Article at a glance:
Reorganization is a powerful tool when a company adopts a new strategy, incorporates an acquisition, or simply aims to improve productivity. Although employees and managers often resist change, a successful reorganization can imbue them with a common sense of purpose. But reorganizations frequently fail, even when they draw on proven principles of organizational design.
The take-away
Reorganizations succeed when they build on simple and motivating business ideas, are well-timed, and face social realities. Only when these three conditions have been met should top executives begin drawing up and testing the options for a new organizational design.