Three types of re-organisation to consider for your business
Emma Shenton is Director and Business Change Ninja at Oakwood Management Consulting. If you need help navigating the current situation and delivering a reorganisation that delivers successful, sustainable business change then book a discovery call to discuss how Oakwood can help.
With 9.4 million people furloughed and an ever increasing list of potential redundancies on the horizon we are hearing a lot about reorganisation. However if you look below the surface not all reorganizational opportunities are as equal as they appear.
I am certainly seeing three types of reorganisations, strongly differentiated by the motivation of the company and why they are happening at exactly this time.
If you’re looking to re-structure your business here are the top three types of re-organisation you need to consider.
- The Financial Reorganisation
This often means reactive redundancies for organisations of every size for whom the pandemic and the economic impact have significantly impacted the immediate or longer term demand for the organisation’s products and services.
It’s heartbreakingly difficult for those who must cut their workforce now in order to keep their organisations afloat, in even the medium term. However what happens if there is a relatively swift return to demand?
I have helped many companies successfully maintain workforce numbers by moving to partial week working, with significant cuts in salary at all levels. This works best where there is a higher percentage cut in the most senior layers, with the percentage reducing for those workers on the front line. This helps to ensure that everyone has a stake in the longer term future of the business and in later years when prosperity is returned, bonuses over many years can make up for the loss of income.
- The Opportunist Reorganisation
These companies have been wanting to make structural changes for some time and are seizing the opportunity to push through the changes now, while the attention is focussed on the inevitability of large redundancies during these difficult economic times.
Be warned – this is always harder to watch as staff and their industries can see what is going on! Loyalty will be given to those organisations who do the right thing during these difficult times, rather than those going down a path of what is fast or easy. You can break your loyalty with one poorly conceived action and spend years trying to repair that damage.
This doesn’t mean that this is the wrong time to make structural changes, but that transparency is king if you expect to take the residue of your people with you on the journey.
Otherwise, fast forward a year to when economic stability is returning and you will watch the inevitable as staff turnover numbers drop when people feel there are better companies to work for.
- The Pre-Emptive Reorganisation
Those who feel that as the financial impacts of the post-pandemic downturn are uncertain, perhaps they should cut back just in case or put effort into pivoting into the perceived new world. Again, I would highlight that reorganisations do not have to mean compulsory redundancies and that there are many ways of retaining your existing workforce in a way to increase loyalty and productivity for the future.