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10 Organizational
Design Models
Seta A. Wicaksana
www.humanikaconsulting.com
Seta A. Wicaksana
0811 19 53 43
wicaksana@humanikaconsulting.com
• Pendiri dan Direktur Humanika Consulting dan hipotest.com
• Business Psychologist
• Certified of Assessor Talent Management
• Certified of Human Resources as a Business Partner
• Certified of Risk Professional
• Certified of HR Audit
• Dosen Tetap dan Peneliti di Fakultas Psikologi UP
• Penulis Buku: Sobat Way (2016), Industri dan Organisasi: Pendekatan Integratif dalam
menghadapi Perubahan (2020), Human Faktor Engineering: Integratif Desain Manusia dan Lingkungan
Kerja (2021), Psikologi Industri dan Organisasi (2021), Psikologi Umum (2021), Manajemen
Pengembangan Talenta (2021), PIODiagnostik: Pengukuran Psikologi di Lingkungan Kerja (2021),
Transformasi Digital: Perspektif Organisasi, Talenta dan Budaya Organisasi (2021), Psikologi Pelayanan
(2021) dan Psikologi Konsumen (2021).
• Dosen Tidak Tetap di: Program Pasca Sarjana Ekonomi di Univ. Pancasila, STP
TRISAKTI, Fakultas Psikologi Universitas Mercu Buana, STIKOM IMA
• Wakil Ketua Asosiasi Psikologi Forensik Indonesia wilayah DKI
• Pembina Yayasan Humanika Edukasi Indonesia
• Ilmu Ekonomi dan Manajemen (MSDM) S3 Universitas Pancasila
• Fakultas Psikologi S1 dan S2 Universitas Indonesia
• Sekolah ikatan dinas Akademi Sandi Negara
Agenda
• Background
• Organizational Design
• The Purpose of Organizational Design
Models
• Framework for Excellence in Organization
Design
• Diagnostic Models:
• McKinsey’s 7S Design Model
• Jay Galbraith’s Star Model
• Weisbord’s Six Box Model
• Transformation Model
• The Congruence Model
• The Burke-Litwin Organizational
Change Framework
• McKinsey Helix Model
• Holonic Enterprise Model
• The Flexible Organization Model
• SOBAT Humanika Consulting
• Choosing An Organizational Design Model
Background
• Up until about 20 years ago, companies experienced
organizational redesign every few years or even
decades.
• Most top executives would have the experience perhaps
only a few times in their careers.
• However, automation and competitive pressures had
begun to accelerate the pace of organizational change.
• In this presentation, we explore traditional
organizational models and how they have been used to
align structure and operations to business strategies.
• We will show how those models can still operate as
diagnostic tools to understand where various
organizational factors can be out of balance.
• Then, we will show how organizations have shifted from
static models for diagnostics and alignment to flexible
models that help organizations adapt to continuous,
dynamic change.
Organizational Design
• Organizational design refers to how an organization is
structured to execute its strategic plan and achieve its
goals. This means that the optimal type of organizational
design is determined by the organization’s strategy.
• Organizational design is creating the best structure for:
• strategy execution in relation to the external
environment, and
• the organization’s unique internal strengths,
weaknesses, competence, and leadership style.
• There are no organizational design best practices. Every
organization has different needs. Following another
organization’s methods and approach is not likely to
lead to lasting success.
• As a result, organization designers use frameworks,
not prescriptions.
The Purpose of
Organizational Design
Models
• An organizational design model is a
conceptual framework that an organization
uses to:
• diagnose its current state,
• visualize a future state that will succeed,
and
• establish an identity—purpose, value,
and culture—to help the organization
thrive.
Source from Josh Bersin
Diagnostic Models
Most of the well-known
organization models in use today
originated in the 70s and 80s.
Their creators were moving
organizations from the industrial
age hierarchical models to
flatter, more responsive
structures.
Organizations have different
priorities and challenges in
organizational design.
Understanding the traditional
organizational design models
can help you choose the right
tools for diagnosing and
changing your operating models.
McKinsey’s 7S Design
Model
• Probably the most well-known and used design model
has been the McKinsey model.
• Its purpose is to analyze organizational effectiveness
through the interactions of seven key elements. You do
that not by examining any one element or viewing them
only to strategy but as they balance and align together
as a whole.
• The 7s model has been criticized for not being specific
in identifying gaps in strategy or execution. We should
bear in mind that McKinsey, like other consulting firms,
developed its models as frameworks for organizational
design consulting. We doubt that its original intent had
anything to do with do-it-yourself organizational change.
• First, the “hard”elements of structure, strategy, and systems:
• Strategy defines how the company will compete in the
market.
• Structure is the way it organizes business functions,
reflected in the organization chart.
• Systems are the decision framework, processes, and
procedures that determine how the company does
business.
• These elements are easier to manage than the “soft”
elements of skills, staff, style, and shared values:
• Skills are the organization’s ability to perform, usually
defined in a competency framework that aligns them from
organization competencies to individual knowledge, skills,
and abilities and the analytics to manage them.
• Staff is the shape of the workforce and how it is managed.
• Style refers to the way top-level leaders manage the
organization and the symbolic value they present to
stakeholders.
• Shared Values are the norms and standards that guide
behavior at every level of the organization and thus are the
core of the 7s model.
Advantages and
Disadvantages
Advantages of the 7s Model
• The McKinsey model’s value balances the critical elements
instead of focusing only on strategy and structure.
• It can be beneficial during mergers and acquisitions to bring
functional elements and processes together.
• 7s also helps apply policies, regulations, and strategies
formulated by business leaders
• You can use the model to develop analytics to measure the
impact of changes.
Disadvantages of the 7s Model
• The McKinsey model does not include an action plan for
change management. It is a static analysis of the balance of
all the organizational elements.
• There is some criticism that it is focused inward and not
considering external factors. However, strategy formulation by
definition includes analysis of externals.
• The model doesn’t explicitly explain organizational
effectiveness or performance.
Jay Galbraith’s Star Model
• The Star Model is a framework for influencing employee behavior through a
“series of design policies” controllable by management:
• Strategy determines goals and objectives, values and missions, and the
“basic direction of the company.”It establishes the“criteria for choosing
among alternative organizational forms” to enable strategists to choose
the relative importance of activities.
• Structure determines where power and authority lie in the organization
based on analysis in four areas:
• Specialization refers to job specialties required to perform work.
• Shape describes the number of people in organization units or span of
control at each level.
• Distribution of power can be vertical, determining how flat or
hierarchical the organization is; it can also be lateral, referring to the
movement of power to a department dealing with critical issues.
• Departmentalization is the formation of organization units on the
dimensions of functions, workflow processes, markets, customers, and
geography.
• Processes are the flow of information and decision processes across
the organizational structure. Vertical processes allocate funds and
talent, while horizontal (lateral) processes are the workflow.
• Rewards align employee goals to organizational goals. To do so, they
must align with the other design components.
• People refers to aligning human resources policies and functions to
develop both people and organizational capabilities.
Advantages of the Star Model
• Galbraith supports his model with an
extensive collection of books and
guides.
• The model supports a detailed
description of elements and the
interaction between them.
Disadvantages of the Star Model
• It does not address culture and
purpose as motivating factors. Instead,
it relies on a seemingly Pavlovian
approach to human motivation.
• The model does not include inputs and
outputs.
Advantages and
Disadvantages
Weisbord’s Six Box
Model
• Marvin Weisbord’s model, presented in 1976, comes from his
work on creating “a working tool which anybody can use.”
• He wrote that it helped him to rapidly expand his diagnostic
framework “from interpersonal and group issues to the more
complicated contexts in which organizations are managed.”
• By envisioning the six elements as blips on a radar screen, he
shows how to manage the relationship, just as air traffic
controllers work aircraft distance, altitude, and velocity.
• Like other organizational design models, the Six-Box model is a
diagnostic tool designed to understand relationships and
balance elements.
• Weisbord’s approach is similar to Galbraith’s. Either can be
helpful as a diagnostic tool.
• Like Galbraith, Weisbord supports the use of their models
through an extensive body of writings and guides.
• Purpose: What “business are we in?”
• Structure: How do we divide up the work?
• Relationships: How do we manage conflict
(coordinate among people? With what
technologies?
• Rewards: Is there an incentive for doing all that
needs doing?
• Leadership: Is someone keeping the boxes in
balance?
• Helpful Mechanisms: Have we adequate
coordinating technologies?
Advantages and
Disadvantages
• Advantages of the Six Box Model
• Examines information and input from both
internal and external sources.
• Analyzes communication structures to process
information effectively.
• Each box begins the discussion with diagnostic
questions to frame the analysis.
• It starts with purpose, which has proved to be
critical in later models.
• Disadvantages of the Six Box Model
• The model does not appear to speak to balance,
which may create a risk of focusing too much on
some elements at the expense of others.
Transformation
Model
• The Center for Organizational
Design created the
Transformational Model in 1995.
• It is an organizational design
framework with two purposes: to
help leaders understand their
organizations and to guide a
successful redesign.
• The model comprises eight
variables that form the context of an
organization. The objective is to
understand and manage the
variables to achieve balance.
Transformation Model
• Environment. The organization is a living system that can
only survive if it maintains “harmony with its external
environment.”That environment includes the competition
and “the legal, social, and political climates.”
• Strategy is about how the organization will compete by
adding value for customers. It includes performance
targets and a system for growth. It’s about where the
organization is going.
• Core Process is the flow of work in the organization and all
enabling technology and resources. It organizes all other
business activities around core processes.
• Structure describes how the business organizes people
around business processes. It helps us understand
boundaries, roles, responsibilities, and reporting
relationships.
• Systems are the activities and tasks that organize and
coordinate work. We are probably more accustomed to
calling them functions. Interestingly, the Center’s
something of a side note: “The most effective systems are
often the simplest.”
• Culture is how the organization really operates and how
well it translates strategy into practice.
• Results are the measures of how well the organization
functions. Well-designed metrics are the basis for
understanding performance.
• Leadership sets goals and monitors results, defines the
vision and strategy, and designs the organization.
Advantages and
Disadvantages
• Advantages of the Transformation
Model
• It creates a better understanding of
how people respond to change.
• The Center provides a seven-phase
process for organizational design.
• Disadvantages of the Transformation
Model
• The one-way flow doesn’t
emphasize the way all eight
elements interact.
The Congruence Model
• The Nadler-Tushman model presents a six-step plan for
closing the gaps in how the elements of an organization
work together. It examines communications and
information flow to understand the congruence of four
components.
• Work is the tasks employees carry out and
whether they align with company objectives.
• People refers to skills and knowledge, experience,
and education in relation to compensation and
development of their potential.
• Structure creates consistency between what the
organization wants and what it does.
• Culture is values and norms, behavioral patterns,
and both written and unwritten rules.
Advantages and
Disadvantages
• Advantages of the congruence model
• The model is simple and easy to follow.
• It includes a discussion of both formal
and informal organizational elements.
• It requires congruence (being in
agreement) among the boxes.
• Disadvantages of the Congruence Model
• Lack of detail in the model may lead to
the omission of critical elements.
The Burke-Litwin
Organizational Change
Framework
• The organizational change framework could be used as a
diagnostic tool, but its primary purpose is to guide
organizational change.
• Burke-Litwin is a causal change model designed to show where
change happens and flows through the organization.
• The framework is much more complex and complete than most
organizational design models. It groups twelve factors into five
groups. Each group is affected by the group above and below it.
• External Factors are at the top of the groups because they
create the need for change.
• Strategic Factors include strategy/mission, leadership,
and organizational culture.
• Operating Factors are structure, management practices,
and systems (including policy and procedures).
• Individual Factors are work unit climate, skills and tasks,
motivation, and individual needs and values.
• Outputs include both individual and organizational
performance measures.
Advantages and
Disadvantages
• Advantages of the Burke Litwin Organizational Change
Model
• It includes essential elements of human
motivation, work climate, management practices,
and individual needs and values.
• A feedback loop shows the relationship between
individual skills and actions and strategy.
• A feedback loop indicates that individual needs
and values affect and are driven by organizational
culture.
• Disadvantages of the Burke Litwin Organizational
Change Model
• Some will find it too difficult to grasp quickly. On
the contrary, others may see the detail as an
advantage.
McKinsey Helix Model
• When McKinsey discovered in 2020 that modern matrix and agility
models made businesses too complicated, slow, and inflexible,
they developed the helix organizational model.
• They named the model on the concept of the double helix
structure of a DNA molecule. It entails creating two distinct,
parallel lines of accountability that are equal and intertwined but
different.
• The device people leadership into two sets of tasks:
• The first is value creation (what gets done), overseeing day-
to-day work, and satisfying the customer. This idea makes
us wonder if Sandy Ogg’s Talent to Value concept
influenced their thinking. Ogg’s vision is that the
organization’s highest priority is to provide the best possible
talent wherever the organization creates value.
• The second is capabilities (how work gets done). Develop
people and resources, set standards, and drive excellence.
• As in matrix organizations, a person reports to two managers, but
the managers are not in conflict concerning that person’s time
and attention. They have separate functions.
• The helix is an advanced design for most organizations, and we
think to a degree experimental, but there have been early
successes.
McKinsey Offers Four Recommendations to
Ensure Success
Make resource planning
transparent, flexible, and
focused on value, requiring
frequent business reviews to
prioritize and allocate resources.
Create an internal talent
marketplace to align people to
value based on supply and
demand.
Support leaders who are shifting
their mindsets and culture. The
model requires a culture of
collaboration to align resources
and business requirements.
Balance performance
management across the two
roles with both providing
feedback.
Advantages and
Disadvantages
• Advantages of the Helix Model
• It enables the shift of value creation to the highest
return on investment.
• The structure reduces complexity and increases
flexibility.
• It encourages faster decision-making.
• It also empowers employees to act.
• Disadvantages of the Helix Model
• The model requires a significant change in how the
organization operates in the way leaders manage.
• It cannot succeed without a relinquishing of control
and “a healthy dose of humility.”
Holonic Enterprise Model
• The holonic model serves global virtual organizations by
allowing self-directed information and resource
management linked through the internet.
• The theoretical framework isn’t new: it originated in the
work of Arthur Koestler in 1968, published in 1970 as
Beyond Atomism and Holism—The concept of the holon 1.
• Koester studied the self-organizing tendencies of social
and biological systems.
• He coined the word holon to describe a state where an
entity is both a self-contained whole and a part of a more
extensive system. Or a subsystem of a greater system.
• It combines the Greek holos meaning ‘whole’ with the suffix
-on ‘a particle or part.’
The Holonic Enterprise Operates on Three
Levels
The Global Inter-Enterprise
Collaborative Level
• In the enterprise meaning of the word,
companies enter a collaborative
hierarchy to produce products or
services.
• We have traditionally regarded this as a
supply chain moving from the customer
to the producer.
• However, when we regard the construct
as a holonic enterprise, we see that each
holon seeks to optimize its efficiency. It
operates as an independent entity in
collaboration with the extended
enterprise.
• A customer in the chain seeks to work
with the most efficient and responsive
supplier. The supplier aims to sell to the
most profitable customer.
• The result is an optimization of the whole
collaborative inter-enterprise.
The Intra-Enterprise Level
• Each enterprise in the holocracy must
organize its internal resources to deliver
according to the coordination
requirements of the collaborative cluster.
• This organization requires planning and
dynamic scheduling of resources,
including functional reconfiguration.
• A failure such as machine downtime
requires a re-clustering of enterprise
resources (see Task Distribution Pattern).
The Machine (Physical Agent) Level
• The third level manages the distributed
control of the machines that perform the
work.
• The distribution is done through agile
manufacturing using self-reconfiguring,
intelligent distributed automation
elements.
The Flexible Organization
Model
• We don’t include flexible organization in our experimental organizational
design models because it is not an experiment–it is a proven set of
practices that innovators and lean startups use to disrupt markets.
• It’s the force that accelerates the pace of organizational change. By
adopting these innovative practices, your organization becomes a
disrupter.
• In the report Unlocking the flexible Organization: Organization Design for
an Uncertain Future, Deloitte presents a model and path that traditional
companies, or any other, can use to become agile and quick to market.
• Traditional organizations have based their structure on organizational
silos that produce repeatable results in predictable markets. They are
bureaucratic, multi-layered hierarchies that resist change.
• That model will no longer suffice. In today’s markets, things change
quickly, and rigid models will fall behind more agile competitors.
• The organization of the future is a network of self-managed teams that
organize themselves around a specific outcome.
• Radical interventions usually fail, but Deloitte has found a method that
unleashes the agility of empowered teams without upending the
organization.
Advantages and
Disadvantages
• Advantages of the Flexible Model
• It fosters creativity, teamwork, and innovative thinking.
• The structure places decision-making at the point of need
rather than a chain of command.
• It creates a culture of empowerment and commitment to
the team’s mission.
• The absence of bureaucracy creates an agile, adaptive
organization that thrives on change.
• Disadvantages of the Flexible Model
• It cannot be done too quickly or in a manner that disrupts
the core. The culture needs time to adjust to autonomous
teams.
• It will take time to develop the managers needed in the
new environment.
• Traditional command and control managers may need
outplacement.
SOBAT Humanika
Consulting
• SOBAT is a development of the change management concept developed by
Humanika Consulting in 2009, which has now become an organizational
design framework that can adapt to future organizational challenges.
• Divided into 2 axes, namely the first vertical, which describes the perspective
of time, the one above is the future while the one below is the present.
Second, Horizontal which describes the focus orientation, namely the right
side is the organizational approach, and the left side is the people approach.
• The red box depicts the challenges that must be answered by the organization
and is always present at all times, these challenges are Sustainable
Competitive Advantages/SCA (on the future time axis), Innovation (on the
organizational orientation axis), Compliance (on the current time axis), and
Engagement/Wellbeing (on the People orientation axis).
• Meanwhile, the management process uses the Strategy, Organize, Behaviors,
Accelerate, and Transform (SOBAT) approach.
• SOBAT This model is very suitable for organizations that continue to respond
and adapt to changes toward sustainable competitive advantage.
Thinking,
Learning,
Performing,
and Changing
Strategic
Organize
Behaviors
Accelerate
Transform
Mission & Vision,
Values/Culture
Competencies
Business Process,
Organizational structure,
system, Policy, Regulation,
SOP, and Technologies
Leader’s Role:
Coaching, mentoring,
counseling
HR Management,
Performance and
Reward Management,
HR Analytics
(Wicaksana, 2009)
Future
Present
People
Organization
Sustainable Competitive
Advantages
Innovation
Compliance
Engagement/
Wellbeing
Advantages and
Disadvantages
• Advantages of the SOBAT model
• Has a time orientation perspective (future and present) and
focus orientation (organization and people).
• The existence of external challenges that are always present is a
need for organizations to excel (SCA, Innovation, Compliance,
Engagement/well-being).
• In responding to challenges, the management process responds
with a change management approach, SOBAT (Strategy,
Organize, Behaviors, Accelerate, and Transform)
• SOBAT This model is very suitable for organizations that
continue to respond and adapt to changes toward sustainable
competitive advantage.
• Disadvantages of the SOBAT Model
• Some will find it too difficult to grasp quickly. On the contrary,
others may see the detail as an advantage.
Choosing An Organizational
Design Model
• Choose the right partner. Check references and talk with other organizations
that have worked with your potential partners. Ask for specifics on how your
potential partner helped their organization.
• Start with purpose and strategy. Without that solid footing, your efforts can
be derailed.
• Carefully consider your organizational priorities as you review your
purpose and strategy. Examine all the internal and external forces that affect
your business.
• Consider both current and future organizational needs. Be constantly
aware of how things might change. Resist the urge to go defensive to protect
your current position. Instead, prepare to discover the opportunities that
change will bring.
• Culture is critical. If it doesn’t fit your culture, it won’t work. If you need to
change your culture, get the right help, and approach culture change as
essential for your organizational transformation.
• Not all organizational design models will fit your situation. Consider each
carefully, and don’t let a model limit what you can do. Let your analysis do the
talking.
• Seek compatibility in the change tools you use. For example, your project
management and organizational approaches must agree, as should your
culture and change management plan.
• You don’t have to do everything today. Change, especially cultural change,
takes time. Don’t get ahead of yourself in what you can accomplish.
Learning and Giving for
Better Indonesia
www.humanikaconsulting.com

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Ten Organizational Design Models to align structure and operations to business strategies

  • 1. 10 Organizational Design Models Seta A. Wicaksana www.humanikaconsulting.com
  • 2. Seta A. Wicaksana 0811 19 53 43 wicaksana@humanikaconsulting.com • Pendiri dan Direktur Humanika Consulting dan hipotest.com • Business Psychologist • Certified of Assessor Talent Management • Certified of Human Resources as a Business Partner • Certified of Risk Professional • Certified of HR Audit • Dosen Tetap dan Peneliti di Fakultas Psikologi UP • Penulis Buku: Sobat Way (2016), Industri dan Organisasi: Pendekatan Integratif dalam menghadapi Perubahan (2020), Human Faktor Engineering: Integratif Desain Manusia dan Lingkungan Kerja (2021), Psikologi Industri dan Organisasi (2021), Psikologi Umum (2021), Manajemen Pengembangan Talenta (2021), PIODiagnostik: Pengukuran Psikologi di Lingkungan Kerja (2021), Transformasi Digital: Perspektif Organisasi, Talenta dan Budaya Organisasi (2021), Psikologi Pelayanan (2021) dan Psikologi Konsumen (2021). • Dosen Tidak Tetap di: Program Pasca Sarjana Ekonomi di Univ. Pancasila, STP TRISAKTI, Fakultas Psikologi Universitas Mercu Buana, STIKOM IMA • Wakil Ketua Asosiasi Psikologi Forensik Indonesia wilayah DKI • Pembina Yayasan Humanika Edukasi Indonesia • Ilmu Ekonomi dan Manajemen (MSDM) S3 Universitas Pancasila • Fakultas Psikologi S1 dan S2 Universitas Indonesia • Sekolah ikatan dinas Akademi Sandi Negara
  • 3. Agenda • Background • Organizational Design • The Purpose of Organizational Design Models • Framework for Excellence in Organization Design • Diagnostic Models: • McKinsey’s 7S Design Model • Jay Galbraith’s Star Model • Weisbord’s Six Box Model • Transformation Model • The Congruence Model • The Burke-Litwin Organizational Change Framework • McKinsey Helix Model • Holonic Enterprise Model • The Flexible Organization Model • SOBAT Humanika Consulting • Choosing An Organizational Design Model
  • 4. Background • Up until about 20 years ago, companies experienced organizational redesign every few years or even decades. • Most top executives would have the experience perhaps only a few times in their careers. • However, automation and competitive pressures had begun to accelerate the pace of organizational change. • In this presentation, we explore traditional organizational models and how they have been used to align structure and operations to business strategies. • We will show how those models can still operate as diagnostic tools to understand where various organizational factors can be out of balance. • Then, we will show how organizations have shifted from static models for diagnostics and alignment to flexible models that help organizations adapt to continuous, dynamic change.
  • 5. Organizational Design • Organizational design refers to how an organization is structured to execute its strategic plan and achieve its goals. This means that the optimal type of organizational design is determined by the organization’s strategy. • Organizational design is creating the best structure for: • strategy execution in relation to the external environment, and • the organization’s unique internal strengths, weaknesses, competence, and leadership style. • There are no organizational design best practices. Every organization has different needs. Following another organization’s methods and approach is not likely to lead to lasting success. • As a result, organization designers use frameworks, not prescriptions.
  • 6. The Purpose of Organizational Design Models • An organizational design model is a conceptual framework that an organization uses to: • diagnose its current state, • visualize a future state that will succeed, and • establish an identity—purpose, value, and culture—to help the organization thrive.
  • 7.
  • 9. Diagnostic Models Most of the well-known organization models in use today originated in the 70s and 80s. Their creators were moving organizations from the industrial age hierarchical models to flatter, more responsive structures. Organizations have different priorities and challenges in organizational design. Understanding the traditional organizational design models can help you choose the right tools for diagnosing and changing your operating models.
  • 10. McKinsey’s 7S Design Model • Probably the most well-known and used design model has been the McKinsey model. • Its purpose is to analyze organizational effectiveness through the interactions of seven key elements. You do that not by examining any one element or viewing them only to strategy but as they balance and align together as a whole. • The 7s model has been criticized for not being specific in identifying gaps in strategy or execution. We should bear in mind that McKinsey, like other consulting firms, developed its models as frameworks for organizational design consulting. We doubt that its original intent had anything to do with do-it-yourself organizational change.
  • 11. • First, the “hard”elements of structure, strategy, and systems: • Strategy defines how the company will compete in the market. • Structure is the way it organizes business functions, reflected in the organization chart. • Systems are the decision framework, processes, and procedures that determine how the company does business. • These elements are easier to manage than the “soft” elements of skills, staff, style, and shared values: • Skills are the organization’s ability to perform, usually defined in a competency framework that aligns them from organization competencies to individual knowledge, skills, and abilities and the analytics to manage them. • Staff is the shape of the workforce and how it is managed. • Style refers to the way top-level leaders manage the organization and the symbolic value they present to stakeholders. • Shared Values are the norms and standards that guide behavior at every level of the organization and thus are the core of the 7s model.
  • 12. Advantages and Disadvantages Advantages of the 7s Model • The McKinsey model’s value balances the critical elements instead of focusing only on strategy and structure. • It can be beneficial during mergers and acquisitions to bring functional elements and processes together. • 7s also helps apply policies, regulations, and strategies formulated by business leaders • You can use the model to develop analytics to measure the impact of changes. Disadvantages of the 7s Model • The McKinsey model does not include an action plan for change management. It is a static analysis of the balance of all the organizational elements. • There is some criticism that it is focused inward and not considering external factors. However, strategy formulation by definition includes analysis of externals. • The model doesn’t explicitly explain organizational effectiveness or performance.
  • 13. Jay Galbraith’s Star Model • The Star Model is a framework for influencing employee behavior through a “series of design policies” controllable by management: • Strategy determines goals and objectives, values and missions, and the “basic direction of the company.”It establishes the“criteria for choosing among alternative organizational forms” to enable strategists to choose the relative importance of activities. • Structure determines where power and authority lie in the organization based on analysis in four areas: • Specialization refers to job specialties required to perform work. • Shape describes the number of people in organization units or span of control at each level. • Distribution of power can be vertical, determining how flat or hierarchical the organization is; it can also be lateral, referring to the movement of power to a department dealing with critical issues. • Departmentalization is the formation of organization units on the dimensions of functions, workflow processes, markets, customers, and geography. • Processes are the flow of information and decision processes across the organizational structure. Vertical processes allocate funds and talent, while horizontal (lateral) processes are the workflow. • Rewards align employee goals to organizational goals. To do so, they must align with the other design components. • People refers to aligning human resources policies and functions to develop both people and organizational capabilities.
  • 14. Advantages of the Star Model • Galbraith supports his model with an extensive collection of books and guides. • The model supports a detailed description of elements and the interaction between them. Disadvantages of the Star Model • It does not address culture and purpose as motivating factors. Instead, it relies on a seemingly Pavlovian approach to human motivation. • The model does not include inputs and outputs. Advantages and Disadvantages
  • 15. Weisbord’s Six Box Model • Marvin Weisbord’s model, presented in 1976, comes from his work on creating “a working tool which anybody can use.” • He wrote that it helped him to rapidly expand his diagnostic framework “from interpersonal and group issues to the more complicated contexts in which organizations are managed.” • By envisioning the six elements as blips on a radar screen, he shows how to manage the relationship, just as air traffic controllers work aircraft distance, altitude, and velocity. • Like other organizational design models, the Six-Box model is a diagnostic tool designed to understand relationships and balance elements. • Weisbord’s approach is similar to Galbraith’s. Either can be helpful as a diagnostic tool. • Like Galbraith, Weisbord supports the use of their models through an extensive body of writings and guides.
  • 16. • Purpose: What “business are we in?” • Structure: How do we divide up the work? • Relationships: How do we manage conflict (coordinate among people? With what technologies? • Rewards: Is there an incentive for doing all that needs doing? • Leadership: Is someone keeping the boxes in balance? • Helpful Mechanisms: Have we adequate coordinating technologies?
  • 17. Advantages and Disadvantages • Advantages of the Six Box Model • Examines information and input from both internal and external sources. • Analyzes communication structures to process information effectively. • Each box begins the discussion with diagnostic questions to frame the analysis. • It starts with purpose, which has proved to be critical in later models. • Disadvantages of the Six Box Model • The model does not appear to speak to balance, which may create a risk of focusing too much on some elements at the expense of others.
  • 18. Transformation Model • The Center for Organizational Design created the Transformational Model in 1995. • It is an organizational design framework with two purposes: to help leaders understand their organizations and to guide a successful redesign. • The model comprises eight variables that form the context of an organization. The objective is to understand and manage the variables to achieve balance.
  • 19. Transformation Model • Environment. The organization is a living system that can only survive if it maintains “harmony with its external environment.”That environment includes the competition and “the legal, social, and political climates.” • Strategy is about how the organization will compete by adding value for customers. It includes performance targets and a system for growth. It’s about where the organization is going. • Core Process is the flow of work in the organization and all enabling technology and resources. It organizes all other business activities around core processes. • Structure describes how the business organizes people around business processes. It helps us understand boundaries, roles, responsibilities, and reporting relationships. • Systems are the activities and tasks that organize and coordinate work. We are probably more accustomed to calling them functions. Interestingly, the Center’s something of a side note: “The most effective systems are often the simplest.” • Culture is how the organization really operates and how well it translates strategy into practice. • Results are the measures of how well the organization functions. Well-designed metrics are the basis for understanding performance. • Leadership sets goals and monitors results, defines the vision and strategy, and designs the organization.
  • 20. Advantages and Disadvantages • Advantages of the Transformation Model • It creates a better understanding of how people respond to change. • The Center provides a seven-phase process for organizational design. • Disadvantages of the Transformation Model • The one-way flow doesn’t emphasize the way all eight elements interact.
  • 21. The Congruence Model • The Nadler-Tushman model presents a six-step plan for closing the gaps in how the elements of an organization work together. It examines communications and information flow to understand the congruence of four components. • Work is the tasks employees carry out and whether they align with company objectives. • People refers to skills and knowledge, experience, and education in relation to compensation and development of their potential. • Structure creates consistency between what the organization wants and what it does. • Culture is values and norms, behavioral patterns, and both written and unwritten rules.
  • 22.
  • 23. Advantages and Disadvantages • Advantages of the congruence model • The model is simple and easy to follow. • It includes a discussion of both formal and informal organizational elements. • It requires congruence (being in agreement) among the boxes. • Disadvantages of the Congruence Model • Lack of detail in the model may lead to the omission of critical elements.
  • 24. The Burke-Litwin Organizational Change Framework • The organizational change framework could be used as a diagnostic tool, but its primary purpose is to guide organizational change. • Burke-Litwin is a causal change model designed to show where change happens and flows through the organization. • The framework is much more complex and complete than most organizational design models. It groups twelve factors into five groups. Each group is affected by the group above and below it. • External Factors are at the top of the groups because they create the need for change. • Strategic Factors include strategy/mission, leadership, and organizational culture. • Operating Factors are structure, management practices, and systems (including policy and procedures). • Individual Factors are work unit climate, skills and tasks, motivation, and individual needs and values. • Outputs include both individual and organizational performance measures.
  • 25.
  • 26. Advantages and Disadvantages • Advantages of the Burke Litwin Organizational Change Model • It includes essential elements of human motivation, work climate, management practices, and individual needs and values. • A feedback loop shows the relationship between individual skills and actions and strategy. • A feedback loop indicates that individual needs and values affect and are driven by organizational culture. • Disadvantages of the Burke Litwin Organizational Change Model • Some will find it too difficult to grasp quickly. On the contrary, others may see the detail as an advantage.
  • 27. McKinsey Helix Model • When McKinsey discovered in 2020 that modern matrix and agility models made businesses too complicated, slow, and inflexible, they developed the helix organizational model. • They named the model on the concept of the double helix structure of a DNA molecule. It entails creating two distinct, parallel lines of accountability that are equal and intertwined but different. • The device people leadership into two sets of tasks: • The first is value creation (what gets done), overseeing day- to-day work, and satisfying the customer. This idea makes us wonder if Sandy Ogg’s Talent to Value concept influenced their thinking. Ogg’s vision is that the organization’s highest priority is to provide the best possible talent wherever the organization creates value. • The second is capabilities (how work gets done). Develop people and resources, set standards, and drive excellence. • As in matrix organizations, a person reports to two managers, but the managers are not in conflict concerning that person’s time and attention. They have separate functions. • The helix is an advanced design for most organizations, and we think to a degree experimental, but there have been early successes.
  • 28. McKinsey Offers Four Recommendations to Ensure Success Make resource planning transparent, flexible, and focused on value, requiring frequent business reviews to prioritize and allocate resources. Create an internal talent marketplace to align people to value based on supply and demand. Support leaders who are shifting their mindsets and culture. The model requires a culture of collaboration to align resources and business requirements. Balance performance management across the two roles with both providing feedback.
  • 29.
  • 30. Advantages and Disadvantages • Advantages of the Helix Model • It enables the shift of value creation to the highest return on investment. • The structure reduces complexity and increases flexibility. • It encourages faster decision-making. • It also empowers employees to act. • Disadvantages of the Helix Model • The model requires a significant change in how the organization operates in the way leaders manage. • It cannot succeed without a relinquishing of control and “a healthy dose of humility.”
  • 31. Holonic Enterprise Model • The holonic model serves global virtual organizations by allowing self-directed information and resource management linked through the internet. • The theoretical framework isn’t new: it originated in the work of Arthur Koestler in 1968, published in 1970 as Beyond Atomism and Holism—The concept of the holon 1. • Koester studied the self-organizing tendencies of social and biological systems. • He coined the word holon to describe a state where an entity is both a self-contained whole and a part of a more extensive system. Or a subsystem of a greater system. • It combines the Greek holos meaning ‘whole’ with the suffix -on ‘a particle or part.’
  • 32. The Holonic Enterprise Operates on Three Levels The Global Inter-Enterprise Collaborative Level • In the enterprise meaning of the word, companies enter a collaborative hierarchy to produce products or services. • We have traditionally regarded this as a supply chain moving from the customer to the producer. • However, when we regard the construct as a holonic enterprise, we see that each holon seeks to optimize its efficiency. It operates as an independent entity in collaboration with the extended enterprise. • A customer in the chain seeks to work with the most efficient and responsive supplier. The supplier aims to sell to the most profitable customer. • The result is an optimization of the whole collaborative inter-enterprise. The Intra-Enterprise Level • Each enterprise in the holocracy must organize its internal resources to deliver according to the coordination requirements of the collaborative cluster. • This organization requires planning and dynamic scheduling of resources, including functional reconfiguration. • A failure such as machine downtime requires a re-clustering of enterprise resources (see Task Distribution Pattern). The Machine (Physical Agent) Level • The third level manages the distributed control of the machines that perform the work. • The distribution is done through agile manufacturing using self-reconfiguring, intelligent distributed automation elements.
  • 33.
  • 34. The Flexible Organization Model • We don’t include flexible organization in our experimental organizational design models because it is not an experiment–it is a proven set of practices that innovators and lean startups use to disrupt markets. • It’s the force that accelerates the pace of organizational change. By adopting these innovative practices, your organization becomes a disrupter. • In the report Unlocking the flexible Organization: Organization Design for an Uncertain Future, Deloitte presents a model and path that traditional companies, or any other, can use to become agile and quick to market. • Traditional organizations have based their structure on organizational silos that produce repeatable results in predictable markets. They are bureaucratic, multi-layered hierarchies that resist change. • That model will no longer suffice. In today’s markets, things change quickly, and rigid models will fall behind more agile competitors. • The organization of the future is a network of self-managed teams that organize themselves around a specific outcome. • Radical interventions usually fail, but Deloitte has found a method that unleashes the agility of empowered teams without upending the organization.
  • 35.
  • 36. Advantages and Disadvantages • Advantages of the Flexible Model • It fosters creativity, teamwork, and innovative thinking. • The structure places decision-making at the point of need rather than a chain of command. • It creates a culture of empowerment and commitment to the team’s mission. • The absence of bureaucracy creates an agile, adaptive organization that thrives on change. • Disadvantages of the Flexible Model • It cannot be done too quickly or in a manner that disrupts the core. The culture needs time to adjust to autonomous teams. • It will take time to develop the managers needed in the new environment. • Traditional command and control managers may need outplacement.
  • 37. SOBAT Humanika Consulting • SOBAT is a development of the change management concept developed by Humanika Consulting in 2009, which has now become an organizational design framework that can adapt to future organizational challenges. • Divided into 2 axes, namely the first vertical, which describes the perspective of time, the one above is the future while the one below is the present. Second, Horizontal which describes the focus orientation, namely the right side is the organizational approach, and the left side is the people approach. • The red box depicts the challenges that must be answered by the organization and is always present at all times, these challenges are Sustainable Competitive Advantages/SCA (on the future time axis), Innovation (on the organizational orientation axis), Compliance (on the current time axis), and Engagement/Wellbeing (on the People orientation axis). • Meanwhile, the management process uses the Strategy, Organize, Behaviors, Accelerate, and Transform (SOBAT) approach. • SOBAT This model is very suitable for organizations that continue to respond and adapt to changes toward sustainable competitive advantage.
  • 38. Thinking, Learning, Performing, and Changing Strategic Organize Behaviors Accelerate Transform Mission & Vision, Values/Culture Competencies Business Process, Organizational structure, system, Policy, Regulation, SOP, and Technologies Leader’s Role: Coaching, mentoring, counseling HR Management, Performance and Reward Management, HR Analytics (Wicaksana, 2009) Future Present People Organization Sustainable Competitive Advantages Innovation Compliance Engagement/ Wellbeing
  • 39. Advantages and Disadvantages • Advantages of the SOBAT model • Has a time orientation perspective (future and present) and focus orientation (organization and people). • The existence of external challenges that are always present is a need for organizations to excel (SCA, Innovation, Compliance, Engagement/well-being). • In responding to challenges, the management process responds with a change management approach, SOBAT (Strategy, Organize, Behaviors, Accelerate, and Transform) • SOBAT This model is very suitable for organizations that continue to respond and adapt to changes toward sustainable competitive advantage. • Disadvantages of the SOBAT Model • Some will find it too difficult to grasp quickly. On the contrary, others may see the detail as an advantage.
  • 40. Choosing An Organizational Design Model • Choose the right partner. Check references and talk with other organizations that have worked with your potential partners. Ask for specifics on how your potential partner helped their organization. • Start with purpose and strategy. Without that solid footing, your efforts can be derailed. • Carefully consider your organizational priorities as you review your purpose and strategy. Examine all the internal and external forces that affect your business. • Consider both current and future organizational needs. Be constantly aware of how things might change. Resist the urge to go defensive to protect your current position. Instead, prepare to discover the opportunities that change will bring. • Culture is critical. If it doesn’t fit your culture, it won’t work. If you need to change your culture, get the right help, and approach culture change as essential for your organizational transformation. • Not all organizational design models will fit your situation. Consider each carefully, and don’t let a model limit what you can do. Let your analysis do the talking. • Seek compatibility in the change tools you use. For example, your project management and organizational approaches must agree, as should your culture and change management plan. • You don’t have to do everything today. Change, especially cultural change, takes time. Don’t get ahead of yourself in what you can accomplish.
  • 41. Learning and Giving for Better Indonesia www.humanikaconsulting.com