Garrett Mintz: You can’t ‘reorg’ without buy-in from the organization

Are company reorganizations—aka “reorgs”—bad?

It depends on whom you ask and how the reorg was handled.

Most people associate reorgs with negative experiences, because they often signify significant changes to the business. For better or worse, people tend to resist change, making reorgs an uphill battle when it comes to winning hearts and minds.

Whether a company has determined a business unit is no longer profitable, their success metrics need to change or that they are simply moving in a different direction, a reorg usually is unsettling.

The challenge most companies run into when attempting to successfully enact a reorg is effectively communicating the strategy, getting buy-in and adopting the new status quo.

A typical reorg looks like this: The CEO, often under pressure from the board, decides to implement a change in how the business operates. Perhaps the company isn’t profitable enough, early indicators suggest the need for proactive adjustments, or a new strategy seems necessary. The CEO shares this plan with the executive team, expecting them to communicate and champion the change with the same enthusiasm.

In an ideal world, employees would immediately understand, embrace and adapt to the changes.

In reality, direct reports—wanting to appear as team players—often say, “I’m on board and looking forward to this change,” whether they genuinely feel that way or not. This lack of transparency creates a false sense of confidence for the CEO, who believes the team is fully aligned.

Then the wheels fall off.

The proposed changes fail to gain traction. Confused and frustrated, the CEO demands answers: “Why isn’t everyone as excited about this change as I am?”

The truth might eventually surface, often at great cost. A brave executive who explains the lack of adoption risks being labeled insubordinate—and perhaps even losing their job. Others in leadership take note and quickly learn that honesty about these matters is unwelcome.

So what actually happened when the CEO proposed these changes?

First, the members of his executive team conceptually understand why the change is being proposed, but they aren’t fully sold on the solution. It wasn’t their idea, and they haven’t had enough time to think through the ramifications and determine the best outcome. The change feels very sudden.

They then go to their next level of leadership and say, “A change is being made. We are now transitioning from operating like XYZ and are instead going to operate like ABC.” The team asks, “Why?” And those leaders say, “Because the CEO has determined that we need to make this change.”

That next level of leader now must communicate down to their direct reports, often hedging as follows: “I didn’t make this change! My hands are tied. I can’t control it, but the executives at this company are now making us operate like this. Don’t kill the messenger!” You might have seen this exact scenario play out at your company on remote work policies as we get further from the pandemic.

The individual contributors doing the work at this company do one of two things: 1) Continue work as normal and not implement the change; or 2) adopt the change but do it very lazily, thus scuffling the change process with the hope that the executive team will see this new way isn’t working and that it will revert back to the old way.

The result: complete and utter failure at worst, and a major distraction at best.

But reorgs don’t have to be this way. Shoot, if reorgs were always failures, companies would stop pursuing them. It’s just critical that companies pursue reorgs in the right way.

Here are a few tips on how to successfully enact a reorg:

◗ Start with pilot teams

Develop tiger teams or experimental teams that can begin to work on this change. If they are successful, it creates a template to refer to in terms of setting expectations for the rest of the organization when the wide-scale rollout happens. It also creates an early group of advocates for the change.

◗ Involve key stakeholders early

Incorporate a strong team of relevant folks to set proper expectations based on full knowledge. Get as many people as is relevant and necessary to be involved in the change. Get a clear understanding of and alignment on the problem statement that needs to be solved. If everyone isn’t in agreement about the problem to be solved, it will be impossible to create a successful solution and get buy-in.

◗ Ensure leadership buy-in

Have your team communicate back to you, in their own words, why the change is happening and why it will help the business. Be skeptical, and don’t move forward until you feel convinced by their argument that the change needs to happen.

Ultimately, reorgs are hard but necessary for companies to innovate and continue to grow. If a reorg can be enacted successfully, that company will be in an incredible position to thrive moving forward.•

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Mintz is founder of Ambition in Motion, a firm that helps companies increase employee engagement and collaboration by implementing corporate mentor programs.