We recently hosted one of our Atlanta People Strategies Executive Roundtable (PSERT) over wine and hors d’oeuvres. Our topic for the evening, “Leveraging the Chaos of an Organizational Restructure” generated great conversation and a generous serving of insights. While it’s impossible to convey the nuance and observations of the stories shared in the room, we’ve taken a shot at capturing some of the highlights.
Big restructuring often comes with the replacement or elimination of a sizable population of resources, sometimes even those in the C-Suite. When shaking up an organization and a culture, leadership can sometimes end up “throwing out the baby with the bathwater,” by losing top performers along with the desired turnover of employees not suited for or engaged with the company’s new direction. Leadership, particularly new leadership, should take the time to understand what keeps people at the company and why they choose to work there. Culture change, or changing “how things are done around here,” is challenging enough without adding on new habits and disciplines to an already tapped-out workforce, so be sure to preserve the positive and healthy elements of the culture through the transformation to help ensure your stars stick through the journey.
Speaking of culture, when you’re designing the measurements, you’ll use to track your transformation, remember to include key elements of culture. Tangible, quantitative measurements are, of course, critical to any transformation; but it’s just as important to find creative ways to measure the more qualitative aspects of your culture as well. Those qualitative measurements, whether gathered through focus groups, surveys, or by HR and leadership observation are critical to the success of the transformation.
Keep in mind that survivor’s remorse is real. One PSERT participant, a college professor, shared a study he did early in his career that found the people left behind at the company had a higher incidence of anxiety and mental health issues than the people that were let go. Severing any kind of relationship is stress-inducing, and the uncertainty can be unnerving. The people who remain in the organization are going to watch how leadership and the organization handles the treatment of employees they let go. Everyone left behind and everyone let go need to feel like “procedural justice” was followed, that everyone was subject to a fair and consistent process. Leaders and managers need to keep communication short and sweet and avoid providing more detail than is necessary behind the decisions of who stays and who goes. Let HR handle the detailed conversations.
When evaluating whether someone belongs in the new organization, look beyond easy-to-measure performance metrics, and evaluate how aligned the metrics are with the desired culture. Misalignment of measures with culture can be toxic, and that toxin can easily infect others. A reorganization can provide a clean slate to deal with any cultural toxicity that leadership has not dealt with in the standard performance management process.
Perhaps one of the biggest challenges in a large restructuring is getting the C-Suite aligned. It’s critically important, but often very difficult. Ultimately, it’s the role of the CEO to get everyone aligned and on board with the new direction, or to replace those that can’t. The board has a role to play here, too, keeping an eye on the alignment of the C-Suite executives and advising the CEO on necessary actions to get everyone pulling in the same direction.
To get alignment amongst the masses within the organization, leaders should leverage the power of story and anecdotes to convey the new “way things are done.” Anchor back to guiding principles and values or establish new ones to provide your workforce with the tools they need to make the best decisions in their everyday activities. Leaders are 100 percent responsible for how our organizations perform, but also 100 percent dependent on everyone in the organization making the right decisions and adopting the right behaviors to drive outstanding performance. It’s those small, everyday decisions that make up your culture. Provide the stories, guidelines, principles, and examples your people need to align on the way forward.
How have you leveraged the chaos of an organizational restructure?