It takes a special kind of development geek to get excited about something like the organizational structures of donor institutions. Accountability and voting shares? Sure. Policy priorities and disciplinary paradigms? Even those are just one step removed from impact.

But organizational structure? Yeesh. Crucial issues such as social protection or global health get reduced to boxes on an org chart. It sounds about as dull and dehumanizing as the sector gets. Still, just as procurement policy is more important than it seems, the way that big institutions organize themselves to channel resources and accountability has real-world implications.

So it’s been interesting that three big players are currently undergoing restructuring of some sort. The World Bank’s shake-up has grabbed headlines and will involve significant staff cuts. It seems like staff reductions will also accompany UNDP’s restructuring, though the reductions will fall more on HQ than regional offices. And finally USAID has launched its Global Development Lab — a new entity that pulls together several previously existing units along with new ones and outside partners — without clear impacts on staffing.

Why would you restructure a massive donor institution? Organizational structures create pathways for interactions, communication, decisions and resources allocations. Structures are key determinants of what gets done, so if you want to shape what gets done, start with the structure.

In other words: form follows function.

Though “restructuring” is used as a management euphemism for cost-cutting and down-sizing, there can be real benefits besides efficiency. For example, bringing new units together can prompt communication and collaboration that leads to greater innovation — which is exactly what USAID hopes to gain from its Lab.

Yet organizations rarely move to restructure unless a crisis hits, budgets shrink, or the operating context (market) changes dramatically. Without such outside forces, it’s hard to generate the political momentum to overcome entrenched internal interests. That’s why these restructurings such unique opportunities: organizational positioning and effectiveness intersect with personal politics in ways that could determine the future of the sector.

And you thought that getting a new org chart would be boring.

  1. Sorry, but having lived through a few restructurings, I argue: Restructuring is the White Elephant of Management. It is instead of getting results. Before the dust settles, the 3 remaining years of your mandate have passed and people are still cleaning up the mess instead of doing their work.

    In theory, it can work, but as well in the private sector as in government and in development, the evidence is against it.

    There is little good in having everybody uncertain about their job and scurrying to save their own skin. Are you really sure the organisation the better structure will make up for the 2-3 years of lost productivity?

    Probably, by the time the new structure is in place, priorities have moved on. A new structure will be needed.


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