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What are the trade-offs that must be considered in making the decision to re-structure in order to best implement strategy as opposed to taking the organization as a given, and developing a strategy keeping structure fixed?

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What are the trade-offs that must be considered in making the decision to re-structure in order to best implement strategy as opposed to taking the organization as a given, and developing a strategy keeping structure fixed?

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The primary trade offs in restructuring the organization as compared to keeping the structure fixed in order to implement the corporate strategy in the most effective manner are:

1) Restructuring the structure of an existing organization can be a cumbersome and lengthy process, often disturbing the current momentum of the organization and its current processes, tasks and activities, thereby creating an immediate chaos and confusion among the employees. The management of the organization need to handle this situation very carefully and delicately as mishandling of the affairs of the organization at this stage can really lead to long term problems in the organization. This is a very risky stage as structural changes take place in the organization, for which employees are not prepared or ready and are thus reluctant to offer their full support in favor of such changes. Thus, this trade off can be explained in terms of loss of time and disruption of routine tasks, which takes place due to such restructuring.

2) As seen from above, due to the transformation of the current structure into a new one, employees become fearful and more often than not, pose all sorts of resistances to avoid the structural change, even though it is meant to be beneficial for them in the long run. The primary reason for such fear and apprehension is the lack of knowledge, information and benefits about the proposed change as well as lack of communication from the top management regarding the synergy of the proposed structural changes with the long term corporate strategy.

People do not want to the change ...

Solution provided by:
Sandeep Bardia, MBA
Education
  • BCom, SGTB Khalsa College, University of Delhi
  • MBA, Rochester Institute of Technology
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