THE INSTITUTE OF ADMINISTRATION AND COMMERCE

___________________________________________________________________________

NAME SIMBARASHE MABHEKA

ID NO. 24-219629H27

STUDENT NO. 230155

MODULE: STRATEGIC MANAGEMENT

ASSIGNMENT DUE DATE: 24 FEBRUARY 2023

ANSWERED QUESTION
 QUESTION 1  QUESTION 2

QUESTION 1
As the strategic manager in our organization, examine how our performance can be managed
or measured. [50 Marks]
QUESTION 1:

Introduction

Effective strategic manager means; reaching goals in an efficient manner using less amount
of resources. It is obvious measuring the strategic manager is challenging, and it will not
provide all the issues. A strategic manager’s performance and effectiveness are measured by
the amount of profit or surplus, the rate of productivity, the quality of techniques, the
response rate of managers to the feedback, the working environment of an organization, the
labor-management relationship, and the relationship with external interested parties with
managers

Definition of important terms

A strategic manager is a primary planner, analyst, and risk leader who build strategic plans
in a corporation. For example, the Chief Procurement Director can prepare a procurement
plan. They are also in charge of overseeing and developing company plans to assist business
growth and stability c. Hill, g. Jones, and m. Schilling (2014).

Organization
Association of people who interact with each other and use resources of various kinds in
order to achieve certain objectives or goals H. Gençer (2019).

Performance is how well a person, machine, etc. Does a piece of work or an activity R.
Schechner (2017).

Amount of profit or surplus

Measuring strategic manager performance and effectiveness with profit and surplus. The sole
objective of a business is to create a surplus. An effective strategic manager creates a surplus
in an efficient way. The amount of profit or surplus is a base for measuring the effectiveness
of strategic management. So on this occasion, Here are some strategic manager KPIs that can
be considered across different companies:

1. Revenue growth
Revenue growth means our earnings are increasing over time. To calculate revenue growth,
we can use this formula:
(Revenue for the current period the – Revenue from previous period) / Revenue from
previous period x 100

Revenue growth shows board members, investors and other stakeholders that the strategic
manager can continuously improve overall revenue earnings. D Parmenter (2015)
Companies can set revenue growth targets and review it for each pay period to monitor
strategic manager performance.

2. Profit margin
More than just revenue earnings, companies often want to measure profit margins. Strategic
managers might hope to increase profit margins by either increasing overall revenue or
reducing costs. To calculate profit margin, we can use this formula:

Gross profit margin = (Revenue – Cost of goods sold) / Revenue

Companies may also choose to measure net profit margin (how much net profit a company
earns compared to total revenue) or operating profit margin (the ratio of operating income
against a company's net sales). Campbell, A., Kunisch, S., & Müller-Stewens, G. (2012). A
high-profit margin can show that a strategic manager is making the right business decisions
that can help strengthen a company through investing or saving its profits.

3. Net promoter score

Net promoter score is the likelihood that an individual will recommend our purchasing
business or company to others. D Parmenter (2015). This is important for strategic managers
because they are responsible for the overall reputation of a company and can show board
members how customers respond to their business decisions. Net promoter surveys ask
customers how likely they will review a business on a scale of 1-10. People who rate a
company 0-6 are detractors, 7-8 are passives and 9-10 are promoters. To calculate NPS, use
this formula:

% of participants who are promoters - % of participants who are detractors

This helps measure a company's and its strategic manager’s ability to create and maintain
customer loyalty and growth.

4. Customer satisfaction
Similar to the net promoter score, we might choose to measure customer satisfaction
percentage. This can sometimes be subjective, but it can tell us how satisfied customers are
with their company interactions, products or services , D Parmenter (2015). We might create a
sliding scale of 1-10 with a series of questions for customers to fill out at the same time, like
at checkout, to ensure we capture consistent data. Consider setting a percentage benchmark
for our KPIs. For example, we may want 95% of survey participants to rate their experience
as a 9 or 10.

Tracking change here is also important to show improvements in customer satisfaction. If

there is an area where customers rated lower scores, tracking the change in satisfaction can
show that any adjustments we made improve their satisfaction.

5. Employee satisfaction
Employee satisfaction is how happy employees are with certain areas of the business, like
culture, processes, and leadership, Wyk, L. M., & Wesson, N. (2021). Tracking KPIs like the
percentage of satisfied employees can help identify areas where the strategic manager should
focus and where they're excelling. Improving employee satisfaction helps companies
motivate their staff which can lead to improved performance and an increase in sales.

6. Spending
Tracking spending can help companies understand how much it costs to produce and sell
goods and services. Consider tracking the percentage of spend over total revenue, as that
shows if we are earning more than we spend, Wyk, L. M., & Wesson, N. (2021). Depending
on the company budget, we may also measure the difference between the budget and actual
spending. Tracking spending KPIs can show where a strategic manager is allocating money
and where they can improve.

7. System quality
Particularly in technology organizations, measuring the quality of systems can show board
members how invested a strategic manager is in providing employees with the needed
technology,Wyk, L. M., & Wesson, N. (2021). We might include this as a sliding scale in an
employee satisfaction survey, or have technology teams track defect frequency, the time
between defects and development time. Consider setting benchmarks with the Chief
Technology Officer (CTO) to ensure the acceptable level of defects or time helps increase
business performance.

8. Return on investments
Return on investments is the amount of profit earned after making strategic spending
decisions. We can calculate this percentage using this formula:

(Current value of the investment - Cost of investment) / Cost of investment x 100

Strategic managers often decide what systems, partnerships, tools and people they might
invest in to improve business performance, so tracking this can show board members and
investors their ability to make good decisions, D. Parmenter (2015). Return on investments
can change over time, so it's important to track how the value of the investment changes to
calculate accurate figures.

Rate of productivity
Productivity or production rate is also a way of identifying the effectiveness of a strategic
manager. An efficient strategic manager will increase productivity without hampering the
quality of the product, and he will do it in an efficient way. Every successful manager is
aware of the importance of team member productivity , Keong Choong, K. (2014). People's
productivity is merely the utilization of their hours in a manner that drives the desired
outcomes and contributes to the achievement of company objectives. According to research
by Voucher Cloud, the average employee is only productive for 2 hours and 23 minutes
daily. Considering an eight-hour workday, team members waste an average of 5 hours and 37
minutes daily. Every day, an enormous amount of time and company resources are wasted.
When managers and team members are productive and work well together over the long
term, a culture based on solid camaraderie emerges — one that is forward-thinking,
collaborative, and motivating. Having a productive team is advantageous in the short term,
but these benefits compound over time, Temkin-Greener, H., Cai, S., Zhao, H., & Mukamel,
D. B. (2010).

Quality of techniques used by a strategic manager.

The use of technological advancement, by the strategic manager, is using for the
accomplishment of a goal, also indicates the effectiveness of a strategic manager. A good
strategic manager always finds a way to use the most advanced technology in the production
and operation process within the budget of the organization. Temkin-Greener, H., Cai, S.,
Zhao, H., & Mukamel, D. B. (2010). Technology exists in everyone’s life in some way or
the other. Business life is impossible without technology as every business is dependent on it.
It helps meet the requirements and needs of customers and employees. It is not at all complex
but helps makes life easier. With the changing time requirements of the employees and
customers have also changed further technology has also evolved with time. With the
changing time and technology, people can easily cook food in a microwave and on an
induction cooktop using electricity. Keong Choong, K. (2014) The need to prepare food has
not changed, but the way of preparation has changed immensely. Earlier, making long-
distance business calls used to take weeks. Today there are reliable sources of
communication in the form of mobile phones that thing is at the fingertips. With the
increasing needs of employees and customers, even technology developed faster.

The response rate of the strategic manager to the feedback

A strategic manager receives feedback by monitoring and controlling the operations. But
receiving feedback is not the end of the hob of strategic management. A strategic manager
needs to respond to the feedback depending on this nature; good or bad. “the faster, the
better” is not always the case, P. Daniela (2015). A key ingredient in effective performance
management and development is the skill of giving and receiving feedback. This is vital in
order to focus on employees’ energy and efforts toward achieving goals in the most effective
way, providing clarity and alignment, Wyk, L. M., & Wesson, N. (2021). Feedback can
either be constructive, that is identifying errors or areas for improvement, or appreciative,
that is recognizing successes or where someone’s contribution has been valued. Exchanging
feedback openly and working in partnership with others is an indicator of mature culture in
managing performance and development. A strategic manager must respond to feedback
quickly and efficiently.

The working environment of the organization as an indicator

The working environment is also an indicator of the effectiveness of strategic management.
The more suitable the work environment is, the more effective the strategic management will
be. “Trust is defined, as the willingness to rely on someone in a situation where we are
vulnerable so it’s, in a sense, the absence of fear” (Weiss, 2018). A positive work
environment is a place where everyone is heard. Safety and equity are two important
components of a positive work environment. L.Weiss (2018) talks about how psychological
safety allows people to take risks and people can speak up which is part of a strategy for
building trust. Williams (2018) talks about how inequitable treatment for example penalizing
women for engaging in flex schedules – can add a gendered aspect that creates a barrier to
trust. Cooperation is the act of people working together toward the same goal. Working
together toward a goal, like collaborating on a project, requires a lot of communication.
There is a big difference between the quantity and quality of communication in the
workplace. It is important that strategic management and team members have a shared
purpose. If the strategic manager does not share the same purpose and values, then managers
might be talking about two different things, and pursuing two different goals, and that leads
to problems when communicating with team members. Agarwal (2018) describes some
cooperative elements of a positive work environment.

Effective Labour-management relationship as a measure

Measure strategic manager by labour-management relationship. It is a base for measuring the
effectiveness of the strategic manager. A good labour-management relationship is necessary
for strategic management for attaining goals, P. Daniela (2015). Quality of the labour-
management relationship has to be maintained and is well manner fashion as it has effects on
the productivity and working environment of an organization. Effective labor-management
relationships are rooted in respect for the law. Temkin-Greener, H., Cai, S., Zhao, H., &
Mukamel, D. B. (2010). The law that governs the relationships between labor unions and
employers is fundamental to achieving a productive union work environment. Absent a
respectful and collaborative relationship between the two, they become adversaries unable to
serve the interests of employees as well as the day-to-day and strategic concerns of the
business. A strategic manager is able to handle grievances. A collective bargaining
agreement, or labor union contract, typically contains a grievance process, which is key to
maintaining an effective labor-management relationship. In a unionized work environment,
employees who dispute their supervisors' decisions must file a grievance. Keong Choong, K.
(2014) Generally, a grievance process involves three steps before an unresolved matter goes
to arbitration. The first step is a meeting between the union steward and the supervisor; if
there's no resolution, the steward then meets with a strategic manager to present the
employee's position. If the union steward and strategic manager cannot come to an
agreement, the employee and steward can appeal the strategic manager's decision. The matter
goes to arbitration if the third step fails to produce a resolution. A strategic manager must
have the skills to handle the issue to do with labor relations so that their effectiveness can be
measured.

Relationship with external interested parties with strategic manager

Strategic managers are the liaison for the organization. They should have a good relationship
with the parties outside of the organization. Maintaining relationships with shareholders,
creditors, bank and financial institutes, government, customers and any other interested
parties is necessary for strategic management. Developing relationships results in increased
trust. And where there is trust, people work together more easily and effectively. Investing
effort in identifying and building stakeholder relationships can increase confidence across the
project environment, minimise uncertainty, and speed up problem-solving and decision-
making Temkin-Greener, H., Cai, S., Zhao, H., & Mukamel, D. B. (2010).. It is important to
manage relationship as a strategic manager. Building relationships is a natural human instinct
that often ‘opens doors’ or influences outcomes that cannot always be achieved by following
plans and processes alone. There are a number of human factor and Human Factors
Indicators that reflect relationship and trust. These ‘shoulder to shoulder’ working practices
and alliances help reduce barriers, build rapport, instill confidence and fuel progress. "We
need relationships big enough to get the job done", Steve Radcliffe (2017). This can be a
measure of strategic manager through relationship management.

Conclusion
Measuring the effectiveness of strategic management and its actions is a tricky task. Before
this one needs to consider several things such as; the economic situation of the organization,
resources availability, and economic condition of the country. The goal of measures is to
improve the strategic managers of the organization and not the other way around. The
strategic management processes should inspire employees to perform at their best with
motivation and dedication toward the company goal.
References
i. Daniela P. Blettner, Zi-Lin He, Songcui Hu, Richard A. Bettis (2015) ,Adaptive
aspirations and performance heterogeneity: Attention allocation among multiple
reference points

ii. Keong Choong, K. (2014), "The fundamentals of performance measurement systems:

A systematic approach to theory and a research agenda", International Journal of
Productivity and Performance Management, Vol. 63 No. 7, pp. 879-922.
https://doi.org/10.1108/IJPPM-01-2013-0015

iii. Temkin-Greener, H., Cai, S., Zhao, H., & Mukamel, D. B. (2010). Nursing Home
Environment and Organizational Performance: Association with Deficiency Citations.
Medical care, 48(4), 357. https://doi.org/10.1097/MLR.0b013e3181ca3d70

iv. Parmenter, D. (2015). Key performance indicators: developing, implementing, and

using winning KPIs. John Wiley & Sons.

v. van Wyk, L. M., & Wesson, N. (2021). Alignment of executive long-term

remuneration and company key performance indicators: An exploratory study.
Journal of Economic and Financial Sciences, 14(1), 17.

vi. Campbell, A., Kunisch, S., & Müller-Stewens, G. (2012). Are CEOs getting the best
from corporate functions?. MIT Sloan Management Review, 53(3), 12-14.
QUESTION 2

Most organizations are downsizing due to the effect of bad economic times caused by the
pandemic and other macro and micro business environmental factors. We have been asked
to draft a report on “restructuring the organization with a human face” for the board’s
consideration. [50 Marks]

Solution:

Table of contents

Table of Contents
Background..............................................................................................................................................10
Key phrases..............................................................................................................................................10
Organization:...........................................................................................................................................10
Organization structure:..........................................................................................................................10
The Concept of Restructuring................................................................................................................11
Organizational restructuring..................................................................................................................11
DISCUSSION:.........................................................................................................................................11
Causes of restructuring as our corporation faced the following problems Malačič, N., & Malačič, I.
(2016)........................................................................................................................................................11
1. The competitive panorama has modified...........................................................................................12
2. Employees' ability sets do not suit their function..............................................................................12
3. Performance is lower than expected...................................................................................................12
4. Inefficiency is good sized.....................................................................................................................13
5. Turnover is excessive...........................................................................................................................13
6. Employees are overworked.................................................................................................................13
7. Employees are underutilized...............................................................................................................14
8. Teams that are closely aligned aren’t collaborating.........................................................................14
Key advantages of organizational restructuring ,Kwoka, J. (2008).....................................................15
1. Decreased cost......................................................................................................................................15
2. Increased performance........................................................................................................................15
3. Improved personnel’ morale...............................................................................................................15
4. Effective communication.....................................................................................................................16
5. Improved selection making.................................................................................................................16
6. Resolution of shareholders’ conflicts..................................................................................................16
7. New enterprise opportunities..............................................................................................................17
8. Improved tax performance.................................................................................................................17
9. Enhanced organizational recognition.................................................................................................17
10. Adoptation of generation..................................................................................................................18
Types of organizational restructuring....................................................................................................18
Organizational Restructuring and Its Implications for HR Practitioners..........................................21
Open Communication.............................................................................................................................21
Enlarge the Range of Adverse Personnel Actions.................................................................................21
Set and comply with Standards..............................................................................................................22
Involve the Stakeholders.........................................................................................................................22
Align Process with Legal Imperatives....................................................................................................23
Rightsizing, Not Just Downsizing...........................................................................................................23
Restructuring, Not Just Rightsizing.......................................................................................................24
Developing human resources practices that enhance dedication.........................................................24
Conclusion................................................................................................................................................25
Recommendations...................................................................................................................................26
REFERENCES........................................................................................................................................28
To: Board of Directors SMR Pvt ltd

From: Mr. S. Mabheka Chief Executive Officer of SMR Pvt LTD

Ref: A Report on Restructuring the Organization with a human face

Date: 24 February 2023

Background

The employer is downsizing because of the effect of horrific financial times because of the
pandemic and different macro and micro business environmental elements. When groups
increase, they need to organize and cluster employees based totally at the business-associated
activities they do. When there are many individuals operating in the direction of a shared goal,
often in separate locations, there have to be a plan to signify how jobs are organized, that is the
formal organizational shape. The structure outlines how an organisation's interconnected groups
have constructed the way employees are formally organized into groups for coordination and
management.

Key phrases

Organization: An company is a collection of folks who paint together. The organization shares
not unusual dreams.

Organization structure: In keeping with Drobnick (2002) is “the sum overall of the way in
which it divides its labor into distinct duties and then achieves coordination between them”.
(Cole, 2005), defines an agency structure as a concept that is used to explain something that is
intangible: “an intangible internet of relationships among humans, their shared functions, and the
responsibilities they set themselves to achieve those functions.”
The Concept of Restructuring

Restructuring is the manner of making a good sized exchange in organizational structure, which
frequently entails reducing control degrees and perhaps changing additives of the enterprise via
divestment and or acquisition, as well as shrinking the team of workers size. Restructuring, in
line with Khandwall (2001), is an orchestrated systematic trade that isn't "incremental, ad hoc, or
partial... Nor an insignificant alteration of the organizational chart is a chief realignment of the
tradition, imaginative and prescient, values, method, shape, management structures, control
styles, technology, and workforce abilities. (2000) (Muijen and Witte) Modern managers might
not be able to keep away from the requirement to make use of restructuring approach so one can
offer a strategic alternative for the business in resolving operational and monetary demanding
situations whilst enforcing trade. Departmental reform will also improve service delivery overall
performance. When a organization needs to restructure or increase the effectiveness in their gift
organizational structure, regularly requiring lowering the variety of humans, organizational
restructuring is a essential procedure. It can also entail changing the make-up and job obligations
of employees with a purpose to growth a organisation's common productivity. Organizations and
those can also both gain from restructuring. As painful as exchange is probably, it often enables
people in phrases of lengthy-term balance and development. Change thru restructuring
introduces new challenges that permit professionals to learn and develop, whilst secondary
rewards such as promotions and earnings increases are often available because of employee
modifications.

Organizational restructuring is an important technique when a business enterprise makes a

decision to exchange or improve the performance of its existing organizational shape, regularly
regarding downsizing in the range of personnel. Khandwall (2001), It may also include
converting the composition and job roles of people with the intention to enhance the general
productivity of a business.

DISCUSSION:

Restructuring can provide advantages to each companies and people alike. As tough as it is able
to be, regularly times this alteration blessings people in phrases of long-time period stability and
growth. Khandwall (2001),
Causes of restructuring as our corporation faced the following problems Malačič, N., &
Malačič, I. (2016).

Restructuring is whilst an enterprise modification its internal strategies and operations,

reorganizes groups and employee structures, repositions itself inside the marketplace, or updates
its approach. Often, employer reorganization takes place in response to monetary threats or
pressures on the corporation. By making organizational modifications, groups can lessen high
priced inefficiencies, reply to new competitive markets, and expand techniques to transport
forward correctly. Malačič, N., & Malačič, I. (2016), The backside line is that subsequently;
some stage of reorganization is important to building a sustainable business that lasts. In other
phrases, as the sector moves forward, corporations must be prepared to move with it or get left
behind. The following are main concerns on why we want to restructure.

1. The competitive panorama has modified

The enterprise international moves quick. Innovations and technological advances can disrupt
entire industries in just a few quick years. Local, country wide, and international economies
evolve, impacting charges and introducing new players to the industry. If we are still running the
identical manner we had been even 5 or ten years ago, we can already be falling behind our
opposition. In order to stay applicable and profitable amidst converting markets and growing
opposition, we’ll need to assess and update our business approach, Malačič, N., & Malačič, I.
(2016).

2. Employees' ability sets do not suit their function

If there is a mismatch between our employees’ competencies and their job capabilities, we are
losing one of our maximum valuable resources—our humans. Putting the right people with the
proper talents inside the right task is vital in our business’s fulfilment, Malačič, N., & Malačič, I.
(2016). Re-compare our hiring systems, career development programs, or the structure and
organisation of our teams. For example, we might need to combine teams or departments,
replace job descriptions, create and hire for brand new roles, or actually have strategic layoffs to
realign our workforce.

3. Performance is lower than expected

Low performance will have lots of reasons which includes terrible management, loss of right
training, insufficient gear or era, and occasional worker engagement. If performance metrics are
continuously lower than sudden, don't forget whether our organizational shape is contributing to
the hassle. Reorganizing could be as trustworthy as hiring or promoting the right leaders,
developing (or updating) formal on boarding strategies, or upgrading the tools and resources our
employees use to get the process finished.

4. Inefficiency is good sized

Widespread inefficiencies for our employer factor to outdated or outgrown tactics. In different
words, what worked for we within the beyond now not serves our present day business.
Inefficient operations can cripple our bottom line. If we don’t deal with the hassle at the supply,
the only way to grow our business is to boom the wide variety of personnel we've got. But this
will fast drain our earnings and gradual our boom. Instead, we should get rid of inefficiencies to
our tactics so that we can do more with much less. This may imply updating our generation and
IT systems, changing our workflow, or reorganizing human beings into greater effective group
structures.

5. Turnover is excessive

In nowadays’s tight exertions market inside the midst of the Great Resignation, keeping
personnel is more essential than ever. Employee turnover prices companies round 33% of an
employee’s base pay—or $15,000 for the common U.S. Worker nowadays. That’s double the
value of turnover in view that 2000. Employees are appreciating belongings—the longer they
paintings at our business enterprise, the extra treasured they turn out to be. That’s why it’s
important to spend money on and maintain our humans. If our employer has excessive employee
turnover, it’s time to re-examine. What structures or methods are contributing to turnover? Are
our personnel leaving for competitors? Why? Solving the problem of worker retention isn’t
constantly easy, however it's miles worth it. It may require converting our control, enhancing our
hiring and onboarding tactics, increasing salaries or benefits programs, increasing faraway and
flex paintings alternatives, or offering extra training and mentorship opportunities.

6. Employees are overworked

Do we've got groups which can be overburdened and overworked? Overworking our employees
can cause improved stress, burnout, and turnover. According to a 2018 Gallup examine, 67% of
complete-time personnel skilled burnout. And today, employee pressure is at an all-time
excessive. Burnout isn’t simply awful for personnel; it’s awful for commercial enterprise.
Burned-out employees are more likely to take ill leave and search for any other task. Plus,
multiplied pressure at the process can cause inefficiency, mistakes, and low morale. If we’re
overworking our employees for an prolonged time frame, that’s a sign we want to make a few
modifications in our business. We can also want to rent more body of workers to relieve the
workload or offer other structural and strategic guide for our personnel (consisting of new
technology or up to date approaches).

7. Employees are underutilized

On the flip facet, having too little work (or not assigning the right work) for our employees can
be simply as crippling and demoralizing to our business enterprise as having an excessive
amount of work to do. Are we leveraging our personnel’ full capacity? Do our employees
experience their paintings is meaningful? If no longer, we threat disengagement, low morale, and
turnover. Addressing underutilization is hard because our employees are probably acting well
with the paintings they are assigned. One of the handiest methods to become aware of this
untapped potential is to ask our employees. Once we recognize wherein our employees are
disconnected and what talents or opportunities they need to pursue, we can reorganize our
commercial enterprise and adapt our technique to fulfill those needs and take benefit of all of our
personnel ought to offer.

8. Teams that are closely aligned aren’t collaborating

As our enterprise evolves and grows, the structure of our departments and the make-up of our
groups might also no longer be effective. For example, do we've got teams whose paintings or
desires are carefully aligned however they remain soiled? Highly efficient and productive
companies strategically shape their businesses to foster collaboration and align groups with their
ordinary undertaking. An optimized shape streamlines operations reduce miscommunication and
misalignment throughout the enterprise and creates more possibilities for innovation and
increase.
Key advantages of organizational restructuring ,Kwoka, J. (2008).

1. Decreased cost

Cost financial savings is one of the maximum critical advantages of organizational restructuring,
as it allows companies to lessen their overhead fees and growth efficiency while not having to
lessen the quantity of personnel. Downsizing is a key element of organizational restructuring,
because it enables organizations to keep on costs related to administrative costs. This is done
with the aid of permitting organizations to do the same quantity of labor with fewer employees,
ultimately decreasing their overheads and enhancing their efficiency. Restructuring additionally
allows agencies dispose of redundant roles and processes, letting them come to be more efficient
while not having to reduce the range of employees.

2. Increased performance

Organizational restructuring can assist agencies turn out to be more green by using streamlining
techniques and removing useless roles and duties. By optimizing present operations and growing
new ones, agencies can save time and resources. This in turn ends in higher efficiency tiers
throughout departments and stepped forward customer satisfaction. Moreover, organizational
restructuring allows teams emerge as better organized and enables them to collaborate extra
correctly. It reduces the need for micromanagement and allows personnel to work in a self-
directed way, with clear dreams and targets. With a restructured organizational structure, groups
are better able to pick out areas that want improvement, develop answers, and take movement to
complete jobs in a timely way.

3. Improved personnel’ morale

Organizational restructuring not handiest facilitates to growth performance and reduce prices,
however it may actually have a effective effect on worker morale. By moving the focal point
from process-driven targets to ones that are without delay associated with accomplishing
commercial enterprise goals, personnel can sense more empowered. A range of blessings are
offered to personnel because of organizational restructuring. These advantages can also
encompass multiplied pay, possibilities for merchandising, and share schemes. This allows to
improve worker morale and motivation, leading to a extra efficient body of workers.

4. Effective communication

When a business eliminates layers of management all through its restructuring, it may greatly
enhance communique and collaboration within the organisation. This is due to the fact when
there are fewer degrees of control, people have direct get admission to to senior management and
may have their desires higher addressed. As a end result of organizational restructuring,
conversation flows faster and more efficiently among team contributors. Without the traditional
layers of control, there may be no need for data to filter via a couple of channels.

5. Improved selection making

The organizational restructuring also can result in advanced decision-making, because it reduces
departmental silos and allows for extra collaboration among exceptional parts of the enterprise.
With fewer layers of control, groups are higher able to form selections greater speedy and put in
force them with more speed and performance. This allows to create direct traces of verbal
exchange between crew participants, allowing them to work more closely together and share
assets as a way to gain their targets. The streamlined manner additionally reduces the want for
micromanagement and lets in employees to take decisions in a self-directed way with much less
supervision.

6. Resolution of shareholders’ conflicts

Organizational restructuring is a precious device for resolving shareholder disputes. Demergers
and share redistribution are key elements of this process. Through demerger, businesses can cut
up into two or extra separate corporations which can be independently owned and operated. This
permits shareholders to break up their holdings as they see healthy, while not having to promote
the entire business. Organizational restructuring can assist to remedy conflicts between
shareholders via presenting them with alternatives and a more degree of manage over their
investments. This creates an environment of extra flexibility and preference that can help to
lessen conflicts and disputes among shareholders.

7. New enterprise opportunities

The organizational restructuring lets in agencies to identify new regions of boom and possibility
that they may not have previously explored. Restructuring can unfastened up assets and launch
blocked capability. This, in turn, offers businesses the chance to invest in new services or
products, input new markets, or restructure their organizational shape to higher meet purchaser
expectancies. What are blessings of finding new business opportunities. By disposing of
organizational silos and breaking down conventional hierarchies, businesses can free up get entry
to to a wealth of assets, skills, insights and information which could have been previously
blocked or unavailable. This can cause new avenues for growth that weren’t formerly seen or
feasible.

8. Improved tax performance

Organizational restructuring can also enhance tax efficiency. By doing away with superfluous
fees, groups can lessen the quantity of tax they pay. This may be achieved via reallocating
resources to extra profitable sports and taking benefit of available deductions and advantages.
Another manner to growth tax efficiency because of restructuring is by using taking advantage of
international tax benefits. Kwoka, J. (2008). Companies can make use of the benefits of go-
border funding and take benefit of lower-tax jurisdictions. This may contain transferring some
operations abroad, or putting in place a new corporate entity in another country with a higher tax
surrounding.

9. Enhanced organizational recognition

Organizational restructuring can also have a high quality effect at the recognition of a
commercial enterprise. By streamlining processes and eliminating useless prices, customers can
see that the company is striving to provide efficient, great provider. Whittington, R. (2017).
Companies that display these benefits are more likely to attract new clients and to hold their
current ones. Rebranding can be an effective device for enhancing an enterprise’s reputation. It
offers the agency a clean and present day appearance, assisting to create a extra high-quality
impression inside the eyes of clients, buyers, and different stakeholders. When completed
successfully, rebranding can assist to enhance an organization’s visibility and public belief.

10. Adoptation of generation

Organizational restructuring is likewise a remarkable opportunity for businesses to undertake

new technologies. By restructuring corporations can free up resources, to put money into present
day generation a good way to improve the efficiency in their operations. Whittington, R. (2017).
Organizational restructuring can be an powerful tool to persuade crew members to undertake
new technologies. By developing an environment of more flexibility, companies can offer their
employees with the freedom to explore and discover one of a kind methods to trouble solving.
This benefits the entire corporation and allows group individuals to embrace progressive and
rising technology with out feeling constrained by means of traditional organizational structures.

Types of organizational restructuring

Cascio (2002) adds a special dimension to the understanding of organizational restructuring. He
contends that restructuring no longer necessarily should bring about the retrenchment of
personnel with all of the painful consequences that observe. There is an opportunity method,
which he refers to as „accountable restructuring‟. Whether the corporation will observe the
traditional manner of restructuring that includes retrenchments or what he phrases „accountable
restructuring‟ depends on the management view of personnel. Managements who view their
personnel, as charges to be reduced are much more likely to lessen their body of workers when
restructuring. They constantly study an irreducible core of workers that the business requires to
ensure that minimum range of employees is maintained. Management who view their employees
as property to be nurtured and developed, then again, are much more likely to be responsible
restructurers. Kwoka, J. (2008). They continuously are trying to find new ways of doing
commercial enterprise so one can make sure that personnel are applied greater successfully and
effectively. The downsizers view employees as commodities that may be changeable and
substituted for one another. The accountable restructurers, on the other hand, view employees as
sources of creativity and renewal in addition to having capability to grow the commercial
enterprise.

Organizations that comply with a natural employment downsizing approach generally tend to
attention on altering the quantity of employees with out changing the manner wherein the work
is executed. This technique has a tendency not to result in lengthy-time period effects that
management were searching out. The corporations that pursue a „accountable restructuring‟
approach, however, tend to rely on their employees to offer non-stop aggressive advantage and
embody a whole lot of practices. The following are a number of such practices: adopting abilities
education and sustained studying programmes for personnel; sharing of statistics; encouraging
their personnel to participate inside the lawet and execution of labor techniques; adopting
organizational structures which can be flattened; promoting partnerships among personnel and
management; adopting a purchaser centric technique in their lawet and shipping of services and
products; and, remunerate employees consistent with their abilities and organizational
performance.

These practices should be applied together as a system a good way to bring about top
consequences. This method to restructuring does give upward push to more suitable performance
and productiveness among employees as well as longer-term economic overall performance for
the organization (Cascio, 2002).
It is vital to word that personnel in the organisation do require some assist to effectively address
the method of organizational restructuring. Restructuring need to be regarded as an ongoing
procedure rather than a task. The successful implementation of change calls for agencies to trade
their attitude and this does not appear in a single day. Employees need to no longer best receive
each intellectual and financial tools needed to cope with future commercial enterprise challenges,
however be assisted in starting to see the enterprise surroundings in a different way. This will
help them to realize the want for alternate in their enterprise and this could evidently make them
more supportive of exchange (Senge, et al., 2008).

Organizational restructuring may involve changing the dimensions and the primary association
of the organizational chart. It might also contain downsizing that is a technique of lowering the
quantity of personnel required to perform efficaciously. This technique is not directed handiest at
retrenching people, however additionally at ensuring that the newly designed structure absorbs
most effective the range of employees required, not anything greater and not anything much less.
It is therefore additionally referred to as rightsizing. As Greenberg and Baron (1999) put it, most
of today‟s companies require some distance lesser human beings to characteristic than inside the
beyond.

Organizations can also restructure through outsourcing of the non-center components in their
business to every other employer. This enables to unfastened the enterprise to consciousness all
its interest on center commercial enterprise features that are enshrined in its project. Depending
at the outsourcing agreement, the employer to which the enterprise is outsourced may rent the
same employees who were production the goods or services from the outsourcing agency and
vice versa. This shape of restructuring may not necessarily cause the loss of jobs (Greenberg and
Baron, (2011).

The structure of the employer does affect the facts it gathers from its surroundings and the way it
integrates and tactics the facts to craft future techniques. Structural modifications therefore, do
provide upward thrust to alterations within the go with the flow of facts. This, in turn, offers
upward thrust to modifications inside the strategic opportunities that are being notion cautiously
approximately and observed up. Structural modifications are also vital to place an cease to power
bases that may block the desired modifications in method in seeking to protect the vested hobby
of a few top managers. It is therefore, no longer a horrific concept for an employer to have
regular reorganization. Changes inside the shape can be done by using an enterprise in reaction
to a want for a exchange. It is one form of carrying out an organizational exchange in response to
a hassle.
Organizational Restructuring and Its Implications for HR Practitioners

Organizational restructuring has consequences on the paintings surroundings. Downsizing

specially, ends in disruptions in the paintings environment, which could have an effect on the
bonds that have advanced between a worker and an corporation. The allegiance between
employee and business enterprise is fairly de-emphasised, as organizational leaders grapple with
strategies to deal with the uncertainty and change, Whittington, R. (2017). The mental agreement
among a employee and an business enterprise is therefore undergoing fundamental changes that
go away people unsure in their function and location in organizational systems.

Thus, the HR practitioners have to apprehend that in some cases there may be viable
alterna1tives to downsizing and should be organized to assist management find such alternatives
and enforce them. As stated, rightsizing involves layoffs; in any other case called downsizing
and additionally new recruitment. In carrying out a downsizing exercise, HR practitioners have
to equally realize that although layoffs may every now and then be essential, however they are
able to usually be executed better or worse. Some of the thoughts generated with the aid of
Robert T. (1999), a researcher on this field, on what are to be prevented and/or emphasized
whilst carrying out a downsizing exercising are:

Open Communication

All viable efforts ought to be made to keep away from putting employees saved inside the dark.
Preannouncement dynamics must now not be deliberately constrained to a small elite running
under situations of secrecy and perhaps conspiracy, if not deep cover. Substantial statistics
applications targeted to all important stakeholders mainly the workers and unions have to be the
high motors helping downsizing efforts, Whittington, R. (2017). The factor stressed is that HR
practitioners have to endeavour to inspire openness in communique and involve a participatory
procedure in any given downsizing exercising.

Enlarge the Range of Adverse Personnel Actions

Fitting employees actions to the state of affairs has tons to suggest it. Specifically, “downsizing”
normally refers to reductions in total employment, however a few downsizing desires can be
carried out in terms (for instance) of a lowering of an organisation‟s task or talent profile.
Consider a advertising organisation that decides to reduce its managerial cadre–given reduced
income, or a desire to upgrade salesperson‟s jobs. El-Sayed, N. (2019). Demotion of such
managers is seldom relied upon, but evidence shows the shortsightedness of counting on most
effective dismissal or early retirement in such instances. Thus, the chance to just accept demotion
can be regarded as an excellent religion response to a task once completed properly sufficient,
but no longer visible as beneficial. Moreover, demotion also retains a pool of possiblypromotable
should the state of affairs trade.

Set and comply with Standards

HR practitioners should have a look at all troubles concerned in downsizing, the rational, the
goals to be met, needed strength of body of workers affordable to preserve the wheel of
manufacturing going, and so forth and then set requirements or criteria to be able to be adopted
in disposing the extra luggage without hurting the business. El-Sayed, N. (2019), HR officials
should set the standards to observe in accomplishing this: beneficial questions need to be asked;
along with: is age the handiest applicable criterion for lay off; will past performances and
competencies be evaluated; what of bad statistics; should a workforce that has intense horrific
report be left at paintings simply because he is 40 years whilst a 55 yr old treasured workforce of
great asset to the corporation is laid-off; and are scientific records going to be tested to ascertain
those staff whose medical repute are no longer useful to attaining nice and most output, and so
on?

Examining all of the factors will assist the HR practitioner to arrive on the necessary criteria to
be followed in deciding on which employee to be dropped or who to keep. Having set the
standards, those standards need to strictly be followed and seen to be accompanied N., Juru, T.,
& Tshimanga, M. (2017), Any deviation will ship the incorrect alerts and could purpose
upheavals in relationships among control and the employer‟s applicable stakeholders mainly the
labour unions.

Involve the Stakeholders

There is want to collaborate carefully with the applicable stakeholders of the organization in
particular the in-residence alternate unions in operating out modalities of sporting out a hitch
loose workout. N., Juru, T., & Tshimanga, M. (2017), They ought to be carried along on the
diverse troubles of challenge. The argument that slicing the staff is basically a management
feature isn't always altogether doable. Though the choice is a control prerogative, the choice
process ought to involve the stakeholders to sustain business concord.

Align Process with Legal Imperatives

Downsizing has to take awareness of legal contracts guiding the agency and the employees.
Such matters as compensation rights and entitlements need to be secured. El-Sayed, N. (2019), It
ought to be visible that different social agreement requirements among the employee and the
employer have been duly found and accompanied all through the disengagement system. It is the
obligation of HR practitioners to make sure organizational compliance with this important
requirement. HR exercise has additionally long past beyond the method of effecting reduce in
team of workers strength as and when the need arises to getting ready group of workers for such
inevitable changes in life, Girod, S. J., & Whittington, R. (2017). Organizations which might be
deemed to be worker pleasant put together their people for submit-retirement lifestyles. Such
arrangements take commonly the form of seminars, workshops and re-skilling development.
These preparations help the personnel involved to suit into and be useful within the larger society
after the leaving the employer. The act of getting this performed is purely an HR feature. HR
practitioners may additionally consequently wish to take attention of the enormous goodwill that
this provider garners for the agency and the empowerment value, which it renders to employees.

Rightsizing, Not Just Downsizing

As has been stated earlier, rightsizing isn't pretty much downsizing. There is the element of
interdepartmental postings, the use of the extra arms in a bloated branch to replenish an below
staffed department. To efficaciously impact such organizational reshuffling and nevertheless
keep performance at maximum efficiency and potential, the staffs which are to be transferred to
other devices might also necessarily need to be re-skilled or re-professional to carry out the
brand new roles predicted of them.
Another component of rightsizing involves new recruitment. HR practitioners function to
become aware of want regions for staff recruitment, competences required, and the choice
system and tactics to be undertaken to fill such vacancies. Girod, S. J., & Whittington, R. (2017),
As inside the case of downsizing, standards ought to be set and observed. Equally the choice
system and procedures should be obvious, honest and objective. Another implication of effecting
new recruitment lies with personnel improvement. The new personnel always wishes to go
through some form of orientation and development to in shape into the employer. It is the
function of HR practitioners to make certain that that is finished.

Restructuring, Not Just Rightsizing

It ought to be confused that restructuring isn't always all approximately downsizing or rightsizing
as the case can be. Emphasis might also have been unduly laid on those factors due to the touchy
nature and the prime role that HR practitioners play on this control feature. However,
restructuring also entails the dynamics of efficaciously sporting mergers and acquisitions. The
position of the HR practitioners in organizational improvement continues to expand and agencies
depend upon informed HR practitioners to play a few crucial roles in making a fulfillment of
mergers and acquisitions. Critical roles that HR practitioners take directly to obtain fulfillment in
this place encompass initial strategy and making plans, due diligence tests and analysis that
affect the mixing procedure.

It is consequently the position of the HR practitioners to make certain that there's an powerful
and green planning of jobs and people in order to balancing call for in opposition to deliver with
the right wide variety of personnel on the proper time and on the right region. Strategic and
included motivational devices to productiveness make sure process delight, thru task growth,
process rotation; participation, networking and group working as well as comments circle are
crucial components in modeling and streamlining the HR practitioners‟ obligation to
responsibility Girod, S. J., & Whittington, R. (2017).In the implementation procedure, the human
sources practitioners additionally have onerous task of imparting clear attention and course to the
corporation at the same time as at the same time creating incentive strategies for members of the
enterprise to conform to the converting state of affairs. With restructuring inside the oil and gas
industry, the human sources practitioners are challenged to spearhead the exchange, manage the
trade and screen the change to ensure successful implementation and success of the brand new
vision of the business enterprise.

Developing human resources practices that enhance dedication

According to Armstrong (2005) the subsequent ten (10) exercise make a contribution to increase
of employee commitment:

• Advise in techniques of speaking the values and ambitions of management and

achievements of the business enterprise, in order that employees are more likely to discover with
it as one they're proud to work for.

• Emphasize to management that dedication is a two way technique employees can't be

predicted to be dedicated to the business enterprise except management demonstrates that it's
miles dedicated to them.

• Impress on the management the need to increase a weather of agree with by using being
honest with humans, treating them pretty justly and continually, preserving its phrase and
showing willingness to listen to the remarks and hints made by way of personnel.

• Develop a nice mental contract by way of treating humans as stakeholders depend on

consensus and cooperation as opposed to manage and coercion and provision of possibilities for
mastering and profession development.

• Advise on and assist within the establishment of partnership agreements with exchange
unions which emphasize harmony of motive, commonplace strategies to working collectively
and the importance of giving personnel a voice.

• Recommend and participate within the success of single popularity for all personnel in
order that there's no an “us and them “subculture.

• Encourage management to develop a policy of employment protection and make certain

steps are taken to avoid involuntary redundancies.

• Develop performance management method that provide for the alignment of

organizational and man or woman targets.

• Advice on way of growing employee identification with the organization through rewards
associated with organizational overall performance (profit sharing or benefit sharing).

• Develop process engagement: identification of employees with the activity they are doing
via process design system that aim to create better levels of job satisfaction.

Conclusion
Implementing an organizational restructuring may be a hard and emotionally charged procedure,
but the advantages may be well worth it to our enterprise. A hit restructuring can lead to
improved performance, productiveness, and profitability. It can also help to make clear roles and
obligations within the organisation, enhance communication, and promote innovation. If we are
considering a reorganization to our commercial enterprise, make certain to do our studies and
visit experts to ensure that it is the right decision for our company.

Recommendations

That the Board of Directors receives this report for information.

That the Board of Directors approves the executive manager to restructure the organization with
a human face as responsible restructuring is indicated as the best method since it is a win-win
situation for both the employees and the organization
Organizational restructuring is a technique that calls for a notable deal of alternate management.
It is because of this that communication should come to be one of the cornerstones of a hit
organizational restructuring. Effective communication with employees performs a critical
position in the course of the restructuring period of any enterprise because it helps to well tell the
personnel about the adjustments. This facilitates to dispose of the uncertainty and allay fears
amongst employees and therefore might also overcome any resistance that could result thereof.

Organizational restructuring necessitates modifications within the tradition of the employer as

properly. When greater groups merge, they come into the merger with specific dominant
cultures. The business enterprise cannot function nicely with dominant cultures. One dominant
culture must therefore be adopted for the brand-new enterprise. The way of life that will be
adopted in a merger will rely on the character of the merger. The new business enterprise may
additionally adopt more cultural functions of the larger birthday celebration in the merger or a
combination of all the merging parties as its dominant lifestyle. This process of cultural trade
needs to be controlled very carefully.

Every attempt has to be made to ensure that each one the factors of equity along with agree with,
openness and recognize do exist for the duration of organizational restructuring. Organizational
justice is one of the key considerations in any restructuring procedure, especially whilst task
losses are inevitable. Employees will usually make their own judgments approximately the
fairness of the selections taken for the duration of a restructuring method. Such perceptions do
have severe influences at the behaviour and attitudes of personnel. When employees sense that
they had been not handled fairly, they will sabotage the restructuring procedure and vice versa.
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