Do you ever wonder if people running out of a burning house are thinking about rearranging the furniture? Would you think them crazy if they did?
And yet this is what we do so often in business. We run around doing things that don’t matter and really don’t make much sense…
We are often ignoring the real issues of leadership and process, and spend our precious time just looking at rearranging boxes on an organization chart.Reorganizing the staff can sometimes be just a blind stalling tactic that let’s us feel like we are doing something important.
FIRE? WHAT FIRE
Organizations have historically used reorganizations to solve real performance problems that really don’t have anything to do with structure.
For example, here are some real problems that a reorganization can help fix:
- Ineffective leadership
- Lack of accountability
- Lack of, or poor, project/program prioritization
- Poor internal or external communication
- Few real measures to understand effectiveness of service (internal and external)
- No cohesive/holistic approach to outsourcing or using vendors
As a by-product of many mergers and rapid growth, many organizational structures are unruly, but not untenable.
With competition nipping or gnawing at their heels, fundamental changes are usually in order and not just moving people from one side of the organizational chart to the other.
WHAT IS REARRANGING?
Reorganization is defined as:
re·or·gan·i·za·tion (r-ôrg-n-zshn)n.
1. The act or process of organizing again or differently.
2. A thorough alteration of the structure of a business corporation.
Or quotes found from folks I know:
- “Or perhaps you mean the kind of corporate lunacy that induces people who are far removed from operational reality to decide that they need to ‘shake things up‘ in the organization to ‘spur productivity‘ and ‘improve bottom-line results‘, without having a clue as to the true cost of their decision.”
- “Layoffs“
- “Reorganization is a ‘friendly term’ management uses to make significant structural/organizational/position changes more palatable when people are about to get ‘moved around.’”
Suffice it to say, most people do not think random reorganizations work well or at all.
PUTTING THE FIRE OUT FIRST
The most important thing is to deal with what is really broken.
- If leadership is not effective, help the leaders gain skills to become better leaders or find new ones.
- If people aren’t being held accountable, set up processes to do so.
- If project prioritization is an issue, make sure to create a forum to have all the key stakeholders discuss and agree upon project priorities and resources.
Essentially, deal with the real problem head on.
Don’t be naive; reorganizations are necessary, but are not the answer to all organizational issues.
REARRANGING THE FURNITURE WILL NOTPUT OUT THE FIRE
There are times that restructuring does cause increases in positive outcomes. However, more often than not they fail.
Although there are thousands of reasons why, they mostly boil down to three themes:
1. Employee and Leader Resistance
Employees and affected leaders often believe the reorganization is a result ofinability to make tough decisions or other non-business related rationale.
People hate change.
Change actually causes a reaction in the prefrontal cortex that has people resist change initially. Outside of a very few occasions, everyone resists change regardless if it is good or bad.
If it’s determined to be necessary, make sure that the rationale for the reorganization is steeped in facts that point to improved performance. Although people may still grumble, it is hard to argue with facts.
2. Timing is Horrible
“Timing is everything.”
Nothing could be more true when it comes to reorganizations. It is important to undertake a reorganization only during a slower time in the business cycle.
If that is not possible, it should not be in the midst of other big changes or at peak times.
If FedEx were to restructure, doing it between Thanksgiving and Christmas in America would not be a good time.
3. The Scope and Impact of the reorganization is not realistic or fully thought through
Doing these two things will set you up for failure:
1. Trying to turn a team around in very short time frame.
2. Adding a large amount of responsibility to a team that does not have the capacity.
Change does not have to happen all at once. It should not be thought of as a “once in a lifetime” opportunity.
Trying to get everything into one reorganization too quickly is like trying to jam 40 kilos of potatoes into a 10 kilo sack: something will break.
If the furniture really does need to be moved, then Move It.
Be clear about the issues that cause the lower productivity, efficiency, etc. It is imperative that the real issues causing reduced productivity, profit, etc. are being addressed.
As a result of taking some actions to “put out the fire” a reorganization can be a natural outcome. Make sure that the new structure works to address these issues.
Moving boxes on an organization chart will not solve deep-seated issues of performance and productivity. It is vital to take time in determining what the true issues are.
MAKING THE REORGANIZATION SUCCESSFUL
1. Plan or the “Dip In the Delta”
Change will impact performance, but you can make that a positive. That is why it is undertaken in the first place. The magic is knowing how to mitigate the dip in productivity and turn that quickly into a positive. This takes planning and thought.
Make sure you are actively working on how to utilize the change to solve organizational and productivity problems
2. Get Buy-In from Leaders, Employees, and Other Key Stakeholders
Make sure that the people impacted by the change not only buy in, but are “pulling for it” before it happens.
3. Make Sure the Process and Metrics Are In Place
There is nothing worse than not being able to accurately tell if the reorganization is really making a difference. Make sure there are agreed upon metrics to measure organizational performance to showcase wins and point out where more needs to be done.
Hone internal processes to ensure that performance gains can be realized.
Make sure that internal communication, project prioritization, and other key processes are known, used, and enforced to maximize the impact of the reorganization.
4. Take Care of Employees and Leaders After the Reorganization.
Reorganizations and change initiatives in general fail if focus is taken off the change once it’s implemented or goes live.
This is a huge mistake.
The most important work and most critical time to focus is right after the reorganization takes place.
Leaders need training and support, employees need to know where to find answers and express concerns, and customers need to continue to be served and find resolution to problems when they arise
5. There Must Be a Willingness to Take On More Change, Just Not too Quickly
Nothing is ever perfect the first time.
It’s okay to tweak structure and process once it’s been in place for a little while if its not working. In fact, if you don’t people will learn to get around things to get what they need.
If a change is not working, admit it, but only if there is proof that it’s not working. Once time has been given to make the change work and it is proven to be unsuccessful, change it again.
REMEMBER: PUT OUT THE FIRE FIRST, AND THEN REDECORATE
Reorganizations can be a powerful tool to support organizational change. They can be a tool in increasing the effectiveness and efficiency of an organization. But it is imperative that the real underlying issues of low performance are taken care of first.
Without that, no matter how well the sofa looks against the wall, the house will still burn down.
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This blog also appears on the Linked2Leadership Blog. Please visit them!
Anil Saxena is the President of Cube 2.14, an organizational development consulting firm that works with clients to increase both customer and employee engagement while decreasing turnover, improving customer retention, and increasing profitability within organizations.
Saxena is a certified High Impact coach and trainer and a Joint Application Design facilitator. He is also certified by both Rush Systems and IBM as a focus group facilitator. He is an inaugural member of Northwestern University’s Learning and Organizational Change program, and he earned his bachelor’s degree in mechanical engineering from the Illinois Institute of Technology.
