Organizations are driven to change in response to market pressures, disruptive technologies, new ventures, and other sundry influences. Leaders must then reconfigure the organizational landscapes.
Redesigning an organization for the future is hard work. Top of mind — where will people add the most value and who will have which role.
As leaders draw a new map for the future, they are naturally concerned with how to reward loyal team members who have paved the way. So, they begin deciding where people will sit in the new organization even before they decide on the strategy going forward.
This is a colossal mistake.
The best leaders resist the urge to place people on the org chart before they know the strategy. They focus on deciding what is most important and where investments in resources will be made. Once they’ve constructed the game plan to achieve the short and long-term goals, then comes the matter of who should be doing what. Not the other way around.
A leader who puts people into positions without a clear connection to a larger strategy is putting the cart in front of the horse. In doing so, they make everything less effective.
In that scenario, strategy emerges as a result of who can do what rather than what is best for the enterprise. The rule of thumb is to follow the following sequence whenever reorganizing anything: Strategy, structure, and people.
Once the strategy has been clarified, the structures necessary to execute on that plan need to be put in place. Structures might include the number of teams needed and which leadership roles are required, not to mention the design of processes needed to allow efficient execution of the strategy.
Finally, once strategy and structure are set, the choice of which people are best suited for particular roles is the natural conclusion. Sometimes, this means a favored team member may not have a seat or that new talent will be needed to execute and achieve the desired outcomes.
Following the correct sequence of strategy to structure to people enables for objective and quality decisions regarding any reorganization. Doing things in the right order promotes clear thinking. Don’t attempt to put the house in order without putting strategy first.
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