If your organization suffers from poor employee relationships, miscommunications, and a lack of accountability, it may be misaligned. As misalignment affects resource deployment, strategy execution, and employee coordination, effective organizational alignment should be a top business priority.
What is organizational alignment?
Organizational alignment involves coordinating efforts, resources, and procedures toward a common goal. This entails achieving both horizontal and vertical alignment, where departments, teams, and individuals work together to achieve primary objectives.
Why you need organizational alignment
Organizational alignment is essential for companies looking to ensure that organizational components work together toward common goals, where overarching visions and values are consistently prioritized. This creates an environment where synergistic efforts pull in the same direction, bringing cohesion at every level of the organization.
The benefits of organizational alignment
Cultivating a united front using organizational alignment has five critical benefits for your organization, including:
- Improved accountability, engagement, and productivity helps employees have a better understanding of how they contribute to the bigger picture
- Better collaboration brought on by streamlined communication flows between departments, teams, and employees
- Quicker decision-making as communication expands beyond silos
- Consistent work makes employees more aware of how everyone in the business operates
- Greater visibility into resources as employees know what’s being deployed and how
To reap the benefits of organizational alignment, you must first understand its separate components: vertical and horizontal alignment. Understanding these alignment frameworks’ strengths and weaknesses can showcase why you need both for superior performance.
Starting with vertical alignment
The most researched form of organizational alignment is vertical alignment. Vertical alignment involves a clear, top-down flow of information, where high-level strategies, goals, and processes are passed down and converted to lower-level objectives. This type of alignment encourages you to break down, filter, and distribute goals to relevant stakeholders, ensuring organizational efforts converge to overarching priorities.
When you manage vertical alignment successfully, you:
- Enable optimal resource use
- Diminish ambiguity using centralized decision-making
- Improve ongoing awareness of company goals
Why you shouldn’t rely on vertical alignment
While vertical alignment can act as a guiding light for your organization, you shouldn’t rely on it entirely — especially if you operate in a large, siloed organization. Doing so can give rise to several issues, including:
- Slow operations: Translating and passing goals down a bureaucratic organization may take months to execute
- Inflexibility: As information distribution may be slow, limiting adaptive capabilities
- Complex goal setting: Once the arduous process of setting cascading goals is complete, executives may be more willing to plod along with irrelevant goals than produce new ones when the time comes
- Resentment: As employees are often dictated around in hierarchical organizations, they may be less committed to delivering on goals they didn’t develop themselves
- Limited collaboration: With limited employee engagement comes ineffective collaboration, impacting well-being and performance
Given these disadvantages, you must chip away at hierarchical layers and work on optimizing horizontal value chains. Adding horizontal alignment to the mix can help you mitigate issues brought on by vertical alignment, improving performance across your organization.
The need for horizontal alignment
Horizontal alignment can flatten communication structures for better cross-functional collaboration. With horizontal alignment, employees work together to co-create complementary processes and synergies with minimal input from managers. Part of this process can involve bottom-up planning, where teams and departments create goals and communicate these to executives.
Horizontal alignment can improve workflows by:
- Improving adaptability and flexibility
- Enhancing creativity
- Increasing employee satisfaction
- Enabling employee autonomy
Why you need both vertical and horizontal alignment
As with vertical alignment, relying on horizontal alignment can bring several challenges. These include:
- Power struggles: Without established authority at lower levels, a power struggle may arise, creating confusion around roles and responsibilities
- Limited productivity: With everyone encouraged to propose ideas, valuable time and energy may end up wasted on ruling out ineffective proposals
- A lack of motivation: Employees may be less inclined to be productive with minimal top-down supervision
Given the benefits and drawbacks of using horizontal and vertical alignment separately, a holistic approach to organizational alignment is necessary. This integrative approach gives you optimal results, as one alignment method's advantages overcome the other's disadvantages — and vice versa.
5 steps to organizational alignment
If you’re looking to cement organizational alignment within your organization, there are five steps you need to focus on:
- Getting a top-level, strategic understanding of your goals
- Passing this information down to the rest of the organization
- Shifting to a matrix organization structure
- Ensuring progress visibility
- Regularly assessing performance and providing feedback
Top-level, strategic understanding of your goals
Before aligning your employees, you need to know what you’re aligning them toward. First and foremost, your executive team must agree on the company’s main goals, strategies, and interdependencies. These should be based on your core values and competencies, enabling continuity across the business.
Passing information down your organization
Once you’ve established a North Star, you must communicate it across your organization. When conveying strategic priorities, consider mentioning your focus on organizational alignment. This should be fortified by a solid ‘why,’ describing the value of organizational alignment for your company. Once you have a definite ‘why,’ you can go on to explain the ‘how.’ This involves outlining expectations around collaboration, roles, and goal ownership.
Keep in mind that organizational alignment doesn’t occur overnight. Allow for a transition period as employees gain decision-making confidence and grow comfortable taking ownership of goals. Do your best to support and empower employees during this time.
Shifting to a matrix organization structure
After updating employees on the company’s next steps, shift your focus to creating an organizational structure that supports these changes. Communication lines across departments and teams should intersect vertically and horizontally, resembling a grid-like layout. This is known as a matrix organization structure.
A matrix organization structure enables cross-functional employees to rely on each other without being confined to restrictive silos. This structure encourages collaboration across relevant projects and value streams, with employees responding to multiple managers to cultivate a dynamic, aligned, and coordinated organization.
Ensuring operational transparency
The complexities of organizational alignment require transparency for efficient operations. This entails stakeholder visibility across real-time progress and goals. This company-wide visibility is key to maintaining superior performance, collaboration, and employee relationships as:
- Employees are held accountable for their goals, ensuring steady progress
- Transparency nurtures a trust-fuelled environment, where honesty is encouraged and everyone can ask for help
- Visibility around goal progress enhances the quality of feedback and knowledge-sharing
- Employees are more engaged with their work, improving productivity
Regularly assessing performance and providing relevant feedback
While trusting employees is crucial, keeping an eye on their progress can help you overcome challenges before these cause workflow disruptions. For best results, establish a regular cadence of check-in meetings. During these meetings, managers should discuss upcoming tasks, goal progress, and obstacles with employees, addressing these using relevant feedback.
Spearheading organizational alignment with operational alignment frameworks
An operational alignment framework is one of the best ways to consolidate alignment in your organization. This involves integrating employees, operations, strategy, and IT using:
- Employee alignment: Employees can tackle projects that serve organizational goals
- Infrastructure-process fit: Organizational structures support processes adequately
- Strategic fit: Internal resources work together to ensure alignment with external environments
- Functional integration: IT systems support organizational processes, operations, and infrastructures
Using an operational alignment framework, your employees contribute to superior goals, strategies align with primary functions, customers' needs are kept top-of-mind, and your tech stack supports organizational activities. As such, cultivating a fully integrated business, with coordinated value streams ensuring ongoing efficiency.
Leveraging the OKR framework
One operational alignment framework you can use is objectives and key results (OKRs). The OKR framework is a goal-setting methodology that helps employees, operations, strategy, and IT have better organizational alignment. It does so using its two key components: objectives and key results. Objectives are short, qualitative descriptions of what you’re looking to achieve. Each objective is accompanied by 3-5 key results, which are quantitative metrics depicting goal attainment.
As the primary aim of OKRs is to coordinate organizational efforts, they’re highly capable of facilitating organizational alignment. This is due to the seven core benefits of OKRs:
- Focus: As the OKR framework places a limit on the number of priorities, they orient performance toward the most important objectives
- Alignment: Cascading, bottom-up, and bidirectional OKRs can be used to align organizations, with OKRs trickling top-level goals down to lower levels, bottom-up goals enabling employees to create supporting OKRs, and bidirectional OKRs encouraging collaborative goal setting
- Collaboration: OKRs are a common language for organizational goals, assisting interdependent teams in working cohesively toward what matters
- Transparency: With OKR visibility, employees are constantly reminded of what they’re working toward and how successful they are in achieving their goals
- Flexibility: Although OKRs are commonly set per quarter or year, they can be reassessed, adapted, or scrapped throughout the OKR cycle when necessary
- Accountability: As OKRs are trackable, transparent, assignable, and subject to progress reviews, employees are held accountable for OKR progress
- Engagement: With employees involved in goal setting, they have a greater sense of responsibility toward their goals, driving engagement via a sense of commitment
Given these benefits, the OKR framework fulfills 75% of the necessary conditions for a robust operational alignment framework. That is, OKRs foster:
As OKRs require cross-team coordination, they encourage interdependent employees to pursue OKRs collaboratively. Moreover, OKR visibility facilitates feedback and progress discussions, strengthening employee relationships and ensuring ongoing alignment with broader goals.
OKRs enable infrastructure-process alignment by directing processes toward organizational priorities. Cascading OKRs reveal how your OKRs work together, showcasing how lower-level OKRs serve primary goals. This provides a bird-eye-view of your operations, serving as a solid infrastructure for coordinating work.
As company OKRs can be split into lower-lever OKRs based on team, departmental, or functional contributions, they help you attain internal strategic alignment. Moreover, as OKRs are adaptable throughout the OKR cycle, you can quickly adjust goals to changes in the external environment. This makes OKRs a robust tool for internal-external alignment.
The last piece of the puzzle is functional integration, which involves using an integrative IT system to underpin organizational operations, processes, and infrastructures. This is where OKR software comes in.
Strengthening alignment with OKR software
If you’re using OKRs as an operational alignment framework, you need OKR software for functional integration. OKR software streamlines the OKR process by making it scalable, accessible, and effortless, allowing you to communicate broad priorities to your entire organization. Moreover, incorporating OKR software into your tech stack helps you solidify OKRs as a fundamental operating system, allowing you to integrate OKR data with your favorite tools for technical organizational alignment.
When choosing the best OKR software for your organization, ensure it provides these key features:
- Real-time visibility into OKRs and OKR progress
- Flexible OKR creation
- Dashboards and progress reports
- OKR ownership
- Enables progress-based feedback
Read more on crucial OKR software features.
As your organization expands and business environments evolve, maintaining alignment — both vertically and horizontally — is no longer easy. Therefore, you must make active strides toward organizational alignment to stay adaptable.
Creating organizational alignment within your organization requires you to first pinpoint upcoming priorities. After you’ve communicated these to your organization — and stated your commitment to organizational alignment — you should work on cultivating a flatter organization via a matrix organization structure. This ensures streamlined communication flows across both horizontal and vertical levels. As part of this organizational restructuring, transparency and ongoing performance assessments are vital, with additional feedback provided to ensure your company’s on track.
To sustain and consolidate organizational alignment, you need an operational alignment framework that integrates people, strategy, operations, and IT. Using the OKR framework, you can establish your primary goals as centralized hubs connecting these four dimensions. This ensures all activities converge to your primary objectives. To further scale your OKRs across your organization and ensure alignment with your tech stack, consider using OKR software. OKR software ingrains OKRs into your technical operations, ensuring OKR data is effectively deployed throughout your organization.
Quantive is your bridge between strategy and execution. Founded on the objectives and key results (OKR) methodology, our Strategy Execution Platform is where businesses plan successful strategy, focus and align teams to it, and stay on the leading edge of progress.
As your company looks to achieve the best possible results, you need a modern approach to run your business and change your business. The Modern Operating Model brings strategy, teams, and data together to help make decisions faster, optimize operations, and drive better business outcomes.
Whether you’re a large enterprise facing competitive disruption or a small business leading the innovative charge, Quantive helps gets you where you want to go.
Ready to achieve the best possible? Start using Quantive for free.