4 Key Steps to Conducting an Effective Company Reorganization


Every once in a while, businesses find themselves in the midst of growing pains. This can range from wanting to take the business in a different direction, expand to other industries, or even prepare for potentially damaging market conditions. Oftentimes, these decisions lead to big changes within the business.

Sometimes the change comes in the form of reorganization. When businesses reorganize, they usually do so for a number of reasons, which can include but are not limited to:

  • Mergers or consolidations with another company
  • Positive or negative company growth
  • Simplifying the company’s many departments
  • Change in brand identity
  • Change in management

Reorganizations can be complicated and stressful and when handled improperly, can cause a business to fail. Consider the following steps when reorganizing your company:

  1. Start with the why.

The very first thing you should do when a reorganization needs to happen is to ask why it even has to happen in the first place. Understanding why the reorganization is happening gives everybody involved in the process a clear vision of what needs to happen.

By asking why there needs to be a reorganization, you can identify the problem that the reorganization is able to solve. This also affords you the ability to define measures of success for the reorganization that is about to occur.

  1. Identify the pros and cons.

The next step to reorganizing is to weigh the pros and cons of reorganizing, as well as the pros and cons of maintaining the business as it is. This will help you make a better decision that will benefit the company and the people behind it.

Gather feedback from parties that will be affected by this planned change. This can be done by conducting productive meetings, focus group discussions, or anonymous surveys.

  1. Plan the execution.

This is where you will be drafting the reorganization of your business. Planning how the reorganization will happen down to the last detail also requires getting key players to contribute.

Apart from considering what your organization’s new structure will be, you may also need to work with a legal team, like the corporate lawyers from mcquarrie.com, in order to make sure that you aren’t breaking any laws when you enact the reorganization.

Creating a project timeline is also very important, as this helps prevent the business from grinding to a halt while changes are underway. Reorganizations can cause entire departments to feel disorientated, which may cut their productivity; project timelines can help prevent this from happening.

  1. Communicate the game plan.

Before giving the “go signal” on the reorganization, it’s important to communicate the game plan to the rest of the company. Avoid giving employees a short notice, as big changes like a reorganization can cause them to question their job security or the stability of the company.

Use effective communication styles in order to achieve your desired result of getting everyone on board without widespread panic. Apart from communicating the plan via emails or memos, you may need to speak privately with certain parties and answer any questions they may have.

Launching a reorganization can be incredibly stressful for any business but with proper planning and communication, a reorganization can have extremely positive effects on a company looking to take a new direction.