Top Seven Warning Signs of Poor Organization Design

by | Dec 13, 2021

Do these symptoms exist in your office?  Let’s examine the case of the ABC Agency (name protected).

  1. Silos – Lack of Inter-Office Coordination
    An international aid agency had a mandate to deliver health programs for children in Less Developed Countries.  They had two departments and two types of staff: the accountants who collected, processed, and reported on funds from donors; and the scientists who designed and administered programs.  The accountants were frustrated because the scientists didn’t fill out the right financial forms on time.  The scientists were mad at the accountants because “it’s not about the money, it’s about the children”.  There was a clear lack of communication.  The Executive Director was under pressure from the Board to track funding commitments accurately and show positive program results.
  2. Excessive Internal Friction and Conflict
    The environment was characterized by excessive friction and conflict.  “Internecine warfare” was the term we used.  Nasty emails abounded, financial reports were late, committed funds were left sitting in bank accounts, supplies for field programs were not delivered, and donors were threatening to walk.
  3. Lack of a Common Vision
    Our agency was characterized by the lack of a broader vision and role perspective by staff.  The accountants’ job description specified their job – to collect, process, and report on funds.  They diligently pursued their financial goals but had never visited a field site.  The scientists had minimal awareness of where the funding came from.  As long as their supplies arrived on time, they were happy.  There was a lack of common goals between departments.
  4. Unclear Roles and Reporting
    The agency also lacked more specific role definitions, especially on the Program side.  The field scientists in the head office reported to the Director of Programs.  The field scientists in Africa reported to the Regional Director for Africa.  Global programs were created by the Director of Partnerships.  Contracts for supplies were managed by the Director of Contracting.  The Director of IT oversaw the use of all technology.  Territorial disputes were rampant.  Staff suffered from Multiple Boss Syndrome.
  5. Misused and Under-Utilized Resources
    In head office, the monthly and annual work cycles varied.  The accountants were busy at the end of every month chasing down missing forms and preparing their reports.  They sat around mid-month with nothing to do. The scientists were busy at the start and middle of each month liaising with the field managers and suppliers.  Once all the supplies were delivered, they sat around at the end of each month with nothing to do.
  6. Poor Workflow
    The overall function of the agency involved: Find donors, obtain funding, develop programs, match funds to programs, arrange contracts, purchase and deliver supplies, monitor results, and report to donors.  The Executive Director’s favourite expression was “where is my money?” because multiple staff were involved in these functions and the status of funds could not be tracked on a daily basis from donor to delivery.
  7. High employee Dissatisfaction and Turnover
    Even the brightest employees were prevented from doing their best work and became frustrated because the organization was poorly designed.  Recruiting and training costs soared.

What happened to the agency?  They re-organized.  They adopted a ‘bicameral functional structure” with the Executive Director and two Directors.  The Director of Corporate Services was responsible for Accounting, IT and Contracting.  All scientists and field programs report to the Director Programs.  The two Directors meet daily.  Roles and processes were revitalized.  The Executive Director was freed up to act as CEO, be more strategic, and manage Board, Partner, and Donor relationships.  Twice a year he visits the field and delivers a slide presentation about accomplishments in a staff town hall.

A year later the ABC Agency became a major grant recipient in the Global Health Program of the Bill and Melinda Gates Foundation.