Operational Reorganization Program

Operational Reorganization Program

Our company is downsizing, facing major budget cuts, reorganizing departments and instituting a cross-training program for employees. It's imperative that we effectively manage these process changes and transition into a more productive organization. A goal setting, motivation and stress management program is required to assist employees and management during this transitional time.

As we are all aware, we must make our company more responsive to an increasingly competitive global market. We must be more flexible and be able to adapt quickly to the competitive demands of our industry. Product development cycles need to be reduced and our workforce must be able to continually improve our processes to remain competitive.

The following is a step-by-step analysis of a proposed reorganization plan. A time line has been established to cover the initial 3-month implementation phase. The plan provides for a high level of employee involvement, the creation of teams to oversee the changes and set objectives, and a structured communication plan to reduce change resistance and insure that our message is being understood.

Step 1 - Analysis of Organizational Objectives (Week 1)

"The implementation of a Management by Objectives (MBO) program is an effective solution to make goal setting operational." (Robbins 206) Specific and measurable objectives must be set at the organizational level and then flowed to divisions, departments and individuals.

The required budget cuts have already established an initial organizational objective. We must quantity the budget cuts and develop a detailed reduction in work force plan. The loss of employment will be a major destabilizing factor for our company and we should move rapidly to implement the necessary reduction in work force to meet our budget criteria.

Our organizational objectives must also cover the specific reorganization objectives that will make our company competitive. The realignment of our organization to reduced process cost, product development cycle times and marketing objectives all need to be defined and set to an aggressive time line. The additional measures that must be taken to achieve our budgets must also be quantified. Indirect costs and travel budgets need to be established and measured against our budgets.

Step 2 - Reduction in Work Force Implementation (Week 2)

The uncertainty resulting from a reduction in work force is a major concern for all employees. All too often, I have been involved in layoff situations, downsizing, rightsizing or however management chooses to characterize the manpower adjustment. When the fear of losing

your job hangs over your head or your co-workers head, it impacts the entire organization and it overtakes productive efforts. Our manpower should be adjusted to budget and implemented immediately so we can move forward with the reorganization. Downsizing to meet budget criteria will provide a level of stability for our remaining employees.

The downsizing plan should be fair. An across the board cut based on lowest seniority is recommended. Exceptions to the layoff plan should be on a case-by-case basis. It is also important how we treat those who will lose their jobs because of the layoff. This will be an important aspect in re-building the trust of our remaining employees. Career counseling and severance benefits should be carefully considered prior to announcing the layoff.

Step 3 - Communicating the Plan (Week 3)

"The less distortion that occurs in communication, the more that goals, feedback, and other management messages to employees will be received as they were intended." (Robbins 323) Communicating the plan honestly and openly is critical to achieving the productivity gains that will be required to be competitive. An "all hands" meeting needs to be called to communicate the impact of the layoffs, the organizational objectives and the reorganization plan for the company. The emphasis of our message needs to be, "We're in this together and that we need everyone's help in this critical time."

Employee participation in the reorganization process is key to achieving the productivity gains that are required. As we flow down the MBO process throughout the operation, small effective teams need to be established at each level of the organization. Employees will support what they help create. Although it will be impossible for us to make everyone happy, we should attempt to pull our employees into the reorganization and improvement processes. Goal setting at the individual level will ensure that all employees are involved in the process.

Communication is an ongoing process and a communication plan will report our progress on a scheduled basis both with "all hands" meetings and written communication. These "all hands" type meeting will provide a forum for status updates on how well we are performing to our set objectives. We also need to make sure that our managers are communicating our message on a one-on-one basis. Each manager and supervisor should meet with their employees to provide assurances and receive feedback.

Step 4 - Team Formation and Objectives (Week 4-8)

Small teams will be established to develop and flow the MBO process into our operation. A steering committee will be formed to oversee the team creations and key personnel will be selected to participate on the teams to develop the divisional and departmental objectives that flow up to the organizational objectives that have already been established.

Our consultants can be utilized to facilitate the team and MBO process into our organization. Their expertise will be invaluable in providing consistency in the reengineering and reorganization process. The consultants will also provide an unbiased evaluation of the effectiveness of the teams developed.

"Effective teams have been found to have common characteristics. They have adequate resources, effective leadership, a climate of trust and a performance and reward system that reflects team contributions" (Robbins 289). Our Teams need to know that they are empowered and that management will support their decisions. These teams will be short lived, focused on the development of the MBO objectives and the reorganization. Other work teams may be created as an output from the initial teams, but the purpose of the initial teams is to establish the objectives and define the reorganization.

Step 5 - Setting Individual Objectives (Week 9-12)

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