Source | Bersin
We just launched one of the world’s largest studies of people challenges in business, Deloitte Human Capital Trends 2016, and the results were striking. Among the 7,000+ companies who responded (in over 130 countries), the #1 issue on leaders minds is “how to redesign our organizational structure” to meet the demands of the workforce and business climate today.
Our conclusion, after almost a year of study, is that today’s digital world of work has shaken the foundation of organizational structure, shifting from the traditional functional hierarchy to one we call a “network of teams.” This new model of work is forcing us to change job roles and job descriptions; rethink careers and internal mobility; emphasize skills and learning as keys to performance; redesign how we set goals and reward people; and change the role of leaders.
Fig 1: The New Organization: A Network of Teams
Our research, which identifies the top ten human capital trends for 2016, shows that most of the issues facing companies today (employee engagement, culture, time to market, innovation) are tied inextricably to this new way of working. And 92% of the companies we surveyed cited “redesigning the way we work” as one of their key challenges, making this the #1 trend of the year.
Fig 2: Relative Importance of the Ten Global Human Capital Trends
What is a “Network of Teams” and Why Now?
If you look at the research, you find that companies already operate this way. Only 24% of large companies (>5,000 employees) claim to be functionally organized and only 38% overall. We naturally run our businesses in sales teams, manufacturing plants, retail stores, product groups, service teams, and geographically independent operations.
Uber, who is well known as one of the most disruptive and innovative companies in transportation, sets up city managers who run their local operation with local marketing, government relations, staffing, and operations leaders.