Structural madness

I used to work in an organisation that liked to restructure on a regular basis. The joke was that you could tell which day of the week it was based on whether there was an announcement about some sort of change. If you stayed in the organisation long enough, you got to see all the things that were undone, redone. It was a kind of cyclical musical chairs, but without the music, or a winner.

The more I learn about business and organisational performance, the more I realise that restructures mostly don’t improve either. And if there is any improvement, it is normally only marginal compared to the uncertainty, insecurity and disruption that are caused.

Most reorganisations fall into four categories:

  1. A new leader arrives and determines that they want to do things differently
  2. Something is not happening that the organisation wants to happen
  3. There is a need to reduce the cost base of the organisation
  4. Somebody leaves or there is an organic reorganisation of work and responsibilities

I’d go as far as to say that only the last of these makes any real sense at all.

The first is normally driven by the need of a new leader to stamp their authority, to have things working “their way” and to make people realise that there is a new regime in place. Now this “may” be true, but other than make things work from their perspective, will it really drive any meaningful shift in performance? The counter argument is that it probably won’t hurt – but then is that really a meaningful basis for any management intervention?

The second is where we enter the territories of madness….if you want something to happen that isn’t happening, if people aren’t talking, if there isn’t cross selling, if you don’t have the lead generation that you want. A structural change is not going to make these things happen. Nor will it get you liked, loved or adored.  A behavioural change, on the other hand, just might. People don’t do things differently because they’re organised in a different way, they do it because they understand things in a different way – they change their hearts and heads, not their seat.

As for three, there are the rare occasions when people are sat around in a business not doing anything. But in most cases, they’re carrying out the tasks that the organisation has historically deemed necessary. Wholesale structural changes to take out cost rarely work, without a subsequent change to the business operation or model. And if you’ve got an individual who is a problem? Deal with them, not the poor suckers around them.

A few years ago, I was talking to a successful leader of a business area who was referring to a competitor announcing another restructure. “I don’t think we’ve structurally changed things since the 70s” they told me. When I asked them how they’d accommodated all the changes and developments in the world and in their industry they answered, “we talk about it, work out what we need to do and get on with it”.

Hard to put it simpler than that.