Strategic Insights to Company Restructuring
Mastering the Maze: Strategic Insights to Company Restructuring
Emily Meeker, WorkWell CEO
In the dynamic world of business, organizational restructurings are a common occurrence. Whether driven by market shifts, new leadership, or a need to enhance efficiency, these restructurings can take many forms. Having been through multiple restructurings myself—both as an employee impacted by them and as a leader running restructuring projects—I have seen firsthand the complexities involved. I also run a consulting firm where we’ve had to manage our own restructuring efforts, giving me a comprehensive view of the challenges and opportunities these changes present.
In large organizations, restructurings often feel like a circular process. A new leader might come in and decentralize the organization, believing that this will foster innovation and agility. However, three years later, as the company struggles with inconsistent processes and a lack of coordination, a new COO is brought in, who advocates for re-centralizing key functions to regain control and streamline operations. This back-and-forth is a common scenario in many organizations, but it doesn’t have to be disruptive. By following a structured approach, companies can navigate these transitions more smoothly.
The Pendulum Effect: Managing Shifts in Organizational Structure
Imagine a large corporation that has recently appointed a new CEO. The CEO decides to decentralize the organization, believing that this will foster innovation and agility. However, three years later, as the company struggles with inconsistent processes and a lack of coordination, a new COO is brought in, who advocates for re-centralizing key functions to regain control and streamline operations. This back-and-forth is a common scenario in many organizations, but it doesn’t have to be disruptive. By adopting a systematic approach, businesses can manage these transitions more efficiently.
Unified Success: Why Advanced Consideration for Both Leaders and Employees Matters
Restructuring isn’t easy, whether you’re the leader making the tough decisions or the employee experiencing the changes. These processes come with inherent trade-offs and often spark varying opinions on the right way to proceed. What works phenomenally well in one company might not translate to success in another, as restructuring is influenced by the unique culture, goals, and circumstances of each organization. However, the key to success lies in recognizing the shared responsibilities and experiences of both leaders and employees during restructuring. What sets the tone for success is understanding this fact from the onset of the effort and proactively doing something about it.
Adopting a “we’re in this together” mindset helps ensure that decisions are made with empathy and that everyone has a stake in the outcome. Smart business decisions are rooted in the understanding that people matter most. When leaders approach restructuring with a focus on the human side of things—considering how decisions will impact their people—they are more likely to make choices that benefit both the business and its employees. Employees who feel that their well-being is taken into account are more likely to engage fully in the process, contributing to a smoother transition and better outcomes for the business, which leads to a more positive day-to-day reality for the individual.
With that in mind, the tips provided here are designed to help both leaders and employees navigate these murky waters more successfully, ensuring smoother transitions and better results for everyone involved, including the company and your clients!
Key Strategies for Successful Restructuring
Clarify the Objectives
Before initiating any restructuring, it’s crucial to define the objectives. What are you trying to achieve? Whether it’s improving efficiency, reducing costs, or fostering innovation, the goals should be clear and measurable.
Example: If the objective is to improve customer satisfaction, consider how the restructuring will impact customer-facing roles and processes.
Communicate the ‘Why’ and ‘How’
Employees often resist change when they don’t understand the reasoning behind it. Transparent communication is essential. Explain not just what changes are happening, but why they are necessary and how they will benefit the organization in the long term.
Expert Tip: During a restructuring, hold town hall meetings where leaders can answer questions and address concerns directly.
Manage the Impact Proactively
Restructuring inevitably affects employees, both emotionally and professionally. Anticipate these impacts and manage them proactively. This could involve offering support services, providing clear timelines, and ensuring that employees know their roles during and after the transition.
Expert Tip: Offer career counseling or training programs to employees whose roles may be changing or at risk.
Top Three Tips for Employees During Organizational Change
Stay Informed and Adaptable
Keep yourself informed about the changes happening in your organization. Attend meetings, ask questions, and seek clarity when needed. Being adaptable and open to new opportunities can help you navigate the transition more smoothly and will show your leaders that you are invested in the success of the company.
Focus on Personal Development
Use the restructuring as an opportunity to develop new skills or enhance existing ones. This can increase your value to the organization and improve your career prospects, whether within the company or elsewhere.
Maintain a Positive Attitude
Organizational change can be stressful, but maintaining a positive attitude can make a significant difference. Focus on the potential opportunities rather than just the challenges and support your colleagues through the transition.
Top Three Tips for Leaders During Organizational Change
Lead with Empathy
Recognize that restructuring can be unsettling for employees. Show empathy in your communications and decision-making processes. Understand the concerns of your team and address them with sensitivity.
Be Transparent and Consistent
Consistency in communication is key to maintaining trust during restructuring. Be transparent about what is happening, why it’s happening, and what the expected outcomes are. Avoid mixed messages or sudden changes in direction.
Provide Clear Direction and Support
Employees look to leaders for guidance during times of change. Clearly communicate what is expected of them and offer the necessary support to help them succeed in their new roles or responsibilities. Lead by example, setting the tone for open and honest dialogue. Being receptive to employee feedback will not only enhance the process but also foster a more collaborative and successful transition.
In Conclusion
Restructuring is not just a challenge—it's a critical turning point in the life of any business. Approached with clear objectives, transparent communication, and proactive impact management, it becomes more than just a survival strategy; it’s a launchpad for future success. The stakes are high for both employees and leaders, making their roles in this process indispensable. When companies commit to understanding, preparing, and leading with purpose, they can transform the inevitable disruptions of restructuring into powerful opportunities for growth, resilience, and lasting improvement.