Restructures and reorganizations can be challenging processes for any organization. However, with the right mindsets and guiding principles, leaders can navigate these changes successfully.
Our firm has helped a number of organizations through these periods of intense change, in which a combination of internal and external factors lead the organization to look seriously and strategically at doing things differently. Whether it be a mandate to scale impact, an opportunity to evolve the business structure based on positive growth, or a need to revisit mission and better align services with stakeholders’ current needs, in all cases we’ve seen that it’s how leaders approach the change moment that makes all the difference.
In this blog post, we share seven essential mindsets and guiding principles that leaders should embrace when leading a restructuring or reorganization process.
Seven Mindsets to Carry Through a Reorganization
1. Restructuring moments are a huge leadership opportunity
Restructuring and reorgs should be seen as opportunities to advance the mission of the organization. While challenging, they should be viewed for the opportunity that lies within the change. It’s a chance to realign resources, streamline processes, and improve overall efficiency. Additionally, leaders should approach these changes as an opportunity to support and help people through a vulnerable time. By providing guidance and understanding, leaders can foster a sense of trust and stability among their teams.
2. The underlying problem is everyone’s problem
One of the most important steps leaders often miss in these processes is creating shared ownership and understanding of the problem. By viewing it as everyone’s problem instead of the their own problem, leaders are more likely to get the help they need.
Successful leaders invest time in building shared understanding, and bringing the right resources together instead of trying to figure it out on their own and tell everyone the answer. Even if they come up with a great answer, it’s unlikely to be received that way if no one else understands the problem in the first place or feels like it’s theirs to solve.
Some leaders feel a strong instinct to protect their teams and organizations from the problem, sparing them the angst and uncertainty and allowing them to keep focusing on their jobs. This usually backfires.
3. Trust is the key concept and honesty is the best policy
Trust is the foundation of any successful restructuring or reorganization. Leaders must prioritize transparency and honesty throughout the entire process. By keeping employees informed about the reasons behind the changes and the expected outcomes, leaders can build trust and credibility among their teams.
Trust is built in these processes by being direct about why it is necessary, setting transparent dates when decisions will be made and sticking with them, and working to build consensus but making hard decisions when that is not possible. It is built by communicating the outcomes clearly and directly, focusing on the facts and not letting them get lost in salesy rhetoric. It is also built by showing people you trust them with sensitive information, and delivering hard news with dignity and compassion.
4. Uncertainty is a healthy place to visit but a toxic place to live
During times of restructuring and reorgs, uncertainty is inevitable. In general, people dislike uncertainty and the leader will come under intense pressure to resolve it, even if that means settling for suboptimal outcomes. Part of the art of managing a successful reorganization or restructuring is to introduce uncertainty purposefully, helping the team stay in it long enough for new and more optimal options and outcomes to emerge.
At the same time, uncertainty cannot be a permanent state. Leaders should establish clear start and end points, and transparent milestones for the process so that people can see progress towards a resolution, know when to anticipate decisions, and can count on specific points of process to make dealing with the uncertainty more feasible.
5. Assume people know more than you think they do
Reorgs and restructurings often involve lots of closed door leadership meetings and confidential documents. To some extent this is necessary of course. But don’t be fooled – the rest of the organization knows when something is going down. They may not see the whole picture, but they can tell when a strategy has stopped working, revenue isn’t adequate, or a big change is in the air.
One of the biggest mistakes leaders often make in these processes is assuming people know less than they do. They talk down to them or deny things they can see in plain sight. Treating people like they are smart, aware, and have meaningful ideas is one of the best ways to build trust and confidence in the leadership, and the process. Conversely, treating them like they are naiive, dumb, or unaware, is one of the quickest ways to tank it.
6. Anticipation is the worst part of hard conversations
Having difficult conversations is an inevitable part of the restructuring or reorganization process. However, when handled with dignity, honesty, and compassion, these conversations rarely turn out to be as bad as we anticipate. In fact, they usually end being a huge relief. In many cases they even find that the other person already anticipated the outcome, or was thinking along the same lines.
Leaders working through a reorg or restructuring should keep in mind that they longer they delay these conversation the more they are suffering themselves, and the more they are delaying outcomes that could benefit both the impacted individuals and the organization.
7. The way you handle the reorg IS the culture
Leaders must remember that their actions and behaviors during restructuring and reorgs set the tone for the organization’s culture. It is in these moments where people are looking at the leaders the most closely, and scrutinizing whether their actions match the values the company claims are “core” to its culture. Done well, these processes reinforce these values, showing what they look like in action when the stakes are highest.
Leaders will be most successful in navigating these processes when they remember that everything they do in these moments is communicating exactly who the organization is, and what its culture will be on the other side. When an organization is experiencing intense change, people often feel vulnerable. Leaders should approach these moments as opportunities to help people through these vulnerable periods, and model the cultures they seek to create.
Conclusion
Restructuring and reorganizations can be complex and challenging endeavors. However, by adopting these seven essential mindsets and guiding principles, leaders can navigate these changes successfully and create a positive impact on their organizations. Besides achieving the reorg itself, leaders have a real opportunity to strengthen the organization’s culture, deepen commitment to the mission, and build team relationships through the process.
By embracing opportunities, fostering shared ownership, prioritizing trust and honesty, managing uncertainty, valuing employee insights, addressing difficult conversations, and setting the right cultural tone, leaders can lead their teams through restructuring and reorgs with confidence and resilience. Effective leadership during these turbulent times of change can empower individuals, strengthen the organization, and pave the way for future success.