Structure–Strategy Fit
Structure should follow strategy—but too often, it doesn’t. HR plays a key role in making sure the organization’s design enables its goals, not obstructs them.
The Foundational Principle
A core idea in organizational theory: structure follows strategy. Coined by Alfred Chandler in the 1960s, the concept holds that the way an organization is structured should reflect what it’s trying to achieve.
Yet in many organizations, structure evolves out of habit, internal politics, or legacy systems—not strategic intent.
What Misalignment Looks Like
When structure doesn’t match strategy, symptoms emerge:
- Innovation goals blocked by rigid hierarchies
- Customer focus diluted by functional silos
- Global expansion slowed by centralized decisions
- Digital transformation layered on outdated models
Diagnosing Fit
To assess alignment, ask:
- What are our top 3 strategic priorities?
- Does our current structure enable or inhibit those?
- Are decision rights aligned to our value drivers?
- Are we organized around products, regions, customers—or legacy functions?
Common Strategic Models and Structural Implications
| Strategic Focus | Best-Suited Structure |
|---|---|
| Innovation | Flat, team-based, decentralized |
| Efficiency | Functional or process-based |
| Customer intimacy | Divisional (by client or region) |
| Speed/agility | Networked or cross-functional teams |
| Scale/globalization | Matrix or hybrid models |
HR’s Role in Enabling Strategic Fit
HR has both the vantage point and the tools to assess and improve structure–strategy alignment.
1. Workforce Architecture
- Job roles and org layers should reflect how value is delivered
- Structure should not only control cost—but create capability
2. Leadership Alignment
- Strategy shifts often require different leadership behaviors
- Structure must support new power centers, collaboration patterns, and accountability lines
3. Organizational Agility
- Strategy is no longer static—structure must evolve accordingly
- HR enables this through agile talent models, scenario planning, and feedback systems
Getting from Misfit to Fit
Steps to realignment:
- Clarify strategy—what are we optimizing for?
- Assess current structure—where does it help or hinder?
- Model options—use org design scenarios
- Engage leaders and teams—ensure clarity and buy-in
- Implement and iterate—structure is not a one-and-done
Final Thought
Strategy without structure is theory. Structure without strategy is inertia. HR’s role is to connect the two—to design organizations that don’t just look good on paper, but deliver results in practice.