The critical importance of organization design (OD) is well established. Research increasingly highlights its transformative impact on accelerating growth, improving decision-making, optimizing costs, boosting innovation, and enhancing employee satisfaction.Yet, many organizations remain stuck in legacy structures too rigid for today's fast-changing business landscape. As change accelerates, businesses need to move from steadfast to adaptable structures, making OD a continuous strategic necessity rather than a periodic obligation. To drive this shift, organizations need a dedicated role that continuously and intentionally drives this responsibility across the organization.

OD Center of Excellence (CoE): A Strategic Imperative to Unlocking Business Goals

At its simplest, an OD CoE is a specialized team dedicated to optimizing how a business operates, evolves, and adapts in a dynamic environment. At its core, an OD CoE focuses on seamlessly connecting business strategy with organizational capability, leveraging analytics for continuous improvement, and orchestrating high-impact design initiatives that unlock organizational potential.

By embedding this critical expertise within the organization, an OD CoE enables agility, helping the business quickly adapt to ongoing market shifts and maintain competitiveness through nimble organizational changes. It applies a systems-thinking approach, integrating adjustments across structures, processes, rewards, and people. By avoiding siloed interventions, the CoE minimizes friction, addresses root causes, and creates value for all stakeholders.

Perhaps most importantly, an OD CoE bridges the gap between the design and its user - the people of the organization. Rather than treating OD as a periodic, disruptive exercise, an OD CoE fosters continuous evolution through ongoing feedback and iterative refinements. Much like modern product design, this approach keeps the organization responsive, enhances employee experience and performance, and reduces the costs typically associated with large-scale reorganizations.

Building an OD CoE Step by Step

Building an OD CoE is a transformative journey that often unfolds in stages. Creating a CoE that genuinely delivers value requires patience, dedication, and intentional effort. By taking a phased approach, organizations can create a sustainable and high-impact OD capability. Organizations are often at different stages of their journey, but each phase is a crucial milestone in establishing a resilient and high-performing OD CoE. Companies typically progress through three key phases when establishing an OD CoE.

Phase 1: Exploration and Community Building

This initial phase centers around raising awareness and building foundational knowledge of OD within the organization. Building a network of engaged OD practitioners through informal forums, regular meetings, and collaborative platforms fosters shared learning and establishes the foundation for a unified approach to OD. This sense of community equips practitioners across the organization with the fundamental knowledge and experience needed to support initiatives and monitor organizational health within their respective areas.

Phase 2: Formalizing the OD CoE

In Phase 2, organizations recognize the need to establish a formally recognized entity within the organization, equipped with a defined mandate and delivery model to own the OD agenda. This stage marks the shift from an ad-hoc initiative to a strategically integrated function, supported by dedicated leadership commitment and resources. Key elements typically include setting clear guidelines and metrics to drive organizational effectiveness and efficiency, establishing a governance process for change, creating learning materials for OD practitioners, and improving data quality for strategic insights

Phase 3: Mastering OD capabilities

In its most advanced phase, the OD CoE evolves into the organization’s central nerve center, enabling leaders to systematically translate business vision into operational reality while building lasting organizational resilience. As OD CoEs mature, they expand their scope to not only respond to change but to anticipate and shape it. To be successful in doing so, they embed synergistic functions such as workforce management, change management, and people analytics, broadening their influence to enable holistic problem-solving and drive evolution across all components of the organization.

Key Success Factors For Establishing An Impactful OD CoE

From our experience, successfully establishing an OD CoE requires focus on six key factors that will guide the journey from inception to strategic enabler.

Moving from Vision to Transformation

Establishing an effective OD CoE requires a well-defined vision that aligns with the organization's overarching strategy, strong executive endorsement, and the agility to adapt to evolving business demands. Whether you're just starting to explore how to unlock greater OD value or already have an established OD CoE, maturing this capability over time is key to ensuring your organization evolves and remains agile. By strengthening OD within your business, you build the foundation for continuous adaptation, innovation, and resilience in a dynamic market.

References:

• Orgvue platform | Solve your strategic business challenge | Orgvue
• 2021 Global Human Capital Trends | Deloitte Insights
• Linking Organizational Design and Workforce Planning | Deloitte US
• Enterprise Adtability | Deloitte US
• Organization Network Analysis (ONA) | Deloitte US