Re­struc­tu­ring for suc­cess

Financial reports show when earnings shortfalls have occurred, but deficits can often be identified well in advance during the planning phase. This phase offers a good starting point for fundamental restructuring because this is when the company's cost and revenue structure is subject to intense scrutiny. Based on these insights, ideas for corrective measures should be collected. There should be no taboos: this is the time to identify as many cost and revenue levers as possible.  Afterwards the levers can be assessed and prioritised – e.g. based on their earning effects or strategic fit.

Once the restructuring decision has been made, the project architecture is designed. The following success factors have proved to be important:

• Broad involvement: because such projects typically have far-reaching consequences, all the company’s relevant functions should be involved.
• Project structure: a successful outcome is more likely if there is a clear, committee-based project structure which allows various levels of the hierarchy to be involved and which is able to reach concrete decisions.
• Measuring success: to measure project success, all activities should be linked to their cost and revenue impact, both in budgeted and actual figures.
• Change & training: large-scale change often creates feelings of insecurity – and not just when it is HR-related. It is therefore advisable to offer staff members support throughout the change process, as well appropriate training activities.
• Co-determination: involving the organs of co-determination at an early stage helps ensure broad-based buy-in.

The project should be designed in alignment with these success factors. In the first phase, the activities have to be defined in detail and scheduled in a way that creates transparency about forthcoming steps and their expected impact. In the subsequent implementation phase, the detailed plan is used for monitoring and to identify any required adjustments.

CTcon's approach differs from that of the “classical”, hard restructuring consultants. Bottom-up and top-down go hand in hand:

• A collaborative, partnership-based approach that involves staff members and stakeholders from the start helps ensure successful implementation.
• Closeness to the finance function ensures technical support with implementation monitoring and clear impact delimitation and assessment.
• The sustainability of the changes is anchored through specific training.