ReOrg: How to Get It Right

Most executives will lead or be a part of a reorganization (a reorg ). And for good reason-reorgs are one of the best ways for companies to unlock latent value, especially in a changing business environment. But everyone hates them. Perhaps no other management practice creates more anxiety and fear among employees or does more to distract them from their day-to-day jobs. As a result, reorgs can be incredibly expensive in terms of senior management time and attention, and most of them fail on multiple dimensions. It’s no wonder that companies treat a reorg as a mysterious process and outsource it to people who don’t understand the business. But it doesn’t have to be that way. Stephen Heidari-Robinson and Suzanne Heywood, former leaders of McKinsey’s Organization practice, present a practical guide for successfully planning and implementing a reorg-demystifying and accelerating the process at the same time. Based on their twenty-five years of combined experience doing reorgs and on McKinsey research with over 2,500 executives involved in them, the authors distill what they and their McKinsey colleagues have been practicing as an art into a science that executives can replicate in companies or business units large or small. Their approach isn’t complex, nor is it bogged down by a lot of organizational theory: the five steps give executives a simple, logical process to follow, making it easier for everyone-both the leaders and the employees who ultimately determine the success or failure of a reorg-to commit themselves to and succeed in the new organization.