Sometimes, people seem to think about organization design principles as abstract, theoretical concepts with no immediate relevance to how they work.
This is unfortunate. The principles may be abstract, but they can have a big impact, if they are applied to improve the design of organizations, and thereby influence the way we work, who we collaborate with, as well as the the quality of the outputs that we produce.
But the way organization design is taught makes it difficult to see the relevance of the topic, and does little to increase practical skills in applying the principles.
How then, can we make these principles “come alive” so that it becomes easier to understand how they can be used to improve the design of organizations?
One powerful method is by running simulations and exercises. I created a new simulation earlier this Fall together with two other consultants, Tido Eger and Tore Christiansen.
Last week we were able to pilot test the simulation with 90 enthusiastic students at the Norwegian School of Economics who follow a course taught by associate professor Jarle Bastesen.
Later we plan to use the simulation with executives as part of our client projects.
Here’s how we did it. The key concept that we want to illustrate was the relationship between the formal structure and the work processes in a firm. We used a pharmaceutical company as an example.
After a brief introduction where I explained the purpose, the students were divided into groups and were each given an “employee badge”.
They were told that the company was currently organized by functions (R&D, Product Development, Manufacturing, and so on), but that management wanted to introduce a more process based structure.
On the badges we had printed all the information they needed to configure themselves according to a process based structure:
- Their current unit
- Their current role
- Who they would need information from in order to perform their role (in the new organization)
They were then given 30 minutes to decide who should be part of which team in the new organization. The key principle we intended to illustrate was grouping based on work process interdependencies.
During the de-briefing afterwards, none of the groups stated that they felt they had been able to come up with a very good solution, even though this was a highly simplified case, compared to a real world re-design process.
Unlike in a real situation, they had all the information necessary. However, we did include some dilemmas that would require negotiation between the teams and trade-offs.
The feedback from the students was very positive. One student sent an e-mail afterwards stating: “This was interesting and fun, and something completely new!”
Because of the positive feedback, my long term vision is to develop a course that is based entirely on simulations with the only lecturing being the introduction and the de-briefing. But because it takes a lot of time to develop and test each simulation, this may take a few years to realize.
What we will do during the coming week is to analyze the results more carefully. We asked each team to record the team configuration, so this means we can compare the results across the groups and also with an “optimal” configuration that we develop by means of a mathematical algorithm that my colleagues will develop.
P.S. Lecturers who use the textbook I have written will have free access to the materials required to run this simulation. The materials will be posted to the book site.