Change is inevitable and necessary to achieve growth and success. This principle applies to companies as well. If you’re a business owner, adapting to change and shifting your strategies can help you cater to varying customer preferences and meet business obligations.

Organizational Design 101

A planned organizational restructure is when a company decides to change its current systems, policies, and strategies after evaluating and deciding that these no longer work effectively. Thorough assessments help the organization pinpoint issues, formulate solutions, and implement the necessary modifications, resulting in a company restructure.

Moreover, revising your organizational design could be as straightforward as redesignating people and reforming teams to maximize potential and put talents to good use. While you’re at it, you might need new leaders to facilitate collaboration and support your staff as they cope with the changes.

The Importance Of Having The Right Structure

You’ll come to a point where you need to restructure your organization. Doing so can help you withstand market trends and conditions that could potentially affect your company.

While this can be quite daunting, it’s a necessary process to help your company thrive in the competitive arena of business. Take note that if your strategies have become outdated or your organization isn’t designed well, your business can’t perform effectively.

Likewise, updating your strategy in response to financial threats is important to prevent costly mistakes and business inefficiencies that could damage your reputation. All these have made restructuring a necessary process that can potentially contribute to company success.

Because these adjustments will inevitably disrupt operations, hiring organization design consulting services has been done by some businesses to map out their basic needs and achieve a smooth transition. Working with experts may help you develop solutions backed by factual data to ensure systematic outcomes and a positive return on your investments.

When it’s executed successfully, reorganization can help your company reduce costs, boost business efficiency, strengthen team member morale, and stay relevant in the midst of fluctuating trends. If you’re currently experiencing setbacks, materializing such plans can potentially allow you to reposition your company in the market.

Tell-Tale Signs To Restructure Your Business

Redesigning your company is no small feat. As mentioned, this can involve disruptions to your services and daily operations. Because of this, it’s important to plan comprehensively and recognize the best time to implement the necessary changes. Performing a restructure in a timely and strategic manner can help you move forward successfully.

How do you know it’s the right time to restructure your organization? Look out for these four signs:

1. Operational Inefficiency Is Widespread

Numerous inefficiencies in your company might be due to outdated processes, faulty systems, and poor team performance, all of which are considered your business’ resources. In other words, the accustomed methods and assets that have previously served your company might no longer function the way they’d been intended to. Hence, there’s a need to restructure your business and rethink how you can manage your resources.

If the source of this widespread inefficiency comes from the management, repositioning the right people can help you take care of and address the problem. Strong and experienced leaders can influence the performance of your workforce, your company’s greatest asset. In turn, this’ll increase the rate of your business’ efficiency.

On the other hand, there’s nothing worse than experiencing system failure when your staff is in the middle of producing output for a special client. If this recurring issue is a symptom of a bigger tech problem, working with your IT staff or outsourcing to providers of IT services may help eliminate the root of the problem. Instead of constantly fixing the system, the professionals might advise you to upgrade to the latest software.

Redesigning your organization can be as direct as installing the latest programs, replacing devices, and training employees to use those tools to get the job done. System upgrades can also help you streamline business operations so you can do more with less effort, promoting efficiency.

Conversely, failure to leverage and manage your resources can result in unnecessary costs and downtime that could’ve been prevented at an early stage. If left unresolved, these minor problems can harm employee engagement and drain your profits in the long run.

All of these show how efficiency is crucial to every business as it can contribute to long-term company growth and success. When your company is able to control your assets effectively, you can reduce waste and generate an increased amount of quality output to fulfill obligations and demands, driving more profit.

2. Poor Job Fit

Similar to company inefficiency issues, low team performance can have different causes. These sources may include but aren’t limited to inadequate training, lack of access to new tools, and poor job fit.

If your team’s performance is consistently unsatisfactory, you might have to consider changing your organizational design to address the problem and provide your business with the right solutions.

Notably, among all the mentioned sources of poor team performance, bad job fit is the costliest mistake. A mismatch between skill and company role can result in disengagement, low productivity, absenteeism, and poor morale. Those can hurt your business’ reputation and bottom line. 

While you can send your employees to career developmental programs or purchase the latest tools anytime, it’s not always easy to remove a team member from your business. Also, trying to coach or train them repeatedly might only lead to frustration, resulting in a turnover.

To address job fit issues, you have to modify your organizational design. This may involve strategizing how to combine teams, matching a particular employee’s skill to a vacant position, relocating them to another department, or communicating chances for layoffs.

By changing your organizational chart, you can maximize your employees and their abilities. On your staff’s end, the shift may allow them to put their skills and talents to better use, which would lead to increased productivity and morale. It’s a win-win situation for you and your team. This method can also be crucial in gauging how solid and adaptive your organization is when internal structures have to be replaced.

At the same time, this situation is a perfect example of how your hiring managers must be careful when matching talents with job functions. Take note that a bad hire can be hostile toward your current staff members and unhelpful toward your company goals. It can also become challenging to attract the best candidates if you’ve built a reputation for hiring the wrong people.

3. A New Leader Has Taken Over

An organizational redesign isn’t necessary if a new manager or president starts leading the company. However, this can be used as a perfect opportunity to look into your branding strategies, recalibrate your accustomed methods, and turn things around in order to improve business efficiency.

Remodeling your organization can be especially helpful if your company has experienced a recent failure. A new leader might be what you need to lift its status and reposition it in the marketplace. This particular person can provide your team with adequate support and expert insights to bounce back from profit loss.

Furthermore, this new leader might eventually have to launch changes to give your company a fresh start and realign tasks with goals. Working with them can help you establish new goals and build a concrete strategy to facilitate engagement in the workplace.

While changes can be overwhelming, they make for exciting times as well. Redesigning your organization can serve as a great opportunity to outgrow old systems, boost workforce performance, and improve company culture, which indirectly affects client satisfaction. All these adjustments will be worth it once your company reaps the many benefits of restructuring your business.

4. You Are Falling Behind Trends

The industry is moving quickly, and the market is expanding to cater to a wide range of customer preferences and demands. If your business is still applying the same strategies and operating the same way it did years ago, you may already be falling behind the competition.

Considering this, you must create a proactive approach to keep up with the changes and stay relevant in the industry. In other words, there’s a need to modify your organizational structure.

Updating your business strategy allows you to gather all your resources and leverage new systems to advance and meet your objectives. This initiative becomes extra crucial if you plan on scaling your small business. As you grow your company, you need to be prepared for its long-term growth and stability. Hence, restructuring is necessary.

By reforming the way you run your business, you can strengthen your competitive edge and gear up for the upcoming changes. New strategies can help your company efficiently perform as you enter a broader market or a new segment. In this way, you can be confident as you start to expand your range of services and introduce new products to accommodate ever-changing client needs.

The Takeaway

Although change is daunting, it’s a crucial factor that can potentially drive business growth and profit. By being versatile and open to implementing the necessary changes, you can prevent stagnancy and sustain success. With fluctuating trends in the industry, your readiness to adapt can make a huge difference.

Moreover, while changing your organizational design can be quite demanding, all the time and effort will be worth it once your company completes its reorganization.