Organisation Structure, Pat Kane, Business Innovation Ireland

1. Organisational Design
Presentation by
Stephen, Kaz, Ken, Ron, Leo, Pat
18th August 2011

2. Introduction
 Core concept of organisation design:
 Form follows function.
 Design the entity in such a way so as to
effectively deliver the function (purpose)
 Design elements to consider:
 Strategy, People, Rewards, Processes,
Systems, Skills, Shared values,
Structure, Culture, Mission, Core Goals,
Purpose, Principles, Practices etc.

3. Organisational Design
Approaches
 Five Star: Strategy, Structure, People, Rewards, Processes – Focus on
Strategy
 McKinsey 7-S: Strategy, Structure, Systems, Skills, Staff, Style,
Shared Values – Focus on Strategy
 Strategic Management: System aspects (Technical, political, cultural)
& Aligned Mgt tools (mission/strategy, org structure, HR Mgt) - Focus
on Alignment of systems and tools.
 Congruence Model: Informal Org, Formal Org, Work, People – Focus on
fit
 Collaborative Organisational Model: – Core Goals and Values,
Strategy, Work Processes, Structure, Systems, People, Culture – Focus
on core future goals at design team level
 Six Box Model: Purpose, Structure, Relationships, Helpful Mechanisms,
Rewards, Leadership – Focus on Purpose and leadership.
 Chaordic Design: Purpose, Principles, Participants, Org Concept,
Constitution, Practices – Focus on Purpose and Principles.

4. Loose Organisational
Design
 The suggested academic approach as most effective in using
commitment instead of control as an organising principle is
the Chaordic (the intersection of Chaos and Order where
innovation occurs) with variations such as Org2 Design.
Org2 Design Key Concepts
 Commitment as opposed to control as an organising
principle.
 Iterative process, not necessary linear and not completed in
a single pass.
 Designers consider each facet of the organisation to gain
clarity leading to decisions to coherently deliver the purpose
of the organisation.
 Constantly evolving while remaining aligned and integrated.

5. Org2 Design
Six Facets of Org2 Design

6. Org2 Design’s Six Facets
 Purpose: A clear and simple statement of the worthy pursuit that identifies
and binds the organisation. Purpose leads to commitment.
 Principles (& Values): Clear commonly understood and agreed upon
statements of what will guide the behaviour of the participants in the pursuit
of purpose e.g. quality, integrity and innovation.
 Practices: Specific agreements on how to operate and co-evolve e.g. location
of power/authority, decision making, accountability, knowledge sharing.
 Participants: Members or agents of the organisation. They define who is
involved and how they contribute, are valued and valuable. This involves
defining roles and responsibilities, skills, competencies, learning and
movement in and out of the organisation.
 Processes: Define the work, information and feedback flows that produce
value for the customer.
 Pieces – Units, networks, relationships and connections to the whole. It
defines the organisational configuration or structure. Coordinated groupings of
participants execute the processes utilising resources (especially information)
to further the purpose/strategy of the organisation.

7. Loose Structure Example

8. How a loose structure
could work in practice
 All associates have a single vote.
 Associates select an organisational design methodology.
 All associates formulate and sign up to an agreed articles of
association or charter.
 All associates attack the market under the BII banner forming
networks or connection with other available associates to
share information and or work on client projects.
 Group innovation specialists work with interested associates
on innovation projects of mutual interest.
 External interested parties are allowed entry if they meet the
agreed minimum entry requirements and sign up to the
agreed charter.

9. Strengths Weaknesses
• Decisions require group support. Provides • Possible inability to reach agreement in
opportunity to fully discuss decisions. decision making.
• Provides flexibility for people to try out • Democracy takes a lot of time. It is hard
different roles thus learning new skills. work listening to others.
• SWOT of Loose Structure
High motivation of members as they have
equal voting rights and can shape how the
• Possible infighting, destructive cliques or
individuals and power struggles especially if
organisation evolves. roles and procedures are not clearly defined.
• Ability to move in and out of the organisation • Can be a mismatch between what people see
• Greater collaborative network. as pulling their weight and reality.
• Difficulty in enforcement of agreed policies
and practices.
• It takes too long to set up and window of
opportunity is missed as people become
disillusioned and drift away
Opportunities Threats
Flexible and scalable to attract new entrants The RA may consider the organisation too
and re-entrants to build knowledge, chaotic and too much of a risk to trust giving
attractive skills and industry experience. us introductions.
Loose structure lends itself to innovative We might not get enough work to support
spinoffs and new startup companies by the numbers involved.
members. Reputational damage due to member
Our story and democratic structure -owned fluctuation
by the members could be a unique selling
point.

10. Strong Structure Example

11. How a strong structure
could work in practice
 All participants have a single vote.
 Participants vote in core management team and specialist partners for
an agreed term. Consecutive terms allowed.
 Participants agree an organisational design methodology.
 Core management and specialist partners develop articles of association
or charter.
 Participants vote and sign up (if passed) to the agreed articles of
association or charter - iterate process if necessary.
 Core management and specialist partners attack the innovation market
under the BII banner in a highly coordinated manner forming specialist
networks or connections with other available associates to share
information and or work on client projects.
 Group innovation specialists work with partners and associates on
innovation projects of mutual interest.
 External interested parties are allowed entry if they meet the agreed
minimum entry requirements and sign up to the agreed charter.

12. Strengths Weaknesses
• Controlled points of contact with • Hierarchical.
potential clients for sales/marketing • Potentially Bureaucratic.
gives coherent group representation • Potentially inflexible and rigid.
•
SWOT of Loose Structure
and market positioning.
We understand the model and
• Perhaps inequitable
understand roles and responsibilities.
• Initial decisions can be made quickly.
• More likely to achieve stability quickly.
• Avoids duplication of sales and
administration effort
• Easier to monitor compliance.
Opportunities Threats
Understood by the market. Internal destructive competition
Greater opportunity for external Egos
collaborations. Potential for favouritism
Greater opportunity to agree Perhaps slower to change.
endorsements.
Flexible in ability to join the network.
Our story and democratic structure -
owned by the members could be a
unique selling point.
Ron does not like it

13. Discussion on Structure