How to Navigate a Reorganization

With great reorganization comes great responsibility. As a result, businesses need to develop risk management strategies to achieve sustainable growth during times of restructuring.

Whether these changes are due to increased competition, market adjustments, or preparation for a merger or acquisition, it’s safe to say, every company will face a reorganization or restructuring of a business function to improve efficiency, performance, and agility. It’s a vital and inevitable component of development and maturity—it’s just a matter of how often and to what degree they happen, as well as how well the teams involved navigate the storm. 

The most common forms of shake-ups happen with the company’s management team, the way departments are structured, or the way work is organized. After these shuffles, a few key things can typically happen: Businesses address costly inefficiencies, adapt to newly competitive markets, create winning strategies, and in some cases, unfortunately, don’t take any action and are left behind.

Overall, the effects of a company reorganization can be significant for both the company and its employees. While there may be some uncertainty and disruption during the process, the ultimate goal is to create a more efficient and successful business. With clear communication and a focus on improving performance, a company reorganization can lead to positive results for everyone involved. So, what’s at risk before, during, and after a reorg, especially when teams lose headcount? 

Adapting to changing business environments

Businesses need to be ready to change with the times or risk falling behind. A complex concoction of market slowdowns, supply chain concerns, rising material costs, dropping ad spending, and geopolitical unpredictability has dealt the tech industry a bad hand over the past year. Businesses have implemented large-scale layoffs and cost-cutting initiatives in response. According to layoffs.fyi, more than 900 tech companies have laid off close to 145,000 employees in 2022. The results of this have businesses shifting their focus from risky ventures to tried-and-true profit generators. While major layoffs are on the extreme side of the reorganization spectrum, they’re part of the ebbs and flows of many businesses.

Oftentimes not as dire as some of the examples above, a common outcome of a company reorganization is that only the management team itself may be restructured. This can involve the appointment of new leaders, the merging of departments, or the creation of new positions. The goal of these changes is often to streamline operations and improve communication and collaboration.

Chart a course toward improved outlooks 

In addition to changes to employees’ roles and the management team, a company reorganization can also lead to changes in the company’s overall strategy. This might involve a shift in focus towards a new market or product line or the adoption of new technologies or business models. These changes can help the company stay competitive and adapt to a changing business environment.

One of the main goals of a company reorganization is to improve the company’s financial performance. This can involve cost-cutting measures, such as reducing headcount or streamlining processes, to increase efficiency and reduce expenses. A company reorganization may sometimes involve investments in new technologies or initiatives to drive growth and innovation.

Plugging into unique resourcing solutions 

Execution bottlenecks are common for high-growth companies during times of expansion and acceleration; surprisingly, bottlenecks stick around and sometimes even multiply during times of restructuring and reorganization. 

When you’re feeling the pressure to add more capacity to handle workload during fluxing and change, there are a few options:

1. Hire more, diversified talent
   If you have the headcount available, adding to your team is a clear way to expand capacity. Unfortunately, if your company is going through a reorganization, this is the least likely option
   
2. Bring in contractors and freelancers
   If you have the budget, bringing in extra help is a good way to expand capacity within your system while keeping the work close. However, if you need more than three or four people-worth of capacity, finding and managing that many contractors and freelancers is a job in and of itself.
3. Outsource to agencies
   Some of your work streams may lend themselves to being outsourced as agency projects, if you have an agency you like and trust. In a changing environment, you may have more cross-functional stakeholders with more opinions and input with constant revisions. Sending projects into a typical agency’s “black box” process won’t work.

So how do you add enough capacity to your team, where they’re plugged into your workflows and systems, with the flexibility to scale up and down with the volume of work?

Look for integration, flexibility, and understanding

Ideally, choose vendors that act as a natural extension of your team’s creative process. They should:

• Plug into your existing systems, processes, and tools.
• Offer versatile resourcing options to provide the right combination of people and hours.
• Understand the unique challenges of creative execution at scale in high-growth tech companies.

Every company needs a different resourcing strategy during a reorganization, especially in an uncertain market. Creative teams often require deeply integrated capacity with maximum flexibility during times of change.

Being asked to do more with less

When you’re in the thick of it, a common scenario is—often temporarily—being asked to do more with less budget and bandwidth and at the very least, re-prioritize. 

As an example, a client of ours in the crypto ecosystem was faced with sudden industry shifts creating massive change in an uncertain market. They needed to realign their resources with new, more focused priorities and budgets. Their solution was to flex down to the hours and skill sets that were most needed to complete high-priority work streams. 

In their example, at a glance, they:

• Put content on hold
• Decreased design requests
• Continued to run digital campaigns
• Kept their production steady

When you need to flex down, plugging into a pay-as-you-use model with your partners is a cost-effective option to quickly adjust your creative resource pool. This partnership continues to adapt to evolving work streams and needs as the team looks ahead, and another year of riding together through the ups and downs of ambitious growth.

Lean on your organizational chart and workflows

If you haven’t already, it’s time to get your company’s organizational chart out. It’s the best tool for graphically displaying the company’s existing and future organizational structure. It’s a terrific method to demonstrate to staff where they’ll move, how they’ll fit in, where everyone shifts, who will do what, and how the organization will look when everything is said and done. 

The org chart offers the finest visual representation of how the reorganization will affect each person at every level, as well as their teams, departments, and the business as a whole. Many people are visual learners—use this visual aid for explaining to employees at all levels what the reorganization entails for them, their teams, departments, and the business as a whole.

Another visual tool can be found in your workflow journeys. During reorganization, workflows will likely be reconsidered with shifting roles, responsibilities, and typical timeline allowances. Finding a way to standardize and communicate the best-case scenario for all workflows and how each stakeholder and partner fits into those is crucial during times of shifting and settling into new processes. 

Measure, celebrate, and amplify wins

It makes sense to update your employees on how things are going both during and after the reorg once everyone’s gotten on board with change. Measurement will take time. However, as new accomplishments are noted, commemorate them with the team so they may see that some struggle was worthwhile. Even the smallest win, the smallest return on investment, or the smallest increase in market share is newsworthy. Advancements are inspiring and encouraging. To demonstrate to employees that you appreciate their tenacity and dedication to the reorg, celebrate them whenever and wherever possible.

Manage risk with clear communication

A major risk of reorganizing is that affected teams won’t be aligned with the overall business plans. Goals and objectives run the risk of not being in line with organizational priorities, which increases the possibility that team members won’t adapt to their new responsibilities. Teams must also consider the likelihood of moral decline during reorganization.

This can be a stressful and uncertain time for team members, as they may be unsure of what these changes will mean for their careers. Leadership needs to communicate clearly with employees during this time to help them understand the changes, why they’ve happened, and the bigger plan going forward. Champion honest and realistic communication, from the leadership team to the managers and producers. 

Share what’s going on company-wide before anyone has a chance to get the rumor mill spinning. Ideal ways to begin the conversation start with global meetings, company emails, and updates posted to the internal communications site. Employees care about the health and viability of the company and are just as concerned about how things are going as the execs. Sharing profitability, market share, and satisfaction numbers ensure they can be more part of the solution. Keep in mind that every employee will have their worries and inquiries. One-on-one meetings with reports are vital for answering personal questions and concerns.

Maintain team integrity and get strategic 

Align your budget with your priorities. Triage projects by what can wait, what can be completed by strategic partners, and what needs to be handled in-house. 

Examine the story in your data and map out the types of projects completed in 2022: The cost to complete them, and the return on investment for each. Adapt staffing models that allow you to scale up or down depending on what your 2023 models look like. 

Look for trusted partners that can integrate into your workflows. Months after the dust settles, intentional strategies anchored in your goals, priorities, and budgets will see you through changing times.