Reorganisations, restructures and other major changes

The importance of planning and communication

Planning and communication are critical for any reorganisation. Getting top management involved in planning and executing any major changes can improve the chances of a successful reorganisation.

Planning for any restructuring will help you ensure that changes happen in the way you want them to and that costs are identified in advance and kept in control:

• Plan well ahead. Set priorities and keep these flexible enough to change as your circumstances change.
• Assess any risks to the success of the change and to the business as a whole.
• Draw an organisational chart to understand existing processes, workflows and lines of authority, as well as an organisational chart for your new business structure.
• Develop a vision of how the change will put the company in a better competitive position to achieve its business objectives - communicating this vision can be a great motivator for your staff.
• Set objectives that will help you measure the success of the change.
• Plan resources and schedule timing for the change.
• Incorporate your objectives into a restructuring plan and distribute it among senior management.
• Plan how you are going to communicate the change to your employees - it demonstrates commitment if the managing director or chief executive talks personally to employees to communicate the change.

Sustained communications are vital. You should meet with managers and employees regularly to explain the reasons for the change, how it will be carried out and how it will affect them. Combat unfounded rumours by tackling them head on. Make sure that managers operate an "open door" policy to any employees who may have questions. See the page in this guide on managing people.

Depending on the size of the business, you may also need to take account of the Information and Consultation of Employees (ICE) Regulations. These came into force in April 2005 and initially apply only to businesses with 150 or more employees. From April 2008, they will affect all businesses with more than 50 employees. Under these regulations, employees have a statutory right to be informed and consulted about anything which affects their employment, or which involves a substantial change to work organisation.

You can read about the ICE regulations at the DTI website. You can also download a Code of Practice to help relevant businesses comply with the ICE Regulations from the Acas website.

It is important to talk to suppliers, partners and customers to keep them informed of any changes that could affect them. Giving this information as far ahead as possible will give you, your employees, customers and suppliers time to digest and adapt to any changes.

Subjects covered in this guide

• Introduction
• Reasons for changing the way your business is organised
• Different business structures: by function and area
• Different business structures: by product and project
• The importance of planning and communication
• Managing people
• Implementing change
• Systems for delivering change
• Financial considerations
• Special considerations for change
• Here's how I changed my management style as my business grew

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