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July 16, 2019

How a team-based structure can help build the organisation of the future

The changing world of work and increasing pace of innovation are driving the rise of a team-based organisational structure. To build a high-performing workforce, HR leaders must play a key role in enabling and improving team collaboration and transparency.

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With rapid technological advancements disrupting the way organisations work, paired with intensifying competition from more nimble organisations that quickly adapt to changing market demands, organisations are under pressure to remain relevant in the market. The siloed bureaucratic organisational structures of the past that focused on effectiveness and efficiency rather than speed and agility are no longer effective.

Leading organisations are breaking down siloes and redesigning their workforces to be able to continuously adapt to change amidst the uncertain digital environment. To achieve this, companies will need to build more collaborative teams, boost employee engagement and productivity and create an agile organisation to fuel innovation.

What does it mean to be team-centric?

The “team”, according to leading HCM industry analyst Josh Bersin, is evolving into the fundamental organisational design principle of a company. He states that redesigning the workforce for greater adaptability requires a shift away from hierarchical organisational structures toward models where work is accomplished in teams.

Building a team-based structure requires a flat and open organisation where employees work together in teams and collaborate across departments and even across geographical locations. Designing a team-centric workforce means that individuals transparently share information and seamlessly transition from one team to another based on project requirements rather than remaining in siloed departments with a top-down approach.

What are the key factors influencing the rise of teams across organisations?

The team, according to Bersin has primarily been driven by a shift in employee demographics as more millennials and Generation Z have started to enter the workforce. Younger employees that are just entering the workforce desire greater flexibility in how, when, and where they work, and are open to adopting unconventional organisational structures that are more team-centric. These “digital natives” thrive on social media technologies outside of work, and they expect similar connectivity tools within the workplace.

Stephane Kasriel, CEO of global freelancing platform Upwork, believes that this new wave of employees is likely to “reshape work as we know it”. Millennials and Generation Z already account for 38% of the workforce, and that figure is expected to surge to 58% within the next decade.

In fact, adoption of team-based management models is becoming increasingly popular. Deloitte’s 2019 Human Capital Trends survey reveals that 31% of respondents now operate mostly or almost entirely in teams, with another 65% saying they are hierarchical but have some cross-functional team-based work. These teams break down hierarchical reporting structures and openly collaborate by sharing goals and projects, allowing information and feedback to flow openly, and reward one another for their skills and abilities.

How can HR leaders build successful team-based management in their organisations?

Despite the growing significance of teams within organisations, only 32% of respondents in Deloitte’s Global Human Capital Trends survey say they are designing their organisation to be more adaptable and team-centric. According to McKinsey & Company, the biggest challenge for HR leaders looking to build a team-based structure in organisations is proper governance from executives. This involves aligning company resources with strategic priorities and providing managers with the coaching needed to become well versed in agile ways of working.

Although it is beneficial to enable teams of employees to independently make small-stakes decisions, companies can ensure that teams remain aligned to the overall organisational strategies.

Here are some of the steps that HR leaders can follow to create agile teams within their organisation and ensure long-term success:

  • Establish a quick and easy process for onboarding employees onto new projects teams
  • Build teams with a focus on adding value and enhancing the customer experience
  • Assign high performers to lead independent teams
  • Enable teams to better understand their customers’ needs
  • Allocate resources at the outset, define outcomes, and then hold teams accountable for execution
  • Provide adequate training to team managers to ensure achievement of desired outcomes

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