What Makes Organisational Design in the Public Sector Different?

If you've watched a corporate organisational design programme fail when transplanted into a government or NHS setting — or seen an experienced private sector consultant struggle to get traction in a complex public body — you've seen this problem first-hand. Public sector OD is genuinely different. Not harder, not easier: different. Understanding how is the starting point for getting it right.

The accountability structure is fundamentally more complex

In a private sector organisation, the accountability chain runs upward to shareholders and a board. In a public body, accountability runs simultaneously upward (to ministers, boards, and regulators), outward (to the public and service users), and across (to other public bodies, scrutiny committees, and trade unions). A TOM or restructuring programme that ignores this political and institutional landscape will stall — not because the design is wrong, but because it failed to navigate the environment it was designed for.

In practice, this means that stakeholder engagement in the public sector is not an afterthought — it is load-bearing. Designs that would pass through a FTSE 250 exec team in a fortnight can take months in a government department with union consultation obligations, ministerial sign-off requirements, and parliamentary scrutiny in play.

Savings targets are real and non-negotiable

In commercial OD, the goal is often growth — unlocking new revenue, improving margins, enabling scale. In the public sector, the mandate is frequently the opposite: deliver the same or more with less. This fundamentally changes the design logic. The City of London Corporation's TOM programme, for example, was anchored around a £14m savings target that was non-negotiable and publicly committed. The design had to work backward from that constraint, not forward from an ideal state.

This is not simply a budgetary constraint — it shapes every design decision. Role reductions, spans of control, shared services, insourcing versus outsourcing: each choice carries financial, legal, and political weight that must be managed explicitly.

The workforce context is unlike the private sector

Public sector workforces typically have high union density, strong employment protections, long average tenures, and deeply embedded professional identities. HMRC's 2,100-person departmental merger, for instance, required navigating existing job families, nationally agreed pay bands, and TUPE-equivalent protections — while simultaneously delivering a new operating model that changed how people worked day-to-day. Getting the HR and ER dimensions right is not optional — it is the critical path.

Complex organisational structures require specific expertise

Many public bodies have a structural complexity that has no corporate equivalent: charity arms, trading subsidiaries, arm's-length bodies, regulatory functions, and democratic oversight bodies — often all within the same corporate umbrella. The City of London Corporation operates simultaneously as a local authority, a charitable funder, a business improvement district, and a private landowner. Designing a TOM that works across all of those entities requires a fundamentally different approach to role design, governance architecture, and accountability mapping.

What this means for how you commission OD

When commissioning an OD or TOM programme in a public sector context, look for a consultant who has done the work in comparable environments — not just someone who has adapted a corporate model. The difference between a consultant who has delivered an NHS merger TOM and one who hasn't is not a question of general competence: it is a question of whether they know what they don't know.

The structural complexity, political accountability, and workforce dynamics of public sector organisations require OD practitioners who have worked in them — not ones who are learning on the job at your organisation's expense.

Peter Wyllie is an HCPC-registered Occupational Psychologist and doctoral researcher with over a decade of senior OD experience across central government, NHS, and local government — including HMRC, University Hospitals Sussex, City of London Corporation, and Wirral Borough Council. If you're leading a TOM, post-merger integration, or restructuring programme in the public sector, we'd welcome a conversation.