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Mapping Internal Change: Structure, Strategy, People, and Process
Principles of Management · Chapter 6: Leading Organizational ChangeSection 6.2 · lesson 26 of 11712 min · free with a free account
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In this lesson
Structure, strategy, people and process.
- Identify the 4 principal targets of change
- Explain how a change in one target spreads to others
- Explain alignment, and why change stalls where it can't be seen
- Select the right target for a described problem
Transcript
Everything said in the video, section by section (1,697 words). Read along, or search it.
Leading Organizational Change
Mapping Internal Change
Once an organization decides to change, a practical question follows. Change what, exactly? This section maps the four places a change can land inside an organization. Those are strategy, structure, people, and technology or process. We'll see why a change to one of them puts pressure on all the others. We'll look at alignment, and at why organizations so often change the easy target instead of the right one. And we'll see why change stalls in the parts of an organization you can't see on any chart.
Where Change Lands
4 Targets, One Organization
Subchapter six point one established what triggers change. It didn't address where a triggered change actually lands, once an organization decides to act. Four principal targets absorb essentially every change an organization undertakes. A target is simply the specific point within the organization that a change is directed at. The four are strategy, structure, people, and technology or process. Naming the target correctly matters, because each one needs a genuinely different kind of change effort. And there's a trap here. A change aimed at the wrong target can look identical to a correctly aimed one. Right up until the moment it fails to hold.
Strategy and Structure
What It Does, and How It's Arranged
Take the targets one at a time, starting with strategy. A strategy change alters the organization's chosen direction. That means which markets it competes in, which customers it serves, and on what basis it competes. That basis might be cost, differentiation, or some other position. Strategy is developed in full in Chapter fourteen. Here it's named only to place it among the four targets. It's the target that redefines what the organization is trying to do. That's distinct from how the organization is arranged, staffed, or equipped to do it. A structural change alters how work and authority are arranged. That covers reporting lines, the grouping of activities into departments, the distribution of decision authority, and spans of control. Structure is developed in full in Chapter seven. But it keeps coming back in this section for a reason. Of the four targets, it's the one most often chosen not because it's correct, but because it's the easiest to redraw.
People and Process
Who Does the Work, and How
A people change alters the skills, attitudes, behavior, or composition of the workforce. It works through hiring, training, and performance management. Or through a deliberate effort to shift how people approach their work. People change is developed in full in Chapter thirteen. It's also the target most directly implicated in resistance, which Subchapter six point three takes up. That's because it asks something specific of the individuals who must actually change their own behavior. A technology or process change alters the methods, systems, or workflow through which work actually gets done. Think of a new tool, a redesigned procedure, or a different sequence of steps. This connects to kaizen and reengineering, from Subchapter five point six. The division of labor is simple. This section treats process as one of four possible targets. Subchapter five point six covers the specific methods available once process has been identified as the correct target.
Interdependence
Change One Target, Pressure the Rest
The four targets are not independent compartments you can adjust one at a time. The interdependence principle says a change to one target creates pressure on the others. So a change designed in isolation does one of two things. It propagates, forcing adjustment elsewhere, planned or not. Or it gets reversed. The untouched targets pull the organization back toward its previous state. Here's a structural change on its own. A department is reorganized, and a new role is created to own a function that was split across two teams. But performance measurement and compensation, which belong to the people target, aren't updated. So the person in that role is evaluated and paid, according to a structure that no longer exists on paper. Employees, sensibly, act on what is actually measured and rewarded, not on what an org chart says. The structure changed. The behavior it was meant to produce did not. To be clear, not every change has to touch all four targets at once. But ignoring the other three doesn't exempt an organization from their pull.
Figure 6.2.1
Pressure Radiating From a Structural Change
This figure traces a structural change at a fictional manufacturer, Harborline Manufacturing. Structure sits at the center, marked as changed. Pressure radiates outward from it. Toward strategy, because the strategy no longer matches who reports to whom. Toward technology and process, because the old workflow still assumes the old reporting lines. Toward people, because new roles were created, but no one was selected or trained for them. And toward rewards, which stayed unchanged. That last arrow is dashed for a reason. It marks pressure that went unabsorbed. Nothing in the reward system moved to accommodate the new structure. That gap is the exact mechanism behind the case at the end of this section.
Alignment
Every Element Pointing the Same Way
The alignment requirement follows directly from interdependence. Strategy, structure, process, people, and rewards must be consistent with one another, for a change to hold. Misalignment is the opposite state. Some elements point in the new direction, while others still point in the direction the organization is trying to leave. Misalignment is the single most common reason a well-designed change does not hold over time. That's the uncomfortable part. A change can be excellent in its own terms. It can be correctly diagnosed, and carefully planned within its own target. And it can still fail. It fails because no one checked whether the other elements were pointing the same way.
The Diagnosis Problem
Changing What Is Easy, Not What Is Responsible
Organizations frequently change the target that's easiest to change, rather than the one actually causing the problem. Structure is the classic case. An organization chart can be redrawn in an afternoon. A genuine shift in employee skill can't be done that fast. Neither can a redesigned strategy, or a rebuilt workflow. A reorganization is also visible. It feels decisive, and it can be announced immediately. That makes it an attractive response to a performance problem. And it stays attractive, whether or not structure is where the problem actually started. The diagnostic discipline in Subchapter six point four exists largely to counter this tendency. The job is to identify which target a problem actually lives in. Not to default to whichever target is fastest to rearrange.
Visible and Invisible
Where Change Stalls
Every organization has visible components and invisible ones. The visible components are the org chart, written policies, official job titles, and formal systems. The invisible components are norms, informal networks, and the assumptions people hold about how things actually get done. You first met these in Subchapter four point one, in the treatment of informal organization. Change most often stalls in the invisible components, and the reason is specific. A visible component can be changed by decree. An invisible one changes only when the people who hold it are genuinely persuaded. And persuasion cannot be issued the way a memo can. A reorganization announced on a Monday changes the org chart that same day. It does not change, that Monday, which informal contacts people still go to for help getting something done. That gap is where this chapter picks up the thread again, in Subchapter six point eight on organizational culture.
Table 6.2.1
4 Targets Compared
Table six point two point one compares the four targets on what changing them involves, how long it takes, and why each gets misused. Strategy means redirecting markets, customers, or the basis of competition. It takes months to years to design and communicate. It's rarely chosen wrongly, because it usually requires senior sign-off, which forces real diagnosis first. Structure means redrawing reporting lines, grouping, and authority. It can be announced in days, though taking full effect takes much longer. It gets chosen because it's visible and fast, whether or not it's the actual cause. People change means hiring, training, performance management, and behavior change. It takes months to years, and it's slow and uneven. It's often avoided, because it's slower and politically harder than redrawing a chart. Technology and process means redesigning methods, systems, or workflow. Weeks to months for a defined process, longer for a system. It gets chosen wrongly when the real problem sits upstream, in strategy or people, where process redesign can't reach it.
Sequencing and Scope
What Moves First, and How Far
When more than one target genuinely needs to move, sequencing matters. Strategy typically needs to be settled first, before structure is redesigned around it. A structure built for an unsettled strategy is likely to need redesigning again shortly afterward. Once strategy is fixed, people and process changes can often run in parallel with structural change. That works provided alignment is actively managed, rather than assumed. Scope follows a related logic. Scope is how much of the organization a change touches, from a single team to the whole enterprise. A narrow-scope change is easier to align across all four targets, because fewer people and systems are involved. A wide-scope change multiplies the alignment work at every target, all at the same time. That's part of why transformational change, from Subchapter six point one, is managed so differently from incremental change.
Case Vignette
A Redrawn Chart Nobody's Behavior Followed
Here is a composite case, constructed for instruction. Harborline Manufacturing's customer service division reorganized, to give a single team full ownership of each major account. Before, separate specialists had handled billing, technical support, and account management for the same customer, with little coordination. The reorganization itself went smoothly. New reporting lines were published, team leads were named, and the chart was updated within a week. Six months later, an internal review found that most of the old specialist behavior had simply continued under the new titles. Billing questions were still routed informally to the people who used to specialize in billing, whatever team they now belonged to. And individual bonuses were still calculated against the old specialist metrics. No one had gotten around to updating them. The structure had changed cleanly and visibly. The reward system, part of the people target, had not moved at all. Employees rationally kept behaving according to what was measured and paid, not what the new chart said. The new structure was absorbed back into the old pattern it was meant to replace. Try one yourself. A sales team reorganized into industry teams, but a year later people still sold across industries out of habit. Which target was most plausibly left unchanged, and how would its absence produce exactly that reversion?
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