This article provides a detailed response to: How Can Companies Preserve Core Values During Restructuring? [5 Key Strategies] For a comprehensive understanding of Restructuring, we also include relevant case studies for further reading and links to Restructuring templates.
TLDR Companies preserve core values during restructuring by (1) transparent communication, (2) engaging employees, (3) reaffirming culture, (4) leadership alignment, and (5) continuous feedback.
Before we begin, let's review some important management concepts, as they relate to this question.
Companies can preserve core values during restructuring by prioritizing transparent communication, employee engagement, and reaffirming their culture throughout the process. Restructuring, defined as organizational changes to improve performance or adapt to market shifts, often risks diluting company culture if not managed carefully. According to McKinsey, 70% of transformations fail due to cultural neglect, underscoring the importance of maintaining core values during change.
Successful restructuring integrates clear stakeholder communication and employee involvement to sustain morale and loyalty. Consulting firms like BCG and Deloitte emphasize that aligning leadership with cultural priorities and embedding core values in every step reduces resistance and improves outcomes. This approach not only safeguards brand integrity, but also enhances organizational resilience and performance post-restructuring.
One critical strategy is transparent communication, which involves regular updates and open dialogue to build trust. For example, PwC recommends structured communication plans that address employee concerns and clarify the rationale behind changes. Companies employing these methods report up to 30% higher employee retention during restructuring phases, highlighting the tangible benefits of culture preservation.
Communicate Transparently and Consistently
One of the most critical steps in ensuring that restructuring efforts do not dilute an organization's core values and culture is through transparent and consistent communication. Leaders should articulate the reasons behind the restructuring, how it aligns with the organization's core values, and what it means for the future. According to McKinsey, organizations that prioritize transparent communication during restructuring see a 25% higher employee engagement rate than those that do not. This involves not just one-way communication from the top down but encouraging an open dialogue where employees can express concerns and ask questions. By doing so, organizations reinforce their commitment to their values, such as trust and respect, during periods of change.
Moreover, consistent communication helps in managing rumors and misinformation that can often accompany restructuring efforts. It ensures that all employees receive the same information and understand the organization's direction, further aligning them with the core values and culture.
Real-world examples include companies like Starbucks and Cisco, which have been praised for their transparent communication strategies during restructuring. They utilized various platforms, including town hall meetings, internal webinars, and direct communications from leaders, to ensure their messaging was clear and consistent.
Engage Employees in the Restructuring Process
Another effective strategy is to actively engage employees in the restructuring process. This can be achieved by involving them in decision-making processes or in roles that allow them to contribute to the restructuring efforts directly. Such involvement not only makes employees feel valued and respected, reinforcing core values like inclusivity and collaboration, but also ensures that the restructuring process benefits from a wide range of perspectives, safeguarding the organization's culture.
Employee engagement can take various forms, from feedback surveys and workshops to participation in focus groups or task forces aimed at specific aspects of the restructuring. According to Deloitte, organizations that engage their employees in change initiatives are 30% more likely to maintain or improve productivity during periods of change.
Companies like Google and Zappos have successfully maintained their unique cultures through significant changes by involving employees at all levels in the restructuring process. These organizations have utilized cross-functional teams and open forums to ensure that the restructuring efforts are in line with their core values and culture.
Reaffirm Core Values and Culture Post-Restructuring
After the restructuring process, it is crucial for organizations to reaffirm their core values and culture. This can be achieved through various initiatives that reinforce the importance of these elements in the new structure. For instance, revisiting and possibly revising the organization's mission statement and value proposition to reflect any changes can help in realigning employees and stakeholders with the core values and culture.
Leadership plays a pivotal role in this phase by modeling the behaviors and attitudes that reflect the organization's values and culture. According to Bain & Company, leadership alignment with an organization's core values is one of the top predictors of successful restructuring outcomes. Leaders should also recognize and reward behaviors that exemplify the organization's values, further embedding them into the new structure.
Organizations like IBM and Hewlett-Packard have demonstrated the importance of reaffirming core values post-restructuring. Through leadership initiatives, internal campaigns, and continuous learning programs, they have successfully navigated significant restructuring efforts while preserving their distinctive cultures.
In conclusion, restructuring efforts do not have to come at the cost of an organization's core values and culture. By prioritizing transparent and consistent communication, engaging employees in the restructuring process, and reaffirming core values and culture post-restructuring, organizations can navigate these challenging times while maintaining their identity and integrity.
Restructuring Document Resources
Here are templates, frameworks, and toolkits relevant to Restructuring from the Flevy Marketplace. View all our Restructuring templates here.
Explore all of our templates in: Restructuring
Restructuring Case Studies
For a practical understanding of Restructuring, take a look at these case studies.
Organizational Restructuring Best Practices for a Global Technology Firm
Scenario: A global technology company has grown rapidly over the past five years and now employs tens of thousands of people across multiple regions.
Turnaround Strategy and Revenue Management for a Boutique Luxury Hotel and Wellness Resort Chain
Scenario: A boutique luxury hotel and wellness resort chain is facing declining revenue, occupancy, and average daily rate in a highly competitive market.
Business Turnaround Case Study: Mid-Sized Real Estate Firm
Scenario:
The mid-sized real estate firm faced a critical business turnaround challenge due to declining sales, profitability, and market share erosion in a highly competitive market.
Luxury Brand Turnaround Case Study: Retail Turnaround
Scenario: In this retail turnaround case study, a luxury fashion retailer based in North America has seen a steady decline in sales over the past 24 months, driven by the rise of e-commerce and a failure to adapt to changing consumer behaviors.
Operational Excellence in Healthcare: Regional Hospital Case Study
Scenario:
A regional hospital faced a 20% increase in patient wait times and a 15% decline in patient satisfaction scores due to outdated processes and systems.
Turnaround Strategy for Telecom Operator in Competitive Landscape
Scenario: The organization, a regional telecom operator, is facing declining market share and profitability in an increasingly saturated and competitive environment.
Explore all Flevy Management Case Studies
Related Questions
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Strategy & Operations, Digital Transformation, Management Consulting
This Q&A article was reviewed by David Tang. David is the CEO and Founder of Flevy. Prior to Flevy, David worked as a management consultant for 8 years, where he served clients in North America, EMEA, and APAC. He graduated from Cornell with a BS in Electrical Engineering and MEng in Management.
It is licensed under CC BY 4.0. You're free to share and adapt with attribution. To cite this article, please use:
Source: "How Can Companies Preserve Core Values During Restructuring? [5 Key Strategies]," Flevy Management Insights, David Tang, 2026
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