Organizational Design and Capability
Aligning Human Capital to Maximize Value
An organizational capability is a company’s ability to manage resources, such as employees, effectively to gain an advantage over competitors. The company’s organizational capabilities must focus on the business’s ability to meet customer demand and react to market changes. Organizational capabilities are anything a company does well that improves business performance and differentiates the business in the market.
Competencies tend to be at an individual level while capabilities span across an organization. Organization capabilities are critical yet intangible assets that cannot be duplicated. These assets matter more than any other when implementing strategy, yet we often do not plan for them as meticulously as other physical or financial assets. In a market survey 60 percent of C-suite executives stated building organization capabilities was a top 3 priority, but only a third of them had a plan to address this. The Center for Creative Leadership (2015) published a detailed report, Bridging the Strategy / Performance Gap, wherein the main message is that executives in the highest performing companies actively discuss leadership and organization needs during the strategy development process, not afterwards.
How We Are Different:
- Most companies have a strategy, yet many business leaders fail to discuss or consider that ‘how’ they execute is probably more important than ‘what’ they execute. Organization capabilities are truly the greatest differentiator a company can have in any market. Products, services and even business models can all be replicated and even improved by any global competitor. Capabilities cannot be copied and (more importantly) they ensure sustainable performance even during the volatile times we work and live in today.
- Our approach is to evaluate and foster the alignment of the organization to support the business strategy. Ideally, an executive team should find time during their strategic planning period and hold a series of working sessions to determine and assess their most critical capabilities inclusive of leadership bench, critical skills, strategic roles and organization design. Realistically, most businesses today have established strategic plans in place and do not have the luxury of pressing the ‘pause’ button to discuss capabilities. At a minimum, CEOs and leadership teams should determine how well the following areas are aligned with their strategy:
Culture. How consistent are our company values, behaviors and expectations with our strategy?
Leadership. Is the leadership team clear and aligned with our strategy?
Structure. Are organizational resources properly allocated to execute against the most critical properties?
Organization Processes. Do our performance, management and talent processes support our strategic direction?
Capabilities. Are we focused on developing the right skills, competencies and talent?
How We Do It:
- Sponsorship shaping
- Stakeholder analysis and barrier determination
- Communication and business engagement strategy
- Organizational capability assessments
- Training development and execution
- People, process and technology readiness assessment