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Reorganization · Organizational Redesign

Reorganization

📂Leadership & Organization⏱2 min read📊Advanced🔗8 related

What is reorganization?

In one line
Redrawing departments, reporting lines, roles, and authority to fit changes in strategy and the business environment. The announcement and settling-in phases decide success more than the design does.
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⚡ Summary in 3 lines
  • Reorganization in three phases: design, announcement, settling in
  • Draw decision rights before department boxes
  • Tell those affected one-on-one, before the company-wide announcement

If you think of reorganization as moving boxes on an org chart, the work looks finished on announcement day. For employees, though, the reorganization starts that day, because the boss they report to, the colleagues they work with, and the criteria they are evaluated on all change. In practice, a reorganization should be viewed as three phases: design, announcement, and settling in, and most problems arise not in design but in the last two phases.

Design starts with one sentence: what problem is this reorganization meant to solve? Describe the problem concretely, such as slow decisions or customer contact points that are split across teams, then work out whether the cause is structure, people, or process. If it really is structure, map who decides what before you draw the department layout. The right span of control depends on the type of work, but once a manager has more than about 7 to 10 direct reports, one-on-ones and evaluations tend to become a formality. Concurrent roles and dual reporting lines cause the most confusion after a reorganization, so put their duration and authority in writing.

Order and speed matter in the announcement. Tell anyone whose position changes or who is giving up a title one-on-one, before the company-wide announcement. The announcement itself should cover why the reorganization is happening, what changes, what doesn't, and where people can take their questions. In the settling-in phase, use a checklist to confirm work handovers, approval lines and system permissions, and the transfer of in-progress goals and evaluation criteria, then review again at 30 and 90 days.

Reorganizations tend to go wrong when they try to solve a people problem with structure. If one leader’s capability or a conflict between two department heads is papered over with an org chart change, the problem simply moves to the new department. Frequent reorganizations are costly too. If you change the structure again before it has settled, employees stop moving, thinking “it’ll just change again anyway.” Also, transfers, job changes, or changes in working conditions that come with a reorganization can raise legal issues, so check your work rules, collective agreement, and relevant laws with your HR and labor staff in advance.

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💡 In plain English
Drawing a new floor plan doesn't finish a move. A reorganization isn't done until the boxes are unpacked and the water and electricity are connected, so people can actually live there.
Why it matters in practice
Year-end is when companies draft and announce reorganization plans to match next year's business plan and executive appointments. Many managers are looking for the right announcement sequence and ways to reduce confusion afterward.
Origin and sources

The idea that an organization's structure must be redrawn to fit its strategy and environment has long been a theme in organization design in management studies. The term reorganization itself has no particular originator. It became a working term through companies' regular personnel cycles and business planning.

Source · Organization design discussions and corporate HR practice
An example

Consider a hypothetical case. Company A, an industrial equipment maker with 520 employees, plans to replace its 3 product-based business units with 2 divisions organized by customer industry. In its reorganization two years ago, 6 team leaders learned about their moves only on the day of the company-wide announcement, and rejected approvals tripled for three months.

  1. The head of business administration writes the purpose of the reorganization in one sentence: "Eliminate the problem of three sales reps visiting the same customer." The team draws the decision-rights chart before the org chart.
  2. The HR manager calculates how many people each manager will lead in the new structure. Two teams would grow to 14 people, so they are split into sub-teams, and each of the three dual-role assignments gets a written 6-month term.
  3. Starting three days before the announcement, division heads meet one by one with the 11 people whose roles are changing. One team leader asks, "Who will evaluate me?" and the division head hands over the transfer criteria in writing.
  4. The company-wide announcement is organized as '5 things that change, 4 things that don't'. Once a question channel opens, 73 questions come in the first week, and HR posts answers within 24 hours.
  5. On day one of implementation, 38 approval lines and system permissions are checked against a checklist. The 126 goals in progress are handed to the new team leaders along with handover meetings.
  6. At the 30-day check, rejected approvals are only 1.2 times the usual level, and at the 90-day check, customers visited by more than one rep drop from 41 to 6. Two of the three concurrent roles are resolved on schedule.
Related terms
Matrix Organization · Organizational Structure TypesAn organizational form in which employees belong to both a functional department and a project or product line at the same time, reporting to two managers.Change ManagementSystematically guiding the people side of change so that a new strategy, system, or culture takes hold in the organization without resistance.Span of ControlThe number of employees a single manager directly manages. It determines how many layers an organization has and how heavy the management load is.Personnel Orders · Transfers and SecondmentsActions that change an employee’s duties, workplace, or affiliation. A transfer within the same company and a secondment to another legal entity have different requirements.Kotter’s 8 Steps of Change ManagementA classic change management framework that lays out eight steps to follow in order, from creating a sense of urgency to anchoring change in the culture, to make large-scale change succeed.Town Hall MeetingAn open meeting where executives share the company’s status with all employees at once and take questions freely.Job Grade Restructuring · Simplifying Grades and Unifying TitlesAn HR reform that reduces multi-step grades (staff, assistant manager, manager, deputy general manager, general manager) and unifies titles. Grade, position, role, and title must be designed separately for pay and promotion systems to move together.Team Stabilization After a Leader Change · A New Team Leader’s First 90 DaysA transition process covering roughly the first three months after a team leader changes, in which the new leader gets to know the team and earns trust, preventing attrition and performance gaps caused by the break with the predecessor.
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Last updated 14 Oct 2026 · Reviewed by John Kim

FAQ

The standard order is to tell the affected person one-on-one first, then their department, and the whole company last. Never let someone learn their own news from the announcement.
When the organization changes mid-period, it’s common to collect the previous leader’s evaluation comments in writing and pass them to the new leader. Whether goals stay or change, and who holds evaluation authority, should be communicated in writing together with the reorganization announcement.
There’s no fixed answer, but a new structure usually takes six months or more to settle in. Changing it again before it has taken hold teaches employees not to follow the change, so it’s better to handle minor adjustments and structural changes separately.
The legitimacy of transfers and job changes, and whether working conditions are being altered, can become issues. Because each case is different, it’s safest to check your work rules and collective agreement and get guidance from the Ministry of Employment and Labor or review by a labor law specialist.