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Restructuring & Growth Restructuring & Growth

Restructuring & Growth - PowerPoint Presentation

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Restructuring & Growth - PPT Presentation

A Refresher Change Roles Three broad roles for change Change strategists Identify the need for change and develop a new vision Change agent Helps shape enable orchestrate and facilitate change ID: 583336

team change amp downsizing change team downsizing amp structure stage range management systems mode development restructuring organization process corporate

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Slide1

Restructuring & GrowthSlide2

A Refresher: Change Roles

Three broad roles for change

Change strategists: Identify the need for change and develop a new vision

Change agent: Helps shape, enable, orchestrate and facilitate change.

Change recipients: Have to adopt and adapt to change.Slide3

Implementing Change

Even more important than creating a vision is the difficult process of implementing change:

The daily, detail-oriented, tactical and operational decision-making of change

Change failures usually result from flawed implementation and not from incorrect strategic choices.Slide4

Key Components

Change is about managing emotions

Anger, alarm, alienation and confusion

Effective change requires:

Employee trust through predictability and capability

Employee empowerment that involves inviting everyone to co-create the future.Slide5

Integration Issues

Culture Clash

Start up vs. 20 yr. established company

Retention of:

CEO / CTO

Key technical staff

Marketing Team

Technical Sales Team

Integration / Structure

Leadership team – corporate

R&D organization – corporate

Marketing organization – corporate

Sales Team – different customer base

Acquired Company Morale Issues

Loss of independence

Fear of “Big Company” mentality

Loss of unique identity / brand

Loss of influence, power and control

Acquiring Company Diversion

New Market / different sales capability

Diversion from profitable businessSlide6

Professionalization

New venture

Consolidation

Flamholtz

: Organization Life Cycles

stage

Growth / Size

ExpansionSlide7

Identify and Define a Market

Develop Products and Services

Acquire Resources

Develop Operational Systems

Develop Management

Systems

Manage

the

Corporate Culture

Stages of Organization Evolution

Growing Pains: Transitioning from an Entrepreneurship to a Professionally Managed Firm

by Eric G

FlamholtzSlide8

Oozing Strategy-no functional objectives

Chaotic-overwhelmed

Resource squeeze

Constant change in roles

Rebellion against beginning structure

Lots of grandiose vision / no real strategy

No processes/ systems/ structure/ little role delineation

Boredom!

Early professionalization stage

Early entrepreneurial stage

IPO able leader

Processes / systems more defined

Culture defined by team

Culture derived from Founders

Founder Group dominance

Internal coordination and linkage evolving

Roles stabilizing

90 day task implementation roadmap

Strategy of the quarter

Later entrepreneurial stage

Start Up Life CycleSlide9

Potential “new team / old team” conflicts

Marketing / engineering power struggle

Emerging push to change decision process from hub to team decision

Resentment at beginning process and structure controls

Founding team fall out

Technologists beginning to struggle with embryonic marketing

Early professionalization stage

Later entrepreneurial stage

Early entrepreneurial stage

New leadership structure / style - tension

Team “Storming” between old and new

Requires prioritization and tighter task alignment

Silo mentality / communication breakdown

Founding team beginning to

turn over - role transition

Neat technology to commercialize, but unclear how

Unrealistic business models explored

and discarded

Expand beyond Founder Team

Power shift from technology to commercial side

Founder / leader hub management

Leadership Transition COO or new CEO

Upgrade functional capability

Define 1 year strategy functional goals and 2 qtr task roadmap

Key processes / systems introduced

Functional alignment thru hallway conversations

Functional alignment thru documented objectives and key processes

Need for management growth of early executives

“Cowboys” rebel

Start Up Transitions / IssuesSlide10

Start

Over

Again

Performing

Norming

Storming

Forming

Defining purpose of team

Defining structure of the group

Selecting members

Hesitant participation

Cautious/anxious about new environment

Establish “pecking order”

Turf definition & protection

Competition & infighting over roles & opportunities

Resistance to leadership style

Negotiated agreements

Team norms jelling

Increase in candor

Silos break down

Effective decision making

Collaborative

Respect for skills and styles

Efficient problem solving

Stages of Team DevelopmentSlide11

Start Up Intervention Areas

outcome

Venture group funding

New investors

Different incentives

Board

New Board

Chairman role

Right team

Effective

Aligned

Stage of

Life Cycle

Individual executives

Right skills

Development Plan

Founders

Evolving roles

Transition out

Leadership

Right leader

Development Plan

Strayer Consulting Group, IncSlide12

Managing Change: Partnering

Partnership types: Mergers, Acquisitions, Joint Ventures

Partnership Aims: To achieve the objectives of growth, diversification, economics of scale, synergy or a global presence.Slide13

Barrier to Successful Partnerships:

Geographic distance

Language barriers

Cultural Differences

Understanding why employees behave the way that they do on the job from day to day (Gibbon, 2002)

Understanding shared beliefs, traditions, and expectations about how individuals behave and accomplish tasks (

Cartright

& Cooper, 1993).

Aligning structure, politics and emotion (Clemente & Greenspan, 1999)Slide14

Historical Perspective

1960-1970: Conglomerate type that involved partnering with an organization in an unrelated field.

Often the focus was on financial and planning systems at the corporate level with operations being conducted separately.

Need for cultural integration: LowSlide15

Historical Perspective (Cont

d)

1980-1990

s: Greater number of partnerships between organizations in the same field of business activity or industry

e.g. Time Warner & AOL

Need for cultural integration: HighSlide16

Steps for Successful Partnership

Prospect search and identification

Due diligence

Negotiations

Transition management

Operation as an integrated unitSlide17

M & A Lessons

No partnership of equals. Avoid arrogance.

Change is inevitable.

Culture matters!

Two-way and open communication.

View employees as assets, not liabilities.

Employee involvement.

Overestimate timing. Slide18

Burt’s Bees

Moving forward what are the risks and opportunities from the Clorox acquisition?

What are the implications of this choice?

Can the virtuous mouse and the wealthy elephant live happily ever after?Slide19

Managing Change: Internal Structure to Foster Performance

Complex organizations require diverse experts to collaborate to get their work done across organizational boundaries:

Divisions

Departments

Client Groups

Conflicting goals, languages, cultures, and procedures can inhibit collaboration necessary to effectively performSlide20

Common Aims of Internal Restructuring

Enhance flow of information and expertise across organizational boundaries to increase:

Learning

Catching Mistakes

Innovation

Efficiency

Shared Understanding

CoordinationSlide21

Implement the Internal Restructuring

Over communicate honestly

Align goals with the restructuring Efforts

Avoid the creation of bottle-necks that require certain people to be brokers

Involve employees in the process and take their input into account

Create a climate that supports speaking up in order to enhance the flow of information resources across organizational boundaries.Slide22

Managing Internal Change: Downsizing

Downsizing= Layoffs + Restructuring

Given economic weakness, majority of CEOs report the need to reduce staff amid continued economic weakness and tight profit margins

More than 3 M people are laid off every year

Downsizing can happen even during good economic times.Slide23

Announcing a Downsizing

Use as a last resort

Communicate rationale and allow for questions and answers

Involve senior management

Let everyone know at the same time

Provide counseling at the location

Try not to make an announcement before the holidays or before the weekendSlide24

Implement the Downsizing

Over communicate honestly

Be fair

(Procedural Justice, Trevor & Nyberg, 2008)

Help victims find other jobs

Senior management should share this burden

Reduces likelihood of voluntary turnover

Explain the selection process

Focus on merit or future skill needsFit this criterion with the vision for the futureSlide25

Implementing the Downsizing (Cont

d)

Involve employees

Don

t just take people out

Work out procedures and processes

If you can’t offer job security, provide ways to enhance employabilityTraining and DevelopmentLink incentives to performance in order to motivate skill developmentSlide26

Surviving Organizational Downsizing

Depends a great deal on the way that survivors respond:

If they support the change initiative, downsizing is perceived to meet its objectives

If they feel that the downsizing has violated them and their work environment, workers will tend to work against the objectives of downsizing. Slide27

From a Worker

s Perspective: Survivor

s experience

Recommended text:

-Healing the Wounds (Noer, 2009)Slide28

Midterm Results

2015Slide29

Descriptives

Mean = 87.13%

Mode = 96%

Range = 74% - 100%Slide30

Multiple Choice

Mean = 17.69

Mode = 19

Range = 13 - 20Slide31

Short Answer #1

Mean = 4.06

Mode = 5

Range = 2 - 5Slide32

Short Answer #2

Mean = 4.75

Mode = 5

Range = 3 - 5Slide33

Short Answer #3

Mean = 3.66

Mode = 3

Range = 2 - 5Slide34

Case

Mean = 13.41

Mode = 13

Range

= 10 - 15