robot human final

Implementing AI: The initial steps

ChatGPT was launched in 2022. In the beginning, it was mainly individual employees who adopted the tool, sometimes secretly using the tool to enhance their own productivity.

These days, surveys show that large firms are starting to adopt ChatGPT and other similar tools in a more official and systematic fashion.

Where should they begin? How do you estimate the potential gains from implementing AI in different areas, and, more broadly, gain a better understanding of the organizational implications?

This is a question we have been discussing in Reconfig over the last few months internally as well as with some of our partners (consultants who are helping clients implement AI) and external experts.

As a result, we recently launched a new set of features that complement the existing capability of the tool to support organization design processes.

The new features are based on three key insights.

 

Getting the unit of analysis correct is critical

The first relates to the “unit of analysis.” We see that some consultants start with an analysis of jobs (or “job families”) to estimate the potential productivity gains from automation or augmentation.

Instead, we focus on activities or work processes. This is because a single job may consist of a number of different activities, only some of which can be automated, and most of those can only be partially automated. Or vice versa, the automation of a single activity may have an impact on multiple jobs. So Reconfig’s key unit of analysis is the activity with a drill-down into specific tasks within the activity.

 

Internal company data are needed to get actionable insights

Second, to estimate the potential gains, there are two main approaches. The first is to look at external data (There are studies that estimate the augmentation and automation potential of AI for generic job categories and/or activities.) The other approach is to use internal data about the time that is spent on different activities and derive scenarios for productivity gains given different levels of augmentation and automation.

We decided to rely on both: First, we use large language models (LLM) to analyse the activities of the organization and produce well reasoned estimates for the likely percentage improvement of generative AI in each activity. These estimates should be reviewed by managers and internal experts and adjusted based on their knowledge and experience.

Then, Reconfig combines these estimates with the activity profiles of the employees, which state how much time each employee is spending on each activity. These data are then used to provide a detailed breakdown of the potential productivity gain from generative AI per employee, per team and for the organization as a whole.

 

When to move from generative AI tools to agents

Third, organizations will need to move beyond the generic language models such as ChatGPT to realize the potential of AI. We agree with industry observers that the next phase will consist of building domain-specific systems that in some cases will fully automate processes. The most typical example is an AI agent that is trained specifically for a clearly defined and targeted role in the organization.

You can think of an AI Agent as having a really efficient remote employee that you can only reach digitally. You ask your agent to perform a task, it gets working on it and will query you when input or verification is needed. You then sign off on the final result before the task is completed and you can use the result. In this manner, the agents could even be placed on your organization chart as a valuable part of your team.

 

How we can help

We would be happy to give you a demo. During the demo, we will show you how you can use Reconfig to get tailored recommendations for implementing AI agents and to evaluate the effects of the changes at the individual, team and organizational level.

matrix orgg right size

Three Misconceptions about the Matrix Organization

What is a matrix organization?

Are matrix structures inevitable in complex organizations?

Unfortunately, there is a lot of confusion about this.

One reason is that textbooks and articles fail to provide good definitions.

A book I just read proclaims that the matrix “is an excellent choice” for higher education institutions. But it doesn’t describe in any detail what it is.

Consultants and “thought leaders” who recommend this solution aren’t very precise, either.

This is one reason why some misconceptions have taken hold.

Let me address the three most common ones.

Misconception #1: We are talking about the same thing when we use the term “matrix organization”.

Consider a fairly typical re-design process in an organization. A project team or working group is considering alternative organizational models. They first look at a product based model:

…they may then compare it to a second alternative, such as a geographical model:

…but then, somebody may ask why they can’t combine them, and they may produce a drawing like this one:

It might be a good idea to combine two different dimensions.

But this type of illustration is not very helpful in itself. The reason is that it leaves a lot of questions open to interpretation.

What IS it supposed to show?

  • Does it mean that the units that are connected by the lines are supposed to collaborate, and if so, about what and in what manner?
  • Does it mean that people in these units will participate in joint meetings, teams or projects?
  • Does it mean that these units will share the same goals and KPIs?
  • Does it mean that people, somewhere (usually not shown on this type of chart) will report to two or more managers? (If so, who does this apply to – will everybody have two bosses, or just some people at a specific level of the organization? )

Or all of the above, or none of the above?

It wasn’t always like this.

When the matrix solution was first introduced, it was relatively clear what it entailed. But it has gradually become a very ambiguous concept.

There are also multiple variations of it, and these variations are usually not described or discussed.

As the author Stephen Haeckel put it, ambiguity is good for many activities in life.

It’s a good thing if you are writing a poem or creating an abstract painting.

But it is the mortal enemy of good systems design.

So the kind of drawing that you see above is not very helpful – unless we specify what we mean.

To do that, we need to use a different format, we need different types of illustrations – and a more precise vocabulary.

Only then will we be able to explore what the actual design options are and identify the risks and limitations of the different alternatives. Only then will we be able to create a common understanding among those who are involved in making the decision about a new organizational model.

Misconception #2: “The main challenge of the matrix is that people have to work for more than one boss”

It is fairly common to hear that the main problem with the matrix is that it’s difficult to work for – or report to – multiple managers.

However, there are few organizations today, matrix or not, where you only relate to one manager.

In most organizations, regardless of reporting structure, you work for multiple managers, participate in teams and projects, contribute to cross-functional improvement initiatives, and so on.

This can be time-consuming for sure, but it is not necessarily the main problem.

What is problematical, however, is reporting to two or more managers if the goals and KPIs that these managers have been assigned are in conflict with each other.

This may be the case if the units that the managers belong to have conflicting mandates or overlapping jurisdictions, something that happens relatively frequently in large and complex organizations.

And installing matrix reporting lines doesn’t do much to resolve this problem. On the contrary, it will probably make it worse.

(If you want want more detail, there’s a piece of research that confirms this point. You can find it here.)

The implication is: If you have a matrix structure that doesn’t work, you don’t need to abandon it completely. With a few modifications (aimed at clarifying roles and removing overlaps in unit mandates) it may become a lot more effective…

….which leads me to my third point:

Misconception #3: “The choice is either/or”

Some proponents of the matrix solution basically say: “Either you have a modern organization with a matrix, or you are old-fashioned and have a silo organization”.

In my opinion, this is a false dichotomy.

It is based on a confusion between two different things – the formal reporting structure, or who should be the line manager, and the extent of information sharing and collaboration across units.

It’s false dichotomy because you can of course have extensive collaboration across units even in an organization where every employee has only one line manager.

The matrix is one type of multi-dimensional organization, where you have different units such as product units and geographical units at the same level in the organization.

However, as I describe in my book, there are other organizational models that also have this feature and that look similar on paper, but that do not assume that employees report to two bosses and do not require overlapping goals and KPIs (see a brief summary of the line of reasoning in this blog post).

The matrix organization is also quite rare (if you define it as I do – “a two-boss reporting structure”).

During the last 7 or 8 years, I have interviewed managers in about 40 different firms.

Only 2 or 3 of these firms had a matrix with a two boss reporting structure, and in these cases, it applied to a relatively small group of people, typically middle managers at one specific level or in one part of the organization.

So at least in my experience, a formal matrix structure is not very common.

However, what is quite common is something I call a hidden matrix.

By that I mean governance processes and authority relationships that cross the formal units, but which are not shown on the official organization chart (and that are usually not deliberate).

This is an important issue, which I will discuss in my next blog post.

简化组织

The Political Test of a Proposed New Organizational Model

 A few years go, I was assisting a firm in developing a new organizational model, working together with a colleague.

We first identified key design criteria, based on interviews with more than 40 managers.

The most important criterion was to design an organization that would help the firm achieve growth for one of the key products. It was also important to find a model with the right “balance” between different business areas.

At the same time, there was a need to simplify the structure, and reduce the number of management layers.

We then started developing a couple of alternative models.

It was pretty hard work, trying to identify a model that would meet the different criteria, while avoiding an increase in costs. But one evening, in a meeting with the VP of Human Resources, we thought we had found at least one possible solution.

We went through the criteria and could check off one after another. We concluded the meeting on an optimistic note.

But as we were about to leave, the VP remarked:

That question re-framed the discussion. Suddenly we were not talking about what you could call the “rational” criteria, but about the impact on individuals and whether the proposed model would get the support of a large enough coalition to be accepted (and once accepted, whether it would be implemented with some level of enthusiasm).

So we looked at the model, and considered the potential impact for each of those who currently held leadership position (and who would be candidates for key positions in the new model).

A simple count suggested that the balance would be negative: A lot fewer would move up than down in the management hierarchy.

So we went back to the drawing board. And in the end, we did produce three alternative models that were more attractive, both from the “rational”, and from the political side. One of the proposed models was then selected by the CEO. The subsequent implementation of the model went quicker than we had anticipated.

* * *

One word of caution here: I am not suggesting that you should “start with the people” in the sense that you should tailor the design to the personal interests of the current members of the management team.

The main design criteria should be derived from the strategy of the firm (see my book for a detailed description of a methodology you can use for this purpose). 

The political test is an additional step that you carry out, once you have a potential solution that fulfills the main requirements, and satisfies the key design criteria.

But it’s a step that you shouldn’t skip– if you want your proposed model to be implemented.

Corporate-solitaire-2-768x768

Why you can’t retrofit a mission

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 skeptical 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:

Or perhaps something like this:

Or maybe this:

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.

NOW OR LATER 5

How do you know whether your organization needs a re-design?

One of the most difficult – and most fundamental – tasks for a business leader is to recognize whether it’s time to introduce a change now – such as a re-design of the formal structure –and whether it is best to wait and do it later.

If you do it too early – before there is a real need – there may not be sufficiently strong momentum to carry the change through, or you simply waste time and money introducing a change that addresses a problem that does not really exist.

If you do it too late, you miss out on the potential benefits that the change could have brought. Key employees may leave as they become frustrated with the lack of resolution of important issues. You may even loose out to competitors who are already making the required adjustments in their respective organizations.

One may err both ways, but most of the leaders I have worked with have been rather cautious people, so at least in my personal experience, waiting too long seems to be the main risk.

So the key question becomes: How do you know when the organization is in need of – and ready for – a re-design?

The first thing to realize is that although organization design decisions are made by senior managers, senior managers rarely have a complete picture of what is going on in their organization. So it’s crucial to create a good understanding of the current situation and consider how people at various levels of the organization view the current challenges.

At the same time, one usually cannot ask people directly about whether it’s time for a change or what their preferred model would be. Or rather, one can certainly ask, but one may not know whether one can confide in the results.

Organization design is about the context of work, which can either hinder or faciltiate the achievement of key organizational objectives. The influence of organization design factors is not always obvious, however.

It’s a bit like asking customers what features they want in a future product. Some customer may be able to answer but many won’t be able to imagine what the features should be or even why they need the product at all before they have seen and tried using it.

In addition, there’s the political issue: Most leaders are aware that the opinions that are communicated may be colored by the personal interests of the people that voice them. This is particularly important in organization design because any proposed change will typically influence the roles and career oppurtunities of the very same people that are involved in the process.

At the same time, it is possible to infer from other information that we collect whether there is a need for a re-design. This requires relevant data and getting some support from people with skills in data analysis and diagnosis.

There’s a range of information sources available in most organizations that one should make use of. First of all, one should look at the data that is already being collected. I have found that the results from employee surveys, customer feedback, and cost benchmarking exercises often point to challenges that can be traced back to organization design choices. Yet many companies fail to utilize the information they already have when they consider a re-design.

How we interpret the quantitative data is still a somewhat subjective process. In more well established, scientifically based professions, there are norms that one can rely on in interpreting quantitative data. A physician knows what the range of normal blood pressure is, or the typical reading for an infection indicator, and can use this knowledge to decide whether there is a need for treatment. Yet as Elliott Jaques once pointed out, we are not at the stage where we have this type of knowledge about organizational indicators.

However, one can also turn it around: Instead of looking for an objective indicator, one may consider these types of judgments as relative. For example, if you know which strategic goals your organization has set, you can then ask what capabilities you need to achieve these objectives, and to what extent the current organizational structure facilitates or hinders the development of these capabilities (If you want a more specific example, look up on page 76 of my book where I show how such assessments can be carried out.)

The best people to answer these kinds of questions are mid-level managers and employees in key positions. They are the ones who feel the consequences of the current design and who can best judge the prospects for achieving the strategic goals that top management has set.

It is possible, in this manner, to build a fairly solid foundation for making a decision. There will always be an element of personal judgment in these cases, but the quality of the judgment will be enhanced significantly if is informed by data that is collected and analyzed in a systematic manner.

Org design

Imagining an Alternative Future

You cannot re-design an organization without thinking about the future.

Professor Georges Romme (University of Eindhoven) has an elegant way of putting it. He says that design is “inquiry into systems that do not yet exist”.

This holds true whether we design an organization from scratch or whether we adjust an existing organization.

Even in the latter case, the adjustment is based on assumptions about the future (e.g., whether customers will continue to buy our product, or whether the same technologies will continue to dominate).

But there are at least two major challenges with designing for the future.

The most obvious one is that the future is uncertain. We know what we have today (or at least we can collect information and find out what we have). So with the right tools and techniques, we can optimize based on the current situation.

But there are many scenarios for how the future will pan out. How can we design an organization when we don’t know what will happen?

The main proposal here is that we design a flexible organization, one that can adapt to different circumstances (e.g., see this blog post).

The second challenge is a psychological one. The current situation dominates our thinking. We have become accustomed to the way the current organization works.

It takes effort to imagine that the organization could look differently. We may even suffer from so-called “status quo bias” – we are emotionally attached to the present and afraid of change.

There are many strategies and interventions have been proposed to counter these challenges. 

I find Russell Ackoff’s idealized design approach particularly intriguing.

His basic idea was that we should design the organization from scratch, rather than extent the present model. But at the same time, he did not advocate that we should try to predict the future.

His recommendation was that we ask ourselves what the organization ideally would look like, if it was designed anew today.

According to Ackoff, we do this by formulating a set of specifications, just like we would when asking an architect to design a house for us. For an organization, the specifications may be the overall mission, broken down into more detailed requirements or desired outcomes (also see my recent blog post on unit mandates).

Once we have a common understanding of what we want, we can then gradually introduce constraints so that that it becomes a model that we are able to implement.

See this video (duration: 28 minutes, it’s part of a series) for further information. I would guess that the video is from the early 1980’s – but Ackoff was way ahead of his time – this is really “design thinking”!

By the way, Ackoff recommended the same approach for education. He didn’t like the use of case studies, for example; he said that they only lead to discussions about superficial features of existing organizations. Here too, his proposal was to ask students to design ideal systems instead of modifying existing ones. 

However, I don’t think idealized design is the best approach in all situations.

It seems well suited for situations when performance is far below expectations, or when there is a radical change in strategy, triggered by external changes. In these situations, it may be necessary to start from a blank slate and re-imagine the whole system that you are dealing with.

But the majority of re-designs occur in fairly well-managed organizations and in situations with only modest strategic shifts. Of course, we should still try to come up with a future-oriented organizational model, but we may do that improving or reconfiguring the current organization rather than by starting from scratch.

But even here – for a more limited area (say, a particular unit or business process), one can still generate more creative solutions by asking what the ideal solution would be and by working backward from there to the current situation, instead of extrapolating from the current situation into the future.

I would also add that even if we use idealized design, it does not imply that we can ignore an analysis of the current organization. As I mentioned, even Ackoff agreed that you have to (gradually) take into account technical and practical constraints to find a solution that you can implement.

Being future-oriented does not imply that you ignore the current realities, only that you temporarily free yourself from them when thinking about potential solutions.

sustainability org design

Sustainability and Organization Design: Is there a Connection?

I have written more than 100 blogposts, covering a wide range of topics related to organization design.

But so far, I have not tackled the issue of sustainability.

I have hesitated, I must admit, because so far, I haven’t seen anything new.

Of course, to implement a sustainability strategy, a firm will have to make organizational changes, including structural ones.

The changes are often difficult to implement (see this and this article). 

But the repertoire of management techniques is a familiar one, and consists in such things as setting goals, defining responsibilities, and aligning the incentives with the goals.

 The things you would do to get any strategy implemented.

 But there might indeed be something unique about sustainability as a challenge.  

 I was reminded of this recently while reading the book “Mission capitalism”, written by Mariana Mazzucato, professor in economics at University College London.

 Mazzucato is characterized as “left-wing” by some commentators but I think most of her proposals will be viewed as sensible to people across the political spectrum.    

 Her first point is that to tackle climate change and other sustainability problems, we can learn from how grand challenges have been tackled before.

 So in the book, she describes how Preseident Kennendey established the mission to put a man on the moon.

 She explains in some detail how NASA handled this challenge from a leadership and organizational point of view.

 And this is where it gets interesting.

 It was not enough to create technological innovations: NASA had to radically re-design its organization as well.  

 Among other things, NASA had to ensure sufficient coordination across different units and sufficient communication across vertical layers, as well as effective collaboration with suppliers.

 This had to be done in a system of 300.000 people. 

 The organization was re-designed into program offices and centers. Centralized planning was combined with decentralized project execution. Many innovations in engineering management were also introduced.

 I was curious to find this definition of systems management, provided by George Mueller (the then head of the office of Manned Space Flight):

It is almost as if he describes the concept of an organizational digital twin, 60 years before the term was coined. 

(By the way, also in more modern times, NASA’s organization has been examined by researchers, e.g., see this study). 

But back to my earlier point: What Mariana Mazzucato is saying is that organizational innovation is critical to handle grand challenges.    

In particular, she argues that governmental agencies need to pursue bolder and riskier goals, and create more dynamic internal structures to implement them. 

A second point she makes, which is also related to organization design, has to do with the use of missions-oriented management. Here, she is not so much thinking of missions as “organizational purpose” (as we do in our field), but as the big goals that must be accomplished to handle a particular challenge (say, a plastic-free ocean).   

The key principle is to define the missions so that the outcome is clear, while allowing different types of solutions. As she writes in an article (Mazzucato, 2018, p. 811):

Although Mazzucato is mainly concerned with how the government can practice such mission-oriented policies at a macro level, her example from NASA also shows that this is relevant at a more micro level.

 For example, a key element of the Apollo program was to specify the goals but allow internal units (as well as suppliers) to come up with the solutions.

 We can ask ourselves how such a model can be implemented within an organization. 

 As an example, if “A plastic-free ocean” is defined as a key mission at the societal level, then it seems clear that this macro-level mission must be broken down into company and even product-specific missions, for example, “Plastics free packaging for our consumer products”.

 And as with a mission at the societal level, we of course need to break it down into more specific requirements – and ensure that we have the organization in place to realize it.  

 Image by Freepik

problem

Why is it so difficult to aligh the structure with the strategy?

One of the key ideas in organization design is to “align the organization with the strategy”.

What does this mean?

The key assumption is that there is no “one size fits all”. So different strategies require different organizational designs to succeed.

Most people would accept that viewpoint.

It turns out, however, that it’s difficult to do this in practice. A surprising number of firms appear to have an organization that is poorly aligned with their strategy.

A well-known study of this phenomenon was carried out by Nithin Nohria and Sumantra Ghoshal back in 1993. They looked at 41 global firms, and compared the actual organization with what you would expect, given the requirements of the firm’s business environment.

They found that only 17 of the 41 firms displayed “environment-structure match”. So, for example, some firms would have a highly decentralized structure, despite being in a type of market that demanded a high degree of global standardization.

Other studies have come to similar conclusions.

There are several possible explanations for this result.

One is that the managers simply don’t think about strategy and organization at the same time. Maybe they have a strategy session in February. and do the annual reshuffling in August, without connecting the two.

Or perhaps different internal groups (e.g., corporate strategy versus HR people) support these two processes, and that they don’t coordinate very well.

Another possibility is that managers intend to align the organization with the strategy, but don’t know how to do it. It’s not easy. In large firms, there are usually multiple – and sometimes even conflicting – strategic goals. So the first task is often to clarify which of several goals we should prioritize when we design the organization.

A third explanation is that there are time delays that prevent organizations from succeeding at this in the short term.

Lex Donaldson, a leading expert, has found that it sometimes takes several years to correct misalignment between strategy and structure.

The reason is probably that it’s hard to convince stakeholders of the need for change, before performance starts to deteriorate. So organizations live with the mismatch until a crisis occurs that really force people to accept the need for a re-design.

The risk, of course, is that it may then be too late.

So if you are a leader, or somebody helping a leader in considering a possible re-design, the message is probably this one: It would be safer to start now.

Digital-twin-www.organizationdesign.net_-768x524

Creating a Digital Twin of your Organization

The concept of a digital twin has been around for at least two decades. It refers to having a computerized representation of a real-world physical system, such as an engine or a building.  

In the initial phase, the digital twin may be more like a “digital shadow”, that is, it may be based on data received once.

But over time, it may be extended to be a living simulation model that updates and changes as the system is undergoing changes.

In other words, a digital twin is more than a dashboard. Dashboards provide visualization of current processes. Digital twins enable simulation and prediction.[1]

Because organizations are also systems, the question becomes: Is it possible to create digital twins of organizations?  

This is in fact the vision that we are now working toward in Reconfig. In the current version of the tool, you are able to visualize the work processes that people participate in and the interactions between them. This is then mapped onto the current organizational structure.

But more importantly, you can alter the structure. For example, you can move roles from one unit to another, or combine two units. When you do this, you can see the effect in real-time by means of five indicators (a sixth will be added soon).

The key purpose is to allow decision-makers to visualize and test the effects of potential organizational changes before they are introduced. See the image below for an example.

I am aware that other people, particularly in the business process management community, are also working on similar concepts.

However, it seems that their goal is somewhat different. Typically, these efforts are based on data that are extracted from existing IT systems, such as event logs, and from what I gather, the purpose is mainly to support operational efficiency.

In contrast, in Reconfig, we are more oriented toward the overall, organizational model or the “architecture” of the firm, if you will.

We collect data by using a survey questionnaire distributed to employees of the organization. We have been experimenting with other data sources, and in future, we may, for example, import email traffic data into Reconfig.

But our experience so far is that it is easier to get valid data directly from the employees in the organization. It means that we can get their views on the activities and working relationships that they believe are most important. It also has the benefit of involving them in the process, and prepare them for the analysis that follows.

The creation of digital twins of organizations will change organization design.

I have always insisted that we should use a data-driven approach. But this approach goes further. To borrow terms from two well-known contributors in my field,[2] it not only allows us to describe “what-is” but to explore how our organization “might-be” or “should-be” in the future.

 

  

[1] Becker, M. C. & Pentland, B. T. (2022). Digital twin of an organization. Are you serious? In A. Marrella & B. Weber (Eds.), BPM 2021 Workshops, LNBIP, pp. 243-254.

[2] Burton, R. M., & Obel, B. (2011). Computational modeling for what-is, what-might-be, and what-should-be studies—and triangulation. Organization Science, 22(5), 1195–1202.

Image by Freepik

agile org

Using Reconfig to Create Agile at Scale

According to one study, 90% of all companies have adopted agile methods in some form. Typically, companies use agile methods for software development, but many also use agile principles more broadly.  At the same time, some companies experience challenges with agile implementation (e.g., see this article). This suggests that there is a need for systematic tools and methods to support both initial implementation and continuous development of agile organizations. 

Reconfig is a software tool that is used to map and optimize the design of an organization. There are at least three factors that make it relevant for agile organizations.

The key feature of agile organizations is the small, cross-functional and self-managing teams. But how do you set up these teams – which roles should be combined to form a team? Reconfig has an algorithm that helps you identify teams with a combination of roles that benefit from being organized together.

One critique of the original Agile approach was that it was too focused on the individual team. Somehow, we need to scale up this concept to fit larger organizations. In a larger organization, you will have multiple teams or squads, organized within larger units, “tribes”, or programs in a project-based organization. You can use Reconfig to make sure that you set up a logical grouping of different teams within larger units. 

Finally, even in an Agile organization, not every part needs to be flexible, in most organizations, there needs to be a combination of stable and moving parts. Reconfig supports this by making sure that you can filter and optimize the organizational structure based on work processes or functions. And the algorithm is set up so that it will customize the design of the organization to each unit, rather than imposing one design principle to all units independent of how they work.  

If you’re interested in learning more about how to design an agile organization effectively, visit our web page at https://www.reconfig.no where you can download a white paper or request a demo that explains the key principles behind it.