Survive a Downturn Through Effective Restructuring by Aarti Thapar, Jeff Gilley and Anny Fenton
As the economy continues to slump, organizations of all sizes, in all industries, are focusing their attention on survival. Many are pursuing huge restructuring initiatives to increase efficiency, improve delivery and cut costs. As talent leaders respond to mounting pressure to reduce their workforces while delivering better value to customers and shareholders, they face complex — and often unanticipated — organizational design challenges.
A straightforward head-count reduction without a full transformation — a common knee-jerk reaction to such challenges — often creates more problems than it was meant to solve, as organizational design efforts are thrown over the fence. At the minimum, lack of collaboration between HR and the business can prevent restructuring efforts from realizing their intended benefits. At worst, it could obscure employee roles and undermine productivity and operational efficiency.
Talent leaders can avoid such problems by taking two necessary yet often overlooked steps: one, develop a thorough understanding of the organization’s operations; and two, integrate organizational and process change. To the second point, there are four key elements involved in creating and sustaining a strong link between process and organizational design. Each provides a critical guidepost in the restructuring process.
1. Understand where you’re going. While it defines the end goal, the vision alone lacks a clear process to create a new organization design. Without a process, HR has no roadmap to reach its intended destination. Talent managers need to work with the business to:
2. Know where you stand. To understand how the organization will achieve its vision, talent managers need to understand employees’ specific roles, responsibilities and reporting lines. While stockpiled job descriptions and manager interviews are staple resources, they provide a limited view of the organization. Further, job descriptions could be defunct or outdated, and managers often lack a detailed view of employees’ daily responsibilities. For this reason, talent and business leaders must collaborate on the following tasks: documenting existing business processes, paying close attention to current organization roles and responsibilities; and analyzing gaps among existing organizational design principles for the future-state organizational design, paying particular attention to where efficiencies can be realized.
3. Create the change. If role boxes are moved and responsibilities shifted, but no adjustment is made for how work is assigned or completed, change likely will not last. To prevent backsliding to a pre-restructure state, talent managers must work with the organization to transform current processes and ensure they align with proposed design principles. This requires that they:
4. Make it real. Restructuring can leave those affected wary and confused. Changes should be communicated to employees so they understand their new roles and how they will operate within the initiative’s early stages. This can be accomplished by:
Restructuring never is an easy process. It requires a large investment of time, money and resources and drastically impacts an organization. By heeding these suggestions, an organization can facilitate a successful restructuring that achieves lasting gains. More importantly, it can ensure employees successfully function in their roles, fostering a supportive and productive workplace.
Aarti Thapar is a managing consultant in PA Consulting Group’s business transformation group. Jeff Gilley is a consultant in the business transformation group. Anny Fenton is an analyst in PA’s IT consulting practice.
Source:Talent Management
