Global technology group

Even the start of the restructuring program proved difficult, as none of the board members wanted to take the lead on the program and its announcement. Finally, the CFO, with extensive coaching, announced the program at an employee meeting at the company's headquarters, which was broadcast to all locations.

The need for a comprehensive restructuring was highlighted and the key points were communicated to set the “tone” for the program from the outset: A focus on one technology, savings of one billion euros and a reduction of 17,000 employees within 12 months. It was pointed out that, for legal reasons alone, no further information could be provided until negotiations with the works councils had been concluded.

As the previous restructuring programs were implemented in a socially responsible manner, the announcement was received relatively calmly despite the key points communicated.

Intermediate step: Governance

As it became apparent in the first few weeks that the Executive Board was struggling to drive forward the upcoming program as a task, new governance was established a few weeks after the start of the program. Among other things, the management of the restructuring program was assigned to a Global Restructuring Board consisting of the CEO, the CFO and a newly appointed CRO.

The workstreams and projects then carried out detailed analyses to identify potential and plan measures. Bottom-up analyses were used to ensure a high level of planning security for the implementation phase, to be well prepared for the upcoming negotiations with the works councils and to be able to argue the necessity of the respective measures in subsequent communication with managers and employees.

Attention was paid in two respects to the effect of the measures. Together with the change management team, consideration was given to how critical measures could be implemented as prudently as possible (e.g. local change management measures for site closures). On the other hand, targeted measures were also put in place to convey a sense of urgency. Where possible, rather than initiating individual measures, Group-wide standards were defined (and consistently enforced) in order to treat all managers and employees equally.

During this period, no further information was shared outside the program team. Once the program had been developed, negotiated with the works councils and agreed, supplementary bonus agreements were concluded with management and the program managers.

The first and second management levels - most of whom were already involved in parts of the program - were then informed about the details of the restructuring program in a workshop.

To prevent rumours and speculation, the company's key stakeholders were then informed about the key points of the program on the basis of a detailed communication plan and stakeholder-specific documents. Employees were informed at staff meetings using a change story based on the content of the announcement presentation.

The country-, location-, division- and department-specific measures were then explained in cascading workshops along the company's management structures. At the same time, managers and employees were asked to develop their own ideas for further measures in line with the above maxims and to implement them independently in their areas. These workshops were set up by the change management team with a train-the-trainer concept.

The program met with resistance for the first time during the local implementation of the measures. Employees, but even more so middle-level managers, questioned the adopted measures, sometimes aggressively.

Others tried to circumvent measures. In this phase, the governance and good preparation in the diagnosis and design phases paid off: as the measures were planned in detail and their implementation was tracked in detail, measures that were behind schedule were identified immediately and the project managers were asked to explain this delay at the next regular meeting.

Objections were investigated and discussed bilaterally with the project managers and, if necessary, in a larger group at the next regular meeting. These discussions were generally conducted by the program team in a forward-looking manner. The majority of objections turned out to be unfounded.

The communicated maxims of discipline, responsibility and results orientation were exemplified by the chosen program approach and the actions of the Global Restructuring Board. After a few months, it was clear to the company's managers that justified objections would be taken into account, but unjustified objections would be rejected.

Word of this also spread among employees and approval of the project grew continuously - also due to the increasing number of success stories that were regularly communicated.

On the “hard” side, not only the company's financial indicators were closely monitored and discussed on a monthly basis, but also the underlying operational indicators (e.g. number of locations and floor space as drivers of real estate costs).

On the “soft” side, approval of the transformation program (support for direction and change) - in addition to other indicators and open questions - was recorded as a key change management indicator in regular pulse checks and discussed monthly in the program's regular meetings.