Most HR practitioners see rightsizing as a synonym for downsizing. It is therefore imperative to differentiate the two concepts. In principle, rightsizing requires an organization to link employee levels to organizational goals. While rightsizing, organizations implement a new strategic direction. Sometimes the strategic design elements of rightsizing introduce a new layer of management and sometimes departments are enlarged while others may be eliminated. This inevitably leads to establishing the most effective shape and size for any organization. Rightsizing in other words helps focus on the core competencies that gives an organization its competitive advantage.
I believe that rightsizing is a proactive and constant process of managing an organization. With the right analysis, insight and planning, your company can be configured in a way that supports effective execution strategy.
To sustain the right shape and size of an organization, HR Leaders must realize that they are dealing with a dynamic process. Rightsizing is a creative, constant process of adjusting one’s organization to be the most efficient, effective, competitive, and profitable. The process of rightsizing is not immune to outside forces, but unlike downsizing it does not wait for things to happen to the organization that force reactive changes.
For instance, a couple of months ago, while working with a large textile house, the mandate was to optimize their people potential in the current and future roles. This was an opportunity to set in motion certain activities integral to rightsizing, like; identifying critical roles to organizational strategy, aligning job descriptions to job roles, eliminating duplication of work and optimum utilization of the employee strength.
We initiated with a structural diagnostics for a specific function. The findings were pretty grave. There was unprecedented focus on individuals instead of key positions; imbalance in portfolio handling and what was particularly debilitating was the existence of blurred or often unclear lines of accountability. These resulted in some very negative behavioral manifestations with complacent tenured employees and disengaged new joinees.
Next, we conducted a time and motion study which indicated only 17% of the team members to be fully utilized but engaged in activities that were below their current levels of competencies. The findings indicated that 42% of the team members were fully utilized, 14% of the team were utilized between 85% - 90% a day, and surprisingly 28% of the team was underutilized on a daily basis!
Getting it Right!
A Competency Audit was next in order which helped in identifying the abilities and potential of individuals and teams and understanding the skill gaps in existing and future roles. It immensely helped create tailored development plans and maximize potential of employees in their current roles. In other words, overlaying talent management information with performance management data proved to be a robust and detailed methodology that helps rightsizing decisions.
We used the wealth of human capital data from the Human Resource Management Systems and in-depth Competency Based Interviews. Analyzing the Performance Management Review Ratings both historical and current helped us map the entire team on a 9 box performance versus potential grid. We also used division, location and salary bands as a few additional metrics for validation. These helped us answer questions around whether a person could be nominated as a successor for a critical role and understanding the overall talent pool better in comparison to competition. Additionally, it helped in rapidly and objectively finding the most suitable employees for new roles and opportunities in other departments within the organization. It also ensured the solution was appropriate and relevant for employees as well as the organization.
We have seen organizations and more often than not family run businesses on a rapid growth trajectory. Employee development often does not keep pace with this expansion as short term measures don’t really bridge the productivity gap, ultimately leading to job duplication, over-worked or under-utilized employees, and ambiguity in job roles. This is where rightsizing plays a major role in re-structuring people management processes to facilitate organizations with their growth and success. Rightsizing is often a complex process and consulting experts with a proven track record can help to configure the right size, right shape, right cost, right place and right skills that can be called upon to assure that business strategy will be delivered!