Doing More With Less

CUNA’s E-Scan online research portal
March 28, 2011 | COMMENTS

During the height of the economic downturn, companies were forced to streamline operations and cut overall costs. The result is that many organizations have become good at delivering their core products and services with fewer resources, adopting a "doing-more-with-less" operating style.

While the cost-saving benefits are obvious, the long-term implications of this new way of working are not as apparent. Companies now need to consider the long-term impact they might be inflicting on their organizations' overall capability, according to strategic human resources firm Sibson Consulting (sibson.com). Emerging problems include:

• Diminished capacity, capability, and agility.
• Misaligned organizational structure.
• Broken business processes.
• Declining workforce engagement.

Designing an agile organization

Organizations should address the inadvertent costs and complexities generated by doing more with less. To ensure long-term viability, organizations must realign certain critical elements without diminishing their core capabilities and competitive differentiation.

Sibson suggests that designing a flexible and adaptable organization requires attention in four major areas:

1. Go beyond the org chart. Think beyond reporting relationships, layers, and numbers of people. Achieving alignment and incorporating necessary business assumptions requires recalibrating:

• Work priorities. What work is mission-critical, what can be scaled back and what should be eliminated?
• Existing role requirements. Identify potential new or modified roles that are needed to ensure that mission-critical work is resourced properly.
• Key metrics and accountabilities.
• Critical information flows.
• Decision-making authority by organization level.

2. Realign core processes. Realigning an organization's core business processes involves consideration of how the supporting infrastructure will need to adapt to sustain performance while maintaining or reducing costs.

Typically, best-practice organizations consider five key elements when recalibrating their core processes:

• Work content
• Roles and accountabilities
• Decision authority
• Key interfaces and communications
• Performance metrics

 
3.Focus on talent. Companies must be adept at engaging and retaining a high level of talent to sustain high performance. While there are many ways to accomplish this, Sibson proposes the following three strategies:

• Identify the company's current employment value proposition by analyzing what the organization expects from its employees in performance and commitment and what it provides them in exchange for their contributions.

• Realign rewards. Forward-looking companies segment their job roles by the value they create or add. By taking a targeted view, companies differentiate and develop total rewards programs that align with the needs, expectations and desires of their top performers.

• Communicate globally but translate locally. Organizations doing more with less cannot afford to have even a small percentage of their employees disengaged. But don’t expect enterprise-wide emails, town hall meetings, and conference calls alone to generate enthusiasm among overworked employees.

4.Regulate new work. Companies must guard against work creep. It’s not uncommon for managers to start initiatives, make more requests, and hold more meetings once economic pressures subside. Processes that continually examine the true value of additional work must be implemented and rigorously followed.

In Sibson's view, five critical questions need to be asked:

• How does the addition of work bring value to the customer and enterprise?
• What is the return on investment and over what time period?
• What work could or should be curtailed or eliminated to offset the new work?
• What structure, process and talent implications will arise?
• How will the absorption of additional work affect overall organizational capacity?

Unless these questions are addressed properly upfront, firms risk employee burn out or a rise in turnover.

This mode of business—doing more with less—is likely here to stay. Organizations must address the indirect costs and complexities by creating alignment up and down the organization. For most companies, that means learning how to operate to drive performance, regardless of changing and unpredictable business conditions.