they measure success. These one-size-fits-all models, while inspiring are nevertheless limited in their practical application.
What drives organizational change?
From my experience the two most common use cases for (re)designing an organization are: One, you are brought in to address the current organization’s inability to fulfill its responsibilities. Or two, as a leader within the company, you recognize your current organization is at risk of not meeting its obligations, either to the company or to its members or both. (Of course there is a third, which is downsizing but let's set that aside for now.)
With the former, executive leadership has recognized the issue and have begun taking steps to address the concerns—which is why they hired you. Likewise, the individuals on the impacted teams are also likely very aware that a change is underway making and subsequent organizational moves less of a surprise. Between you and me, those two things combined make the easier of the two. (Like many things in life, admitting you have a problem is hardest part.). Coming in new you can negotiate timelines, learn what success is supposed to look like, and you can jointly form a plan with your boss, peers and human resources, for addressing the issues.
The latter, driving a change from within a team, is more of a metamorphosis; you will need to spend time prepping the organization. You will needs to carefully measure if others share your concerns, if they feel there is an impending risk, and gage their support for helping in manifesting an organizational change. Think of it as a kind of intervention. You will likely need to syndicate your proposals with your peers outside your team. (Of course, if you are a member of the team, and not its leader, while you may view your intentions as nothing but positive, they could be met with a great deal of resistance, even resentment, and worst have unintended consequences for you, your boss, and your team.)
Making the case for change
Regardless of what drove the opportunity to change your organization, before applying a prescriptive model, it is important to make sure you address the following items so you can tailor that program to best meet the needs of your company and present a solid case for changing the organization.
Make sure you really know the business of your business. Who are the players? How does it operate? Learn the specifics of how you make money. What are the real strategic initiatives? What are the priorities for each of the executive leaders? And how do they align around a common mission? And most importantly, where does your team fit into that context? Is it a driver? A service? What part of the company’s strategy is dependent on your team? If you’re not presenting to the executive leadership, find out how your team is being represented; you need to know how your executives perceive your team and its value.
Have a dispassionate understanding of your team, both internally and externally. It is important to have your own house in order before you move on the next step. Who is on the team? What are their skills? strengths? weaknesses? career objectives? etc. Who would you keep, who would you cut? Do the collaborate? Are they effective communicators? Is there the right mix of resources and skill levels? Do you have the right processes and tools? Can you delegate to them? Do you trust them? What is the quality of their results? What are the metrics of their success?
It’s vital to have an unbiased view of the effectiveness of the team as a function within the larger company. Think of a company as a system comprised of multiple functions with work passing between each function as it progresses. Evaluating your team’s contribution to the business’ overall success requires an objective understanding of the optimizations needed to ensure the peak performance of the system. If your team is failing to deliver its full its potential, take responsibility and met those challenges head on. Don’t blame others. Learn what is keeping you from meeting your dependencies? Is it capacity? Is your team being engaged at the right time? Is it your internal operations? Are you getting what you need? Are you delivering quality? The required changes to improve your team's delivery may in fact need to take place outside your team, in which case you will need to partner with other leaders to ensure your team can reach its potential. Learn how have they organized and optimized their teams. Model the in-puts and out-outs, and what would truly improve your team’s ability to deliver. Run a pilot, test your hypotheses, and iterate.
This one applies if you are trying to add a functional area to your team (i.e., Design Ops or Design Strategy): How do other teams deal with these functions? Have they broken them out as separate functional areas? Is it part of their internal leaderships’ responsibilities? Are these functions part of ascension planning? Do they outsource it to another team altogether? If there are corresponding Corporate level functions, how do they manage the alignment? (i.e Design Operations and the Program Management Office, or Design Strategy and Corporate Strategy?) Adding a net-new functional area to any team will require proof that it will benefit the company. Unlike increasing headcount to an existing function, where the ROI is understood, creating a new functional area within your team can be seen as an unnecessary expense, or worst empire building. You should be prepared to build the business case to justify the on-going expenditure.
Hopefully taking a step back you should have noticed by now that this approach is fundamentally the same approach any designer would take in creating a product or a service: do a 360º, learn from your users, learn from the market, and most importantly make sure you are solving the right problem. The use systems thinking to look at the big picture, and ensure you are working with not against the momentum. Then develop solutions that are data driven, comprehensive, and can be tested so the solution will make your case for you.
Plan like a boss
When it comes time to design the organizational plan—breaking out functions, roles, developing staffing plans (hiring and possibly layoffs), make it clear what your goal is: to make your team the most effective it can be in order to deliver value to the company. Like any design, you should expect this to be iterative but given you are impacting people’s jobs, and potentially their careers, it’s important that you limit the cycles and the churn. On top of that, how smoothly you manage this process will reflect on how you are perceived as a leader; a great deal depends on decisive action.
We all know design by committee is path we never want to go down, the same is true when you are designing an organization. Not everyone will be included in these conversations; not everyone’s opinion is equal but since your team is part of a larger system, making sure you have the right people in the room will be critical for your success. The realities of budget and yes politics will always be present. You need to do your homework regarding budgeting, headcount, etc., and you will need to know how this change it will pay dividends toward the long-term company objectives. It must be clear to all your stakeholders how this change will benefit the company if you want any chance of making it through the organizational politics. Simply saying that this is a “best practice”, or citing that other companies do it this way, will likely not be enough. And even if that works, be careful what you wish for; without putting in the work described above any organization you put in place will likely fail to deliver the results you expect.
I want to take a moment and clarify something about politics. I was fortunate to have worked with a great executive coach a few years ago, he helped me understand that with companies politics is neither good nor bad, it simply just is. And that whenever you get three or more people working together, you will have negotiations, tradeoffs, incentives, reputations—politics. That it’s part of our ego and our id, it’s just part of human nature, so embrace it. But he explained that while some people use politics to gain power for themselves, real leaders use politics to help others succeed. He taught me the key is trust, and trust depends on transparency and follow-through. And that as a manager, your measure of success is to make sure your team is successful. But as a leader, success means ensuring ALL the teams (and thus the company) are successful.
Making change stick
Change—of any size, within a company is often difficult and even painful. Drawing a new org chart is easy, building an organization requires a great deal of energy, commitment, and coaching. It is hard for people to adapt to new organizational models; it takes time to adjust to new structures and changes in responsibilities. You will need to the support of your peers across the organization to ensure the success of any new organizational structure. New routines and behaviors, potentially even new language will need to evolve and adopted. It will take time for people to settle into their new roles, learning who’s responsible for what, how information moves, even which meetings they need to attend, etc. No team comes through an organizational transformation, fully formed and flawless, but with good leaders most get there over time. Consistent messaging and coaching are critical to ensure your team emerges successfully from this change.
It is also important to remember that the emerging functions like Design Ops and Design Strategy are still new to most industries and not yet fully proven. And adding new functions to your team will draw the interest of your peers—especially, if they had to give up budget or headcount in the process. You will want to put clear metrics in place to track your teams’ performance after an organizational change, this is especially for any new functional areas you have instantiated. Going back to the topic of trust, you will need to maintain an open dialogue with your peers and the members of your team to ensure you can iterate and tune your organization. And that the value your team is delivering is seen and understood by the whole organization. It is important that your colleagues not only trust you but also trust the organization you have put into place, and its part in ensuring the overall success of the business.
As always, please feel free to share your thoughts.
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