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Moving Faster: Organizational Design for a More Strategic HR Function

Human Resources (HR) departments are frequently tasked with doing more with less because they often struggle with showing a direct return on investment for their initiatives and general efforts. Therefore, businesses often view these departments as an auxiliary function.

In fact, some organizations end up focusing significant resources on administrative activities rather than strategic initiatives that help align the organization to its goals and objectives, thus perpetuating the cycle or belief that HR is an administrative function instead of a strategic partner. Luckily, HR organizations are not tied to this reality forever.

HR can absolutely serve as a strategic partner in driving organizational goals and objectives. The challenge is in creating time and space to operate in this capacity amid the more administrative actions that naturally flow through the function.

An appropriate organizational design approach can help to break down barriers, streamline processes, and create structures that help employees and leaders navigate the HR landscape while helping HR teams themselves move more quickly. This will naturally shift the perception of HR to a more strategic, value-add business function.

Patchwork Organizational Design

As organizations expand and their needs grow, they commonly take a patchwork approach to organizational design, leading to a haphazard structure and workflow. Due to the high demands and need to continually “prove” themselves, HR teams are often among the least coordinated functions within an organization. The old adage, “the cobblers’ children have no shoes,” rings true in the case of HR in relation to many organizational principles.

To mitigate the complexity of working with corporate HR teams, many functions and departments hire their own dedicated HR professionals to support their department’s specific needs. These business line-focused HR teams or individuals may sit as a matrixed organization, or they may not report into the larger HR function at all. Even when both types of HR teams sit together, they may still serve specific business units. In these cases, they receive their priorities and direction from the business line rather than corporate HR—this creates a disconnect and inability to operate efficiently.

A Case Study: An Overwhelmed and Siloed HR Department

The above situation was the case for a large federal contractor and manufacturing organization we partnered with. The HR function of this organization was tasked with streamlining its structure while simultaneously ramping up output. In other words, HR was tasked with doing more with less.

As our team began digging into the contractor’s internal customer and employee feedback, several concerning (yet common) issues emerged:

  1. COEs within HR were incredibly siloed.
    Serving as the face to the businesses they support, Centers of Expertise (COEs) were often tasked with answering questions about initiatives or processes that they knew nothing about. This significantly slowed down customer service and frustrated everyone involved.
  2. HR business partners supporting specific lines of business felt they reported to and were loyal to the needs of their specific business leader, not the organization.
    Despite what initiatives were presented at the HR level, individuals’ work was essentially prioritized by the needs of the business line. This created a breakdown in HR-driven initiatives.
  3. HR business partners reported spending 75% of their time on administrative activities and serving as a liaison between the business and HR.
    This severely limited their ability to focus on activities that drive business results within their business line or across the organization as a whole. This liaison approach created a severe bottleneck because information flow was primarily restricted at a specific point: the HR business partner.
  4. Individual functions or business units would often seek external support to complete significant initiatives.
    These tasks should have come from various HR COEs, including but not limited to organizational restructuring, leadership programs, development of competency models, and high-impact recruiting. Even this organization’s learning function was moved from HR and placed within the business to meet its needs more effectively.
  5. Within the HR department, various project teams were created to support critical initiatives.
    When HR employees were pulled from their roles to support initiatives, it left gaps on their teams. Many times, this resulted in interim leadership, significant efforts spent adjusting to new leadership, and building engagement within the new team—all very time-consuming responses.

In client- or service-based organizations, the organizational structure can undermine the workflow or processes in place to ensure work gets done efficiently, which this case study demonstrates. But organizational design is about more than creating an effective work structure. How a function is organized plays a role in how quickly information moves, how effectively teams communicate, and whether decisions are made at the right level.

The New Organizational Framework

As we learned more about this organization’s challenges, we identified that both the structure and the operating model were the primary challenges to moving quickly and best serving the customer.

To create the conditions for HR to serve as strategic business partners to the organization, major system changes were needed. Through working sessions with the full leadership team, we identified key areas where most of the questions and time-consuming activities originated, how to filter and service those requests expeditiously, and how to get the information employees and managers need in front of them before they even raise the question.

Redirecting most of this effort would significantly free up a large portion of the function to more proactively identify and address business needs, serving as a more strategic partner to the business instead of as an administrative one.

The New Operating Model

Armed with this new framework, we were able to design an operating model that physically realigned the more tactical side of the function with the more strategic COEs and business partners. We redesigned the organization’s operating model to allow for the administrative responsibilities to be addressed through a shared services team. This eliminated a significant amount of work from the Human Resources Business Partners (HRBPs), giving them time to be the strategic business partners they were designed to be.

A critical need was to address the random project teams that were created to solve specific problems (like a COVID task force, for instance). While emergency situations may result in the disruption of normal workflow, pulling key members of various teams to serve on projects with open timelines should not be normal practice for a well-functioning organization. The leadership team liked the project model for upskilling employees and having teams with diverse experiences but recognized that they needed a better process to move people around without creating so much disruption.

Part of the operational structure was a project team fed by the various COEs. While the COEs would own their own processes, the project teams would unite to support various initiatives by assisting the business or individual business units. These teams would be led by the HRBPs supporting that business unit. This allowed for benefits like rotating project teams for individual development and growth while maintaining stability inside HR.

Organizational Design Requires Full Commitment

Despite the effort and alignment around the need for change, this type of redesign will only be effective if everyone within the function follows the plan. Inquiries must be routed to the shared services function to be addressed and escalated. Initiatives must go through the project team. Business partners must align with the HR decisions and initiatives versus focusing solely on the business unit needs.

A heavy change management process is often needed when making a change to process or workflow. Leaders and employees must be fully aligned and assist with making the change stick. As with any change, resistance will come into play. It is easy to fall into old patterns of behavior, so the new behaviors must be constantly reinforced.

An effective change plan includes providing users with a clear understanding of why the change is important, what their specific roles are in the process, how they need to behave differently, a path to achieve the change through a clear set of resources, and a partner to support them along the way, which will help set the organization up for success.

Redesign Your Organization for Optimal Efficiency

A disorganized team can result in significant wasted time and resources by simply trying to find the right answers. That is what our clients faced and why they were spending significant time answering questions and completing administrative functions, many of which could have been addressed through self-service tools. By continuously “doing for” instead of teaching, this organization had created a system bogged down to the point of paralysis. Additionally, the lack of connection between the teams left them unable to adequately support each other.

Organizational design can be a powerful way to help organizations and functions move more quickly by streamlining the flow of information and providing critical workflows and processes for success.

This blog is part of our Moving Faster series in which we explore how certain business functions can transform into more strategic business partners. To learn about how using an agile framework can improve learning organizations, read Learning Fast: Lessons from an L&D Scrum Team.

About the Authors

Cheryl Jackson, PhD
Organization Design & Change Practice Lead
For over 15 years, Dr. Cheryl Jackson has been supporting transformational efforts in Fortune 500 organizations across a variety of industries including retail, manufacturing, healthcare, and food and beverage. With a doctorate in Industrial-organizational psychology, she combines her experience with scientific methodology and research techniques to create practical solutions that drive meaningful change in the workplace. Cheryl is driven to create effective solutions that help the organization as well as its employees thrive. Her focus is organizational effectiveness strategies supported by organization design, change management, assessment and development, employee engagement, leader development, and performance management. Cheryl is driving the development of the OD and Change Management practice within and across GP Strategies through the development of offerings and solutions, internal and external education, and supporting client initiatives. She remains actively engaged in the practice by contributing to whitepapers, blogs, articles, conferences, and podcasts on organizational design and change management and serving as a lecturer in the Master of I/O program at Texas A&M University.

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