Triggering a full reorganization

How often do you stir things up in your company? I was turn to this topic by a conversation I had about operational efficiency. I was thinking about how often you should look at what you are doing and look for ways to improve it. If you go by the Kaizen methodology, then you are doing this constantly... this works great for small changes but not for big ones. Full-on reorganizations can be triggered by traumatic events but the price you pay in organizational stress is great.
I recommend you are always on Kaizen mode; it is a great way to do business and life in general. But, how do you decide is the right time to do a full-on reorganization? The conditions I think could trigger a full reorganization are:

• Financial results are not there for 3 quarters or more. You are underperforming and it is not the result of a disaster, and the recovery trend is not there.
• You tried incremental enhancements and they are not having enough impact.
• Your key decision processes are convoluted or ineffective.
• Key players leave or arrive into your organization (for example, after a merger or acquisition).
• Your market conditions have changed dramatically (new and strong competitors; new business models)

These are a few of the conditions; your individual reasons may vary and add to this list. If you decide that a reorganization is in order, just be careful to fix the issues with a holistic approach.

Too many priorities

When setting priorities people are usually overoptimistic about what they can realistically accomplish. We see individuals trying to do everything at once: lose weight, exercise, eat healthier, be a better spouse, dedicate more time to the children, fix the house, reinvigorate their careers, build a better network. The reality is that you can’t do everything at once. If everything is a priority; then, nothing is a priority.

Companies don’t fare better than individuals. The illusion is that 100 employees should be able to handle 100 priorities. But companies have to understand that the average employee probably can’t handle more than 3 priorities at a time.

The impact on a business is that employees can’t find optimal solutions to problems that satisfy all priorities: should they be focusing on client experience or on cost management? Product innovation or bug eradication? This in turn can create paralysis in an organization while the decisions makers figure out which one is the most important priority.

Another side effect is that the company makes it impossible to do something that would please everybody. If they execute something thinking of customer experience, then somebody complains about cost management. Thus the actions of employees are based not on the priority but on who they do not want to anger.

The way around this problem is simple: first figure out what the top priorities are, then execute on them. Everything else doesn’t get a pass.