Mu Sigma Organization Design

Formalisation:Company has low to medium level of formalization. The amount of written documentation related to policies and procedures are bare minimum, though with period of time, number of formal rules have increased, but still it remains an open culture company. Specialisation: Mu sigma does not have division of labour on the basis of specialisation. This means that the specialisation is low and employees perform wide range of tasks in their jobs. There is a lot of flexibility for the employees to use their expertise, ranging from training, recruitment to business development in whichever field they want like airline/hospitality and entertainment, retail and consumer products, pharma, telecom, healthcare etc. Hierarchy of authority: There is no well defined hierarchy of authority. The employees are divided into teams containing 4 to 5 members in each, depending upon the request made by them as to which team they want to be part of. The request is approved by the manager.

These teams then work on specific projects but have the flexibility to move across domains (only after 1.5 years).At the broader level, there are managers having 5 associate managers under them. The associate managers further have 5 members under them, giving a total of 25 members.Here hierarchy of authority is shorter. Shorter hierarchy ensures a collaborative and decentralized decision making. Here employees can even directly meet DhirajRajaram if they have something to discuss with him. Centralisation: Mu sigma follows a decentralised structure wherein the decision does not rest at the top level but is delegated to the lower organisational levels. The teams can make decision individually or mutually with the help of the team leaders. Professionalism: It refers to the level of formal education and training to the employees.Mu sigma has high degree of professionalism.Major recruiting is through colleges- hire only engineers or master of statistics. As per the MuSigma, requirements for the hiring of employees are as follows: Necessary Traits

Description
Learning Over Knowing
Ability to apply first principles and structured approaches to problem solving as opposed to relying excessively on past domain expertise Agility
Required to cope up with continuous transformation
Scale & Convergence
Potential to synergize in an ecosystem of talent, capabilities, processes, customers and partners, which can be leveraged across verticals, domains and geographies Multi-disciplinary talent
Ability to apply Math + Business + Technology + Behavioural Sciences Innovation
Increase breadth and depth of problem solving by constantly researching and deploying emerging techniques, technologies and applications Cost Effectiveness
Ensure sustainability and institutionalization of problem solving across organizations

E.g. in India, at the entry level, company only recruits engineers from top tier colleges and the master of stats professionals. The designation level given to these fresher’s is Trainee Decision Scientist. Their major designation hierarchies in India are Trainee Decision Scientist, Senior Business Analyst, Associate Manager, Manager, Senior Manager, Delivery Lead, Director, VP and leading to CEO. In US, this designation hierarchy is slightly different-Difference is because the level of skills and expertise of the people applying for analytics jobs are different- they are mostly post graduates and experienced. Hence in US, the hierarchy designation directly starts from associate and is followed by Engagement Manager, Account Manager, Regional Head, Geography Head, leading to CEO. 2.2 Contextual Dimension

Size: The Organisation of MuSigma is relatively small with about 3000 highly educated employees and four vertical division, which helps the company to be flexible in adapting to the changes in the environment with low labour base. Organisational technology: MuSigma uses Data Engineering, Data Sciences and Decision Sciences techniques to convert data from the industry to a valuable decision support thereby helping its clients in the decision making procedure. It utilises advanced information systems and Internet to carry out its tasks. Environment: Mu Sigma interacts directly with industrial sector( pharma, health retail), human resource sector(employees) and market sector (customers, clients).

He also interacts indirectly with the technology sector and uses advanced analytics, especially predictive modelling, machine learning techniques, and neural networks. Goals and strategies: The Company has a well-defined written down goals and strategy and a sound relationship with the employees to achieve those goals. Each employee is given a target which he is supposed to meet through innovation. Culture: Mu sigma has a very good cultural environment and has adopted a TRIMURTI philosophy from Hindu Mythology. It believes in creating knowledge, utilising the capital available and taking risk and help the clients. The employees share good professional and personal relationship with each other thereby creating a healthy working environment. 2.3 Mintzberg’sOrganisational Framework

Professional Bureaucracy – Mu Sigma is characterised by its pool of highly skilled professionals that work across complex domains such as data engineering, data sciences and data decisions. They have a small technical support staff and a moderate size of administrative support staff.

2.4 Functional classification
Being an Analytics firm, the functional classification briefly can be: Basic reporting:
Tasks like basic data ETL, data sanity checks and making the given data into information. Basic Analytics:
Creating advanced reports by deriving additional metrics to come up with business insights The capabilities may vary from creating/evaluating business models to developing frameworks which facilitate better business insights Modeling:

Sometimes basic analytics fail to deliver the required business insights from the data Modeling solutions by using sophisticated modeling techniques like predictive and statistical modeling can monetize the data to a better extent Visualizations:

Making the generated insights/ reports more easy to understand by creating visuals This involves creating advanced dashboards and attractive business insights frameworks for the ease of consumption of the reports

Social media analytics:
Responsible for generating consumer sentiment insights from the social media data

Big data analytics:
Creating frameworks for fail-proof acquiring of the generated big data and analysis Developing advanced algorithms and usage of better frameworks to reduce data latency Products:
Mu Sigma has been active developing products consumable by anyone who need analytics They have a wide range of products like MuRx, MuMX, MuPDNA and
more. IT:
Basic IT infrastructure and support team

3. Reporting Relationships
3.1 Reporting Structure
The basic hierarchy in Mu Sigma till a certain extent is fairly flat. Senior management is easily approachable. Formality is not expected in form of speech but in terms of mutual respect. Since most of the work force is comprised of students who are serving their first jobs, the environment in the teams is mostly energetic, impulsive and dynamic. The SBA’s also are just a year or a couple of years older than the BA’s. This eases work coordination, knowledge transfer and communication among the peers. Overall at a team level, everyone reports to the lead, which can be SBA/BA depending on the team composition. At an account level, everyone reports to the Manager. This almost flat hierarchy at team level ensures smooth communication among the peers, which reduces work conflicts.

3.2 Inter-department Coordination
There is a high level of coordination among the different departments of the organization. There are several individual departments which deals with IT operations, Finance operations, HR operations, Delivery, Research operations etc. The delivery team which is responsible for most of the work sold by the organization can get any of their issues resolved/ get inputs from other departments with ease. All the departments are very much accessible ensuring transparency of operations to all the employees. Mu Sigma ensures the inter-departmental operations are smooth to ensure quick and optimal delivery.

3.3 Role of Top Management
Mu-Sigma management aims to be the global leader in analytics consulting.It aims to be a fastgrowing and alearning organization and banks on its unique combination of mathematical and analytical problem solving skills of its employees. With the increased focus on analytics by companies around the world, Mu-Sigma sees this a tremendous opportunity. But in this competitive environment, it faces threat from the existing IT services companies and captive units of MNCs who are willing to enter into analytics space to get a slice of their pie e.g. a US based Fortune 100 bank, an ex Mu-Sigma client, which was earlier outsourcing its entire analytics work has now started its in-house analytics unit.

Hence, Mu-sigma now faces another challenge to ensure resource availability. However, sometimes this need to aggressively compete for resources and client has a detrimental effect on the employees. E.g. some employees feel that company over expects while designing and pitching new projects i.e. while selling projects and setting timelines, they don’t discuss these things with employee. Hence, due to unrealistic timelines, pressure on employees is high and this sometimes leads to a cause of attrition. Employees believe that they should be involved not only in implementing stage but also in initial planning stage. 3.4 Expectations from Employees

Mu-Sigma has a decentralized structure. Here employees are not just considered as resources but are considered as partners. Hence, very high expectations are set on them. Even while recruiting, focus is on getting employees who are not only high on IQ but also on EQ. This trend is generally reflected and followed during campus recruitment drives4. Employees are also expected to work across diverse activities, ranging from training, BD activities to organizational development activities in addition to working across different domains. The company believes that best ideas and most innovative ideas in an industry come from an unrelated industry, hence they expect employees to have cross- domain experience. 3.5 Roles and Responsibilities of Employees

Here, roles and responsibilities are not defined. Even while recruiting, there is no fixed job description corresponding to a job title. Depending on the employee’s skill set and company’s need, an employee can be expected to perform varied work. Even a senior Business analyst and a manager can have exactly same role. They may be doing same BD activities and team lead. There is no co-relation between designation and your roles.People don’t have any fixed specialization and management expects employee to be quite flexible. 3.6 Employee Goals

In Mu-Sigma, employees are expected to set annual goals for them at the end of every year. These goals need to be approved by both – employee as well as the manager. These goals are focused across 3 areas:

Competencies: Every employee is expected to develop technical and functional competencies across increasing areas. It can be either in terms of learning new skills such as SAS, BI tools or in terms of getting functional knowledge of the area of scope. E.g. employees are encouraged to do insurance related certifications to hone their functional expertise.

Individual Growth: A lot of focus is to ensure individual growth of the employee. Hence, in addition to above mentioned technical and functional skills, employees are also encourageto take part in personality development and managerial development sessions, which company regularly organizes from time to time.

OrganizationalGrowth: Mu-Sigma considers its employees as partners and employees are encouraged to contribute to organizational growth and development. This includes contribution in terms of developing in-house expertise and tools and as well as participating and training and recruiting activities.

A strong focus is placed on ensuring that these goals are met and hence processes have been put into place to ensure honest feedback. At the end of every quarter, every employee is asked to track and note down his progress in all the mentioned goals. Employees are encouraged to have a discussion with the manager if required. This ensures that manager is aware of the employee goals and suitable corrective actions can be taken at the earliest. 3.7 Information Sharing Structure

Mu-Sigma prides on its horizontal structure designed for learning. The company has a flat hierarchy with few rules. All people sit in an open bay and only the company’s head has a separate room. Since in analytics industry, most of the techniques and common and replicable across variety of industries, hence focus is lot on horizontal and face to face communication. It also has a company point shared site called SPN where employees can exchange their information and aid in mutual development. Besides this, there are also formal knowledge exchange sessions among different teams. Mu- Sigma believes that this wide spread sharing of information keeps organization working at optimum levels. Ideas and information are shared across company, ensuring that every employee has a holistic view about the company and the resources are adaptive. 4. Strategy

4.1 Strategic Intent
Mission: To solve High Impact Business Problems for market leading customers across various industry verticals using advanced analytics in a sustainable manner5.

Vision: To enable businesses to institutionalize data-driven decision making4.

Before moving on to defining the kind of strategy that senior managers at Mu Sigma employ, it is important to understand the competitive environment under which Mu Sigma operates. Some statistics on the current data analytics industry scenario in India include6: Size of the Indian Analytics Market: $ 375 million

Number of companies operating in this segment in India: Over 500 companies Expected size of the Indian Analytics Market by 2015 – $ 1.15 billion

4.2 Competitors
EXL, Absolutdata, Fractal Analytics, Affine Analytics. Also, the in-house analytics teams being put together by most companies pose a major threat to Mu Sigma. 4.3 Competitive Advantage
The major source of competitive advantage that Mu Sigma enjoys stems from its highly talented workforce. Rajaram, the company founder, strongly believed in establishing an A Team. He realized the importance of having the right people in the organization to drive it towards success. Since its inception, the organization has strongly focused on acquiring the right talent to suit its need. This fact is also reflected in the highly selective process employed by Mu Sigma’s hiring managers: just one in 16 people interviewed is hired, and many more are rejected before they get to that stage. The newcomers are not appraised for the first three years. The company’s 45-people human resources, or HR, team is large for Mu Sigma’s size7 The firm, however, also got more things right than just the people piece. It started playing in many sectors – from financial services to healthcare – which helped it gain scale and advantage over its competitors.

Apart from enjoying these advantages over competitors, the firm also focuses strongly on innovation. It has a separate Innovation & Development Group which caters solely to innovation specific activities within the firm. Mile’s and Snow strategy framework to identify the kind of strategy that is being implemented (or should be implemented) at Mu Sigma. Given the above observations on the dynamic, uncertain and growing environment of the Data Analytics industry and the enormous amount of competition, it makes sense to follow the Prospector strategy in order to stay competitive and to survive. The people oriented culture of Innovation within the organization, which we observed above, to some extent, does support this strategy. 4.4 Porter’s Competitive Strategies

Mu Sigma follows a strategy of Differentiation.This is in line with its strategy of investing heavily in ‘Innovation and development’ with a focus on developing in house data analysis tools. 5. Decision Making

5.1 Individual Decision Making
The individuals follow a bounded rationality approach to decision making. Since Mu Sigma operates in a highly unstable and dynamic environment, where decisions have to be taken quickly, the managers use a mix of intuition and experience to take decisions. 5.2 Organisational Decision Making

High velocity environment: Mu Sigma adopts a different approach to decision making since it functions in a highly competitive and technologically oriented environment where the rate of change of market dynamics is fast enough to rule out the traditional decision making models. Meetings are held twice or thrice a week and a lot of discussion is held among various stakeholder departments before deciding a particular course of action. 5.3 The Insight-Driven Organisation Matrix8

At Mu Sigma, decisions are also frequently based on insights garnered from experience and data.

6. Global Organisation Design
CEO& Chairman
Chief financial officer
Cross Industry delivery Head
Geography head Australia
Geography Head, US
Geography Head, Midwest, US
Geography Head ,South
Geography Head, West coast
Cross Industry Unit Head
Head Of Client services
Head Of Fulfilment
Head of Innovation and Development
Head of Presales
Head of Product and strategy
Head of Sales and Commercial effectiveness
Head of Talent Management
Vice President, Operations

6.1 Simple – Complex Dimension
Mu Sigma functions in a complex environment where a number of external elements influence the functioning of the organisation. These elements include the rapid technological changes taking place in the advanced analytics and big data industry and the continuous dearth for talent specific to this industry. 6.2 Stable – Unstable Dimension

Mu Sigma veers more towards being an unstable organisation due to the sheer unpredictability of the industry in which it operates and the frequency with which the various elements of the technology sector change.

7. Conflict and Politics
7.1 Rational vs Political Model
Mu Sigma follows more of a rational model with politics being used only rarely at the higher levels of management to resolve conflict. The company stresses on ‘openness’ in decision making9. The goals are clear and choices are made in a logical way with room for discussion and improvement. Politics comes into play at the higher levels of decision making when managers try to claim credit for a team effort towards business development. 8. Innovation

The organization culture strongly promotes innovation. Employees are given a free-hand to organize events revolving around brain storming for the sole purpose of generating creative ideas. For e.g. they conduct what is called a Fedex day wherein people are asked to think about areas where they can innovate making use of analytics and how to implement such initiatives. The top 3 ideas are then selected and provided support by the delivery leads in order to help implement these propositions. Some of the latest innovations in the field of analytics by Mu Sigma include advances in state-of-the-art RIA technology to help improve interactive methods for exploring data, Mu Sigma’s Marketing Mix (MMX) tool which is used for simulating what-if analysis scenarios, and Mu Sigma’s MMBUZZ solution that helps keep track and make sense of all the social networking buzz10. 9. Culture

9.1 Philosophy
Mu Sigma has adopted a unique philosophy of Trimurti from Hindu mythology. They believe three diverse personifications of cosmic forces namely Brahma, Vishnu and Shiva synergize to complete the universal cycle of creation, preservation and eventually, productive destruction or transformation. They have applied this to their business functioning as follows – The Brahma clan: Creating the future

The Vishnu clan: Preserving or managing the present
The Shiva clan: Destroying or selectively abandoning the past

9.2 Symbols
Mu Sigma is named after the symbols of mean (Mu) and standard deviation (Sigma). This emphasises the roots of the company i.e pure play analytics of data in business using a combination of mathematics and statistical knowledge for rational decision making. Another component is use of offices without private cabins to signify a culture of openness and collaboration. 9.3 Type of Culture

Mu Sigma follows a mix of Adaptability and Mission Culture. The organisation is flexible in terms of adapting itself to the needs of the external environment and encourages innovative and entrepreneurial thinking. At the same time, it emphasises clear focus of goals such as meeting customer needs, profitability etc. 9.4 Corporate Social Responsibility

PRAYAAS is Mu Sigma’s effort to give back to the community and work towards a better society11. Their efforts involve teaching poor school children, working with old age homes, orphanages, NGOs, to conducting awareness programs for causes like AIDS, Child Education, Global Warming, Animal Welfare and Deforestation.

B. Mu Sigma || Evaluation and Analysis
The different components of the organization – Mu Sigma have been analysed and evaluated on the following dimensions namely- strategy, culture, structure, reporting relationships, complex and unstable environmental framework. 10. Strategy

10.1 Strengths
Mu Sigma operates in an industry where people are the most important asset for a company due to the unique skill sets required for analytics and decision sciences. In such an environment, Mu Sigma has a distinct advantage in terms of hiring the best of talent – only 7% of the people interviewed are hired. It has five times the headcount compared to its competitors. Mu Sigma is a learning organisation with a strong emphasis on information and knowledge sharing. This is reflected in its innovative, risk taking attitude. It’s in house Innovation and Development department focuses on building advanced analytical tools using the talent available in the organisation. Also, a number of white papers are technical research papers are published frequently on its website. 10.2 Shortcomings

Analytics is a dynamic and fast paced industry where the requisite skills have to be learned constantly and effectively. This poses a problem for Mu Sigma while hiring their employees since they have to spend a huge amount of money on training costs. It becomes difficult for them to follow their low cost leadership model Talent retention is a problem faced by Mu Sigma that is plagued by an attrition rate of 23%. 10.3 Insights on the Organization Strategies

At Mu Sigma, promotion takes place in 2 cycles: January & July. If somebody joins between July and January, he/she is not eligible for promotion in the coming cycle. This creates employee dissatisfaction and demotivates the new hires. This should be eliminated by having a uniform and continuous time based promotion instead of a cycle based promotion Specialists are hired but are required to carry out variety of work and not just in the field that they have specialized in. Instead, the company should capitalise on specialist talent by giving them projects suited to their field of specialisation. This would increase productivity and give clarity on the scope of the work to be performed. Since Mu Sigma is located in Bangalore and does not have any other offices in the rest of the country, regional preferences of locations becomes one of the most important reasons for attrition. Mu Sigma should expand its footprint across India for it to retain the best talent from the country.

11. Culture
11.1 Strengths
Mu Sigma has a very good culture represented by the open communication that the workers indulge in. This helps the company to have a healthy working environment and drives creation of new ideas which is the key factor for innovation in the company. This also initiates employee motivation in an effective manner. This is clearly visible from the fact that many of the employees of Mu Sigma have started their own ventures. The unique philosophy of Trimurti that the company follows ensures that the employees work in tandem with full cooperation and coordination thereby keeping the company at an advantageous position than its competitors 11.2 Shortcomings

The company follows a value based leadership wherein the relationship between the employees and the managers is based on strongly internalised values that are advocated by the leader. The company’s managers have poor interpersonal relationships with the employees thereby hampering their zeal to work in teams. 11.3 Insights on the Organization Culture

Mu sigma should follow a uniform two 2 way feedback mechanism wherein the employees and the managers can freely share their opinions about each other on personal as well as professional matters. The company should have an interpersonal skill improvement wherein the employees are given the opportunity to enhance the skill set. 12. Structure

12.1 Strengths
The absence of a strict hierarchy and emphasis on openness in communication fosters creativity and helps in developing employee competence. This is demonstrated by the wide spans of control exercised by managers – there are 25 direct and indirect reporters per manger. Mu Sigma has a high degree of professionalism – they hire only engineers, statisticians and mathematicians with a high level of intellect and in depth knowledge of analytics. This creates a huge database of talent. 12.2 Shortcomings

There is a low degree of specialisation for new hires. They are expected to perform a wide variety of tasks across different domains. This hinders employee growth. 12.3 Insights on the Organization Structure

There is a need to introduce some degree of differentiation to avoid overburdening of employees and to allow them to focus their strengths in their own fields of specialization. 13. Environment
13.1 Strengths
The big data analytics market earned revenues worth $3.2 billion in 2013 and it is predicted that this will increase to $15 billion by 202012. Vendors are putting substantial investments into research and development, as well as potential acquisitions. This gives Mu Sigma a significant industry advantage. 13.2 Shortcomings

The growth in analytics industry, both in India and worldwide, has been tremendous. The number of analytics companies in India has grown three folds in last 1.5 years. This creates a number of competitors for Mu Sigma. MNCs are increasingly creating captive units that are in house analytics teams dedicated to developing analytics for the company. This seriously affects the competitive environment for Mu Sigma. Mu Sigma faces infrastructure constraints since it is present only in Tier 1 cities that makes it difficult for them to expand. 13.3 Insights on the Organization Environment

Mu Sigma should invest more in research and development since analytics is an innovation-driven industry. By innovating, Mu Sigma can ensure it stays ahead of its competitors.

14. Reporting Relationships
14.1 Strengths
The basic hierarchy in Mu Sigma till a certain extent is fairly flat. Since senior management is easily approachable and most of the work force is energetic, impulsive and dynamic, there is a high level of work coordination, knowledge transfer and communication among the peers. Inter departmental coordination is transparent and ensures quick and optimal delivery of services, by smooth interaction with various stakeholder departments. 14.2 Shortcomings

Employees face a lot of pressure while meeting deadlines due to the lack of clarity of goals between the manager and the employees. Roles and responsibilities of employees are not well defined and there is ambiguity related to the job profile. There is no correlation between the designation and the roles performed. 14.3 Insights on the Organization ReportingRelationships

The managers should involve employees, atleast in an incremental role in the planning phase of the project. This would set a realistic expectation of the work to be done.

References

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[10] “Innovation & Development Group”, Mu Sigma, www.mu-sigma.com, [11] “Mu Sigma”, Glassdoor, www.glassdoor.com,