Transforming Business Performance through a Data-Driven Approach

23 December 2016 -

There’s a lot of fanfare about using organisational data and analytics to inform business decisions. But are we leveraging them to create a conducive environment for people to perform in?

In the quest to beat the odds, leaders need to revolutionise the way they see, plan, and manage their organisations. Just like budgeting, Organisation Design (OD) is a core process that needs to be done right as ‘business as usual’, instead of in firefighting mode.

Still, we see managers failing to do this. Under time and cost pressures, they often revert to ‘slashing and burning’ and as a result, they risk their business on a coin toss.

Flawed magic numbers are used to right-size the organisation. For example, making a unilateral cut of 20% across the board. This is just one of the many areas of OD that is practiced in a superficial way.

Too often OD is understood as simply org charts or reporting lines

Too many leaders still treat OD as an exercise in moving boxes around PowerPoint slides. There is an obsession with structures rather than a focus on the work or skills needed to deliver an organisation’s strategies and goals.

This is damaging.

At an individual level, many employees become unclear about what their roles are in the organisation. At a higher level, this leads to a lack of visibility of the organisation’s ‘as-is’ and how to model its ‘to-be’ effectively.

To turn this around, practitioners need to rethink the organisation as a system. This means linking all the organisational elements together: people, activities, competencies, positions, customers, objectives, and structures.

By having a clear map of how the organisation is linked, we can track gaps and inefficiencies in the workforce.

Organisational analytics is not just about monitoring people metrics

HR and OD practitioners sit on some of the most valuable data to the business, yet they are not using it to its full potential. The HR function is often stuck in the realm of transactional work rather than providing strategic input that could benefit the business.

Understanding headcount is important, but even more crucial is understanding how resources are placed on high-value versus low-value activities.

We need to guide our organisational analytics with hypotheses crowdsourced from the business.

By connecting people data to business outcomes, we could improve both individual and company performance. For example, linking People and Activities through actual time spent will enable an understanding of time allocation to design a more efficient ‘to-be process’.

Stop great ideas going from sizzle to fizzle

No matter how good your design or plans are in theory; ultimately success comes down to getting things done on the ground.

If people can see what’s going on in the ‘as-is’ and where they are going with the ‘to-be’, then it’s easier to get them engage and make design plans a reality.

Rupert Morrison is the author of Data-Driven Organization Design: Sustaining the Competitive Edge Through Organizational Analytics, which is shortlisted for the 2017 CMI Management Book of the Year.