For those of you who’ve worked with me in the deals / post merger integration environment, this rant will be very familiar and i apologise for repeating myself in this forum…but I was reminded once again of this in a conversation with an old colleague. Let me take you through the way the discussion normally goes, the participants being an HR person and me in a operational due diligence and post deal planning role:
HR Person: I need an organisational diagram / structure of the target…in fact what I really want is the whole organisation described in terms of levels, functions, down to the entry level. If you haven’t got that, give me the top 5 layers of management.
HR Person: Because it will show me how the organisation works, who has what level of authority, how decisions get made, how communication flows, who the most important people are.
Me: Show me your organisational structure, just draw it for me, top 3-4 levels is fine.
HR Person: Here it is.
Me: Does this accurately describe the nature of your business, in terms of influence, decision,asking, key people. If I were a martian landing in your business, would this work as a road map to navigate my way around your organisation?
HR Person: Of course not…
Me: Why not?
HR Person: Well, it doesn’t describe the true nature of the relationships…for example (starting to draw actively), this person has way more influence than his role would suggest, whilst this person is purely employed to rubber stamp decisions. This person exerts Incredible power over the organisation as he is the primary SME and that is highly valued in our business. This person has strategy in his job title but the reality is that strategy is decided by the owner on an entirely intuitive basis and this person then provides documentary evidence to back up the decision. The most important person from a productivity perspective isn’t even on this chart…she’s the receptionist and she greets everyone by name as they come through the door, smiles, acts as the primary conduit for information, is the knowledge keeper for all that has gone before, manages the politics beautifully!
Me: So, given your incredibly eloquent description of your business which doesn’t seem to resemble the structure you drew at all, why do you think that the target will be any different?
HR Person: mmmh (thinks to him / herself, he’s an awkward so and so, I will get it through some other means!)
Please do not see this as a rant against HR people….it is a critical and massively undervalued discipline and the top performers add real value to their organisations. Rather it is a comment about the inherent messy nature of organisations and the, in my opinion, relatively pointless task of trying to squeeze them into a neat structure which actively misleads rather than informs the reader.
Just wait until I get onto the subject of reward structures….!