Source | LinkedIn : By Mark Nyman
In good and bad economies, functions such as HR, Finance, and IT are in a continual cycle of growing then shrinking and centralizing only to decentralize. They are reengineering, downsizing, outsourcing, or creating shared service organizations. One day they are asked to increase responsiveness, the next they’re asked to cut cost and improve efficiency.
Most change efforts focused on support functions have unintended negative results. For example, when the HR function makes what it feels are positive changes, line leaders often have a negative view.
When functions try to improve without aligning with the larger organization as the primary outcome, they tend to hurt rather than help business performance.
While they value the contribution of the HR people assigned to them, they don’t value the contribution of the function. Why? The changes HR makes to improve the function do not help the line leaders improve business results. When functions try to improve without aligning with the organization as the primary outcome, they tend to hurt rather than help business performance.
(If you’re looking for guidance or materials on how to align your function to the business and how to prove your value to stakeholders, learn more about RBL’s Outside-In approach.)
Five types of misalignments:
1. Optimizing the function.
Often a function will implement changes that make their work more efficient or easier while making it harder for the organization to achieve its goals. Support functions must know who they are connected to and how their actions and improvements will impact the core business. When you are in a support role, most of the requirements need to flow from the business needs out rather than from the support organization to the business.
2. Standardization versus customization.
Standardization is a common solution in streamlining functions and cost-cutting initiatives. When properly applied, it creates great value and cost savings. But when business drivers call for customization, standardization results in rework, shadow organizations, and other drains on people’s time. The belief that work is scalable is not enough of a reason to standardize.
3. Utilization versus availability.
Functional groups are often challenged to be available whenever someone wants their services but also be lean enough that their people are being fully utilized. Managing utilization versus availability often feels like a no-win situation. In fact, trying to do both is a no-win. Functions must be clear about the primary drivers of business success to determine where they apply utilization versus where they apply availability as organizing principles. To do so, support organizations need a clarity on what works creates value and a clear method for prioritizing work.