one function. Be explicit about ownership, so you don't forget important parts of your strategic roadmap.
If you're scaling the People team, the logical first managers will be in People Operations and Organizational Development and you will have systems and people in place for the entire organization. Once you've designated leaders for those two functional areas, make sure that your operating system is updated to include a leadership meeting so leaders can stay aligned on strategy, and guide their teams effectively. Of course, you'll want to continue to have full team meetings as well, so that all functional team members still have relationships and visibility into everything happening on the team and in the business. You'll also want to ensure that you invest time every quarter on team development and deepening skills and emotional intelligence on your team. Your team members need to embody the values of the organization and be role models in their behavior. Keep in mind too that it's really common for a People team to care so much about others in the organization that they neglect themselves. As the Chief People Officer, you need to be aware of this tendency and know your team well enough that you can spot when people are too emotionally invested in the goings on of a company. While you can't completely eliminate this tendency, you can identify it quickly and take steps to minimize the impact. If you have a strong operating system that includes regular leadership and team development, one‐to‐ones with members of your team, and a level of trust where people can admit that they are struggling, you can help your team stay focused and balanced.
As you continue to grow, the sub‐functions may be ready for their own leaders or managers but there's a tradeoff in scaling by creating subgroups with managers and that is usually less speed and nimbleness. I try to keep the hierarchy as light as possible and prefer to create team leader roles instead of manager roles. I also use the same employee/manager/organizational structure guidelines for the People Operations team that we use in other parts of the organization. That way you have structural alignment company‐wide and that makes promotions, compensation, and career pathing similar across the whole company.
A powerful way to extend your reach and share responsibility for cultural stewardship is to get a network of volunteers from other teams at the company to drive different people‐related programs. Make it a requirement for each employee to “give back” to the community. At Return Path, we had volunteers who ran social events, community service programs, our well‐being program, and our diversity, equity, and inclusion programs. The People Team managed the programs globally, gave direction, guidance, and budget for local committees.
If you are creating, or already have, a values‐driven company, the People team is critical to the success for the business. I'd even argue (although my colleagues might disagree!) that the People team are the true drivers of a company and impact both top‐line growth and productivity. Values and culture impact hiring, turnover, engagement, morale, and productivity. There's a measurable effect of culture and values on innovation.
Chapter 27 Organizational Design and Operating Systems
Be intentional about your organizational design from the beginning, and evaluate it periodically to ensure that your design principles still align with your company values and stage of growth. Use the data you collect from exit interviews, turnover, employee surveys, and employee conversations to determine if the design and principles are still relevant.
Your initial design work will be with the CEO, and will also engage the leadership team. Your work on organizational design is not theoretical, or something that stands alone. Just the opposite! It goes hand‐in‐hand with culture and values conversations. Your organizational design will never be perfect and will always have tradeoffs to consider. There's a saying that you should “never let perfect be the enemy of good” and that's the case with organizational design. As long as your design aligns with your culture and values, it ought to serve its purpose, which is to help people be as productive and engaged as possible and to ensure that there is the right flow of communication between people and teams.
There are a few things to build in from the beginning, including practices around manager span of control, manager role, cross‐functional teams, and how you think about hierarchy. People have preconceived notions about all aspects of organizations, and having conversations with the leadership team to help them think about the implications of organizational design principles is critical. It's really easy to grow too hierarchical where managers have small spans of control or if you hire managers who have a “command and control” style. You can help leaders get creative about career development when a team isn't big enough for a leader, and employees want to take on leadership roles. Employees in this situation can expand their role by managing workflow, team operating systems, or projects, without becoming the team manager.
In the beginning, you may not have executive leaders for all the different functional areas, so some executives will lead functions that are new to them. You may have a COO who is also leading Sales, or a CFO leading Technology. Help ensure that leaders who are responsible for several functional areas hire functional experts or get strong mentorship in the areas where they aren't as knowledgeable.
It's best to evaluate organizational structure every six to twelve months for effectiveness, and to make small adjustments, or do a full redesign and restructure if absolutely necessary. Often as you grow, you realize that you've prioritized role function over product/division, and you may need to swing the pendulum the other direction. While every organization has different needs, many organizations are moving toward flatter, more networked, team‐based structures. These structures need even more clear leadership and operating systems to be most effective.
At DoubleClick, my division managed global services for all product lines. Each product line would separately modify their investment in services based on the success of their products. When the key executive and I started in the division, small regular layoffs were standard. The Product line would reduce their investment, and then the Services organization would reduce their staff. This resulted in a lack of engagement and productivity, as people were constantly wondering if they were going to be next to go. In addition, changes were made without any notice. One day, you'd be working alongside a colleague; the next day their desk would be cleared out. I worked with the new executive to understand the impact of these reactive changes, and we agreed on a new process. We created strong career pathing so people could move between roles and product service areas, and we also created a planning process for each product area to follow, so we were able to predict need and manage our staffing appropriately. At one stage, we decided on a large‐scale change in roles, and proposed a consultation process that included transparency and engagement of employees. We were modifying over 100 roles, and this would result in a reduction of 20% overall. Within a week, we communicated the changes, asked people their preferences, assessed skills, and made all the role‐change decisions. Some people voluntarily left the organization and others took on new roles. There was some risk in this approach, and many of our internal clients were worried about losing their best service people. The result of the transparency and employee input was that we retained everyone critical to the organization, and people were more highly engaged than before the reorganization.
At Return Path, we made changes to the organizational structure periodically. At one point, we realized that one of our new product areas wasn't getting the right level of focus from the different functions. It was a new product and wasn't driving a lot of revenue, and when each functional team prioritized their work, this new product was last on the priority list. We moved the product into its own cross‐functional team that was managed separately from all the other functional teams to ensure we created the right focus within the company. Another time, we knew one area of the business needed to be divested, so we moved all our teams into cross‐functional business units, which made the sale much cleaner from both a balance‐sheet and people perspective.
When you change your organizational structure, there will be a lot of questions from employees and, perhaps, some anxiety on what those changes mean for them. To effectively lead an organizational redesign, you'll need to make sure you follow your
