In today’s uncertain business environment, concepts like efficiency, effectiveness and delivery of value become even more important. Organisations need to ensure that they are focussed on understanding and meeting the needs of their customers in the most effective and efficient way possible. This means that the organisation must align its efforts towards delivering value.
Alignment doesn’t just mean communicating strategy to everyone. To truly align around value, the organisation’s structure – the way its people work together, must also align. If the organisation’s structure is misaligned to the way it delivers value then inefficiencies in the way work and information moves through the system will result in higher costs, slower delivery and less understanding of customer needs. So, how do you organise your workforce in today’s complex business landscape?
Elabor8 has identified 9 ways that organisations can align themselves – the 9 primes. Four of the primes – project, component, business function and phase, are what we refer to as Traditional or internally aligned primes. These primes represent the way organisations have aligned in the past.
The common thread between the traditional primes is that they are all aligned around the organisation’s own internal concerns – how we fund work (project), the systems we operate (component), our own internal processes (phase) or our internal functional silos (business function). They help us navigate work through our own, existing internal structure.
The customer/product aligned primes, on the other hand, force us to change the way our organisation is structured to identify and align with the way value flows from unmet customer needs through our organisation, to deliver customer value. Whether that’s through value streams, customer segments, customer journeys, or missions.
We surveyed 80 major organisations in Australia about the way they are aligned and the way they think they should be aligned. The results are very clear.
While 55% of organisations have already made the switch to an externally aligned structure, 45% are still internally aligned. Those organisations that are aligned externally primarily have a product/service focus.
When we asked them to identify which prime they think best suits the needs of their business, a very different picture emerged. 87% of organisations identified an externally focused prime as the best fit for their business, with customer journey being the dominant prime rather than product/service. The number of organisations identifying a product/service alignment as their best fit dropped significantly.
The majority of organisations identified a different prime to the way they are currently aligned as their preferred prime. So the majority of organisations are not currently aligned in the way that best allows them to effectively deliver customer value.
While some organisations remain unaware that they are misaligned, the majority of organisations are aware that the misalignment exists but are either unsure how to re-align or are worried that the realignment will be too disruptive, and even destructive, to the organisation.
Most organisations carry a history of traumatic re-organisations with them – massive programs that disrupt operations for months, cause high staff turnover, and leave the survivors bewildered and confused about how the new organisation works and their place in it. Even worse, it all needs to be done again in a few years as conditions have changed.
Rather than large, destructive re-organisations, The 9 primes model allows organisations to evolve in an adaptive manner – continually evolving the way they align to value as their organisation, their competitive landscape, and their customers evolve.
Instead of viewing the organisation as a machine which needs re-building if you want to change the way it works, the 9 primes allow the organisation to be seen as an ecosystem that can continually grow and change. Forests don’t renew themselves by ripping out all the trees and starting from scratch, instead, it evolves continually – as one tree dies, others grow to take its place. The mix of species changes over time as the weather changes. Different plants occupy different niches, and so on. It’s the same with organisations. As one product comes to the end of its life, other new innovations need to be ready to take its place. The mix of skills you will need changes as the needs of your customers change. Organisational change should be a continuous process, not a stasis punctuated by mass extinctions.
Used in conjunction with the other 3 characteristics of Dynamically adaptive organisations – Adaptive leadership, Adaptive Governance and Deliberately Developmental Cultures, the 9 primes gives an organisation the tools it needs to continuously evaluate, and navigate its changing needs. This model of continual evolution avoids the need for large, destructive re-organisations and allows the organisation to focus on delivering real value.
If you would like to gain a deeper understanding of the 9-primes, we are offering a deep dive workshop. Contact us.