The excellent book CEO Excellence shares some research about which roles generated the most value. Their findings were revealing in one instance: 37 people (out of a company of 12,000) generated 80% of that business’ value.
One role singlehandedly was responsible for 10% of that value.
The takeaway is this: hierarchy and value creation often don’t go hand-in-hand.
This gets to the point of organisational design: how you shape your organisation so that it’s set up to perform.
Conventional wisdom is that it’s about people. And it is to a very large degree. But there is another lens that needs to come into play beyond just getting your people to be the best versions of themselves.
And that lens is about recognising where your business’ ‘horse-power’ comes from and making sure the conditions are appropriately in place for those horse-power generating individuals to thrive.
- Do they have the right reporting lines (hopefully directly into you)
- Do they have the right resources?
- Are they getting the right development?
- Do they have the appropriate support?
- Are their channels of communication set up for them to have the right conversations with the right people at the right time.
This isn’t about making wholesale changes to your set-up. Rather it’s about making sure you’re not missing a trick by unintentionally hiding your most important value-creators under a rock, just because that’s been the historical arrangement of your business.
Take a fresh look at your organisational design by throwing the organogram out of the window. The organogram is a false construct that has very little bearing on performance. It’s just an arrangement on a page.
If you seek performance, then the underrated art of organisational design must come into play as a CEO. It might not be what you’re drawn to as it might seem to be an overly complex topic. But it’s not. It’s a real thing that needs to come into your arsenal.
Hopefully, this piece will steer you in that direction. Reach out to me directly at ceoship@jonathan-rowan.com if you’d like to unpack this a bit further – I’m happy to have an informal conversation if it would be to your benefit.
J-R.
