Restructuring is defined by Investopedia as a “type of corporate action taken when significantly modifying the debt, operations or structure of a company as a means of potentially eliminating financial harm and improving the business”. This word is something that can strike fear in the hearts of those involved directly or indirectly with the organization because most of them associate the term with something negative. However, restructuring is part of the process of evolution that a company sometimes has to go through in order to adapt to changes brought about by the ever-changing corporate environment.
Restructuring is a difficult procedure that takes up a good amount of time and energy to plan properly because introducing significant changes to an organization that is well established will be complex and most likely emotional. Restructuring goes way beyond simply doing away with the olden embracing the new. The way a business goes about the changes can be just as crucial to the restructuring as the changes themselves and is why it is so important to do things right from the beginning.
One of the most difficult things about restructuring is knowing which factors you have to consider so the negative impact can be minimized and the company can take full advantage of the positive side of the equation. Having experience with restructuring is also something that is not usual at all, as restructurings are not common occurrences and they do not happen regularly.
Today in Suzzanne Uhland’s Blog we want to talk about some of the most significant considerations you should make a priority when going through a restructuring process in order to make the most out of it and so it has the most positive impact possible.
Planning your move properly should always be your first consideration. Remember this strategy of looking ahead needs to be focused not only thinking about the way it impacts your business in the long run but also how external groups are impacted by the changes. How about the financial structure and the way your customers and your employees are affected? It happens more often than not that new leaders only think about the business as a concept and how it will be modified by the restructuring but forget about the human component and the set of external factors and how they are directly affected by the restructuring.
Rushing to the implementation stage without having sufficient impact assessments can be a huge mistake and it will leave you defenseless when unavoidable issues arise. Being prepared allows you to make changes as smoothly as possible, to prepare for any eventuality and to show professionalism and leadership when the process goes exactly as you planned it.
Open Channels of Communication
Change is difficult and it will always be met with resistance. The fear and uncertainty that employees feel when managers are upfront about changes is something that can turn into trouble down the line. If your organization gives communication its proper importance, then you understand why this step is a no-brainer. Employees feel they are important when they are informed of what is happening, no matter how small the restructure is. Announcements should be made regularly and clearly. Remember the organization is made out of its members, and as members, they should all be made aware of what is happening and they should also be given and participative role in the process.
Remember that is not just about changing the business without any regard for what goes on with the human component. Be prepared to make compromises and understand that you should balance things out properly in order to have a successful restructure. Sometimes as a leader, you can be disconnected with what it is like to work where the rubber meets the road. Communication and flexibility go hand to hand and both aspects should be carefully considered into the decision making process.
Successful Team Building
Once you give your company the opportunity to restructure, make sure the changes address all the issues that led you there in the first place. Teams need to be built determinedly and with the long-term goals of the organization always in mind. Address the issues at all time and work around the answers you want to give to those issues. Is customer satisfaction something that your company struggles with? Then create a solution for that particular problem and make sure you include it in your restructuring plan.
Retraining and Re-Engagement
Changes will not take effect and will not be lasting if you do not set in place plans to retrain and restructure the way your team thinks. Remember that you are changing things and that means having a different mindset and perhaps a whole new approach to doing business. Employees need to be given the necessary tools to be successful in their new environment. If you fail to do this, then you will be back where you started.
* Featured Image courtesy of woodleywonderworks at Flickr.com