Organizational Design Simulation Assignment

How students can master organizational redesign strategies through hands-on simulations addressing real-world performance challenges in growing companies.

Purpose

The purpose of this simulation is to help students experience the complexity of organizational design decisions. Engaging in this activity allows learners to apply theoretical concepts to practical scenarios, building confidence in handling organizational changes. Students will assume the role of organizational leaders and design (or redesign) an organization in response to strategic and environmental constraints, demonstrating how structure, roles, and coordination mechanisms affect performance.

Scenario

You have been hired as an organizational design consultant for a growing organization experiencing performance challenges. Senior leadership has asked you to design or redesign the organization to better align with its strategy, workforce, and environment. This role places you at the center of decision-making processes that influence long-term success and adaptability.

You may choose one of the following scenarios or create a comparable organization with instructor approval:

• A fast-growing technology startup scaling operations
• A healthcare organization facing regulatory and staffing pressures
• A retail company expanding into new markets
• A nonprofit organization seeking greater efficiency and impact

Selecting the right scenario helps tailor the exercise to your interests and career goals, making the learning more relevant and engaging.

Instructions

Step 1: Organizational Context (Simulation Setup)

Briefly describe the organization (1-2 pages total):

• Industry, size, and mission
• Strategic goals
• Key environmental challenges (e.g., competition, regulation, uncertainty)

Outlining these elements sets a strong foundation for the redesign process and highlights the unique factors influencing your choices.

Step 2: Design Decisions

As part of the simulation, make and justify decisions in each of the areas below:

1. Structural Design

• Chosen structure (functional, divisional, matrix, hybrid, flat)
• Rationale for this structure

Explaining your rationale connects the structure to the organization’s specific needs and anticipated outcomes.

1. Authority and Control

• Level of centralization vs. decentralization
• Span of control and decision-making authority

Balancing authority levels ensures efficient operations while empowering employees at appropriate points.

1. Work Design and Coordination

• How work is divided and grouped
• Use of teams or cross-functional roles
• Coordination and communication mechanisms

Effective coordination fosters collaboration and reduces silos, leading to smoother workflows across the organization.

1. People and Culture Considerations

• Desired cultural attributes
• How design choices support motivation, inclusion, and performance

Integrating cultural elements strengthens employee engagement and aligns behaviors with organizational objectives.

Sample Answer Guide

Students often begin by selecting a fast-growing technology startup as their scenario, focusing on scaling operations amid rapid market changes. Leaders in this context might choose a hybrid structure combining functional expertise with project-based teams to promote innovation and flexibility. Decisions on decentralization allow lower-level managers to make quick calls on product features, enhancing responsiveness to customer feedback. Coordination happens through regular stand-up meetings and shared digital platforms, ensuring alignment without stifling creativity. Cultural attributes emphasize agility and collaboration, with design choices like open-office layouts supporting motivation and inclusion. For instance, research shows that fitting organizational structure to coordination needs significantly boosts performance (Burton and Obel 2018, https://doi.org/10.1186/s41469-018-0029-2). Such simulations prepare students for real consulting roles by simulating trade-offs in design elements.

References / Learning Materials

1. Aubry, M. and Lavoie-Tremblay, M. (2018) ‘Rethinking organizational design for managing multiple projects’, International Journal of Project Management, 36(1), pp. 12–26. Available at: https://doi.org/10.1016/j.ijproman.2017.05.012.
2. Burton, R.M. and Obel, B. (2018) ‘The science of organizational design: fit between structure and coordination’, Journal of Organization Design, 7(1), p. 5. Available at: https://doi.org/10.1186/s41469-018-0029-2.
3. Joseph, J. and Sengul, M. (2025) ‘Organization Design: Current Insights and Future Research Directions’, Journal of Management, 51(1), pp. 1–34. Available at: https://doi.org/10.1177/01492063241271242.
4. Stanikzai, M.E. (2025) ‘Strategic alignment of organizational structure based on decisions for sustainable organizational performance: a bibliometric-systematic literature review’, Cogent Business & Management, 12(1), p. 2560650. Available at: https://doi.org/10.1080/23311975.2025.2560650.
5. Winkler, M., Ziekow, H. and Zimmermann, A. (2022) ‘Design and Simulation of Manufacturing Organizations Based on a Novel Function-Based Concept’, Applied Sciences, 12(2), p. 811. Available at: https://doi.org/10.3390/app12020811.