Designing Organizations That Breathe: How Structure Shapes Culture, Leadership, and Impact - A Conversation with Salima Hemani

This is Leadership Beyond, your community of conversation. But this is the first time in my professional career that everybody, 100% of us, are consciously aware we are engaged in the change initiative. Yeah, everything. I mean, COVID caused us all to go through change, right, at the same time, but our experiences were so different. Facing these unprecedented times in isolation Is pure insanity. Joining us today is Salima Hemani. Salima is an accomplished organizational strategist, executive coach, and human capital advisor with over 25 years of experience leading large-scale transformation. Organizational design, and leadership alignment initiatives. She is the founder and president of SZH Consulting, an organizational and leadership development firm serving Fortune 500 companies, government agencies, and mission-driven organizations. Saleema brings a rare blend of strategic insight and operational depth, having served as both internal executive and external consultant guiding C-suite teams through growth, restructuring, and culture evolution. Her expertise spans strategy execution, organizational design, leadership development, and executive team coaching. Anchored in systems of thinking, data-driven insights, and a people-first approach, Saleema's a trusted thought partner to CHROs and senior leaders. And she's known for her ability to turn complexity into clarity and create space for bold, actionable dialogue. She frequently speaks on topics including leading through culture and building organizations that thrive. In this conversation, Salima tells us why 75 to 80% of organizational redesigns fail.— and here's a hint, it's not about the org chart— and more importantly, how leaders at every level can create the clarity that becomes their organization's greatest competitive advantage. Welcome, Salima Hemani. Salima Hemani, welcome to A Leadership Beyond. We're so excited to introduce you to our community and happy to spend some time with you today getting to know you and talking about all the wonderful work you've been doing. People First work for the world. And, you know, we've got a mission of making the world a better place to work. And so we are so aligned with, with our missions here between A Leadership Beyond and our respective businesses. Thank you so much for having me. I'm really excited to be here with both of you today talking about a topic that's really close to my heart. So thank you for this. Yes. So before we jump into those specifics, just so that we can kind of frame the conversation a little bit, Salima, your career has just been a beautiful blend of bringing structure but also bringing that humanity and that soul to the workplace between strategy and human systems. Before we get into all the mechanics of organizational design and, you know, really that strength of yours, what drew you to organizational effectiveness and people leadership? Yeah, I love that question. Thank you for that. So I'll, I'll go back to, you know, when I started my career and I started my career, I've been in this field, I'm going to age myself for 25+ years. And I started my career with a firm which back then was called Andersen Consulting and now they're known as Accenture and actually started in their technology consulting practice. And I did that for a few years and I realized, you know, the magic happens with people, you know, no matter what business you're in. Every single business at the end of the day is people business, right? So I was attracted to all these great technologies and systems and all things. That's great. But at the end of the day, people have to use it. People have to make it work. So I like the people side of things. And I moved to human capital consulting practice within, within Accenture, working across the whole OD, organizational development effectiveness spectrum, human capital spectrum. Working across industries, and I spent 13 years with Accenture. And then from Accenture, I went on to take on a number of positions of increasing leadership and responsibility at BAE Systems, Marriott International, and Northrop Grumman. And about 7 years ago, I launched my own company, Aziz Consulting, and we are a DC-based organizational and leadership development consulting firm. And all throughout my career, I've been working with things around people. So leadership, change management, organizational design, strategy. And I like to think of all these things as different levers within an organization that have to work together in alignment for an organization's success, no matter what business the organization is in. So I like to think of organization as a table and, you know, strategy, structure, culture, and leadership as being 4 key legs of that table. If they are not in alignment, if any one of these legs is weak or wobbly, the table would not be able to serve its purpose, and same with organizations. So I've really been fascinated with how all these levers come together to create environments where people can actually do, do their best work and thrive in service to the purpose of the business and organization. Well, you, when you mention these levers and how they're interconnected, since we are a Leadership Beyond, tell us a little bit about how effective organizational design influences leadership development and building a leadership pipeline across a company. Yeah, that's such a great question, Tom. I appreciate you asking that. I, I very much believe it. My experience doing this work for many years across many different types of organizations, when you do organization design well, leadership development, leadership growth is a successful byproduct of a good organizational design. Great organizational design grows leaders. It's just not, it not, not just organizes them. So when you have clear roles, clear decision rights, spans of controls that are reasonable, that make sense, leaders actually have room to lead rather than just manage chaos or firefight. Good design also creates natural stretch zones that build the capability and confidence in leaders to lead without burnout. So I like to think of organizational design as scaffolding for leadership growth. I'll give you an example of a company that we worked with, and they brought us in because they wanted to intentionally create an organizational system, a design that would create these natural stretch zones for their middle managers. So we created an organizational design that was an activity or project-based organizational design that provided middle managers an opportunity to run cross-functional initiatives, thereby, you know, raising, elevating their leadership visibility, giving them more higher-level responsibility, decision-making rights without putting together yet another leadership development program, right? So the structure built in these stretch zones for leaders to elevate their own leadership impact, their own leadership capability, thereby elevating the leadership competency of the entire organization, right? And give them a chance to put into practice doing leadership on a daily basis rather than just going to another leadership development program and just relying on training alone. I love that it's immediately in practice. Yeah, right, that it's not something side of desk, which so often it is. It's an initiative, it's an event, that's right, right? And then what happens? We go back to work and we fall right back into the same patterns that we've always been, because the rest of the system isn't supporting what you just learned. Yeah, exactly, right? Exactly. And, and so what, when you explain that, what I, I heard, two things kind of came, came to my mind was agency, right? Creating agency for the employees to have that decision-making power, to stand firm in, this is my place here, knowing your lane, right? But, and knowing all the other lanes. But, and then, and just being able to trust that everyone else can trust that. So when a decision gets made, it's, it can be made because you're, you're so firm in that agency for each of those leaders and be that practical piece. So do you recall what was happening that led that company, that your client, to come to you? Like, was it, was it proactive, or was there some kind of warning sign that something is not feeling right that we need to do differently? Yeah, that's, that's a great question, Adrian. For that particular client, they had invested a lot in providing coaching to their leaders and investing money in sending them to different leadership development programs. In fact, even doing leadership development programs internally within the organizations. And they would go just so far. To your point, once the leaders went through those programs, and went back to their day-to-day jobs, they were still constrained and they still, they couldn't really practice, right? The things that they had learned, the concepts, the frameworks, all those things had been introduced to them, like, great, we still really can't do anything different, right? So the system that was in place, the structure that was in place was constraining to their ability to really grow as leaders and put into practice true leadership that they wanted to put into practice, right? Because they were constrained by how the things were set up, how the structure was constraining them. So they came to us and they said, we've done all this stuff. And we, as often we do, the first thing we do when we start working with any client, no matter what the project is, is doing an initial organizational assessment. And that's what we did because we said, we don't want to make an assumption. You've made all these investments. We want to really understand what's going on. And we ended up actually having a lot of conversations with those leaders. I said, it's great. They've spent a lot of, and we were very grateful for the investment the company has made. But the reality is when we go back to our day-to-day jobs, nothing changes, nothing is different. The company was also in an industry where there was some precedence around doing this activity or project-based organizational design models. When we introduced that concept to them, it made a lot of sense. Then when we started putting it into practice, they saw the value right away. Then we started with a pilot program and then we were able to expand it to broader areas of the organization. It realized not only did it help elevate the capabilities of especially the middle managers, but it increased their satisfaction, their confidence, their motivation. So there was also a mindset shift about more ownership, more accountability, all those side effects of, you know, moving to a structure that really created those spaces for the leaders to grow. What are some of the symptoms if they haven't done an assessment that the structure of the organization is actually holding back the performance? So say that we know we need to do something, so we brought in world-class training and everybody liked the experience, but we're not noticing the changes yet. And it turns out that there's something holding back performance in the structure. What are some things that are readily seen on the surface that says, I got to raise my hand for Salima to help me to, or to understand this? Yeah, that's a great question. And I think some of the things that, you know, we've all worked in large organizations, we've seen it through our own personal experience. You know, when, when, when, when people are spending, when everything looks great on paper, you have the most perfect org chart you can build, right? And you have the right talent. You, you've bought the, you brought in the best people with the right technical skills. You have a well-defined list of, you know, like these are our cultural values. We've aligned on that and yet you see you're not getting the results that you're seeking, right? You see people frustrated, you see people running around in circles, decisions are not being made, you know, progress is not happening, people are frustrated, you know, your Glassdoor reviews are going down, right? Things like that, and you start losing good people. Those are all Symptoms or signs that, that folks are not being able to see their place within the organization. There is lack of clarity on where they are, how their, how their role, their work lines up to this strategy, to the purpose of the organization. Those are all clues that tell you that from a structural perspective, you don't have the— you don't have clarity within the organization. People don't have clarity about, you know, where they are, where they sit, who does what, where decisions are being made, how they're being impacted, how their work aligns up to the overarching mission and the strategy of the organization. So those are things that we pay attention to when we're brought in. But those things, you know, a lot of times if you have perceptive leaders and leaders who are, you know, struggling with why am I not getting the performance, why I'm not getting the results, those are things to pay attention to. To that could give you clues that, you know, maybe we need to take a closer look at how things are set up and look at the organization design and the structure of the organization. And if I may add a little bit more to that, when we talk about organizational design, when we do this work, it's really beyond just the structure, right? So structure is just one part of it, right? The org chart is just one part of organizational design. But what runs that structure, the operating model, the governance framework, the decision-making rights, right, the role, the roles and responsibility, how information and communication flows within, with, under, underneath that structure, all those things are critical elements of an overarching organizational design. So you could have a beautiful-looking org chart that makes a lot of sense on paper, But if you haven't taken care and really defined and clarified those things, people are going to feel stuck, right? And you're still going to have all this frustration. You're going to have misalignment. You're going to have lack of motivation. You know, you're not going to be able to achieve the results, and people will end up doing whatever they want to do regardless of what the org chart says. I like to say that the problems happen not, not in from box to box on an org chart, but the dotted lines in between. Right? It's what's going on in between from box to box that usually is what the problem is. I mean, not always, not completely, right? But you got to look at the dots. Sometimes those dots don't make sense. Yeah, that's, that's right. Yeah. So what are the— you identified some real, like, impact to the, the bottom line, but it's so hard for us to prove, you know, like, I know, right? Like, we're trying to prove ROI. On something that, I mean, is more intangible, right, in a lot of ways. So what are ways that you can, can identify— you know, I'm thinking about business owners, leaders who are not connecting those dots between the real return on investment of aligning people to a business strategy, right? And looking at those, how is one way that your firm is able to do that to kind of make, you know, really bottom line it, if you will? Yeah. You know, and that's a big concern, especially in this day and age where everyone is looking— Budgets are tight. Budgets are tight. They're like, what's the tangible return that I'm getting on this investment? And I always remind my clients that when it comes to organizational design, right, it isn't luxury, it's a multiplier. When every person in your organization knows how their work ladders up to the strategy, you get more impact per dollar. And especially when times are tight, clarity is the best return on investment. It reduces waste, right? It reduces confusion, it reduces rework, while at the same time unlocking the potential of these expensive people resources that are part, you know, that you brought in. They're part of your organization.. So clarity is a big metric that we measure, right, that organizational, you know, design, a good organizational design enables, right? It saves time, it saves money, it, you know, it prevents frustration. And people, you know, frankly perform better when they know where they fit in, how their work fits in with the, again, broader strategy, broader purpose of the organization. We did some work a few years ago with a government agency, actually, and they thought that organizational design was too abstract. But once we were brought in and we did the redesign— and by redesign, not just the org chart, but the governance framework and the operating model— and put in clarity around decision-making, decision pathways, their productivity increased. And their project rework actually dropped by 70%, which is a pretty big metric for us to measure and for us to be able to report to them. So their mindset around what org design is really shifted because oftentimes, and it happens many a times when we are first brought in, they're thinking of org design, they equate org design to creating a new org chart. And it's very limited, but org design is much bigger than that. And I think the biggest thing that organizational design when done right, provides this clarity. And there's, as I said, no bigger return on investment than providing clarity within the organization. Yeah, your performance is better, right? So that makes productivity better. You're hitting your KPIs. If you're producing a product, then there becomes your tangible, right, number of pieces you're physically building, right? But reduction in attrition or terminations, like those things all have hard dollar costs that we often don't look at, right? Or don't measure. I've come into a lot of companies and asked for those kinds of metrics and there is no baseline. There's no baseline. How's your attrition? Eh. What does that mean? Eh. That's right. We need to measure that so we know if we're making a difference, right? Absolutely. And one of the things that I think which maybe differentiates how we do this work, uh, from others, um, is we are very data and KPI-driven. So when we start working with the clients, often we start with this kind of project discovery, organizational assessment phase. And from the very get-go, we are really clear on partnering with our clients on identifying What are the critical metrics that we're going to measure to assess the success of this investment? And it's for both for them to be able to sustain that work, right? Especially in this, in these times of like tight budgets, right? And for us also to make sure that we are, that we have, we have the, we have the direction, right? We have clear focus in our work. Like these are, This is what success the client needs for us to achieve for them, right? And it guides our work and it focuses our work. So it helps both us and the clients when we are able to be really clear on the KPIs, the data that's going to be important for us to measure is not only at the end, to be honest, Adrian, but as we go along the process. What comes up for me as I hear you and Adrian talking about that is there's a lot of people who need to be more aware of it, and they just will think, well, that's Adrian's area. And so I'm curious what inspired you to create the Essentials of Organizational Design training, because you talk about there are a lot of people that would say, I don't belong in that, that's for Schmedley. So talk a little bit about who needs greater awareness. It's obvious that the CFO could use it. But who can benefit by just expanding their understanding of what you mean by clarity and organizational design? Yeah, I really appreciate because it speaks to something so close to my heart. And the reason we created this Essentials of Organizational Design training, which is, by the way, I think it's valuable for anyone who is in people business, right? Is because oftentimes we'd be brought in to help support org design efforts. And what, what, what I realized very early on was I had to spend so much time upfront just educating leaders on what organizational design was, because as I said, oftentimes they're saying org design because that's a cool term. They've heard it, they're using it, and they mean divisions and boxes on a chart. They might use boxes and layers of control. We know that. That's all they care about are boxes and lines. The technical stuff. Yeah. And like, there's so much more. So we put it over there. I get it. Right. And there's a statistic, I'm sure you've heard of it. And I can't remember the person or the source to attribute it to, but it's really famous in org design work that about 75 to 80% of org design efforts fail. That's the truth. And the main reason they fail is because it's just focused on org charts and boxes and lines. And they're not thinking about the people side of it. It's a huge change. They're not thinking about change management, right? They're not thinking about actually what you need to do once you have the org chart. What do you need to do to bring it to life and how it impacts people and how do you bring them along and all those different things? I found myself when we were brought in to do the work was to, and selfishly because we couldn't scope and we couldn't price the work accurately because they were thinking one thing, talking about org design, but what they needed was what was really org design. They were calling it org design, we're thinking org charts, We're thinking org design. And so, yeah, why is your price so high? Right? Why is it like, why, why do you have to do like, why do you have to do change management? Like, they'll just figure it out. You just give us a good org chart and, you know, that's all that's needed. So, so I realized, and then, and then, you know, we started doing this educational, you know, you know, we'll do a lot of education initially at the start of the engagement and sometimes even before that to just engage people and help them understand what organizational design really is. And then we started doing a lot of work of that work for HR business partners, right, who were often being asked to do org design work. And they, they weren't— that's not part of their training, right? So we found naturally that there was— when we did that kind of education, there were a lot of ahas. You know, people— it helped us, but it really helped the organization think differently about what this work is and the criticality. And the importance of organizational design, right? And so, you know, so that, that was kind of the motivation to, to build this training and then to offer it so people have a clear understanding of organizational design. And it's not necessarily that they have to do the work itself, but that when they are bringing consultants in or when they're embarking on this kind of effort initiative, they are much more educated about what it really takes and what are the different things that they need to look for so that it's not yet another reorg that leaves people frustrated and is more costly for the organization actually than if they had actually spent the money upfront in the right way that could have led to, again, a better return on investment for the organization. They don't even know what came up so clear is they don't even know what questions to ask. That's right. And then if they get involved in that training, they start to have more awareness, not that they do those things, but they know what questions to ask. Exactly. If someone were to bring a manager in and said, well, we really want your input on this new org design we're doing, and you heard the geeks talking back and forth, then you'd go, I don't have anything to add because I don't even know how to ask the questions. Yeah. So it's interesting you mentioned that because when we do the training, we spend a ton of time on the consultative part of this work, right? Which is the upfront, what are the kinds of questions to ask. Yes. And that itself, for a lot of people, is the most valuable thing. They now— they wouldn't know. They wouldn't know, right? They know. And they're— and one of the pieces of feedback that we get is, uh, when we do this training, is you spend so much time on the strategy and understanding the business strategy. Because sometimes, you know, or I would say more than sometimes, often our first question is— or first few questions is to really get an understanding of what the business is and what's the, what's the strategy, what's the strategic What's the vision? Where do you want to go? What's the purpose of this organizational design redesign? And leaders struggle to answer those questions. So our upfront work ends up sometimes bringing more strategic clarity, right, for the organization that then the organizational design could support. And so our Essentials of Org Design training, we end up talking a lot about how do you bring that, what kind of questions to ask, what kind of frameworks and models you can use to bring and enable that strategic clarity within organizations that haven't had that, right? Especially organizations, companies that have grown really fast. We have many clients like that that have just seen rapid growth, right? And then haven't had time to kind of take that step back and intentionally think about, you know, their strategy and their future direction because it's hap— it's hap— it's been more reactive. But that's an important part of organizational design because organizational design should ultimately serve the strategy and where the organization is not only today, but where it aims to go in the future. Taking that pause, right, is so important. And it's often the pieces that I see with clients, they just want to jump right over that, right? Like, no, no, we need a little bit of time. We don't need 12 weeks. Like we don't have 12 weeks anymore, right? Like, yeah, you, you come in with a big McKinsey model, you don't have that kind of time anymore, right? So now your 12 weeks got, got reduced to like 3 hours probably, right? But it's so critical to take that pause, to rise above, to really align on what is that strategic direction. Because if it's if it's growth, if, if it's new products, you may need to beef up your R&D department, right? If it's performance and produce, then maybe it's on your manufacturing side or your design side, right? Like, this, these things matter on where are you putting the emphasis from a, from a headcount perspective, but then just from an alignment perspective. So absolutely, I know you're going to tell me we don't have time, but I want to talk about, about people, like the people in the boxes. Yes, right. Because I know the org design, right, like you take all the people out of the boxes and you look at the work, right? This is how we do it. But then like you have to put the people back. Yeah. And I would frame what Adrian's saying with the word culture so that we really think about The culture is the way people behave in the real world in the organization. And I think that as we wind down this conversation, we never have enough time for these conversations. I'll let Adrian frame the question, but it's just this idea of if you're going to take a break and look at how you can reorganize, you better think about all the 4 levers you mentioned. And what kind of culture we're creating. Yeah. Is there a question in there, Adrienne, or did I just talk too much? Well, I think it's just how do you make sure that you're still focused on the talent, but really looking at the talent, not just a name and a title, but really who you want in that box. Technical skills, yes, but what else? Is important. Yeah. You know, and, and, and, and that is why when I started, when we started the conversation, I'd mentioned this culture, structure, strategy, leadership, they're so interconnected. So when you do organizational design well, you're constantly keeping all those four things in mind, even though as good org design practitioners, you're not starting by thinking of names, right? But you're thinking about what capabilities, what mindsets you want, right? What competencies you need, right? Both soft as well as technical competencies. What's the culture of the organizations? What are the critical values that people in various positions need to be able to demonstrate, right, through the right behaviors, through the right mindsets, through the right actions? So you're thinking of all of those things when you are not only when you're creating the boxes, but what's underneath the boxes, how communication will flow, how work will flow, how interactions will happen, right? So, so that when that is clear and when you go back to your point, Adrian, and you go back and put people back in those boxes, right, there's clarity for you and across all different layers exactly what's needed, not just the technical skills, not just the functional skills, but again, how this role needs to engage with other roles within the organization, how it needs to fit in within the cultural, like in terms of values and pillars and all of that. That's all thought through. When the person is brought in, that expectation is clearly set from the get-go, right? So it's not just expectation about the technical skills and that's where you're going into the box. But this is how this box engages with all these other boxes, right? And this is how work is going to happen. And these are, these are the communication flows and how you communicate and how you engage and how you interact and, you know, all that. And by the way, this is how you support— these are the mindsets and behaviors we expect from someone in that box. All that is clearly communicated right from the very beginning. And when you do an org redesign, That's a great opportunity to reinforce, remind people these behaviors and practices when it comes to our culture are really critical. This is our expectation. If you don't remember, this is a reminder and the culture that we've built honors those. This is our expectation. This is how you're going to show up in this box when you use that. So I think, I think making sure that you're balancing culture against structure, what are the technical and functional capabilities needed within the role, you know, the strategy in terms of what, where the organization is going and what, what would be needed from the different boxes. You're balancing all of that constantly when you're creating an organizational design and then clearly articulating and communicating that when you bring people back into those boxes from the get-go. So there's, there's that, that clarity. And then, then the HR practices, the people practices from a performance management and feedback, all of that, the leadership training that you provide can all follow those things along and reinforce that once, once you implement the new, new design. I don't know if I answered your question. You did indeed. And we are running out of time. So this is your opportunity to encourage leaders to give a little bit more thought to organizational design. And we'll make sure that they have the information of how to reach you. But just a little word of encouragement. I would say don't be scared of organizational design. And also remember that in this day and age, especially, you cannot afford to run an organization with lack of clarity within the organization. So organization design is not a luxury. It's truly a multiplier. It's the best investment you can make. You can have the best strategy, you can have the best leaders, you can have the best talent. You know, we know we work with a lot of clients that for them the war on talent is still very real. They work, they, they need high quality, high caliber talent that they're looking for, you can bring them in. But if you cannot provide clarity, right, once they join the organization, your— that return on investment will be null, if not negative. So again, org design is critical now, now more than ever. And I think the biggest return on investment that you get from it is, is clarity. Thank you so much for joining us. Thank you. Thank you, Salima. Thank you for having me. It's been so much fun. As you said, as you said, Tom, in the very beginning, we can continue to talk about this forever, but I really appreciate the time. Thank you. Thank you for listening to the Leadership Beyond podcast. We hope you benefited from this conversation as much as we have. We invite you to join our community of conversation. Subscribe to our podcast on iTunes, Spotify, or wherever you listen to podcasts. Don't forget to sign up at aLeadershipBeyond.com for free materials and updates. That's aLeadershipBeyond.com. Join us in 2 weeks for our next episode.