Complete Guide to HR Strategy: Organisational Design and Development (With Examples)
HR has an important role to play within the wider organisation as a strategic partner.
It’s essential for HR practitioners to be able to use their insight to drive organisational changes and play their part in organisational design.
Digital disruption and an ever-evolving workforce drive the need for changes within organisational design. Our expectations as employees are shifting and day to day processes are increasingly handed over to AI.
Within the scope of your HR strategy, you should be aligning your activities with the goals of the organisation. This allows for cohesive effort to be placed in these areas of the business, to develop the organisation towards these goals.
In this guide, we’ll take you through the organisational elements that you should address in your strategy, with concrete examples of how to do so.
Utilising Upcoming Trends in Organisational Design
Organisations now are almost unrecognisable from the organisations of just a few short years ago. The way that we define success within the organisation and the characteristics that we recognise as indicative of a positive workplace have both changed.
The following trends are already in effect and modern organisations should be pulling them into their HR strategy. These trends take time to implement in the workforce, so staggering this in advance will allow for a smooth transition.
Reskilling Workers in the Wake of AI
AI is rapidly changing the workforce, with some job roles more affected by this tech than others. A McKinsey study asserted that as many of 365 million workers (around 14% of the workforce) may need to switch roles as a result of automation.
The kinds of workers that organisations will need will change, which will impact the career paths of upcoming and existing workers. Job roles will shift, and entire careers will change because of this automation.
While this automation will save organisations money, it also allows workers to take on new roles. For this to happen, HR have to be ready to implement digitisation and also evolve the existing infrastructure.
Through your HR strategy, you should lay out how you will meet this challenge. This may include job restructuring, retraining and phased implementation of new technology. As this technology comes into play, you should already be aware of how the human capital saved in these processes will be used elsewhere.
This telecommunications giant faces serious challenges as their legacy businesses are becoming obsolete. While these traditional services and products are increasingly cut back or handled digitally, they were challenged with a talent base in need of reskilling.
The company invested $250 million on employee education and development programmes, with a further $30 million set aside annually for tuition assistance.
From January to May of 2016, they were able to retrain half of all tech management job, with almost half of these employees gaining a promotion through training.
They gave existing technicians working on legacy products the training required to work with the cloud-based solutions that drive their current business. This saved redundancies within these teams and recruitment costs for thriving areas of the business.
- 140,000 employees actively engaged with reskilling.
- Reduction of product development life cycle by 40%, as employees were already familiar with the brand as opposed to new hires.
Speed, Adaptability and Agility
Businesses today are challenged to be more adaptable and agile than ever before. The ability to move at speed and with purpose is highly prized among businesses, as this can significantly boost their profit margins.
Reallocating resources and innovating new services quickly drive increased profits for businesses. Without the framework to move quickly, their golden opportunity may just go to a competitor instead.
Within the realms of HR and organisational design, this means building in frameworks and resource pools that turn this concept into a reality. From the boardroom to the front-line, each employee has to be ready to flex their skills as required.
Through the course of your HR strategy, you should allow for periods of experimentation with different working methods. These should be different ways of reaching the same goal; consistent goals and priorities deliver increased speed even during experimentation.
Implementing these planning and communication meetings can be time consuming, but allows for faster decision making in future. Building in experts and training for new working methods also helps to combat resistance to change within management.
Centralised structures can cause delays and reduce agility, as there are more roadblocks in the way of new ideas. That’s why Whole Foods Market works on a fluid structure, which empowers employees to make decisions that benefit the store.
Team members are trained to notice trends and source products from the surrounding areas. In a traditional supermarket structure, this is the responsibility of a corporate buyer – a position far removed from the store. With the Whole Foods Market structure, teams can spot regional trends and fill gaps in their specific portion of the market.
Whole Foods Market also provide online training to educate their employees on their values and enhance their experience. Reducing the red tape around introducing new products allows them to more accurately cater for geographical demand.
- Strong employee engagement from team members, as they have more autonomy and purpose within the organisation.
- Faster deployment of new products to regional stores, capitalising on new trends.
Maximising Human Capital
Ensuring that employees can be effective within their roles will maximise the human capital of the business. To assess this, it’s important for HR practitioners to undertake regular reviews of job roles.
This gives the organisation a boost of productivity by reshuffling responsibilities to those that can handle them best. Those that are bogged down with tasks they’re not skilled in handling or that would be that would be expedited by other departments aren’t being as productive as they could be.
By assessing this and restructuring roles where appropriate, busy employees can find that their schedules are eased to offer them better balance in their role. This can also lead to a higher rate of employee engagement, as they enjoy their role and relevant tasks.
For employers, this can allow for better productivity, without the need to hire new members of staff. Exploring and experimenting with these responsibilities can be the key to a better workplace.
Restructuring can have a negative connotation, as some employees believe this to be synonymous with down-sizing or financial issues. Reframe this as a way to more appropriately delegate tasks and achieve better job satisfaction to mitigate this negative view.
In the current economic climate, it’s essential to get the most from the existing human capital within the business. This need is really driving this trend, which can create huge savings for an employer.
New Ways of Working
Flexible working, scrums, virtual conferencing and new ways of working have the potential to transform the workplace. These shouldn’t be dismissed out of hand, as they can save employers money and make employers happier.
While each of these organisational changes will take a period of experimentation and implementation, the results can justify any lost productivity. Not every one of these will be effective for your organisation, but piloting schemes can indicate which will.
If you’re aware of new trends or technology that your organisation isn’t using, then this strategy document is your place to make a case for them.
Use this space to outline how this could be implemented and the costs that are associated with the initial implementation. Balance these costs with projections of tangible improvements that will be made to the organisation.
Aligning with Organisational Goals
The goals of the organisation should be strategically assisted through HR’s policies and schedule. Starting with the overarching goals will inform you of the direction that you should be going in, then you can use your strategy roadmap to get there.
If possible, you want to ensure that you have the relevant goals for an extended period of time, as these changes can’t happen overnight. Changing too quickly can be detrimental to the employee experience, as employees can feel too quickly uprooted from their original roles.
The core values of the business inform decisions throughout the organisation. These aren’t simply intangible ideas, they should inform how employees behave in their role as representatives for the business.
From time to time, organisations shift and it’s necessary to alter these core values alongside this change. For example, shifting from traditional working methods to more modern ones may inspire core values of innovation and forward thinking.
This requires updates to company literature, as well as sessions to instil these new values in the workforce. If you want each employee to act consistently and understand the organisation, then it’s essential to communicate these core values.
The process of change management can have a positive effect on the employee experience; without this diligence, the opposite is possible. This is part of what makes employees feel secure and happy within their roles, even when there are shifting factors to contend with.
Managing this change well means clear communications at the right time, involving the right internal stakeholders. Time and time again, we’ve seen layoffs and mergers leading to strikes, mass resignations and lost productivity. To prevent workers from feeling threatened by these changes, it’s important to manage their perception of these changes.
Within your HR strategy, there may be large-scale changes in the pipeline for the future. As well as the logistics surrounding these changes, you should also consider the impact that they will have on employees.
Mergers and restructuring can cause employees to worry about the stability of their job, so consider how you can alleviate this fear through sound communication.
Internal and Consumer Feedback
Responding to feedback will also position your department as a strategic partner within the business. Internal feedback can allow you to put measures in place to ease workflow issues and give required training.
If a department is slowing down productivity, with projects becoming bottle-necked, then this can be a clear area for improvement. More staff, better resources and improved training can all be cemented in your strategy to develop this area of the business.
If you do serve external consumers, then this gives you another area to examine. If these consumers have areas of concern, such as long wait times or poor customer service, then you can develop the roles responsible for this too.
Surveying staff will also inform this strategy, as you respond to their requirements and concerns. Gathering this data in advance will allow you to use it as a basis for organisational changes. Understanding how employees feel will highlight where improvements could be made to retain staff.
Developing Organisation Culture
Shifting the culture of your workplace may be necessary to better retain staff, attract new candidates and put your organisation on the map. Again, this is a longer process to shift the overall feeling of the workplace.
Careful planning is required to create a culture shift that doesn’t alienate existing workers. With the right planning and execution, the organisation can shift directions without leaving staff members behind. Communicating the new foals and values is just the start, as HR has to get buy in from managers and then employees.
Within the context of your strategy, you can create a real plan to change this intangible aspect of the working relationship. Many organisational changes should effect this kind of cultural change, as employees understand the values behind the shift.
New ownership or mergers can be catalysts for this change, as the C-suite have a specific culture in mind for the organisation. This has to be handled well to promote buy in from staff, otherwise this can be a change too many and prompt a higher turnover.
The CIPD provides a fantastic checklist for HR practitioners to bring in this kind of culture shift. Following this allows for cultural changes to be made in a logical and helpful manner.
Actioning the Strategy
At the end of this section of your HR strategy, you should have key actions and deliverables to call upon. Condense these at the end of the strategy to refer to during the course of the delivery. If key steps are missed or delayed, then you can work to remedy this as soon as possible, to keep the rest of the strategy on track.
Assigning roles and responsibilities can also spread these actions beyond the HR department. Managers and other employees should be involved in these processes, so ensure that they carve out time in their schedule to complete their actions.
This creates an open and transparent strategy, in which each employee knows what they must do and when they must do so by.
Examples of Organisational Design and Development Strategies
To inspire you to create a strategy of your own, you can use these examples as starting points and templates:
- Rochdale Council: Organisational Development Plan
- Coventry and Warwickshire Partnership: Workforce & Organisational Development Strategy
- University of Glasgow: People & Organisational Development Strategy
Working to maintain and improve the organisational design of your business should be a key factor in your HR strategy. Using your HR knowledge to lay a road-map to organisational goals gives you an opportunity to join the conversation in the boardroom, sharing expertise with the C-suite.