The UN has been reformed many times since its inception, I don't think the UN is dysfunctional because of its structure and machinery, but rather it's deep political disagreements. And yet it's serves its purpose to a certain extent.
Even in Bush's arrogance when he decided to "go it alone" in Iraq, he went back to the UN because he realized it could help rebuild. Blue helmets have a degree of legitmacy around the world, whether some of us like it or not.
I would think the first thing that needs reform is the UN Human Rights Committee. It must become an effective force in advancing human rights, a good start would be not appointing dictatorial regimes to chair the Human Rights body.
Increase the risk and stakes and perhaps smaller countries would have a more vested interest in its success, by means of distributing funding for the UN more equitably.
Non democratic nations should not be allowed in the UN, immediate sanctions should be imposed and the blue helmets should go in and restore law and order. Period. One nation at a time.
The UN should have a limited but effective armed forces of its own, it currently relies on member states for its forces at the expense of those states. They should recruit people from all over the world.