Restructuring? You must take an ethical approach during this crisis

Article By
James Cumming
James Cumming
Posted On9th June 2020
Posted On9th June 2020

On a daily basis I speak to C suite leaders of large corporates. It doesn’t take a data scientist to get that with the government’s furlough scheme soon coming to an end, there is a significant amount of restructuring about to happen.

It will be interesting to see how large businesses react. I hope that businesses will take in to account that this time is different than normal, people have long memories and will remember those that do the right thing and those that don’t.

You can already see from the negative press that a certain airline entrepreneur has had, that this isn’t the same as before.

Business leaders should heed Warren Buffett’s advice “It takes 20 years to build a reputation and five minutes to ruin it.”

In a typical recession, cuts are broad and indiscriminate, this time (from the conversations I have been having), it seems that companies are taking a more nuanced approach.

There are 3 key themes that come up time and time again:


Companies are mindful of the reputational damage associated with how they act during this crisis

Staff are often a significant part of a company’s P&L and are one of the quickest ways to reduce cost. During most recessions, mass redundancies are one of the first things that happen.

Government intervention has paused this for a lot of companies but it hasn’t gone away. Companies need to be mindful of the reasons why they might make redundancies.

If it’s because your levels of business have dropped and you are facing a liquidity crisis – people will understand.

If it’s because the CEO needs to keep profits up to keep the share price stable (and to get a bigger bonus), people will remember this for some time to come and it will have a negative long term impact on business reputation and ultimately performance.


Employees have realised how to get stuff done quickly (and have generally delivered it well)

Business leaders seem surprised at how easily people in operations have delivered things. Actually getting on and doing the job they are paid for… Who would have thought?!

It won’t come as a surprise, that given UK PLCs productivity challenge, that many companies are now reviewing their management structures with a view of having the right business people in the most effective roles.

In my view there is going to be a significant need for organisation design, change professionals and management consultancies to help businesses come out of this crisis in the right shape.

The common themes are to work out the most efficient structures, to define what job roles the organisation might need in a future state and to ensure that technology is adopted.


Communication and engagement has never been so important

Transparency is going to be key as we come out of this.

If your company is in trouble, I would suggest telling people the truth. People are well aware of the magnitude of what is going on around them, they might not like some of the business decisions that are made but they won’t appreciate being lied to.

Honesty brings people together around a shared cause or purpose. The more engaged and knowledgable people feel, the better their ability to understand and support decisions being made.

Remember, a few months ago that ‘Talent’ was in short supply and although the fundamentals may have changed in the short term. People will remember how their leaders have acted and how they have made them feel during a crisis. The best people will leave when things get better if they haven’t been treated in the right way.


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James Cumming is our Interim and Transformation Search specialist. Please get in contact with him directly to discuss any of these topics further.

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