In a 2017 survey of over 1,300 CEO’s across 79 countries, PWC found that 77% see the availability of key employee skills as their biggest threat. That’s not a surprising finding in an era of rapid technology disruption, evolving customer expectations and shifting employee demands. Now, more than ever, organization optimization is a requirement to compete effectively for resources and market share.
What Is Organization Optimization?
Organization optimization is defined as the alignment and leveraging of an organization’s resources to realize its stated goals/objectives. It lives at the intersection of high efficiency, high effectiveness, and high utilization of all relevant and available resources at an organization’s disposal.
Why Should Companies Optimize?
Staying Ahead in a Rapidly Changing World – Businesses today operate in dynamic environments; environments punctuated by periods of extreme volatility, rapidly changing technology, and globalization. These factors are made even harder to manage by a discerning and ever changing global consumer class whose tastes or preferences seem to shift by the moment. Where effectively exploited though, organization optimization has proven itself a reliable driver of short-term and long-term goals, which companies may leverage to stay ahead of their respective market forces.
The Arrival of the Future of Work – Second, historic organization structures are evolving. Specifically, ongoing workplace changes are presenting new challenges to managers who must now also contend with, manage, and motivate geographically distributed workforces. These new structures include a higher incidence of remote work (both individual and group), greater use of part-time work by corporations, and an increasing reliance on temporary and contract employee models. Managing such dispersed groups at optimal cost and performance effectiveness is and will continue to be challenging and will require a structured and deliberate rethink of organizational design.
Achieving Strategic Advantage – Approaching the corporate challenge from a different perspective, non-optimized organizations playing in arenas comprised of relatively optimized competitors risk becoming less competitive and thus more vulnerable. Via organization optimization, hiring and deploying the right skill sets, and aligning goals across one’s company, one’s business will be better positioned to respond to unexpected changes in the marketplace and will be better able to drive toward one’s corporate priorities quicker and more effectively.
Acquisition Strategies Have Long Been the Norm – M&A activity is a mainstay of the global corporate fabric. And getting the post-merger organization structure right—aligning cultures, human resources, priorities, and workflows—is often the key to unlocking the projected synergies and value-potential of the business combination.
According to a Harvard Business Review article that in turn leans heavily on research by McKinsey & Co., only 16% of mergers deliver on soft and hard goals on schedule. Further, 41% take longer than expected, and in 10% of cases, the new organization is value dilutive rather than accretive. Here too, deliberate strategies around organization optimization offer a proven and reliable road map for greater success.
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