I once helped a global, medium-sized company develop a new organizational model.
At the time, it had a regional model, with units for Europe, Africa, the Americas, and Asia, plus staff units such as IT, HR, Finance, Procurement, and Legal.
One executive was sceptical about the process, and compared it to a game of corporate solitaire.
In a moment of dry wit, he commented at the end of a workshop: “Somebody always ends up with IT and Africa.”
It was intended as a joke (and it resonated with the rest of the participants).
Luckily, we were able to avoid this scenario (We recommended a product-based model instead of the regional structure. This recommendation was accepted and implemented.)
But unfortunately, if you look around in most organizations, you will probably find some odd combinations of sub-units.
So imagine what would happen if they actually had formed such a unit.
What would the management team do after they established the IT+Africa unit?
Well, they might ask the poor manager of the unit to formulate a mission or mandate to clarify what the unit was supposed to do.
The manager could write:
By running the Cairo office, and thereby the Africa region, and also by providing IT services across all four regions, our mission embraces the dual challenge of maintaining IT’s global service commitments while also placing a focused spotlight on Africa’s unique market dynamics…
Or perhaps something like this:
Our mission is to synergize the global prowess of our Information Technology services with the regional focus of our African operations…
Or maybe this:
Our mission is to innovatively combine the global reach of our Information Technology services with the focused expertise of our African Regional operations…
Well, you get the point. The manager would probably struggle with this assignment.
Why would it be so difficult?
It’s because the combination is problematic.
The employees might ask: Are we now a profit-center (like the Afria regional unit) or a cost center (like the IT department)?
The statements above fail to clarify that.
But the relationship toward the other regional units would also be unclear. People in those units might suspect that the IT staff would now favor the needs of the Cairo office ahead of the needs of other regions.
This is just a hypothetical example, of course. But I think it describes a fairly common phenomenon, namely that we tend to retrofit the mission on units that have been already organized.
But if the units are illogically organized to begin with, no amount of mission-formulation can make up for that problem.
Instead, you will have to endure endless discussions about the mission, without gaining any clarity.
The solution is obvious: You need to consider the mission (or unit mandate) of each unit before — and not after — that you decide on a new organizational model.
I am not saying that you need a complete mission statement or a detailed mandate; but you need to at least specify what the unit is supposed to deliver and to whom (what I call the unit’s “function”).
Then you can test whether this function is aligned vertically and horizontally with other units. My colleague Shawn Pope and I describe how to do this in a new paper that we have written (summarized in this blog post).
On the positive side, perhaps, the clarity of a unit’s mission or mandate can serve as a litmus test for the effectiveness of the organizational model.
Ambiguity in a unit’s purpose may signal a need for redesign.