{"id":7689,"date":"2021-02-11T07:02:11","date_gmt":"2021-02-11T12:02:11","guid":{"rendered":"https:\/\/flevy.com\/blog\/?p=7689"},"modified":"2021-02-06T15:04:38","modified_gmt":"2021-02-06T20:04:38","slug":"strategic-restructuring-5-critical-success-factors","status":"publish","type":"post","link":"https:\/\/flevy.com\/blog\/strategic-restructuring-5-critical-success-factors\/","title":{"rendered":"Strategic Restructuring – 5 Critical Success Factors"},"content":{"rendered":"

\"\"Reorganization becomes essential at some stage in the lifecycle of any organization.\u00a0 In order to emerge triumphant through this tumultuous challenge, it is necessary that the focus remains on the challenges impeding the organization, thorough\u00a0Strategic Planning<\/a> to tackle the challenges, and prioritizing strategic initiatives to deliver effective Business Transformation<\/a>.\u00a0 Strategic Restructuring has the capability to deliver these results.<\/p>\n

When the word \u201cRestructuring\u201d pops up, the foremost idea that comes to mind is achieving Cost Reduction by minimizing payroll costs\u2014predominantly by cutting back on the headcount.<\/p>\n

Scores of organizations have suffered because, in the melee of headcount reduction, the most competent employees quickly found opportunities elsewhere, leaving inappropriately competent employees behind, resulting in a crippled organization.<\/p>\n

The purpose of Restructuring is to make the organization profitable, efficient, and effective.\u00a0 Headcount reduction should be a consequence of the Restructuring initiative and not the prime objective.<\/p>\n

To avoid an outcome that debilitates the organization as a result of Restructuring, it is absolutely essential to keep an eye on the Critical Success Factors (CSFs) while the organization moves through the 4 phases of Strategic Restructuring.\u00a0 Strategic Restructuring\u2019s 5 CSFs<\/a> include:<\/p>\n

    \n
  1. Strategic Focus<\/strong><\/li>\n
  2. Continuous Communication<\/strong><\/li>\n
  3. Participative Focus<\/strong><\/li>\n
  4. Positions before People <\/strong><\/li>\n
  5. Focus on Competency<\/strong><\/li>\n<\/ol>\n

    \"\"<\/a>Experts suggest envisioning a \u201cFuture State\u201d for the organization, to be achieved through a robust Strategy that includes Change Management<\/a>, implemented by the most competent employees who are redeployed.\u00a0 The rest of the employees either severe ties voluntarily or are laid off\u2014ideally with a good severance package or a job placement, with the organization\u2019s help, somewhere else.<\/p>\n

    Leadership has to ensure firm resolution in employing these Critical Success Factors<\/a> in order to establish its role and build a constituency among employees who believe in the need for change. \u00a0Let\u2019s dig deeper into the 5 CSFs of Strategic Restructuring<\/a>.<\/p>\n

    1. Continuous Communication<\/strong><\/h2>\n