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Why Organisation Design Is a Growth Lever in Construction Right Now

Picture of Shivendra Kumar
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In an industry under pressure to deliver more complex, high-value projects with fewer resources, organisational structure has emerged as an underutilised lever for growth. 

While most construction and infrastructure firms focus on expanding project pipelines or hiring more talent, few pause to ask whether their current organisational model is truly built to scale.

When treated as a strategic function, organisation design helps align capability with delivery expectations, eliminate inefficiencies, and sustain performance over time. But in many growing firms, structure remains reactive, tethered to legacy ways of working or short-term project demands. 

Project managers keep getting rotated instead of fixing the system that supports them. Leaders don’t always recognise that organisation design is a lever, not just an operational formality.

The urgency is clear. Global construction output is forecast to increase from $13 trillion in 2023 to $22 trillion by 2040, yet productivity across the sector continues to stagnate. 

Between 2000 and 2022, construction productivity grew by only 10%, compared to 50% across the broader economy and 90% in manufacturing. In advanced economies, it has remained virtually flat for two decades.

The disconnect is structural. Without rethinking how teams, roles, and decision-making are organised, many firms will remain stuck and unable to meet rising delivery expectations with their current systems, resources, and leadership capacity.

In some scenarios, this productivity gap could result in a global construction output shortfall of up to $40 trillion by 2040.

In this article, we explore why organisation design must move from the sidelines to the centre of strategic planning.

 

The Most Common Organisation Design Misstep

One of the most frequent organisation design missteps in engineering and construction firms is the continued reliance on project-based structures, where teams are built around individual projects. 

While this model may suit the early stages of growth, as project volume increases, so too does operational risk.

In the absence of a consistent organisational backbone, each project tends to develop its own controls, processes, and reporting mechanisms. The result is siloed teams, fragmented institutional knowledge, and limited scalability. 

Project teams often reinvent workflows from scratch, leading to inconsistent standards and an inability to scale knowledge or performance across the organisation.

But the implications extend well beyond efficiency. When organisations are structured around short-term project delivery rather than long-term capability, they lose the ability to develop institutional expertise, transfer learning, and continuously improve. This results in repeated errors, duplicated effort, and teams frequently resetting rather than building on past experience.

A more effective alternative is a capability-based structure. This model centres the organisation around core capabilities, such as project mobilisation, asset lifecycle management, or commercial contracting, and aligns delivery teams, governance structures, and decision rights accordingly.

The outcome is not only greater consistency across projects, but also the ability to scale what works. High-performing practices are no longer isolated to one team, they are institutionalised and repeatable across the enterprise.

 

Why Organisation Design Is Often Overlooked

Despite its direct impact on delivery and profitability, organisation design is still too often viewed as an administrative function rather than a strategic lever. 

Three factors tend to drive this oversight:

  • Perception: Organisation design is frequently seen as a back-office or HR-driven exercise rather than a mechanism for improving execution or enabling scale.

  • Short-term mindset: Many firms operate with a 3–6 month outlook, prioritising immediate project delivery over longer-term capability building.

  • Fear of change: Structural shifts often bring uncertainty, such as potential attrition, internal resistance, and exposure of leadership gaps. Without a clear strategy or the right support, leaders hesitate to act.

The irony is that while firms are quick to rotate project managers or implement new systems, they often avoid addressing the underlying structural issues. These tactical fixes rarely resolve the root causes of delivery breakdowns.

The construction sector’s broader productivity challenge only reinforces the urgency. 

Despite increasing investment in systems and tools, measurable productivity gains remain elusive.

According to KPMG’s 2023 Global Construction Survey, 37% of capital projects missed their budget or schedule targets due to poor risk management and only 50% of projects are currently being delivered on time.

 

Signs Your Business Has Outgrown Its Structure

Structural challenges rarely present themselves in organisational charts. More often, they manifest as operational bottlenecks and limits to growth. Common indicators include:

  • Decision bottlenecks: Senior executives remain entangled in routine decisions that should sit with empowered mid-level leaders.
  • Inconsistent knowledge transfer: Lessons learned on one project aren’t documented or shared, leading to repeated mistakes and missed opportunities.
  • Stalled growth: The business struggles to take on larger or more complex projects due to coordination and delivery constraints.
  • Leadership gaps: A lack of mid-level capability limits effective delegation and undermines execution at scale.
  • Metric stagnation: Key performance indicators plateau, such as profitability, win rates, or client satisfaction, even as operational activity increases.

Ultimately, an organisation can only grow as fast as it grows its leadership and delivery infrastructure. When structure fails to support capability-building, growth becomes inefficient, and often unsustainable.

The cost of inaction is measurable. According to recent McKinsey research, 44% of construction projects globally result in losses, driven largely by inaccurate risk estimation and poor coordination. These breakdowns aren’t simply execution issues. They often reflect deeper flaws in organisational design.

 

Organisation Design as a Strategic Multiplier

Effective organisation design is more than redrawing charts. It’s about aligning people, processes, and decision-making with the business’s strategic direction. 

In construction, that means establishing structures that enable consistent, high-quality delivery across an increasingly complex and high-pressure project landscape.

It requires a mindset shift, from reactive resourcing to intentional capability-building. From temporary measures to systems that are designed to scale.

With tightening margins, rising delivery expectations, and accelerating growth, organisation design is no longer just an internal matter. It is a strategic advantage. The ability to scale execution reliably, reduce delivery risk, and replicate performance across projects begins with the right structure.

We help construction and infrastructure leaders design for scale. If your systems aren’t keeping up with your strategy, let’s talk.

 

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