Organizational change is important for any business that want to survive and prosper. However, it’s very hard to do a proper transformation of the company. I’ve come to this realization two years ago, when I took over as CEO of a mid-sized company and faced the difficult task of transforming the company.
The company had been established more than twenty years ago, so it’s a long history. The company had achieved some significant achievements in terms of achieving sales, but, unfortunately, they were achieved at the price of their shareholders, because the managers lacked of vision and the ability for making changes. However, I was able to establish effective management processes. The company also had established strong brand management which provided a lot of value to customers. It was also very well positioned economically in comparison to competitors at the same size. In one year, I introduced major organizational changes resulting in a reduction of the number of top managers, a reorganizing of the executive team that brought their expertise to the company, a change of the strategic directions, and a process for strategic planning. I also introduced strategic marketing program, strengthened the brand management activities, and provided various solutions such as cost reduction, better business processes and an increase of human resources. It took me two years to transform the company. I believe that this is an incredible experience for me since I had never considered that I will meet such a challenge.
So, why did out company changed only this much? Why we couldn’t achieve more and became even bigger? From the very very beginning, I had to face the fact that I had no real plan for this company. I could only assume a strategic change. I had to create a new organization that would facilitate me in making the strategic plans, as well as taking care of the organization. As it turned out, the transformation happened slowly. At the beginning of this transformation process, I knew nothing about the internal structure of the company and what the functions of each department were. I had to create a plan that would allow me to identify what each department was carrying out under the leadership of each manager. I had to develop a functional structure that would allow me to plan each department in detail at the beginning and to know what it was and what it was supposed to achieve. Later, I had to identify the organization of the company. I had to develop a structure of the organization, a way to run the organization that would allow me to be aware of all the activities and their purposes. I started the process of building up the internal structure. This was a long-term process; for example, the first two years I thought that there would not be anything special in terms of structure. Later on I realized that I had to structure it in such way that it would allow me to understand what my employees were really doing. In addition, I had to create a way to know which employees were engaged in what department and in what function. I also had to create a functional structure based on employee functions in detail, as well as to allocate each function to each department in the company. The most difficult part of the experience was to identify which were the functions of the company. I had to find out which functions would allow me to achieve my goal and which would not.
When we started the process, I knew nothing about internal structure of the company. It certainly wasn’t a good situation. This was a good beginning; however, the internal structure was created under a very heavy burden because the leaders had no idea about what they were doing and what the company was, as well as what each manager did. It was not possible for me to know the real internal structure and the actual function of each employees in detail. In addition, I had to find out the real purposes of each employee. I had to have a process for making strategic plans. To make a strategic plan, one had to know how the company was organized, what its main functions and business strategies were, the roles of top management and employees in these areas, and the direction of each strategic plan.