Is it Time for a Restructure?

There are so many reasons to review and update your team or organization’s structure.  Sometimes, you may not even realize you’re in one of these scenarios, and therefore won’t be aware that you should be thinking about restructuring!  To help you out, I’m going to cover four of the most common reasons leading to a need for a restructure and what you should do if you find yourself in any of these scenarios.  

Restructure Reason #1: Attrition

If you’ve recently lost a lot of employees, you may find gaps in some areas of your team or organization.  This isn’t a problem if the gaps are in areas where the workload is currently low.  However, if the gaps are in critical areas or teams, you’ll want to do a rebalancing quite quickly to make sure that your operations are not impacted.  

Action: Draw up your organization structure and indicate the following on it:
– Expected/planned number of positions
– Current filled headcount
– Vacancies 
– Risk score of current headcount (1 – low risk, 3 – medium risk, 5 – high risk)
– Movement of people to areas that are more critical at this time

Once that’s in place, re-assess the people in positions to determine whether this could be a permanent change or if you need a more in-depth review into the structure to achieve that. To do this, mark the people who you have moved from one team to another on your organization chart.  Working with your HR team, and aligning with your specific organization’s processes, determine whether the people you have moved are both willing and able to stay in these new roles permanently.  For areas with people who are not both willing and able to stay in their new roles permanently, you’ll need to work on a long-term resource solution.

Restructure Reason #2: Changing customer expectations

There is no better reason to review your internal structure than to do it so you can meet (and exceed!) your customers’ expectations.  Keeping your customers more than happy is and will always be the key to success.  Customer expectations change in line with developments across a wide spectrum of areas such as technology, the environment, the economy, trends, etc.  Customers may expect you to understand their preferences better, now that we have data we can use to do that.  Or they may expect better delivery or scheduling options, since competitors have raised the bar.  They could even expect a concierge service for VIP customers who are part of the high tier loyalty scheme.  For all these examples, there are internal structure implications that need to be met in the form of a customer insights team, a scheduling team and a concierge service team.  

Action: Identify any customer expectations that you are not able to completely meet today.  Going through them, make note of any new roles or teams that you need to put into place to be able to meet these expectations. 

Restructure Reason #3: Changes in the external operating environment

The external operating environment, which consists of competitors, markets, regulator and regulations, suppliers, partners, and more, can also have an impact on how you structure your team.  An example of how regulation has had an impact on structures is easily seen with the EU Data Privacy Regulation.  In the couple of years leading up to its implementation, and in the years since then, organizations that have European Union residents within their customer base have had to put in place a Data Privacy Officer, and, in order to be able to satisfy the requirements in the new regulation, most have also implemented an entire Data Privacy Office.  Some organizations may even have Data Privacy Champions in each of their departments.  

Action: Examine changes in your external operating environment.  You may find it easier to first make a list of what these areas may be and then look at each one to determine whether any changes have or will be taking place.  Next to each change, note whether a change in structure (i.e. a new role or team) is required.  

Restructure Reason #4: Aligning to a new strategy

Probably the most common of all reasons to restructure.  If you’re set up to deliver against a strategy, and that strategy changes, or even if new or updated objectives are drawn up, revisiting your structure is more than recommended, it’s basically a must.  If, for example, you run a B2B business, your sales and marketing teams will be set up to interact with businesses.  Content creation will likely cover lead generation, sales decks for the trade to use, product demos and similar content appropriate and useful for a B2B business.  If, however, you decide to open up a B2C channel, you’ll have to start creating different content – appropriate for end-customer consumption – and to do that, you’ll likely need different sales and marketing skills and/or teams.  

Action: Revisit your strategy.  Has anything changed compared to the previous year?  If so, what are the skills or teams required in order to fulfill the new objectives?

A Final Thought on the Time between Restructures

You should re-evaluate your structure every 4 years.  That’s a long enough cycle to let the previous structure settle and produce benefits to the organization and a short enough cycle to ensure that the structure doesn’t get stale or fall out of touch with developments in your industry, customer expectations, technology etc.  A department or an organization that doesn’t restructure every now and again is at risk of falling behind the competition and disappointing customers along the way, neither of which is good for business.