Karen Cherrett Consulting

All about People – Process – Projects

Category: Restructures

Why restructures in business fail

Failed restructures in business are common. Restructures are often initiated due to a change or changes in organisational strategic focus.

You no longer holding a strategic advantage in the marketplace.  What change will the Board or Senior Executives need to make to bring about change to this situation.  One of the first considerations is to restructure.

In this interesting article titled ‘Change for Change’s sake‘ the authors talk about the need for change:

“A company periodically needs to shake itself up, regardless of the competitive landscape.  Even if the external environment is not changing in ways that demand a response, the internal environment probably is.  The human dynamics within an organization are constantly shifting – and require the organization to change along with them.”

Over time informal networks mirror the formal structure, which is how silos develop.  Restructuring gets people to start forming new networks, making the organization as a whole more creative. It also disrupts all the routines in an organization that collectively stifle innovative and adaptability.  Finally, restructuring breaks up the outdated power structures that may be quietly misdirecting a company’s resource allocation.”

Are these reasons for the change valid?

The reasons listed may be good reasons for organisational change.  The expectations are that the disruption of a restructure will create a better, more cohesive and efficient workplace.  But will it?

Let’s look at the thinking behind these reasons:

A company needs to periodically shake itself up

Is this true?  Why does a company need to periodically shake itself up?  It would need to do that only if it thought it wasn’t operating the way that it should.  Lots of beliefs about how it should or shouldn’t be operating.  Are these really valuable?

The organisation needs to change as the human dynamics shift

Yes, the people in the organisation are the culture.  And it is true that cultures shift and change as the people within an organisation learn more, change based on comings and goings. All of these shifts happen for a reason and are beneficial to the organisation, if they are open to seeing them that way.

Is there therefore really a need to restructure in order to shift the organisation in a more profound way?  Creating more stress in an organisation than already exists is not the answer.

Restructuring gets people to start forming new networks

That’s one way of putting it. Restructuring forces new networks. That might not necessarily be for the betterment of the organisation. Where is the consideration given to the skills and expertise of those people operating in certain areas within the business?  That knowledge and skill base will be dissolved or lost completely to the organisation IF these new networks are seen to be what is required.  What is the cost to the organisation of that?

Disrupting the routines improves innovation and adaptability

This is not my experience.  My experience is that people become less adaptable as they begin to feel insecure.  In these circumstances they close down and protective.  That is what stifles innovation and adaptability.  The right environment for innovation is one of openness and trust.  More openness and trust are not gained by regular restructuring.

Outdated power structures are broken up

Power structures are all perceived by individuals within them. Only if you believe that someone has power do they have power.  We all have an equal amount of power when it all comes down to it. It is our ‘perception’ that we don’t that changes how we interact with others.  If there is a strong belief that power structures exist and need to be broken up, then they will form again.  It’s the thinking that needs changing, not the actual formal structure.

Failed restructures are disruptive

How many times have you heard of restructuring efforts not producing the expected savings or efficiency gains that were described as benefits of the change?  Countless times, if you are like me with a long work history.

And yet, we hear time and time again of organisations that choose to ‘restructure.’

They move boxes around on the organisational chart and expect it to fix problems.

What’s missing?

If you make the change for the reasons above, and manage the change in the best way possible,  why then do your change efforts not produce the outcome that you expected?

The missing piece is an understanding of the individual journey that people take when there is change thrust upon them.  During times of change we each travel an emotional journey.  This is not always recognized or understood.  In business it is not common to speak about emotions.

And yet, we as humans have feelings.  We get emotional.  We respond to situations emotionally. It is a normal part of who we are.

An individuals journey is just that, individual.  Staff won’t all go through it at the same pace.  They won’t go through it in a linear fashion (necessarily).  What do I mean by that?  People won’t all feel the same way at the same time.  Some will get in touch with their emotions quicker than others.

Struggling with the emotional journey is normal for some people. Feeling stuck is not uncommon during these times.

Learning to understand the emotional journey associated with change is a great way to support staff through a restructure.

William Bridges assisted many organisations who went through their restructure process and it failed to deliver, by assisting Managers to understand this change emotional journey.  In doing this Managers had a way of supporting staff that resonated with the staff.  They began to feel supported, rather than detached from the process.

When you support staff through their emotional journey they more quickly move back to their normal ways of operating.

Let’s talk about restructuring

Let’s talk about restructuring and how to manage the change.

Restructuring in most instances means some people stay and some people go.

Restructures mean a complete shuffling of the decks. With the rearranging of the management layer occurring first.  It’s a stressful time for Managers.

The expectations are that the operations will continue as normal, whilst uncertainty exists about who has roles and who doesn’t.

During this time employees often feel uncared for.

You begin to wonder if you will still have a job after all this.  You start to hear about colleagues who weren’t successful in gaining roles and life as it was begins to shift.

Here are some tips for managing these times:

Understand people will be emotional

Individuals lives are being turned upside down.  It is normal for them to get emotional about the change. People will have different emotions surface for them; shock, anger, hurt, denial at what is happening.  These emotions are all normal. Recognize that and let them be expressed.

Enjoy celebrating the way things have been

Life as it was is about to change.  As a group celebrate what has been.  Draw up a picture timeline of your journey as a Division/Business Unit/Team.  Have a party and talk about your journey.  Celebrate the people who have been a part of where you are today.

Let yourself experience your emotions

Don’t hide your own emotional feelings. Simply because you are a Manager doesn’t mean that you need to hide your own emotions.  You are human too.  It is perfectly normal for you to experience emotions.  Share how you’re feeling with your team.  It will create a bond and allow them to express their emotions.

Acknowledge your assumptions and notice them

Notice the assumptions that have surfaced for you around

  • why you think this restructure is occurring
  • what it means for you, and your team in the future
  • why things are being changed the way they are sighted to

Your assumptions will help you to understand what you’re thinking about this change. Questioning some of those thoughts will bring you to a calmer and less stressed place about the change.  It’s worth considering.

Be as present as you can be

Being present won’t feel easy when it seems that ground is shifting underneath your feet. If you focus on being present in each moment of the day.  Get up in the morning and focus on getting ready to go to work.  Go to work and be fully present with each and every individual you meet.  Be present in meetings, noticing the emotions.  When you go home, leave work and be fully present at home, with your partner or family.

Question any stressful thinking

Stress comes from thinking about the future and the past. Any thoughts or beliefs that surface can be questioned.  This will bring you into a different space, a more present space with reality.  Things will always seem worse when your mind runs away with what is occurring, or what you think is occurring.  Reality is always kinder.

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