ORGANIZATIONAL RESTRUCTURING

Phuoc D. Nguyen

Dubrovski (2005) defines “Restructuring is one of the methods of revolutionary changes and a way to achieve renewal of the corporation as a result of strategic alliances.” (p. 77). Organizational restructuring is an organizational process that improves operational efficiency, competitiveness, and adaptability to new contexts, requiring changes in management, strategy, and organizational structure.

Ravanfar (2015) analyzes organizational structure based on the 7s Model of McKinsey. He provides the following steps that should help you to apply this model: Identify the areas that are not effectively aligned; determine the optimal organization design; decide where and what changes should be made; make the necessary changes; continuously review the 7s: The seven elements: strategy, structure, systems, skills, staff, style and values are dynamic and change constantly. A change in one element always has effects on the other elements and requires implementing the new organizational design. Thus, continuous review of each area is very important. Reviewing and re-establishing the strategy: Based on re-evaluating performance and reviewing the organizational performance. It is necessary to redefine the vision, mission, and strategic goals to help move in the right direction, by the existing resources and operating environment of the organization.

Singh (2013) proposes “A transformational leader’s role has been aligned with the 7 elements of the model: strategy, structure, systems, shared values, style, and staff and skills for solving organizational communication problems, improving interpersonal relationships and achieving organizational excellence.” (pp. 43-44). Formulation of strategic implementation structures – building and structuring appropriate structures to realize the vision and strategic objectives set; documenting the coordination between departments and divisions to organize effective operations; defining the functions and tasks of each department and division to see the responsibilities and authorities in the performance of work and working procedures. Additionally, building the organizational foundation – building a human resource management system that enhances the internal strength of the organization and the capacity of the staff; developing culture and creating a professional working environment; developing leadership capacity to lead the organization successfully. Therefore, organizational restructuring must be linked to the strategy of the organization. When there is no clear strategy, the restructuring will be disoriented and performance problems will not be resolved.