Corporate reorganizations can cause headaches

How to Manage Corporate Reorganizations Without the Headaches

Whether you call it reorganization, restructuring, reengineering or realignment, there’s one thing you can be sure of: it’s not going to be easy. In fact, many of these interventions are costly and painful—and in the end, don’t work.

One industry, in particular, that is dealing with this right now is the information technology sector. Mergers, acquisitions, divestitures, financial concerns and other issues are causing leaders to take a closer look at how their businesses are structured and whether or not they have both the agility and the depth they need to remain competitive.

But before any organization goes headlong down the “re” path, they might want to reevaluate the process first.

Why Restructuring Efforts Fall Apart

All too frequently, management implements these kinds of initiatives with an emphasis on ROI (return on investment) and execution. Seems like a logical approach, right? But this is often counterproductive because it overlooks some essential, make-or-break elements—things like culture, vision and morale. The future.

In fact, when the objective becomes so narrowly focused on issues like cost reduction, for example, creative and innovative possibilities won’t even be considered. But creativity is essential when you’re looking for new ways of doing things. Without creativity, restructuring efforts often end up getting good marks for intent, but very bad marks for results.

Reinventing Your Process

From a thinking standpoint, the word reinvention is more descriptive of what should really take place when a major change occurs. And whole-brained reinvention is the whole-brain-modelbest descriptor of all.

Our data has shown that the process of invention very clearly involves both analytical and imaginative thinking. If you look at the Whole Brain® Model, these are the upper A and D quadrants. When you add in the necessary B quadrant activities, like form, sequence and implementation, with the C quadrant preferences for interpersonal relationships, teamwork and communication, you have a much more mentally complete process to support the outcomes you really want.

So, where can you find this breadth of thinking?

You’re in luck. It’s most likely right there in your organization; you just have to be sure you’re tapping into it. That means making sure you have the thinking diversity you need represented both in your project leadership and within your implementation teams, and just as important, that everyone recognizes the business value these different perspectives contribute.

4 Steps to Check Your Thinking

If you’re involved in a “re” effort (or are suffering through one that’s not going very well), here are four diagnostic areas to evaluate to make sure you have the thinking processes in place to support the results you need:

  1. Are the desired financial and business objectives achievable as planned? If not, your analysis may have overlooked key elements from other thinking quadrants. Consider what those might be.
  2. Are timelines and schedules well planned and being communicated and respected? If not, then the planning process wasn’t thorough enough. An easy way to check for gaps is to review the Whole Brain® Model to see what you might have missed.
  3. How are the workforce and customers responding? If morale is a problem and customers are aggravated, you’re likely overlooking some important people-related elements, and there could be other contributing gaps, like overlooked process issues and financial factors. Are you encouraging the imaginative ideas and solutions that could anticipate and preempt potential implementation headaches?
  4. Is this a good strategic decision? Are any innovations or creative solutions emerging? Reorganization is about the future, so it requires future-oriented management decisions. This is a great opportunity for the whole organization to get energized by going creative, but it has to start with and be supported by the leadership.

If you want to read about an M&A initiative that bucked the trend and exceeded expectations, check out the story of the merger of Westpac Bank and Challenge Bank.

Westpac didn’t just avoid morale problems during and after the merger; staff turnover actually went down from 14% to 6%. The bank also increased opening hours, making their customers very happy in the process. To top it off, they were able to save the $10 million that had originally been set aside for redundancies.

Now that’s a great example of mindful merging.

How Global Leaders Think