Transforming Organizations: HR’s Role in Shaping Structure and Performance

 

Improving Organizational Performance

Improving organizational performance often involves aligning structure, roles and responsibilities, process, and culture with new strategic goals.

Competency Connection

An organization is pursuing a growth strategy through merger and acquisition (M&A). HR has been actively involved in performing due diligence for a proposed M&A target. Senior management is very committed to acquiring the operation because it would advance their planned vertical strategy.

The chief human resources officer (CHRO) is reviewing data gathered by an HR task force. This analysis is supported by a variety of Behavioral Competencies. Much of the data is financial, assessing the financial implications of the target's workforce demographics and existing contracts. Business Acumen and Analytical Aptitude help there. Global Mindset helps the CHRO note some characteristics of the target company's culture that might cause problems. A few lines in a report suggest that the CHRO's organization differs in its approach to employee relations from the organization targeted for acquisition. The CHRO's organization has implemented many processes designed to promote individual initiative and innovation. The target organization, however, is very hierarchical. This is reflected in the many layers of approvals that must be obtained to make decisions, the intricate dispute resolution path, and the formal communication channels its employees must follow. The differences suggest entirely different employee relations strategies, probably different cultures, and possibly different employee skill sets, which could have strategic implications.

Using the Consultation competency, the CHRO presents HR's complete findings to senior management, emphasizing the cultural and strategic challenges that this merger poses.

Organizational Interventions

Organizational interventions look at how the structure of the organization is helping or hindering the organization's strategic progress. Organizational structure refers to the way in which work groups are related.

Organizational interventions are required when an organization:

·          Is failing to meet its strategic objectives because its structure is inefficient and/ or ineffective. The organization's structure no longer meets its needs. A common example of this situation is the progression of an organization through its early stages of growth. The organization's design must be aligned with its new realities.

·          Has changed its competitive strategies and needs to develop new skills and traits-for example, skills needed to respond to market changes quickly. The organizational design must be focused in a new direction.

 

Redesigning the Organization

Organizational design refers to elements that support an organization's functioning. These elements include structure but other factors as well, including:

·          The organization's mission and vision and the strategies it is pursuing to achieve its goals.

·          The way decisions are made.

·          The way information is communicated.

·          The processes used to perform work and the degree to which those processes connect parts of the organization's structure and the way in which those linkages are managed.

·          The systems used to align the organization's needs with the resources required to fill those needs. This, of course, includes human resources and all the systems HR uses to fulfill its responsibilities, from recruitment through talent management and exit. It can also include physical and financial assets (for example, equipment, facilities, budgets) and organizational knowledge and expertise.

All of these elements create the integrated system that is the organization. Any OED solution must acknowledge the integrated nature of the organization's design.

HR's Role in Organizational Design

HR's roles and responsibilities in organizational design should include:

·          Providing leaders with a structural diagnosis by identifying the root causes of organizational performance issues.

·          Helping leaders evaluate a range of clear design options.

·          Ensuring that leaders align organizational design decisions with short- and long-term strategic goals by identifying critical activities, strengths, and weaknesses.

·          Helping leaders understand their roles and responsibilities that ensure that the structure is properly implemented.

·          Continually monitoring the structure for alignment with the organization's business strategy and highlighting challenges as needed.

·          Planning for internal or external resources to deliver appropriate short- or long-term development interventions and activities and ensuring that those resources have the appropriate subject matter expertise and credibility to be effective or have the appropriate background, relationship-building skills, and cultural familiarity to quickly build credibility.

The Business Symphony: Where Finance, HR, and Innovation Meet

Finance and Accounting Functions

Finance and accounting both focus on an organization’s financial performance, but their purposes and orientations differ.

Finance is concerned with how the organization strategically utilizes its financial resources to sustain and grow operations in both the short and long term. Key responsibilities include:

• Enabling operational and strategic initiatives by formulating and monitoring both operating and capital expenditure budgets.

• Conducting financial analyses to inform strategic decisions, such as those involving international expansion, technology investments, or strategic partnerships.

• Managing the organization’s treasury through prudent investment and borrowing decisions across varying time horizons.

Accounting, by contrast, is focused on precision, compliance, and transparency. It systematically records, classifies, and reports financial transactions to support internal decision-making and external accountability. Core functions include:

• Recording revenue and expenses in accordance with established standards such as IFRS or U.S. GAAP.

• Supporting corporate governance by maintaining detailed financial records and facilitating periodic internal and external audits.

• Producing essential financial statements such as income (P&L) statements, balance sheets, and cash flow statements.

• Ensuring full compliance with financial regulations and reporting obligations to government authorities, regulators, and investors—reflecting the growing global demand for transparency, fiduciary integrity, and responsible corporate governance.

Both finance and accounting must continuously adapt to evolving regulations, emerging technologies, and shifting ethical standards that heighten risks of fraud and fiduciary misconduct.

Inside the C-Suite: How Executive Management Shapes Strategy and HR Drives Impact

 

Executive Management

Executive management (often referred to as the C-suite) is ultimately responsible for all of the core business functions and their effect on the organization's performance. The primary responsibilities of executive management are to:

·          Develop and communicate strategy to the organization's components.

·          Monitor and control implementation of strategic and operational activities through control of financial resources.

·          Be the primary interface with the organization's stakeholders, from investors and regulators to customers and communities.

·          Lead the organization through a shared vision and the values they model in all interactions.

Executive management commonly includes an individual who holds ultimate' control of organizational resources and responsibility. Titles vary-for example, chief executive officer (CEO), president, or executive/managing. director. In a publicly held company, this individual may report to a board of directors, compensated individuals from outside the organization. (Nonprofit organizations may also have boards whose members are compensated for expenses.) The board is responsible for reviewing and approving strategic plans, appointing and approving compensation of executive management, and overseeing organizational governance.

The heads of the organization's financial operations and day-to-day operations are also at the executive level. According to an organization's mission and values, there may be other positions in executive management, such as heads of information, innovation, or risk management. Some of these positions may be "double-hatted"-they may be held by someone in the organization in addition to that person's primary responsibilities.

How HR Interacts with Executive Management

HR leadership interacts directly with executive management. HR contributes to the development of organizational strategy, advising on the human capital implications of strategic decisions. It may work directly with the board to advise on executive compensation and matters of governance and with other members of the C-suite as they manage the development and implementation of operations and strategic initiatives.

🚀 Reimagining Organizational Performance: Strategy Meets Humanity

 

In today’s fast-moving business landscape, improving organizational performance isn’t just about tweaking charts and workflows—it’s about realigning the heartbeat of the organization. That means rethinking how people work together, how decisions are made, and how culture supports strategy. When structure, roles, processes, and values are in sync with strategic goals, organizations don’t just grow—they thrive.

🤝 When HR Meets M&A: A Story of Strategy and Sensitivity

Imagine this: a company is pursuing an ambitious growth strategy through a merger and acquisition (M&A). The deal looks promising on paper—financials are solid, and the vertical integration could be a game-changer. But beneath the spreadsheets lies something more nuanced: people, culture, and values.

The CHRO steps in, armed with data from an HR task force. Yes, the numbers matter—workforce demographics, contract liabilities, and cost projections. But what really catches the CHRO’s eye is the cultural contrast. Their own organization champions innovation and autonomy. The target company? Deeply hierarchical, with rigid approval chains and formal communication paths.

This isn’t just a clash of styles—it’s a potential strategic risk. Using Behavioral Competencies like Business Acumen, Analytical Aptitude, and Global Mindset, the CHRO pieces together the puzzle. Then, with Consultation skills in full force, they present the findings to senior leadership—not just the risks, but the roadmap to navigate them.

 

Characteristics of Effective OED Interventions

Effective Organizational Effectiveness and Development (OED) interventions are distinguished by several critical attributes that ensure both immediate impact and long-term sustainability. These characteristics are outlined below:

Characteristics	Importance
Strategically aligned	Helps ensure that plans reinforce, complement, and build on each other and support overall organizational goals and strategies
Collaborative	Facilitates discovery of causes and development of solutions with critical input from those most closely involved (managers, supervisors, and employees) in intervention area
Supported by top management	Helps reduce resistance to eventual change
Producing sustainable results	Changes that can continue to deliver long-term results, perhaps because of management preparation or group involvement and acceptance of new processes and success criteria
Supporting continuous improvement	Aims at strengthening the organization in an ongoing manner by identifying weaknesses and opportunities and engaging employees in performance improvement (Continuous improvement is a basic tenet of the quality management programs to which many organizations today have committed.)
Using common tools	Allows for easy comparisons and collation of data
Using common language	Avoids confusion and misunderstanding
Explicit assumptions	Allow the validity of underlying assumptions to be challenged
Fact-based	Clarifies the difference between what is known and what is supposed
Evidence-based	Uses current best evidence to identify problems/ issues specific to the organization through a commitment to continuous, up-to-date information and knowledge gathering and analysis
Oriented toward systems and processes	Uses systems theory to analyze problems (discussed elsewhere in further detail).
Flexibility	Recognizes and accepts that assumptions are likely to change
Multiple perspectives	Provides access to diverse perspectives

 

Assessing OED Interventions and Why They Fail

OED interventions must be assessed once they are concluded, so time must be allowed following the intervention to accurately measure its efficacy. The measurement should use KPIs that track the process or unit that underwent the intervention to determine if it actually succeeded at achieving its stated goals. Measuring too soon, or without using quantifiable data, may result in the organization being unable to accurately determine if further action is required to address the identified issue.