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Optimizing Organization Design: A Proven Approach to Enhance Financial Performance, Customer Satisfaction and Employee Engagement



Optimizing Organization Design: A Proven Approach to Enhance Financial Performance, Customer Satisfaction and Employee Engagement

Ronald G. Capelle

ISBN: 978-1-118-76379-7 October 2013 Jossey-Bass 496 Pages


Optimizing Organization Design offers a comprehensive resource and valued guide for anyone interested in improving organization performance. The book presents an approach to optimizing organization design that is based on over 100 large scale projects and 23 research studies that have been completed by Capelle Associates over the past 25 years. In addition, the book includes insightful comments from executives on their success in using this approach. Capelle’s research and client experience reveal that optimizing organization design leads to better financial performance, customer satisfaction and employee engagement. It can provide a competitive advantage and a significant return on investment. It can also become the foundation of both strategy implementation and human resources management.

Capelle shows that organization design includes the alignment of a number of critical factors, including positions (vertical and functional); accountabilities and authorities (managerial and cross functional); people; deliverables and tasks. He shows that manager – direct report alignment is the single most important organization design variable. His research also shows that it is suboptimal nearly half the time. This is a horrendous waste of talent and capability, but also provides a significant opportunity for improvement in organization performance. 

Optimizing Organization Design clearly explains how to implement organization design improvements. This approach includes people change management, project management, and a cascading, iterative approach that is based on teams and involves education, doing real work and feedback.  In addition, Optimizing Organization Design includes special sections on the role of the Board of Directors, project management, process management and compensation. In addition, the author has included four case studies and a useful glossary.

List of Research Studies xi

Acknowledgments xiii

Introduction xix

1 Why Organization Design Matters 1

Employee Satisfaction 2

Customer Satisfaction 5

Financial Performance 6

Competitive Advantage 7

Significant Return on Investment 8

Foundation of Strategy Implementation 9

Foundation of Human Resources Management 10

Client Experience 12

Research Support 13

Special Topics 15

Conclusion 18

2 Organization Design Assessment 20

Organization Systems Functioning Model 23

Organization Systems Change Model 28

Organization Alignment Model 29

Vertical Alignment of Positions 32

Functional Alignment of Positions 58

Aligning Accountabilities and Authorities 73

Aligning People with Positions 103

Aligning Deliverables 112

Aligning Tasks 126

Organization Design Principles 135

Conclusion 136

3 Organization Design Implementation 138

Objectives of an Organization Design

Implementation 140

Organization Design Implementation Components Model 141

Organization Design Implementation Process Model 150

Organization Design Implementation Principles 155

Strengthening the Organization Design Implementation 157

Internal-External Team Approach 160

Conclusion 162

4 An Overview of the Process 164

Initial Discussion, Proposal, and Contract 165

Assessment, Report, and Meetings 167

Implementation 172

Sustainment 174

5 Additional Topics of Importance 175

The Role of the Board 175

Project Management 184

Process Management 189

Compensation 192

6 A Call to Action 195

Appendix A: Client Experience 201

Appendix B: Research 225

Appendix C: Case Studies 362

Allstate Insurance Case Study 363

Canadian Pacific Case Study 377

Capital Power Case Study 390

Royal Ottawa Health Care Group Case Study 404

Glossary 417

References 430

About the Author 440

Index 441