Many C-suite executives and organizational leaders find themselves knee-deep in strategy creation, long-term organizational planning and setting key performance indicators that highlight at-a-glance whether the proposed strategy is effective. Others focus on putting just the right team member in just the right position with just the right amount of support and autonomy. They spend their days tinkering with organizational charts, job descriptions and where one department’s roles and responsibilities should end, and another’s should begin. Unfortunately, many others barely find time to focus on strategy, design and structure in their attempt to tick off a never-ending to-do list of rapidly changing priorities.
Each of these scenarios come with their own sets of flaws, but one major mistake that leaders often make when crafting these elements of their organization is failing to recognize the importance of employee engagement and performance in the creation process.
Laying out all the puzzle pieces.
Organizations are complex systems. They require strategy, design and structure, and each component must be aligned for the organization to thrive. However, incorporating and engaging employees in each of these components is vital. Research indicates that organizations with high levels of employee engagement often perform better, achieving higher productivity and efficiency.
Research further suggests that employee engagement is often contingent on knowledge and information sharing, feeling valued and heard by those in leadership and understanding how their role plays into the broader organization’s purpose. Given employee engagement drives organizational performance, then involving employees early and often in the strategy process should be of chief priority for organizational leaders.
Many organizations employ a hierarchical structure and approach, with top executives driving decisions and informing others of the strategy and what should be done. While this approach works in some instances, it leaves little to no room for employee engagement. On the other hand, a structure that allows for collaboration between executives and employees in co-developing the organizational design allows for more flexibility and input. It enables employees to engage early on and better understand their role and value in executing the organization’s vision and strategic goals.
In this way, organizational leaders can work to create employees that are champions of the organization’s design and process, as opposed to passive participants. By allowing employees to have a voice in the design, they are better able to share why the organization operates the way it does with other employees. As such, executives can organically build a culture that breeds itself as research indicates that employees are more inclined to listen to peer-to-peer than those disseminated from in top-level management positions.
Similarly, effective organizational design is associated with improved organizational performance as it relates to increased profit margins, improved customer service, and operating flow. It creates an environment that allows for the successful delivery and execution of performance indicators such as those mentioned above. A well-designed organization significantly increases the likelihood that the collective efforts of its employees will be successful as well as allows for innovative solutions that simplify processes, making it easier for employee engagement to be sustained.
Additionally, it has been proven that engaged and motivated employees typically perform better. However, employee engagement is often aided or hindered by organizational design as bureaucratic systems can cause employees to become frustrated and feel they lack the input and support necessary to be productive.
Solving the puzzle – putting all the pieces together.
Effective performance requires strategy coordination, and strategy is informed by organizational design and structure. In other words, procedures and structure are all for naught if an organization’s practices are misaligned and do not support the desired outcome. Often, executives focus their attention on one aspect of these components or look to address organizational issues performance by creating or reinforcing structure, policies, and procedures. While all steps in the right direction, leaders must be intentional about finding ways to use employee engagement to activate and increase performance outcomes.
For decades, academic scholars and business practitioners have touted the positive correlation between employee engagement and organizational performance, promoting productivity, employee retention, customer loyalty, and profitability as its byproducts. More importantly, research also shows engaged employees are better able to deal with potential changes in the marketplace; this is critical given the fluidity needed to adapt both structure and strategy as the organization’s needs dictate.
Engagement drives performance at the individual and organizational level and employees must be engaged in the strategy and design from the beginning, not merely as an afterthought.
Employees should be heard and invested in the strategy and structure as both ultimately affect them and organizational performance. At each step of the strategy and design process, organizational leaders should allow, and call for, employee engagement. As simple and straightforward as the concept sounds – engagement begets engagement. Incidentally, engagement drives performance. Including employees in the decision-making process during the design and implementation process is paramount to increasing engagement, and the organization’s overall performance and success.
Given this, an investment in employee engagement more than provides a valuable return on investment. It essentially pays for itself as it serves to support the organization’s long-term viability.
