One of the main reasons I decided to make Asia my home was the opportunity to help companies and people to grow. We were able to focus on development rather than restructure a company and improve efficiency that was (and still is) the need of the hour in Europe.

Frontier markets in Asia and Africa are all about growth, capturing opportunities, developing people, building organisations and creating value. However this doesn’t mean that people always get it right. More often than not, leaders and companies get it wrong and have to attune their business model in order to survive. In the 8 years of my companies existence I am now on my fourth business model!

Change as they say, is constant and of course this applies as much, if not more, to fast growth environments. As such your ability to restructure and adapt your organisation to these changes circumstances is as important as in other parts of the world.

Over the past 20 years in Asia I have been part of my fair share of organisational restructuring, right sizing and any other euphemism you want to use for organisational change. From this I have distilled the 5 key insights to successfully implement an organisational restructuring in Asia.

1. Don’t Wait

Too often I have seen companies fail because they transformed theme selves too late. As restructuring an organisation is painful and not without risks many CEO’s avoid it for as long as possible. Arguments such as: ‘we got a big assignment coming that will change our fortunes around’, ‘we need to focus on execution over the next few months, ‘we don’t want to create panic with our employees and customers’, ‘there is no way we can deliver with less people’ and ‘we don’t want our best performers to leave’ are constantly used.

As much as all of these might be valid arguments, they aren’t reasons for not making the appropriate changes in your organisation or business model. Companies that got it right, adjust their organisation:

• based on trends that will have an impact on their organisation
• when things are going well and not when ‘water is at the lips’
• and experiment with small scale change, adapt and scale up rapidly

Change for the sake of Change is of course never the right course of action. However Freek Vermeulen, Phanish Puranam and Ranjay Gulati in a HBR article argued that it’s good to sometimes shake up on organisation to stop it from becoming complacent. They developed a simple questionnaire that they dubbed the Corporate Cholesterol Test which quickly assesses whether it is time for your organisation to wake up and do things differently.

2. Structure Follows Strategy

When I speak to leaders that have decided that the company needs to change they often start drawing boxes and reporting lines on a piece of paper, indicating how this person should start reporting to that person, how we should combine this function with that function and we can reduce layers in the organisation. And often they are stunned into silence when I ask them:

Can you explain why you want to make these changes and how do they fit into your ability to develop capabilities that add value to your customers and create long term competitiveness?

Of course step two is to have the clarity to succeed in your market. What is your vision, your aspiration and your strategy in how to get there. When this is crystal clear and your top managers are fully committed to the strategy only then you should talk about how you need to structure yourself to deliver on this strategy AND how much costs (read people) can you afford to achieve your financial numbers.

3. Don’t Hold Back

The third mistake CEO’s make is that they try to get away with the minimum amount of chance necessary to ‘show shareholders that they are taking charge’, ‘not rock the boat’, ‘think tomorrow the future will look brighter’ or don’t want to ‘cut too deep not to lose capabilities in the organisation’. Most of the time these self fulfilling prophecies are fallacies.

I have helped a company restructure its organisation, reduce its manpower by 20% only to come back the next year to make another 15% of the workforce redundant. And only because the CEO didn’t want to take the pain and believed that he would be able to turn the company around.

My advice to all leaders out there is:

When you restructure, do it as deeply as is humanly and financially possible. Don’t hold back, get it right. It is easier to add to a structure then to go for a second round of redundancies.

4. Communicate, Communicate, Communicate

During one of my first HR training course in the early 90’s, we did a case study of a transformation change program at Phillips in the Netherlands. I’m not sure what the restructuring was about, but what I do remember was the fact that the leadership team had taken three months to discuss, debate, argue, design, re-design and come up with a new organisational structure and change agenda. At the agreed date the CEO of the division brought all employees together and announced the plan, what would happen, why and how they wanted to change the company. After a couple of days the CEO noticed that there was still a lot of resistance from the employees. In frustration he exclaimed “Why don’t they get it?!”.

The answer is of course obvious: it’s unrealistic for a team that has worked months and months on a proposal to assume that others, at a more  junior level in the organisation and with more ‘skin in the game’, should ‘get it’ in a few days.

This is the one reason I still like the Dutch Workscouncil concept. It might take longer to discuss, communicate and agree a specific restructuring, but when everybody is on board the implementation is done quickly and with significantly less resistance.

5. Graceful Goodbye

Finally, when you restructure a company, you usually have to face people losing their jobs. Informing people about the individual consequences of job losses is a sensitive, tough but not difficult job. The key word is  ‘dignity’, treat the person and process as you would like want to be treated if the circumstances were reversed. I have covered a number of suggestions on how to do this in one of my previous blogs called: a Graceful goodbye.

Change is never easy which is why change agents are so important. If you expect to face some sort of major change in the near future, make sure your team is aligned through their “soft” and “hard” side. If you haven’t already, download the High Performing Team Spiral to get you started.