Designing Organizations for Growth: The Human Resource Contribution
Mohrman, Susan Albers, Human Resource Planning
Understanding organization design approaches for growth, leading design processes, and building the capabilities for growth into the enterprise are critical strategic contributions for HR professionals. The organization's design configures resources to support the growth strategy, and provides the context in which the scarce talent of the organization operates. To play this new role, HR will have to develop new skills in organization design, play new roles in helping the business think through how it should be structured, and build growth routines into the organization. This article explores the key issues raised in designing an enterprise for rapid growth and how HR should contribute to this.
Moving Beyond Talent Management
The challenge of rapid growth faces most companies in today's highly interdependent, competitive global economy. HR is staring at an incredible opportunity to increase its impact on organizational performance and become a true strategic partner by contributing to the organization and work design challenges that enable growth. This is an important focus for HR, because talent management is inextricably linked to organization and work systems design, in a way that each constrains the other. By expanding its focus to include organization and work design, HR multiplies its influence on both people and business performance.
Growth agendas present a compelling need for this expanded HR contribution. Whether seeking organic growth in new markets, expanding through developing innovative products, services, and business models, or growing through acquisitions and partnerships, companies face the need to find and integrate new resources, realign existing ones, and reconfigure core design features to handle the increased size and complexity that accompanies rapid growth. Different growth scenarios present different challenges. Thus, gaining organization design expertise and leadership is a complicated task, but it can make an appreciable difference in organization effectiveness.
Human resource functions naturally have honed in on the formidable talent issues inherent in growth, including hiring and assimilating large numbers of people, reaching new talent pools, developing existing employees to provide required new knowledge and skills, and addressing the needs for a speedy expansion of leadership capability. Particularly in the era of current and predicted talent shortages, the talent strategies associated with growth must be robust.
To carry out a role as a true strategic business partner, and to manage talent proactively, HR must push beyond its comfort zone and traditional functional domains to help fashion the changing contexts in which talent carries out its work. Providing leadership in designing the organization for growth is an appropriate role for HR because the organization's design provides the context in which the human resources of the firm function. A poorly designed organization is like a colander: You can pour top-level talent and hours of effort into it, but much of this capacity will leak through the holes or be used up trying to plug the holes? A well-designed organization uses its talent effectively, which limits the waste that occurs when valuable talent hours are used poorly, avoiding the frustration, cynicism, and unnecessary withdrawal of the talent that HR works so hard to build.
Assuming a leadership role in organization and work design is not a natural extension of the current roles of many HR departments. In fact, most HR functions have been bystanders over the past decades. The vast majority of HR professionals have not learned the essential knowledge to be players on this field of organization design. Yet, rapid change has made organizational agility essential, and demanding shareholders have made growth imperative. Growth has become increasingly more difficult to achieve and manage, and people are often the passive recipients of what is left after the "experts" have come in to help with the restructuring, or executives have drawn the new organization design on a napkin. …