HR professionals should be protagonists in organizational design

Their main focus is to ensure that business objectives are achieved efficiently, effectively, ethically, and responsibly.

Original post made on 07/18/2024, on the Melhor RH platform: by Fabiano Rangel

In the current dynamics of society and the market, characterized by constant economic, social, environmental, cultural, and technological changes, companies face a scenario of unpredictability and growing complexity.

In this context, Human Resources professionals and organizational leadership play a crucial role in the development of organizational design. This field of study and application in corporate management is essential in structuring relationships, allocating resources, and defining responsibilities.

According to Gartner's research on the Top 5 Priorities for HR Leaders in 2024, which surveyed 800 HR executives, 46% consider organizational design a priority. However, only 19% report that their teams can change direction according to the company's needs. Additionally, less than 40% of employees recognize that they are working on the right tasks in terms of generating value for the business. The data highlights the systemic impact on the distribution of resources and energies within organizations, often allocated for a "physiological" self-sustenance of structures and activities that add little value to people and the business.

Although organizational design is considered a science of business administration, we do not have a single model. There are frameworks and guidelines that provide pathways to evaluate the efficiency and maturity of organizational design. However, as relevant as it is to assess the current design, it is crucial to determine its responsiveness to three basic questions: When will our business context change? How will it be impacted? Where will the impulses for change come from? The only easy and somewhat certain answer is that the business context will continue to change.

The case of the bridge over the Choluteca River in Honduras teaches us about the realities and the difference between developing resilient and robust structures. Very robust structures can resist to the point of becoming obsolete due to external factors. On the other hand, resilient structures are more adaptive; instead of resisting, they seek to learn from the context and evolve with new inputs. Returning to the case of the bridge, it was built by Japanese engineers experienced in natural disasters and received significant investments to be hurricane and flood-proof. Its robustness was such that the bridge "survived" Hurricane Mitch in the 1980s and remains intact today. However, Mitch's force was so great that it altered the riverbed's location, and today the bridge leads nowhere.

Assuming that organizational design is a composition of layers that transversely interconnect, consolidating internal governance within companies, among its many links, we have:

• Guidelines, Policies, and Processes: They form the basic principles of beliefs and values regarding the internal context of companies, reflect the organizational culture, and directly influence how people think, relate, and act internally and externally based on the business context.
• Structures of Responsibilities: These define the company's composition in business units, departments, management, and supervision, as well as the number of layers and levels of hierarchy, roles, and competencies. The greater the number of layers, the higher the risks of forming organizational "micro silos" and channeling energy toward internal self-preservation. This complicates the processes of adaptation, change, and resilience, forcing the past to dominate the present and hijacking the future.
• Structures of People: These define positions, roles, and compensation in conjunction with the structure of responsibilities. This is a process guided by methodologies, and together, they form a relevant core in the expression of organizational design. They should be coordinated with maximum diligence and clear guidelines to avoid assignments and delegations becoming dysfunctional while meeting the challenge of being responsive to the need for constant updates and adaptations. Dysfunctional structures are detrimental to organizational efficiency and a cause of internal tension, which also compromises people's mental health.
• People Management Processes: These begin with how to select and hire and continue through institutional practices of evaluating, recognizing, working, and developing. All these processes reflect various aspects of organizational design and culture and practically materialize internal levels of trust and expected qualification complexity. Moreover, they directly influence cultural traits of conduct, such as: competitive vs cooperative; creative vs standardized; bureaucratic vs autonomous; and convenient vs engaged. Impulses and adjustments in this layer directly reflect the prevalence of internal profiles.
• Physical Structures: These determine the "drives" for choosing the workplace as a whole, shape (capex/opex), location, access, layout, furniture, environment, and everything available for people to work with. This presents numerous elements about organizational design and culture. In daily life, everything communicates!
• Embedded Technology: The "mindset" and availability to invest in technology in terms of quantity and quality, decisions about who and how technologies are made available, and the choice of acquisition form between capex or opex are strong expressions of the business's challenges and adaptability and integrate the prevailing relationships within organizational design.
• Rites and Rituals: Although this is often the most "intangible" part of organizations, it is easily observed in how people present themselves, behave, relate, what they value, celebrate, and how they affect each other. All this results from all other elements and tacitly composes organizational design.
• Work Models: These are directly influenced by all the previous elements. Therefore, assessing the best model - on-site, remote, or hybrid - cannot be done in isolation or centered on the understanding of a few people. This is a decision that expresses and consolidates various tangible elements of organizational design.

A significant part of all these elements integrates HR subsystems and processes or affects people's daily lives, relationships, coexistence, and conditions for better work development in companies. This is why HR professionals need to be at the forefront, positively caring for and influencing all these processes.

Organizational design must be intentional and continuous. It should allow the company to organize and manage the present without losing sight of the future. A common mistake is the intensity of energy placed in the present and based on reproducing what we have learned from the past, where the business continues to generate cash now but transferring dysfunctions, bureaucracies, and sunk costs that may hijack future competitiveness, eroding value unnoticed.

In this context, it is essential for HR professionals to be protagonists, taking on roles, influencing, and acting practically so that the organization has a coherent, consistent, functional, flexible, and adaptive design across all organizational design elements, allowing the development of organizations that grow with people.