Organization Design at a Private Equity Company

Creating a new Organization Design at a Private Equity backed company

How should a company's structure, design, roles and responsibilities change as it grows? This Private Equity backed company faced that issue.  What worked at $100M in revenue was limiting their growth at $500M in revenue. They retained Congruety to create a new organizational structure and design to allow their business to grow and thrive.

As this private equity backed company grew, challenges in the external environment become more complex.  Businesses processes, structures and systems that once worked become barriers to productivity.  Client service, employee morale and financial profitability suffered as well. By not reconsidering how they were operating, they suffered:

• A "silo mentality" among employees and turf battles;
• Lack of focus on the client;
• Redundancies across the organization;
• Blurred lines of authority and responsibility;
• Inefficient and fragmented work;
• Excessive layers of management delaying rapid decision making;
• Lack of ownership and responsibility for solving problems;
• Poor communication and information sharing; and,
• Outdated systems and processes.

To help this company reconsider its structure, Congruety took the following steps:

• Established a design process with senior leadership.  Congruety led senior leadership workshops to discuss current business results, organizational health, environmental demands, and the need to embark on an organization design process. A charter for the design process was created to guide the project. It included a “case for change,” desired outcomes, scope, allocation of resources, time deadlines, participation, and the communications strategy.
• Assessed the current state of the business.  Using our Transformation Model, we facilitated a comprehensive assessment of the organization to understand how it functioned, its strengths and weaknesses, and alignment to its core ideology and business strategy. The assessment process clarified for the company's leaders how the organization currently worked but how the various parts were interrelated, its overall state of health and, most importantly, what was needed to make improvements.
• Designed the new organization.  The senior team looked to the future and developed a complete set of design recommendations for the “ideal future.” At a high level, the steps in this process included the following: defining a basic organizing principle (i.e., organizing around functions, processes, customer-types, technologies, geographies, etc.), streamlining core business processes, documenting and standardizing procedures, organizing people around core processes, defining tasks, functions, skills and performance metrics for each function/team, and defining the management structure that provides strategic, coordinating and operational support.

This approach to redesign the private equity backed company resulted in a streamlined organization design.  By thinking strategically about the needs of the organization in the future, senior leaders were able to create a flexible organization that met their needs in the short-term and long-term.  The organization saw dramatic improvements in quality, customer service, decreased cycle times, lower turnover and absenteeism, and improved productivity.