4
Poorly managed restructuring can have a long-term negative
effect on staff & weaken competitiveness
POTENTIAL AT A GLANCE NEGATIVE IMPACTS OF RESTRUCTURING
During restructuring, many
companies are mainly focusing on
the dismissals of employees.
Understanding the implications on
the remaining workforce and
providing support measures, is
often not a priority.
Large job reduction programs are
disruptive and can be traumatic for
employees. Therefore it is
important how the restructuring is
managed. This implies providing
adequate support measures for
those who stay on.
Firms need to keep in mind that
employees’ perception shapes
the restructuring outcome. It is
more likely that measures are
successful if the employees accept
and are fully committed towards
them.
Restructuring,
downsizing and
reorganization of firms
is an unavoidable part.
“30% of employees in the
EU report that
restructuring has had
taken place at their
organization in the
preceding three years.” [1]
Potential negative effects of restructuring:
Lower levels of
job satisfaction
Brand image,
sales decrease
Uncertainty among
stakeholders (clients,
suppliers)
Internal view
External view
Higher stress levels
& increased
health issues
Loss of talent and
key players
Bad press, criticism
by politics & society
[1] ERM report 2018: European Working Conditions Survey 2015
Source: goetzpartners, ERM report 2018