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Six Principles to Lead a Reorganization

Many people are resistant to change, even when it's well-managed. Thus, even the
word "reorganization" can stir undesirable emotions and bring on headaches.
Katharine Giacalone
February 4, 2009
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Related Topics: Strategy and Management
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Many people are resistant to change, even when its well-managed. Thus, even the word
reorganization can stir undesirable emotions and bring on headaches.
Organizations usually have good reasons to reorganize: the economy, the business requires new
competencies or different talents, competition has brought on new challenges, technology has
advanced, the company has solvency issues and needs to cut expenses quickly or perhaps a
senior executive returned from an industry-association meeting with a new idea.
Talent leaders dont want to shake up the entire organization and drive away the top performers
without providing a clear rationale for change. So before entertaining the idea of a corporate
reorganization, be clear on what the company seeks to gain. Then ask: Is it worth the effort? Here
are some principles to apply:
Frame the work. Gather the senior management team and think through the reorganization vision
and goals. Is it to respond to economic change or new competitive challenges? Is it to recruit new
talent or to address financial issues and save money? What are the short- and long-term goals and
gains? Create a plan with milestones, and make sure there are timelines to guide the process.
Assign roles and responsibilities to each management team member. The talent manager should
take a facilitator role and play an active role in the planning, but not run the meeting.

Know the business model. Focus on the future, not the present. Many executives mistakenly
reorganize around facts that reflect the current state as it is and not how it will be. The
business model, including the organizations mission, vision, values, products and services,
should be clearly stated to internal staff and external customers.
Examine business processes. A successful reorganization requires more than a two-hour meeting
with senior executives. Senior leaders should act like change models, as well as agents, and be
intimately and visibly involved in the day-to-day inner workings of the company. Further, if
reorganizational tools are org charts with names and titles and a goal to reduce the number of
boxes, its not a reorganization process its a cost reduction.
To be effective, operations functions and infrastructure departments such as HR and finance must
participate to identify needs, repetitive business interactions, duplication of efforts, improper use
of technology, proper staff allocation and areas to cut business costs. Involving all stakeholder
groups may take more time initially, but efforts can uncover business impact areas for change
more quickly and accurately. Internal business processes should match what customers want and
what employees can provide.
Re-engineer the way things are done. If processes have to change in order to continue with the
reorganization, maximize the way the work is done. To alter processes, changes must be fully
carried out and maintained. It is not efficient to reduce staff to support a new system that is not
implemented immediately. Further, once there is a new system in place, train employees to use it.
To ensure the changes are adopted, people will need to execute new processes and understand the
need for them.
Take a talent inventory. This is a data-collection point. How many people does it take to run the
business without destroying customer satisfaction? Are the right people in position since
processes changed? Does the staff have the right mix of background, talent and management
skills? Organizations grow over time, but often expect to reduce their staffs overnight. These
questions should be answered before talent managers make final decisions about who goes, who
stays and what positions remain.

Communicate. The most important aspect of the reorganization process is to communicate.


Employees arent as clueless as management thinks. And if they arent told about something,
theyll make it up. The last thing a reorganization process needs is to have the workforce
unaware of goals and working counter to the plan. However, not all details have to be worked out
the first day. Some details legally cant be shared immediately. Communicate what is known to
date, and update details as frequently as possible to relieve organizational stress. Senior leaders
that dont know an answer should make an effort to understand the question and research the
answer. Then follow up.
Reorganizations are painful for those making the decisions and for those for whom the decisions
are being made. The process should not be taken lightly. Organizations have to maintain their
images because their customers are watching. Following these steps can increase the odds for
positive results.

Bio
Katharine Giacalone, also known as The Corporate Nanny, is a management consultant
in the Washington, D.C., area with more than 25 years of experience.

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Build the Perfect Management Team

Define the problem.


Determine whether existing jobs and structures are meeting department goals.
Consider what factors contribute to effectiveness of jobs and structure.
Identify methods for collecting input from staff.

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Verbal, written, and computer surveys


Problem-solving teams
Review committees
Identify a new structure or model that will support your goals, including:
Distribution of functions throughout the organization (definition of
functions to be performed, groupings of functions, and the relationships among
functions)
Vertical and horizontal authority relationships
Communication/decision-making process (how formal decisions are made
and by whom, and the information system established for decision-making)
Internal departmental policies (the decisions, rules, or guidelines
established in production, personnel, purchasing, research and development, and other
areas)
The attributes of department employees (includes abilities, skills,
experience, and other behavioral issues)
Develop a reorganization proposal, including:
Timeframe
Reasons for reorganization
Before and after organization charts
Job descriptions for new, changed positions
Names, titles of employees to be affected by changed or eliminated jobs,
new reporting lines, physical relocation, or reduction in time
Review of Affirmative Action impact
Order of potential layoffs for career positions based on seniority points
Notices to go to unions
A communication plan
Identify the different groups who will need communication and the
different messages/information they will need
Determine series of review and update meetings with management
Determine schedule of informational meetings with staff
Plan communications outside department to announce
reorganization
Set up individual meetings with employees projected for layoff and
for those employees whose jobs will change significantly
Determine skills needed for each position.
Compare current skills with what is needed.
Determine training needs and resources.
Design and implement training.
Review, reassess, and gather input during implementation.
Determine methods to get feedback during implementation.
Include systems that will provide regular feedback from management, staff, and
client groups.
Build an effective team (also see Chapter 14, Team Building).
Clarify mission, goals, and standards for success.
Schedule regular staff meetings.
Facilitate communication by remaining open to suggestions and concerns.

Act as harmonizing influence by looking for opportunities to mediate and resolve


minor disputes.
Encourage all team members to share information.
Support brainstorming and consensus decision-making where appropriate.

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