Companies invest a huge sum of money to figure out how to move the boxes around on the org chart. Months or even a year or more of planning go into figuring out what the perfect vertical structure should be and then they announce the restructure and throw the whole mess over the wall to the HR/OD people.
In 2004, the Joint Special Operations Task Force—a collection of the best special operations units in the world—found itself consistently outmaneuvered by Al Qaeda in Iraq (AQI). Despite a 40-year track record of amazing achievements, superior training and funding, the Task Force could not compete against a scattered, local insurgency.
Similar battles are waged daily in Corporate America, as iconic brands and industry leaders struggle to retain market share against a rising tide of small, nimble competitors.
Your company wants to improve overall effectiveness. What company wouldn’t? Conventional wisdom—or, more precisely, methodology that hasn’t been updated in years—tells you that a restructure will deliver the results you need. Perhaps you’re already searching for the number of a consulting firm.
When an organization is looking to improve organizational effectiveness, they pick up the phone and call a big consulting firm, and upon their advice embark on a major restructure.
The company restructure is a popular tool among CEOs (and big consulting firms), especially in the first two years on the job with varying motivations such as strategic growth, cost cutting, creating better alignment with customers, and more, all with the goal to achieve better performance.
But that’s usually not the result.
Now that you’ve rolled out the new organizational structure, you can breathe a sigh of relief, right? After all, the new job descriptions have been written. People have been assigned to their new jobs. Done and done. Now for a much needed rest.
Well hold on a minute. You’re only half way to the goal line, particularly if you restructured into a matrix organization. There is a lot more work to do to operationalize that matrix, especially if this is the first time the people involved will be expected to work as a matrix.
Living through a restructure is a common enough occurrence these days but being common doesn’t reflect how unsettling and disrupting the change can be.
People are at sea.
They don’t know what they are supposed to do and how they are supposed to operate in this brave, new world that’s been created.
One of the best things you can do to quiet the storms is get people in training that will teach them the skills they will need to operate differently.
Sandy Trume, the Director of Organizational Development at ABC Inc. was taken away in a straight jacket from corporate headquarters in Tulane on Wednesday. Witnesses said she was drooling and babbling incoherently.
There's a barbecue joint near my house. The barbecue is fantastic and the business is hugely successful. People line up for the barbecue an hour before the place opens. The restaurant's menu is focused on one key offering - the barbecue -and a couple of accompanying menu items - potato salad and cole slaw.
There's not much else on offer - no other sides, meat, or alcoholic beverages. The business is kept as simple and focused as possible, and it works well. This, however, is an exception, rather than the rule. Most businesses have no choice but to be complex.
Restructuring is tough, even when the need for it is widely acknowledged and supported across the organization. More often though, change is received with resistance.
Restructuring is painful and often ineffective, yet organizations keep restructuring every few years. The reason this keeps happening is because moving around boxes on the org chart does not solve the problems it aims to solve. So leaders try again, using another approach or perhaps, reverting to the previous structure. That doesn't work either, and restructuring is back on the books a few years later. Clearly, there's a need to look at restructuring from a new angle.