Corporate restructuring for effectively dealing with financial insecurity and modifying company’s structure Corporations are continuously faced with the need to update technologies, redesign financial processes and restructure organizations, complex supply chains and operations. It involves the activities that could be related to changes in corporate control, assets and expansion or contraction of the organization’s operations. It is basically performed when the firm is facing financial insecurity and is in significant need to modify its structure. The main objective of the corporate restructuring is reorganizing the entire structure of a firm in order to increase the profit levels and clients base. It deals with the elements that enhance the effectiveness and performance of any business entity. As a result of the increase in span of control, cost cutting and job eliminations, most corporate teams are under-staffed and don’t have the expertise to design and manage restructuring. It is important when doing this that they find resources who have the appropriate project planning and management experience in similar sized businesses who can bring best practices and the appropriate tools to the project. Group50, a leading consulting firm has a core group of corporate restructuring consultants. Their team is expert in corporate finance, restructuring and process re-engineering who specialize in working with companies on major projects. Their members have strong backgrounds with Fortune 1000 companies such as AT&T, Citicorp, GE, Black & Decker, Jarden, United Technologies, Pirelli S.P., P&G, Transfreight, Sunbeam and many others. They have planned and executed projects in various areas such as financial restructuring, mergers and acquisitions and process re-engineering, organization re-design among others. Primary types of corporate restructuring: Financial restructuring
The root cause for this is poor operational performance and the reality that the management has not responded quickly enough to changing business dynamics. Often, a cost takeout or reduction is required in financial restructuring. In response to perceived weaknesses in the business, senior management calls out for a restructure. Operational restructuring Operational restructuring brings a significant impact on the stakeholders in the business as well as the business processes. In this, all the strategic and operational gaps are identified and the issues in company’s culture are addressed. This restructuring program specifically focuses on operations, overhead and IT. Restructuring consultants focuses on the interrelationship between people and processes as well as creates the change management plan. Factors that companies must pay attention to after corporate restructuring process: Alleviate the concerns about job certainty among workforce Downsizing due to corporate restructuring affects the remaining employees and creates a sense of job uncertainty in them. They fear that their job may be next on the chopping block. the company’s management needs to clear this and alleviate such concerns at the earliest so that the workforce can work efficiently. Restore the business confidence Amidst the ongoing viability within the company, the workforce confidence may be low. The managers should conduct meetings from time to time and invite the employees in the discussion related to business outlook and the steps being taken for the improvement of business position. Technological revolution In this digital age, companies need to adopt information technology methods and tools to meet the changing needs of market. This may need them to modify their existing work processes and adopt newer technological innovations. This technological revolution will enable organizations to add value to their business processes and utilize their optimum potential. Change in government policies With the change in fiscal and government policies, companies may need to follow all these statutory and legal policies. For adapting their structures and processes in coordination to all these changed policies, companies have to pursue corporate restructuring.
For dealing with all the complexities of corporate restructuring, consult a renowned consulting firm. They can put a team of corporate finance and project management experts in place to support your biggest projects, or to resolve some of your thorniest issues. To have more information on all the needs and leveraging benefits of corporate restructuring, talk to an expert at Group50.
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