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CLIENT STORY

Reorganization

Reorganization: 

Leadership, Culture and Communications


When large organizations are faced with new challenges, they sometimes opt for a traditional solution. They reorganize.
 
“Reorganization is one of the most traumatic experiences for companies and their employees,” warns Vince Fearon, a Bay Consulting Group partner. “It can be disruptive, frightening and risky. If there are underlying issues, the ‘reorg’ can produce great upheaval and harmful turmoil. But if done properly, it can produce efficiencies and maximize returns.”

Why? Because reorganization by itself is no panacea and, sometimes, it may not address the real problems confronting an organization. “Reorganization can’t help you—and it can harm you—if there are fundamental issues that need to be confronted first,” Vince says.

This was the case with one of Bay Consulting Group’s recent clients.

THE PROJECT STARTED WITH A REQUEST TO REORGANIZE

The organization, a regulatory body, was established in 1998 by merging a relatively young and growing organization with one that had been around for more than 50 years. Clearly, a merger of such different cultures presented incredible challenges to senior management.

In 2005, the CEO decided to reorganize. He thought that would strengthen the organization to better achieve its mission by minimizing structural, process and communications barriers. Bay Consulting Group was chosen to help the management team tackle this challenge “because we put the right people on the project,” says Vince, who co-founded Bay Consulting in 1984. “These large, complex jobs need people with real expertise and experience. That’s one of our fundamental values: Match the right consultant to the client’s needs. Don’t send in a junior when a seasoned consultant is needed.”

CULTURE AND COMMUNICATIONS WERE THE ISSUES, NOT STRUCTURE

It didn’t take long before Vince and his team uncovered deep-seated cultural clashes that would diminish the impact of any structural changes. These differences were not surprising given that one part of the new organization was relatively freshly staffed, reflecting its creation in 1992, while the other had been in existence for decades. “We also found,” says Vince, “that the CEO was absolutely correct in identifying communications as a fundamental problem.” Further complicating staff relations was the fact that more than one-third of the total complement were charged with law enforcement, and this group had a separate culture with its own set of distinct values and procedures.

Add to that the normal tensions between head office and the field common to most organizations serving a large geographic area. The contrast between the relatively new people at head office and the long-serving field staff exacerbated the tensions. “In the field,” says Vince, “we found tremendous job knowledge and very capable people. But they felt their ideas were ignored by head office. At the same time, they were able to work effectively by sorting out issues among themselves.”

Communication was a major problem throughout the organization. “We found lots of silos and alliances,” says Vince. “Directives went down from the executive group, but not across, and they came down differently, depending on who was delivering the initial message.” He added, “Different processes were used by different parts of the organization reflecting both the evolution of the unit and its manager.”  All of these issues further complicated the normal customer service, effectiveness and efficiency challenges that most organizations face.

It follows that a knee jerk restructuring effort might have looked good on paper but not tackled the root problems of clashing cultures and shaky communications. And it would have hidden the key success factor – leadership.

COLLECTIVE LEADERSHIP WAS THE SOLUTION

The solution: Bay Consulting Group felt the executive team had to take more collective responsibility for the overall direction of the new organization and that the decision-makers, starting at the top, needed to be held collectively and individually accountable for their decisions. As a first step, Vince’s team brought the executive team together for an off-site session. They were asked such questions as how they would overcome existing cultural differences or what sacred cows they wanted challenged.  The response was enthusiastic and immediate. It made the entire team realize that they were saying similar things but expressing themselves differently. The grounds for agreement and growth were laid.

The answers stimulated further discussion that led to a set of recommendations and, in a subsequent session, an action plan developed by the executive and facilitated by Bay Consulting Group. Greater emphasis on demonstrating leadership and breaking down barriers, both among corporate divisions and between the field and head office were key components. Bay Consulting emphasized behavioural change, not reorganization.

What had started as reorganization had grown to become a blueprint for success on many fronts. Bay Consulting had helped the executive to uncover the real problems, and they were pleased to work together as a team to overcome them. As a result, the CEO decided to implement the broad recommendations with a sensitivity to specific issues. “It would be a mistake to do exactly what we told them to do,” Vince says. “The client needs to continue to make the process its own. They have to put their footprints into the sand that we laid out. All organizations and their challenges are unique and all management teams must take full ownership for their solutions.”

In the end, the client got an action plan to address its concerns. But it did not get a disruptive reorganization. Says Vince: “We fulfilled the mandate by adapting to the needs and capabilities of the management team in order to best serve the organization as a whole. ”



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