Organisation: The Key Contributor

Organisation image
Devotees of F1 motor racing will know of the work that goes into ensuring pit crews work quickly and effectively. The driving genius of, for example, a Schumacher is not all it takes to make a world champion. Seconds lost in pit stops cannot be regained against his peer group, no matter how brilliant the driver.

The same applies to a professional firm in today's competitive environment. No matter how brilliant the practitioners, if the organisation around them fails to provide an appropriate level of support, then the market will perceive other practitioners as performing better. The value a practitioner brings to a client lies in the advice, the delivery and the overall relationship. Brilliant advice delivered badly, and without taking into account issues facing the client, will likely not be seen by the client as particularly valuable however well it covers the technical aspects of the issue.

The facilitating organisation

The critically important activity in a professional firm is that which occurs between clients and practitioners. The organisation is, in effect, an artefact that facilitates the relationship – and that can add to or detract from the inherent value received by a client, relative to that of the firm's competitors. Hence, the effectiveness of the organisation is a crucial aspect in delivering value to clients – although it rarely has a higher strategic priority than the client/ practitioner relationship.

Organisational effectiveness is impacted adversely in many professional firms by two issues: first, the management structure and decision-making process, and second, the ability to translate decisions into actions. Both are issues that almost every professional firm is forced to address at some point.

Designing an effective management structure is a complex issue and warrants far more attention than it often receives. While there are generic structural shapes that provide a basis for most organisations, a firm must adopt a structure that best suits its strategy and organisational culture. If both of these are unclear, then a structure will almost certainly be less effective than it could be. In addition, a crucial aspect of any structure is not just the identification of general roles (e.g. managing partner, management committee) but the specific definition of each role, (e.g. what role responsibilities and authorities are), and how these are integrated with others. We find many instances where more or less standard role descriptions have been used without any attempt to tailor them to key activities and decisions required in a firm. In some cases, there have been no descriptions at all.

Defining roles

Defining the level of decision-making in the structure is another issue. In some firms, almost all decisions are made by the partners as a whole, an increasingly cumbersome approach in a fast changing business world. In others, many partners have virtually no involvement – and are therefore unaware of important decisions and why they needed to be taken, so impacting adversely on implementation. Finally, the role of support personnel must also be defined clearly and in a way that facilitates their ability to work effectively and efficiently. We have seen firms recruit high-level personnel into key roles, fail to provide them with appropriate responsibilities and authorities – and then question their competence. Many of the decisions made in a professional firm will need to be implemented by the practitioners, and especially partners. This is another area of tension in many firms.

Of course, there are complications in professional firms that many other organisations do not face. Urgent client needs do arise, deadlines change, engagements expand beyond the original brief and so on, all taking time and pulling practitioners away from important non-client activities they have agreed to do. 'Where there is a will' usually comes to the fore here, and patience can result in successful implementation, albeit over a longer period than originally intended. More important, and occurring far too frequently in many firms, are cases where client matters are used as an excuse to avoid implementing agreed activities. The assumption in management is often that a particular partner is simply being wilful and selfish and trying to have the benefits of both partnership and independence. This is only sometimes correct.

Other issues

Three other issues are often involved. First, intelligent practitioners will always question why something needs to be done and why it should have priority over their many other tasks. Inadequate, unconvincing explanations are often given in response, particularly if the person explaining was not party to the original decision. Hence, finding ways to ensure partners understand the meaning of a decision and why it is important is crucial. Second, it is often assumed that practitioners know how to carry out many activities (e.g. 'cold calling' to sell) but often they do not. They might do a little, but find it unpleasant and dissatisfying because they do not do it well. Hence, they will put a priority on doing what they do best and avoid the less congenial tasks. Providing adequate support, training and coaching in activities other than the advisory work is crucial if implementation is to be effective. Finally, many practitioners are extremely busy – and some might actually want to spend time on non-work related activities as well.

Hence, before it is assumed that partners are simply being wilful or contrary, an examination of their roles can play dividends. Eliminating some existing activities can allow them to be more effective in doing new things. Organisational effectiveness also lies in a firm's functional systems and processes. While these operate effectively as stand-alone items in many situations, we often find two areas for improvement:

  • Systems and processes do not reflect the requirements of the firm's strategy. A good example here is the recruitment process: we see many firms who have defined the characteristics they expect in new partners as a part of their strategy, yet fail to reflect these anywhere in the recruitment criteria of more junior staff. It is vital that a clear link exists between the purpose of a particular function and the requirements of the firm's strategy.
  • Integration across systems and processes. In many firms many systems and processes are developed in isolation, and the management structure is not conducive to developing an integrated approach which would be self-reinforcing. A good example is in performance management systems, which require information from a number of other systems; there is no process in many firms for assembling this information over a year into an automatic feedback process to practitioners.

Management Information Systems

These are another area requiring scrutiny in many firms. Reports are often issued to partners containing huge amounts of data, but not assembled in any way that enhances understanding of how to better manage their particular group. Information is vital if an organisation is to operate effectively, but it must be assembled in a meaningful, relevant way so that recipients can see the issues clearly and be guided into the appropriate actions. Information provided also needs to be directed towards strategic goals and targets. If a firm sets a goal of winning an amount of work from specific client types, then there must be regular feedback indicating current progress towards that goal.

Our key theme here is linking the organisation, its systems and processes to the strategy of the firm. In too many cases we find significant degrees of disconnection: activities are occurring in the organisation which are good in themselves – but are not aligned with the firm's strategy, its objectives, goals and targets. This misalignment is a primary cause of ineffectiveness in the organisational support to practitioners.