· Web viewMembership could comprise of the CEO’s, executive representation, OD/HR and operational expertise. Two key change management issues that should be addressed upfront include

Interim Organisation Structure - Considerations | Page

INTERIM ORGANISATION STRUCTURE

The task of developing an interim organisational structure will be the responsibility of the incumbent CEO’s. This task will therefore require the establishment of a working group to drive the project. It is highly recommended that a comprehensive project plan detailing ALL tasks, methodology, timeframes and milestones be established immediately. The interim organisation structure will be adopted at the inaugural meeting of the new entity in July or August 2015.

Organisational leaders who have been involved in any part of a restructure or realignment understand the difficulty in creating a successful model. To assist staff with the task of developing an interim organisation structure, key aspects of the process are outlined below for your consideration.

1. Principles and Objectives

When embarking upon a task such as designing a new structure from scratch, it’s important to establish a collective understanding of the task ahead, the objectives and the proposed outcomes. To facilitate this, a Project Scope could be established similar to the examples attached (Attachment 1: Interim Organisation Structure - Executive Structure, Attachment 2: Interim Organisational Structure - Staffing Structure). Establishing clear expectations up front is an effective way to set the scene and create some ground rules for change. Developing and documenting manager’s expectations of employees and employee’s expectations of managers can be a great way to start the process.

2. Strategy is Top Dog

In a more conventional situation, Council’s would align resources, policy, systems and employees to their strategy. In the current situation of pre-amalgamation, there may be two or more Strategic Community Plans (SCP) and Corporate Business Plans (CBP) that need to be considered when establishing the interim organisation structure. In this case, ensure that the key aspects and outcomes, risks and major projects outlined in the SCP’s are considered. The interim organisation structure, although initially established to manage the transition will also have the capacity to evolve once the Integrated Planning and Reporting process is reignited and a new SCP is established for the new entity (this process could commence 2016/17).

3. Adopt a structured approach

There are three elements to consider:

I. As a key activity of the reform process, establish a formal project management methodology. Create a working group with terms of reference including progress reporting, risk management and issues escalation. Membership could comprise of the CEO’s, executive representation, OD/HR and operational expertise. Two key change management issues that should be addressed upfront include the development of a change management strategy and a communications plan.

II. Consider a structured approach to organisation design so that it has integrity, is based on data, is transparent and is a repeatable process. This ensures that you follow the same methodology for assessment and decision making across all levels of the organisation and ensures the process is consistent.

III. Costing and budget implications are to identified throughout the planning stages to ensure a full understanding of cost to serve is achieved. Any cost savings or increases are to be identified and documented. All on-costs including fleet etc must also be included.

4. Keep it simple and don’t be tempted to over complicate the process

Keep to a standard method of design, planning and assessment – diversion and complexity will cost. Organisational structures can become compromised when preferences and bias are introduced and strategy takes second place. Some decisions will be made for you though due to the transmittal of employees.

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Manage key position annual leave (i.e. executives, HR/OD, CEO, supervisors etc) to ensure the planning, change management process and communication strategy remain consistent. On the flip side, don’t burn out staff as the process will become all consuming for some.

5. Corporate Values and Charters

Start planning for the new era. Creating new structure also creates an opportunity to work across the organisation and develop new corporate values and charter – or similar. Creating a new vision for the entity, fresh and relevant for the time can be an uplifting and positive experience for employees. It is also an excellent opportunity to bring disparate parts of the organisation together.

Preparatory work can begin in readiness for the new entity and the strategic necessity to create new corporate values. Work on the project plan and employee engagement strategy can begin. The new entity will mark the end of era and thisneeds to be respected and acknowledged, along with the recognition of the new journey about to commence.

6. Focus on core activity

Structure designers will need to know what people are doing now by obtaining a detailed understanding of tasks by position. This ensures that no value-added activities are thrown out when designing a position and future business units. Similarly, duplication and redundant activity can be removed at the planning stages to eliminate inefficient legacies. Where non-core or value-add tasks are identified, they can be assessed and responded to accordingly.

7. Use a staged approach to design

Interim Executive Structure:

Utilise a top down approach initially so that you can clearly articulate levels, accountability and responsibility, starting with the interim executive structure. This will flow through to mapping the sub-ordinate structures.

Once the interim CEO is appointed, recruitment of the executive team can commence. Once the executive are established, recruitment of first level management can commence, then second level management and so forth.

Interim Organisational Structure:

With the draft Interim Executive Structure confirmed, work can progress on the full structure with information feeding into the process from other planning work being undertaken which could include possible changes to service delivery and mode of delivery i.e. decentralisation, outsourcing, centralisation, in-house delivery.

With job security paramount and where applicable, the two year period of continuity of employment confirmed, those designing the structure will need to take into consideration the following:

duplication of positions multi-functional positions (usually more evident in smaller organisations) translation of positions locality (geographical issues); and identification of positions that will not be replaced when vacated

The Workplace Code of Practice with Guidelines will assist with the industrial relations related matters.

8. Business process can dictate structure – so beware.

Structure designers will need to understand the strengths of the current structure and its current capabilities (spans of control, levels, type of structure, work flow across the structure, cost to serve, and the relation between performance issues and the current structure). Key structure performance gaps and their root cause will also need to be understood so that inefficient legacies from the amalgamating entities are not carried through.

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In the context of establishing an interim organisation structure, although the word interim infers temporary, it shouldn’t inhibit the opportunity to re-engineer or aim for process and productivity improvements.

The subject of business process is not very exciting to some. Management teams are often distracted with day to day operations and the thought of delving into current business practice can be overwhelming. The important thing to bear in mind is that business process analysis boils down to answering two questions:

1. What kind of work should the Council be doing?2. What is the most efficient way of doing the work?

The first question is linked with strategy, while the second is linked to execution. It’s recommended to build an inventory of business processes that can be referred to during implementation. This will provide an opportunity to develop better practice and simplify the way we do business so that resources are channelled to service provision / function not unnecessary effort.

9. Structural Options

There are two base-line structural options to be considered:

1. Functional Structure – this would comprise divisions based primarily on the aggregated functions and services of each Council.

2. Geographic Structure – this would comprise divisions based primarily on existing geographically segregated organisations, i.e. existing councils

The distribution of employees within these structures could under normal circumstances be undertaken in a centralised or decentralised manner, though the Geographic Structure naturally lends itself to a decentralised distribution. The Functional Structure is relatively flexible in that it can be based on either the decentralised or centralised option. A further option of creating a hybrid structural model acknowledges that the required structure must serve a transitional role.

All scenarios will have to take into consideration the impact of the Workplace Code of Practice and Guidelines and be subjected to a risk assessment.

Reviewing the Options:

It is proposed that the existing CEO’s and representatives of the executive teams should review the structural options against the following criteria:

1. Satisfaction of Objectives – to what extent are the objectives satisfied?2. Compliance with Principles – to what extent does each option comply with the principles?3. Impact on levels of service – what are the comparative risk levels relating to disruption to service

provision?4. Impact on employees – what is the level of disruption to employees and also to what extent does

each option minimise uncertainty and provide clear direction for employees?5. Transition management and reform capacity – to what extent does each option enable the

progressive implementation of reform and transition initiatives?6. Governance effectiveness – what is the comparative effectiveness and efficiency of the interface

between operations and the decision making processes of Council and its Committees?7. Management effectiveness – to what extent does each option support effective management?

10. Create feasible positions

Make sure you understand the current workload of employees and don’t overload staff. Be mindful also of the extra time required for managing change, team building and generally readjusting to the new environment. Leadership positions including supervisors and team leaders will also need more operational time dedicated to building teams and supporting change.

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The case of leadership or “management loading” can also become a risk when establishing new structures. Often, the inability of managers to focus on leadership tasks due to increased output requirements or bedding down can create significant problems for an organisation. For example, time spent mentoring and coaching staff can be compromised, staff can disengage, more issues arise due to staff errors and managers end up spending more problem solving and resolving issues. To ensure management are appropriately loaded, it’s critical to balance three elements:

1. The number of staff directly managed or supervised.2. Staff ability to perform work without supervision.3. The amount of ‘own work’ managers have to do on top of their leadership activity.

Ensure you design positions that are neither too heavily laden nor indeed too light. Position design must take into account realistic groupings of skills. Packing a position with too many distinct skill-sets reduces the pool of durable candidates.

Identify positions that will not be replaced once vacated.

Quarantine each structure level so that you can manage the employees affected.

Where possible, establish a whole new set of position titles so there is no carry over from the previous organisation(s) and no legacies – this will minimise the opportunity for employees to compare to the past.

Considerations for organisation design:

Design jobs around competencies, not around current incumbents Explore outsourcing of non-strategic functions so that you have comparable data Eliminate non-value activities / processes Optimise processes cross-functionally – now is the time to fully integrate and re-engineer Explore ways to use enabling technology Establish clear responsibility and accountability for results Minimise organisational layers – aim for four (4) layers between the CEO and front line where

possible. Commonsense rule applies and in some cases this will not be possible.

11. Keep the Focus on the People

Begin thinking about the impact on employees right from the start. In addition to traditional leadership positions, most employees will be supporting each other through the transitional stages, helping to manage the emotional fall-out and assisting with organisation alignment, particularly around goals, positions, and performance expectations. The impact upon human capital should never be underestimated.

The development of an interim structure will provide the opportunity to not only standardise the framework and process but define, on mass, new positions, activities, relationships and, possibly most importantly, defining the key behavioural requirements of the positions. The framework could be established now to include the creation of a revised set of competencies that accurately define the behaviours that the new entity will require from its people.

Job translation:

The Workplace Code of Practice and Guidelines will assist the HR team with translation matters including terms and conditions of employment and location of employment. Below are some other considerations for the journey in relation to translation:

Direct Translation of Employees:

It is expected that the vast majority of employees will be directly translated and will continue in their current position. This will be confirmed for each employee in a comprehensive process conducted by divisional and business unit managers.

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This will involve the detailed review of all employees’ current roles and reporting relationships. In most cases neither the role nor the reporting relationships will change, however for those employees that currently report directly to senior management, it is likely that the reporting relationship will need to change to reflect the Interim Executive Structure.

Job analysis:

Some level of Job Analysis is always required to fully understand the requirements of any position. Job analysis and competency design is an important part of the process and if/when called to defend your decisions, demonstrating that you have followed a structured procedure will be very important. Ensure all methodologies and process are documented.

Competencies:

As the selection criteria will rightly be subjected to rigorous review, it is important to document the outputs of these competency design stages, clearly highlighting the essential and desirable competencies for the position.

Have you consulted with key stakeholders on the relevant aspects of the new entity’s key strategies and the implications for positions?

Can you use an existing generic competency framework to expedite the process of competency definition for the new positions?

Have you documented your entire job analysis procedure and outputs?

You cannot design a defensible or equitable assessment process unless you have accurately defined the new positions and compared them to the positions that have existed in the amalgamating local governments.

Assessment:

Does your assessment regime cover the breadth of the position requirements? Have you considered using some assessment methods that will make candidates feel

comfortable/empowered in the process? Have you consulted with employee representatives on the process? How will you assess and include past performance data (appraisals, etc)? What have you done to ensure the assessment regime gives as equal an opportunity as possible to

applicants who are currently performing a variety of different positions or multifunctional positions? Is your final assessment process fit for purpose? How will you manage the anxiety level of candidates? How do you propose to communicate the process to candidates in advance and post the

assessment or recruitment process? Have you developed a core script to ensure consistency throughout the recruitment process?

Human Resources:

To support the job design, recruitment and appointment process, other key HR processes and systems will need to be reviewed/developed with the long term view of inculcating these systems into the new entity. This includes strategies such as:

rewards and recognition performance measures performance management competency gap analysis training and development talent retention and management, and career development

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Redeployment:

The ‘aftercare’ of those who are not redeployed should be considered and planned for as part of the broader redeployment project. If not managed correctly, the impact of redeployment on the workforce can have a detrimental short-term effect. Absenteeism can increase, levels of employee engagement will fall, productivity and levels of customer service can suffer and the Council brand can be tarnished.

Confirmation of Employment / Letter of Appointment

Each employee will receive a Letter of Appointment from the Interim CEO/CEO prior to changeover day. The letter will confirm the following;

employee number title of the position location of employment section/group that the position belongs to supervisor/manager that the position reports to relevant industrial agreement wage/salary classification day and method of wage/salary payment leave entitlements estimated as at Changeover Day delegations/authorisations (if applicable) other special entitlements (if applicable) other special service/reporting arrangements (for multi-functional positions if applicable)

Engagement:

Restructuring existing organisations is challenging enough but, when you merge two or more organisations, the complexity of the situation increases significantly. Employees can experience a lack of position/responsibility clarity; unclear decision making ability i.e. who has the final authority to make each decision); processes not aligned with the new structure; technology architecture (data, applications, hardware) can be inadequate or not maximised, different workplaces and faces; and unresolved conflict can distract and consume employees.

If an employee’s engagement level drops, this translates into the employee’s organisational commitment dropping which means dissatisfaction and poor productivity. Employees may then choose to leave voluntarily when they can find somewhere else to go. The loss of corporate knowledge, skills and experience can become a real risk. Only by ensuring employees are clear on their new positions, managed to deliver against them and motivated to work within the new structure will the benefits of amalgamation become evident.

12. Implementation

There may be some confusion in the workplace during the first weeks and months after changeover day. To mitigate uncertainty and confusion, clarify positions and responsibilities from the very beginning, identify all functions (activities, tasks and decisions) that have to be accomplished for effective operation, clarify who should be involved, where they will be located and be specific about accountability and performance expectations.

Employees who are relocated to different workplaces will need to be supported. They will experience a breakdown of their existing social networks and structures, a new workplace and new faces. Ensure inductions are carried out and team building activities commence immediately.

Refer to the Communications Function (Internal) in the Toolkit.

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Attachment 1.

INTERIM ORGANISATION STRUCTURE - EXECUTIVE STRUCTUREProject Scope

Overview

Insert the general overview of the project, tasks, timelines and outcomes i.e. establishing an executive level structure, driving employee communications, oversee the transition of employees to positions within the new entity, development and adoption of the interim organisation structure at the inaugural meeting of the new entity (July 2015) etc.

Objectives

Example – The following objectives of the Interim Executive Structure are to;

1. allow senior managers to apply their expertise and effort to the principles of local government structural reform

2. establish clear management authority and accountability to the new Council and external stakeholders

3. establish clear reporting relationships between senior management and middle management4. demonstrate clearly that the organisational leadership and management is established and is

capable of fulfilling its transition and reform responsibilities

Principles

Example – The following principles are designed to underpin the reform processes:

1. All options will be explored in an attempt to retain existing managers within the new entity.2. The structure enables management to drive the ongoing delivery of reform3. The structure is sufficiently adaptable to accommodate ongoing change and can be efficiently and

effectively transformed into a substantive organisational structure at a later time4. The structure accommodates the geographic distribution of operations 5. The structure is established in compliance with the Workplace Code of Practice and Guidelines.

Permanency of the Interim Executive Structure

It is very important to understand that the Interim Executive Structure is temporary until such time as the new Council and its CEO adopt the new permanent organisation structure. It is estimated that this will be somewhere between six and twelve months after the changeover day.

Process to determine the Interim Executive Structure

The intended processes and timeframes are proposed as follows for the determination of the Interim Executive Structure.

DATE ACTIONEstablish working group and TOR

July 2015 Adopted at the inaugural meeting of the new entity

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Attachment 2.

INTERIM ORGANISATION STRUCTURE – STAFFING STRUCTUREProject scope

Overview

The incumbent Chief Executive Officer’s are collectively responsible for the preparatory work and associated due diligence required to establish the interim structure, systems and processes for the new entity. The Interim Chief Executive Officer is responsible to manage and implement the various aspects of the transition of the existing Councils to the new entity. A critical aspect of this transition process is the transmittal of employees from their existing organisations to the new Council.

The Local Government Act, Regulations and the Workplace Code of Practice and Guidelines will guide the CEO’s and Interim CEO in managing this task. Specifically, the CEO’s are required to develop an Interim Staffing Structure that will align with the interim organisational structure and fulfil all industrial and statutory requirements.

The Interim Staffing Structure is required to ensure all council employees have a clear understanding of their position, roles, responsibilities and reporting arrangements with respect to the new interim executive structure. The structure will also ensure the continuity of an effective working environment and service delivery during the transition phase.

The required outcome should be a draft Interim Staffing Structure clearly outlining the structure and costs implications.

Objectives

Similar to the objectives adopted for the Interim Executive Structure, it is proposed that the following primary objectives of the Interim Staffing Strategy be adopted to guide deliberations:

1. that all employees are provided opportunity to remain with the new Council and contribute to its development and operation

2. to reassure all employees that their employment is secure and that the new Council values the contribution that all employees make

3. to establish clear reporting relationships between Interim Executive Structure managers and their employees

4. to demonstrate clearly that the new organisation is established and is capable of fulfilling its transition and reform responsibilities

5. to ensure that the transition meets all legislative requirements.

Principles

Refer example Interim Executive Structure

Proposed Process

Map and document proposed process and timelines.

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Proposed Time-frames

The following table sets out the intended time-frames for the implementation of the Interim Staffing Strategy;

Milestone Target DateComplete selection of Managers (3rd line)Define relationship of all existing positions to Section ManagersPrepare translation proposals for all employeesIdentify positions that cannot be translated Commence selection process for duplicated positionsComplete selection process for duplicated positionsCommence redeployment process for employees not translatedComplete redeployment process for employees not translatedIssue Employee Statements to all employeesEmployees submit identified Employee Statement errors for reviewIssue corrected Employee Statements where necessaryChangeover Day 1 July 2015

The achievement of all deadlines will be critical to the successful implementation of the Interim Staffing Structure.

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Documents

· Web viewMembership could comprise of the CEO’s, executive representation, OD/HR and operational expertise. Two key change management issues that should be addressed upfront include