I saw this firsthand when a very frustrated executive called me in to assist in an organisation that she considered culturally unstable. Worse, the poor culture was affecting customer service.
As we completed our first-stage analysis, it was clear the company had restructured three times in the past five years. This had been carried out in an attempt to improve business performance.
This uncertain environment had affected customer perception, built a culture of nervousness and mistrust amongst the managers at various organisational levels and, worst of all, had done nothing to address the poor performance of the business.
Our approach to address this was to focus on management processes, not people, and fix the underlying root causes of the business performance that had been frustrating the executives for some time. The result was a stable business that is better servicing its customers and slowly winning back the confidence and trust of its employees.
There will always be situations that demand restructuring the organisation. Wisdom lies in knowing when and how to implement a restructure. When you use restructuring in a strategic way, understanding fully the impact of a restructure on all stakeholders, your chances for a successful outcome increase.