- 20 years experience in the application and study of organizational design issues
- Assistant Professor, Strategy at INSEAD
- Lecturer, Management and Strategy, Northwestern University - Kellogg School of Management
- 11 years at Bayer AG, where he held management positions in the U.S. and Germany in industrial marketing, information technology, mergers & acquisitions, and strategic planning
- PhD, Managerial Economics
- All 7 Best Practices
- Pre-Call Discovery Process
- One-on-One Call with Expert
- Session Summary Report
- Post-Session Engagement
- Balanced Scorecard
A system of performance measurement that relies on a broad portfolio of indicators. Balanced scorecard systems recognize that there is rarely one single measure that can capture the full range of what an organization or department is trying to achieve.
- Distributive Justice
Refers to perceptions of fairness in outcomes in organizations. This is strongly culture-specific. A system that offers highly differentiated rewards based on "performance" or "merit" may be perceived as fair in some cultures but unfair in others. "Culture" here may be national, regional or even organizational.
- Divisional Structure
An organization structure where activities and accountability are grouped by organizational outputs or markets. Typically, each division is assigned P&L responsibility and has full authority over essential functions such as R&D, manufacturing, and sales/marketing. The most common divisional structures are organized according to product/service lines, geographic territories, or customer segments.
- Flat Organization
See span of control.
- Functional Structure
An organization structure where activities and accountability are grouped by function, such as sales, marketing, R&D, and production.
- Hierarchical Organization
See span of control.
- High-Powered Rewards
Refers to an organizational incentive system that typically consists of relatively low base pay with a large variable component based on a small number of quantitative performance indicators. High-powered reward systems can generate exceptional performance but are also very susceptible to manipulation and gaming. They should be used with great care.
- Horizontal Structure
An organization structure that is organized around cross-functional core workflows and processes, such as order fulfillment, supply chain, and customer service.
- Low-Powered Rewards
Contrast with high-powered rewards. Refers to an organizational incentive system that links rewards and performance in a more subtle way. Variable pay carries relatively low weight, and it may be allocated based on subjective factors. Differences in rewards across individuals are often less pronounced than under a high-powered system. Also the variable pay itself may come in subtle forms such as the prospect of promotion to a higher salary grade, or an above-market wage for all employees who meet the organization's performance expectations.
- Matrix Structure
An organization structure that attempts to balance the strengths of the divisional structure (typically stronger market orientation) and the functional or horizontal structure (typically stronger efficiency orientation). In reality, most large organizations have matrix structures to some degree, even if they are not explicitly labeled as such.
- Network Structure
Sometimes called a "virtual" organization, this is an organization that outsources one or more core functions or processes to external providers.
- Procedural Justice
Also known colloquially as "fair process." Refers to the fact that people care not just about outcomes, but also about the process that led to those outcomes. Procedural justice in organizations usually involves established procedures (either formal rules or strong cultural norms) that reinforce a consistent, objective and unbiased approach to decision making and performance evaluation that is open to input and challenge from those affected.
- Responsibility Assignment Matrix
A system of assigning roles and responsibilities for key decisions in an organization. RACI, an acronym for Responsible, Accountable, Consulted and Informed, is a commonly used system. Many consulting firms have their own trademarked variants. Used well, such systems can add speed and clarity to organizational decision making.
- Span of Control
Refers to the number of direct reports for whose performance a manager is accountable. An organization with a high average span of control is referred to as a flat organization. An organization with a low average span of control is referred to as a vertical or hierarchical organization.