Reorg

We’ve all been there. Reorg. That period where a lot of loud voices are raised. Where emotions flow. Where CVs are polished, and letters of resignation are written. Where opportunities appear, and redundancies are made. Where friends become enemies, and enemies become friends. For some companies it’s an annual thing. Some years there’re actually multiple reorgs. Of course, the scope and severity of a reorg can be very small, like a department or business area. And sometimes they are corporate wide. And severe.

First wave

I had been spared the pain of reorg for a very long time. Sure, there had been several reorgs in other branch offices within the organization. But back then, in the Swedish branch which was my entire scope of caring, we were closing in on a decade of having the same CEO, and basically the same management team. It was very stable. Very predictable. Very bland. Sure, it gave me a sense of safety, and I took the opportunity of developing other interest, outside of the lovely world of IT that is. I experimented in different diets and training regimes. I had things running very smoothly work-wise. But it was boring. I had to make up tasks for myself. That was about to change. Suddenly out of nowhere (but in hindsight I should have seen it coming), our CEO announced his retirement. The whole company was shaken at its core. I asked my manager at the time what would happen now. I pleaded him to tell me. After a while he caved and told me what he knew. “The old CEO had nominated the sales manager as his successor”. I thought it was a joke, so I giggled, but my manager looked at me seriously and my giggle stopped. “Are you gonna stay?” I asked him. “Yes. And who knows, it may turn out to be a good thing! At least something will happen!” I had my doubts. At least about things turning out good. Sure enough, the sales manager was announced as the new CEO for the Swedish branch. And within months the old management team had left the company. I later asked the previous CEO, over dinner, why on earth he’d nominated the sales manager. “It was the diplomatic choice”, was his answer. Note to self, if I ever get to nominate a CEO, don’t make the diplomatic choice.

Second wave

Anyway, soon, as predicted, the first reorg came. It was launched not as a reorg (I guess you avoid that word as much as possible), but more of a tuning of the already anchored client Teams. The essence of the tuning was to make the already established client teams into financial entities, cementing hire/fire and profit & loss within each Team. So Client Teams became just Teams. So, we now had 8 “Team Directors” reporting directly to the new CEO. And soon I had 8 Team Directors demanding I delivered IT in a way that suited their individual needs. Since the teams, in a sense, was autonomous little companies, I suggested to the CEO that we also establish an IT department per Team. And an HR department. And a Finance department while we’re at it. He of course disregarded my suggestion. I tried to make it work. But it didn’t work. My boss, being the CFO, was in the same situation as me, the Team Directors demanding reports to be made custom for them individually, demanding their own solutions and routines for time logging, staffing and other admin processes. He was even closer to the battle zone, I manly pouted over at my end. He was in pain. I was mainly pissed. At one point there were 25 people in the management team. 25 out of 150 in the Swedish branch. Anyone who wanted was welcome to become management basically. Imagine reaching any decisions with 25 fucking people in the room? Anyways, my boss the CFO finally threw in the towel. He resigned, and I went into soul searching mode, trying to decide if also I should abandon ship or stay and fight. I realized there would be no filter between my cozy little IT department and the insanity of the Team Directors since my boss was gone, and I was scared. But since there were new top managers in the Holding company, and they had already proven they were ready to take action, I decided to stay. And fight. But I didn’t have to fight so hard, regarding IT in the Swedish branch at least, since the Team Directors and the CEO had bigger problems on their hands. When my boss had quit, he could talk freely. He agreed that it was not a good reorg. Having eight small popes with no one to keep them in check (the CEO was unable to handle confrontation, not a good quality in a CEO) but a bottom line to deliver on, things became ugly competitive amongst them. The Team Directors kept good staff for themselves, even though they were not assigned on any projects. “I cannot let him/her go to another team, I may have a project for him/her in a couple of months”. Meanwhile, other Teams were unable to deliver since they had no available resources. The employees, having been put on the bench for months on end, quit en masse. The ones not satisfied with their team and/or assignments were not allowed to switch teams. “It’s easier switching companies than teams”. So most of them switched companies. It was a disaster. In a year the result took a dive bigger than ever experienced before, including the global financial crisis of ‘08. The CEO tried, without success, to hire a COO who could rule over all the Team Directors. He tried anything but confronting the TDs and putting his foot down, making them understand they worked for his company, not running their own little companies. I think he might have gotten some traction towards the end. Possibly because the Directors realized that they had to agree and start cooperating with each other if there were gonna be any company left to squabble about. But It was all too little too late. The Team Director for the most important team (the one bringing in the most dough) left for a competitor and brought the whole team with him. That was the final nail in the coffin, and the Holding CEO finally sent a couple of goons management consultants to “support the CEO”. They were not sent to help him, they were there to remove him. It should have been done at least 6 months earlier in my opinion. Shortly thereafter we found ourselves with a new interim CEO, one of the hit men management consultants. He was proclaimed interim CEO, actually having the word interim printed on his business card. Not great for morale. Not great for stability. But I had a mission with the datacenter consolidation project, so I no longer cared too much about what was happening in the Swedish branch. However, others did.

The third wave

The interim CEO was a combination of Gordon Gecko (he actually referred to Wall Street all the time giving quotes from the movie, possibly as a joke on his own expense, but also, possibly, because he prided himself on the comparison), and John Wayne. He spent most of his time bragging about having been a fighter pilot in his youth and turning around some company in Gothenburg a couple of years ago. Not exactly inspiring leadership to the average digital agency consultant living in central metropolitan Stockholm and identifying as a hipster.

That’s unfair of me. The interim CEO didn’t just go around being a dick, he actually took the bull by its horns and tried to clean up the mess his predecessor had made. He was a man of action and boy did we see action! He just went on tirelessly for 2 months, poking into every corner, turning each stone, looking for a buck to save. When the cut-backs were done (there were no redundancies made, that had sorted itself out) we were left understaffed and unable to deliver on our client agreements. To make things worse, the interim CEO, as his second executive action, had put all recruitment on freeze. So we were understaffed (and the employees that had stayed was not always the crop of the cream to begin with but certainly low on morale at this point) and having to cancel a whole lot of clients, we faced, you guessed it, a reorg. I mentioned his second action, the recruitment freeze (in our line of business, having a big personnel turnover, being off the market for a couple of months is devastating, all warm leads for candidates turning cold and actually having to start over from scratch. I think this was his second biggest mistake). His first, and most severe action was consolidating the Teams into Studios, making 3 out of 6 Team Directors redundant. That decision was actually taken before the old CEO had been removed, so it was communicated through him. You could plainly see the Gordon Gecko ventriloquist behind the curtain though. It was tragicomic to witness. So, the final shred of stability left, the safe harbor of the Teams (in a financial sense, the Team structure was a disaster, but to be fair the Team had provided a safe caring family environment for the employees, and to many they didn’t even know there was a company outside the Team. They knew only about the Team.) was torn out by the roots. Everyone was to switch places and familiarize themselves with their new managers and underlings. It failed miserably, and the few good employees still with us left. In my opinion, tearing up the Team structure was the right thing to do. Either that or unbundle them into separate companies. But to tear them up and consolidate them into larger teams was just the worst option of all. The disfunction and protectionism remained, and none of the thought-out benefits (I don’t even remember what the official reason was) appeared. So people left. Again. And we had no one to replace them with. The “Studio Directors” tried their best to maintain morale and inject some sort of enthusiasm about the future. But it was doomed. The new organization and management team were actually referred to as “temporary”, so why the hell should anybody bother doing anything except for circulating their CVs? Darkness.

Forth wave

I asked the interim CEO why he had not gone all the way and truly removed the Team structure instead of just consolidating them into another, even worse studio structure. “I have to leave some reorg for my successor” was his answer. Regarding his second action, freezing recruitment, he admitted that wasn’t smart move. I’d say the Swedish branch is still suffering from that, almost a year later. A cold winter day, the successor finally showed up, 6 months after the interim CEO had entered the stage. The new (and current) CEO proclaimed there would be no more reorgs. “Focus right now is stability”. “What, we’re stuck with this Studio crap?” was my reaction. Well, I didn’t tell it to her face, a lot of others did however. And 6 months into service, she pulled me into a room and draw an orgchart on the whiteboard, describing the new organization. I was relieved. The Studios was finally going to be dragged behind the shack. I longed to hear the sweet sound of shots fired.

Conclusion

So now the Swedish branch is in the middle of a reorg. Again. The fourth in three years. I don’t have any predictions on how it will play out. And to be fair, there are not many left here to remember the previous 3 reorgs, so to most of us this probably is not a big deal. Gun to head, if I had to give a prediction, I’m leaning towards a positive outcome. I have a good feeling about the new Swedish branch CEO. I think she’ll turn this around. Let’s also hope she sticks around, since I believe it’s not as important how you organize, as long as the leadership is long-term, strong and communicative.
Time will tell. I’d like to end with a quote from Jeff Bezos regarding the, in his words, inevitable future downfall of the Amazon empire: “If we start to focus on ourselves, instead of focusing on our customers, that will be the beginning of the end. We have to try and delay that day for as long as possible.”

The personal experiences, viewpoints and opinions expressed in this blog post are my own and in no way represent those of the company.