101: Reorganization leadership
Main reasons for restructuring or reorganizing a business involve the departure of a key person, overlapping roles or new business objectives, such as entering a new market. Here are a few main considerations when leading a reorganization.
Communicate, more than you think you need to, advises Harvard Business Review. Employee communication should be planned, with basic information first, such as what will happen when and who will be affected. Don’t try and get employees engaged or excited about changes too soon. “They won’t listen, and you’ll come across as detached,” says HBR.org. Communication should go beyond email cascades and involve face-to-face talks and two-way conversations.
HBR points out communication should focus on what matters to employees – not necessarily return on invested capital – using Elon Musk as an example. “Musk says … ‘People at Tesla, SolarCity, and SpaceX feel that they are doing things that matter: If we can advance sustainable energy by 10 years, that is 10 years of less carbon,’” according to HBR.
Don’t forget stakeholders, such as customers and suppliers. With employees as a primary consideration in a company reorganization, it can be easy to overlook others who need to be clear on the initiative’s details and understand why it is happening. Management consulting firm McKinsey & Co. calls this tendency to only look within as navel-gazing. The revamped organization should work better for everyone, it says in a 2016 quarterly article, especially clients. “Don’t add additional steps or expect them to navigate the complexity of your new organization by having to speak to several people. When salespeople are friendly with their B2B customers – something most companies would encourage – it’s hard to keep the reorg a secret.”
After designing a reorganization strategy, test it. It helps your company implement your strategy. TheBalanceCareers.com’s Dan McCarthy calls testing an important final step. Discuss “how various business processes would work within the new structure. These ‘what if’ discussions help fine-tune the structure and clarify roles,” he says.
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