By: Dominique Huertas on February 19th, 2020

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How to Best Manage a Company Reorganization

Business Management & Strategy

I was recently in an HR role for a non-profit that was going through a restructuring. The new CEO (formerly the COO of five years), felt this change would streamline business practices and allow growth for the organization. No matter the industry, this term can seem jarring at first, and especially within a 100-year-old association. People felt the current structure of the association seemed to work and didn’t understand why a reorg was something that needed to be done. Our CEO, Division Directors and I met frequently to stay ahead of the growing concerns and manage the change for it to be a successful reorg.

If you are considering a reorganization, you must first find ways to manage the process in order to gain buy-in from staff and achieve continuity amongst the organization. Here are the top three tips I’d recommend below.

Top 3 Ways to Effectively Manage a Restructuring

1) Communicate

A corporate reorganization doesn’t have to be chaotic, but unfortunately, that happens often when there is no clear communication plan. Engage employees throughout the process and keep them updated; they are still your greatest asset. It is our experience at Helios, that if you give them facts from the beginning, employees feel that they are a part of the solution and can better understand. We see most often that preliminary conversations with stakeholders, leadership, and employees return greater buy-in before the role out of the reorganization. McKinsey wrote about two less than ideal examples in communicating with employees, that they called the “wait and see” and “ivory-tower idealism”. How do you not fall into either category? By having frequent, concise, and engaging communication, your reorg process will be more productive and rewarding.

2) Anticipate Blowback

Let’s face it, reorgs often mean people are let go or maybe reporting to someone new. You can’t please everyone, and those that aren’t pleased with the change will let everyone know it. If there is chatter amongst those being let go, and others wondering if they’re next, it’s important to let them know how they can continue to add value to their roles and the organization. Employees can do a lot of damage to a brand’s reputation. Have a strong strategy in place to alleviate risk to protect your ongoing operations and profitability.

3) Measure Success

Once the reorg has been rolled out, it’s important to assess its effects and determine if it was successful. Also, understand that measurement will take some time as not everything is immediately measurable. As milestones are recorded, share company wins and reward efforts. It is our experience at Helios, that as employees learn about different victories and opportunities, the more motivated and engaged they become. Inform employees about the effects of the reorg and how they played a part in the plan overall. It may not even be a bad idea to give an incentive to employees to show you appreciate their commitment through the process, such as a retention bonus for example.

If you are contemplating a reorg because you feel it will ultimately help to add value to your business, a discussion on change management should be your first step. Managing the reorg appropriately throughout the entire process may seem daunting and will be a bit challenging at times, but it will also help to alleviate a lot of unwanted stress. The success of your reorganization is centered around the buy-in from your employees, managing risks, and assessing win and losses. Managing properly through the process may be difficult, but it can also be the vital difference between companies who experienced value from their reorgs and those who didn’t.