I have two young children. When they were small, they used to go to daycare. What this meant in practicality to me was: two kids + daycare = many fevers and visits to the doctor’s office. As the parent, I was able detect and even treat the fever. However, in order to get rid of the fever, I had to rely on my doctor to discern whether the fever was caused by a bacteria or a virus and, if so, what part of the body the bacteria or virus was infecting. Then the doctor, using her knowledge of how the body functions, was able to prescribe the solution to dealing with the root cause of the fever.

You may be thinking right now, “What does this have to do with consulting?” Well, the difference between a parent and a doctor is the doctor is better able to understand the human body as a system, as well as better able to discern root causes of illnesses and to prescribe long-term cures for those illnesses. Similarly, the difference between a good consultant and a great consultant is the latter is better able to understand an organization as a system, as well as better able to discern root causes of organizational challenges and to develop planned, long-term solutions for those challenges.

What is an Organization?

An organization is commonly defined as “groups of people working together toward a common purpose.” This definition provides a simple description of an organization, kind of like describing a car as “a mode of transportation with tires and an engine.” Both entities are far more complex than these definitions would lead you to believe. In fact, this visual should give you a better sense of the true complexity of an organization.

As you will notice, every organization has five major components that, when aligned, dramatically increase its potential to achieve intended results.

1. Strategy: The organization’s formula for winning (e.g., goals, objectives, values, etc.).
2. Structure: The placement of power and authority (e.g., organizational chart, division of labor, etc.).
3. Interdepartmental Coordination: How the work is accomplished, the flow by which products and services are created and delivered (e.g., budgeting, order fulfillment, etc.).
4. Leadership and Culture: How employees are led, and the unspoken but understood “ways things get done around here” (e.g., stated and implicit performance expectations, role and styles of leadership, etc.).
5. Infrastructure and HR Systems: What competencies are required; how individuals are recruited, selected, trained, recognized, compensated and rewarded; and how performance is measured, tracked and monitored.

Every organization has these components, whether leaders are aware of them or not. The key to organizational effectiveness is increasing the level of explicitness of each organizational component and striving for maximum alignment among the components. The greater the alignment; the greater the organization’s effectiveness.

Nordstrom’s department store is an excellent example of a company that achieves maximum alignment among its components. Nordstrom’s is known for its customer service, and leverages that aspect of its strategy as a competitor differentiator. Notice in the next visual the ways in which this company works to ensure that all of the various components of the organization are aligned to support its overall strategic objective.

Leveraging these organizational components, or performance levers, is particularly significant during times of organizational change. For example, one of the theme parks at Walt Disney World to which I was the Organization Development Consultant was in trouble. Despite a strong, “can do” culture and rigorous focus on managing expenses, the park was not meeting anticipated financial results. After conducting research, it was determined that the current brand was not appealing to Guests and, in fact, was creating many misconceptions and inaccurate expectations about the park. To remedy this problem, the operational and marketing leaders felt that a brand re-launch was necessary.

The first thing I had to do to ensure the long-term success of the brand re-launch was convince the leadership that not only did the perceptions of Guests prior to their arrival have to change, but the delivery of the Guest experience also had to change. In essence, the winning formula (e.g., business strategy) needed to change. So I designed and facilitated a high-involvement process that led to a new brand charter, consisting of new vision and mission statements. In addition, I partnered with representatives from Marketing, Operations and Communications to summarize the new strategy in a Position Paper designed to help all stakeholders understand the new strategy and use that strategy as decision-making filters. Further, I worked with leaders at all levels of the operation to better define standards for Guest/Cast interaction and to re-align key processes, organizational structures and rewards to reinforce the desired Cast Member behaviors. Once all of the performance levers were aligned, the theme park was able to deliver outstanding business results and outstanding Guest experiences.

The Return on Investment

There are many benefits to having an organization better appreciate systems thinking, including improved employee experience, morale and motivation; reduction in costs spent on re-work, re-hires, etc.; and increased effectiveness in change management.

However, the ultimate return on investment comes as a result of leaders understanding the organizational components and the importance of alignment among those components. Increased leadership effectiveness translates into employees who are properly focused and who deliver higher quality products and services, because higher quality products and services lead to greater customer satisfaction and, eventually, to increased financial return.

The Bottom Line

A consultant is one that improves a client’s long-term condition. A client is not well served by a consultant who suggests solutions that yield only short-term benefits – especially if those solutions have the potential to wreak havoc further down the road.

To avoid thinking along short-term lines and offering short-term solutions, a consultant should be equipped with a good grasp of systems thinking, to help a client anticipate and mitigate both intended and unintended ripple effects.

An organization is a system with identifiable components that work together to achieve intended results. These components exist whether a leader or consultant is aware of them or not. Increasing awareness and application of systems thinking helps to improve the quality of assistance the consultant can offer, and improves the organization’s return on its investment.

Do you want to learn about systems thinking or other ways to improve your effectiveness as a consultant? Check out the other resources available online at www.acceleraconsultinggroup.com or give us a call at 407.376.8522 for a free consultation. We accelerate results by igniting leadership and organizational potential!