Organization Design Part 3 - Alignment

Excerpt from a 2017 podcast with Dr. Chad McAllister at The Everyday Innovator

In this segment of The Everyday Innovator video podcast, Dr. Chad McAllister and I discuss growing up in silos and how alignment and integration are key organizational design concepts.

Chad

Designing elements like strategy, metrics, and what you mentioned make the organization the organization. I appreciate that you emphasize the alignment between those, and designing that alignment is so important too. Just a quick aside from my experience. I was invited to join the executive team because I was in the role that sat between all the functions. That role often got squeezed between the silos, and it amazed me; maybe I saw this more because I sat between the roles and interacted more with the vice presidents involved.

At one meeting in particular, in an organization primarily managed by objectives, the CEO would say what the organization's goals were. Then, the same day, after the meeting, he talked to the VP of sales about how he was responding to that objective and the VP of engineering about how he was responding to that objective, pointing out that if you indeed do what you do, that’s going to make this other guy’s job challenging, but that wasn’t how they perceived it. He said, “That’s not my responsibility.” In other words, his responsibility was to optimize his role, function, and department. If he is in sales, his job is to optimize sales, even if that might jeopardize something happening in engineering. That alignment is essential, and organizations leave it out too often.

John

The issue you’re talking about is also about aligning incentives, aligning culture, and aligning employee development. All too often, we grow executives in a particular functional area or silo, and some organizations make sure they get broadening assignments. They get to view other parts, but sometimes they don’t. If you can succeed and get promoted or a bonus by optimizing your area at the expense of other areas, then the design and incentives aren't aligned.

Interestingly, most management ideas, techniques, and fads work if you do them right and align everything to support them. But all too often, we plop a new management technique or idea in the middle of an organization, and we don’t work through the system integration, for lack of a better word. Without alignment across the rest of the organization, the new management technique fails. They failed to produce results, and we blamed the idea or the method when we weren't doing our job of integrating and aligning that new technique with our business systems and culture.

The video is an excerpt from a 2017 podcast with Dr. Chad McAllister at The Everyday Innovator. For more podcasts on innovation and product development, check out the podcast on his website and iTunes.