Restructuring Essay

763 Words 4 Pages
Schumpeter’s says Capitalism as a process of “creative destruction” which is necessarily inherent in business activities in a market economy.
The basic nature of restructuring is a zero-sum game. Strategic restructuring reduces financial losses, simultaneously reducing tensions between debt and equity holders to facilitate a prompt resolution of a distressed situation. Corporate debt restructuring is the reorganization of companies' outstanding liabilities.https://en.wikipedia.org/wiki/Restructuring
When change is not handled well, additional loss of jobs can occur. In addition, demoralization of the work force; increased worker turnover; decreased cooperation and teamwork; and increased levels of stress, anxiety, absenteeism, illness,
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So, while internal political intrigue is unavoidable, at least start with a clean and clear design that matches to strategy.
• Avoid making leadership roles too complex.
• Minimise the use of matrices. They introduce measurement overhead and a lack of clear direction to the staff.
3. Focus on core activity
Remove noise (inefficiency in processes) and enhance core before restructuring roles. This means that you will need to know what people are doing today by obtaining a detailed understanding of tasks by role. This ensures that no value-added activities are thrown out when removing a role. Similarly, duplication and redundant activity can be removed at the time of the restructure.
4. Create feasible roles
Don’t overload roles – restructures generally leave an organisation with fewer people to do the same amount of work. When restructuring to reduce headcount, make sure you understand the current workload of employees.
This will help to ensure you design roles that are neither too heavily laden nor indeed too light. Furthermore, role design must take into account realistic groupings of skills. Packing a role with too many distinct skill-sets reduces the pool of durable candidates.
5. Balance ‘own work’ and ‘supervisory load’ of managers
The case of leadership or “management loading” can be particularly troublesome in restructures. Often, the

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