APPENDIX D - "When the Dust Settles"

When the Dust Settles
Managing the survivors of major organizational change
By Richard Korn, January 1988

Managing the survivors of the recent wave of organizational restructurings poses one of the most difficult challenges facing the human resources community. The experience of having gone through a major organizational upheaval frequently creates in remaining employees new perceptions about their organizations and careers. These new frames of reference must be recognized and understood if the survivors are to be integrated productively into the new organization.

Stated simply, once the dust has settled - i.e., after the merger/acquisition, spin-off/restructuring has been completed, the new organization structure has been announced and the players are in place - it is dangerous to assume survivors are "on board" and unchanged by the disruption. The changes often leave pronounced and lingering effects. Human resources managers will be expected to understand these effects and develop appropriate action plans for the management team.

What is may not be for long

Many survivors are likely to feel great uncertainty and lack confidence in the ability of the new organization to retain its existing form over the long term. If a major change occurred once, it can happen again.

Being acquired, spun-off or restructured can create the feeling of "moving ground" as familiar faces disappear, cultural expectations undergo change, and there is a lack of organizational history and predictability. The effects of this experience do not disappear simply because top management issues internal memoranda and public statements announcing "refocused strategic objectives." For a survivor experiencing increased skepticism about the continuities of organizational life, today's "refocused strategic objectives" may be seen as the reasons for tomorrow's reorganization.

Loyalty to whom?

There has been much discussion in recent years about the decline in corporate loyalty. Some have attributed this decline to the "me" generation of the 1980's where the attitude is "I do what's best for me and look out for number one." It can be argued, however, that this declining loyalty also may result from the perception that mutual obligations and commitments underlying the concept have been breached by organizations.

Survivors are ripe for this line of reasoning and the temptations offered for making a move. The departure of colleagues and the demise of the organization as one knew it are likely to create the perception that the company has failed to live up to its end of the deal (i.e., being there, being fair and being somewhat predictable).

Is this what I want to be doing?

Some survivors are likely to go through a period of introspection in which they question previously unchallenged assumptions about their careers and personal priorities. This is most likely to occur when the organizational change has been accompanied by widespread personnel reductions and an atmosphere of waiting for the other shoe to drop.

The human resources manager of a company that went through three rounds of painful, far-reaching layoffs before being spun off by its parent company provided a vivid example. A highly regarded manager who survived the changes walked into the human resource manager's office and resigned. When she asked which company he was joining, he said he did not have another position. His reason for leaving: there was just too much carnage and he just did not want to be around it anymore.

Individuals who believe they have options outside the corporation may begin to pursue these in earnest after the dust settles. Survival is fine, the reasoning goes, but getting more control of one's fate is even better.

Implications for management

Senior managers in the newly created organizations can take a number of actions to minimize these effects and to secure greater commitment from the survivors.

Recognize the Existence of the New Perceptions: Acknowledging that survivors may be experiencing some of these effects is smart management, not soft management. It is essential to accept these perceptions as an element of the new reality, to respond to them concretely and not to judge them.

Be Visible and Communicate: The best way for senior management to provide stability and reduce the "moving ground" feeling are to be visible, to listen to what is on employees' minds, and to communicate - make that over communicate - about the business. This can be carried out on a one-to-one, informal basis and in more structured formal sessions. Senior managers should seize every opportunity to talk about the directions the company is taking and the state of the business.

One caveat should be noted here: The easy way to communicate with employees is through memos, newsletters and bulletins about company performance. This is fine, but it is not enough. Commitment among survivors will not be built in this impersonal and bureaucratic way.

Survivors may be skeptical of a top management style characterized by distance from the concerns and experiences of the employees on the front lines. In return for their commitment, they will want to feel connected to visible and responsible decision makers.

Create a Sense of Purpose: It is axiomatic that employees want to see connections between what they do and their company's overall game plan. This need is likely to be felt even more strongly by survivors. The sense of drifting does not disappear entirely when the dust settles. Senior managers must refocus energies quickly by explicitly translating the company's strategy and purpose into objectives for individual work units.

Nourish In-House Talent: The desire felt by many survivors to exert more control over their careers can be met through the creation of internal opportunities. In particular, intrapreneurship and career development planning should be pursued.

The care and feeding of intrapreneurial ventures can provide an excellent vehicle to harness restless creative talent. Companies should not make an intrapreneur out of anyone who thinks it sounds like fun. Rather, the idea is to create an environment in which the proposal of new ideas is encouraged, the treatment they receive is respectful and the willingness to invest in the best ones is real.

Commitment to effective career planning programs can help to create a sense of direction for survivors. The fact that the new organization is frequently leaner and flatter than its predecessor does not preclude professional development and career progress. In fact, leaner and flatter organizations frequently bring with them expanded jobs for some survivors. The point is that paying attention to career planning can have a significant payoff if some of the most marketable survivors being to feel that the grass is not necessarily greener elsewhere.

There are significant challenges facing human resources and line managers in their efforts to integrate survivors. Successfully meeting these challenges can go a long way toward the creation of organizations that survive and thrive in these turbulent times.