The Restructure Gap: Why Most Redesigns Fail Employees

Organisational restructures with the goal of better performance occur frequently across businesses. Firms restructure reporting lines and rejig managerial positions in the hope of better business results.

However, a study by Bain & Company indicates that many employees do not share the optimism that their leaders have in their plans.

According to the research, 88% of leaders believe that redesigns will meet all expectations, yet only 36% of people working in the new structures believe that to be true.

Bain identifies this disconnect as the reason why so many of these restructures do not work, and this is becoming an increasingly important issue as organisations change their operating models around the development of gen AI.

The consulting firm's survey of nearly 1,000 global executives and employees who have undergone these changes suggests that making the shift work requires new habits and new ways of working.

Common errors in organisational redesigns

Bain outlines that most redesigns fail due to simple reasons. This includes believing that changing organisational boxes and restructuring reporting lines is enough.

The research recognises that most leaders tend to overemphasise the redesign of the organisation itself and short-change planning for the transition to the model.

This could mean that people are left unaware of how they will work differently within the new framework.

The study reveals that leaders have concerns that their people will resist the redesign because they lack a clear handle on the change to their work, and how this works alongside others.

Bain recognises that while top leaders design reorganisations, middle managers have to execute the changes.

According to the research, leaders identified confusion about interdependencies and handoffs as the greatest risk to success (31% of respondents), while 37% of middle managers say resistance to change is the top concern.

The study also reveals that more than 80% of leaders believe they effectively communicate, train and support those impacted by a reorganisation, but only 57% of middle managers agree.

Even when leaders effectively convey key structural changes and implementation milestones, Bain says workers are left confused.

The 20/200/2000 framework

Bain says that the way to achieve the redesigns is to "live the model", which it says will "mobilise the entire leadership spine". The model is called the 20/200/2000 team, focusing on different layers of power.

The framework identifies the "20" as the senior leaders who design and sponsor the new operating model. These executives set the strategic direction and provide high-level oversight of the transformation.

The "200" represents middle managers who redefine key workflows and help new routines take root. This group serves as the critical bridge between strategic vision and day-to-day execution.

The "2000" refers to employees - or most likely more - whose day-to-day behaviours must shift. This largest group must understand not just what is changing, but how to succeed within the new structure.

This framework outlines where time and support is needed to ensure the whole organisation adapts to the changes. By recognising these distinct layers, leaders can better target their communication and resources.

Gaps in resource allocation

The survey results recognise that this resource allocation is not currently being achieved correctly across companies.

According to the findings, nearly 90% of leaders believe the change process was well organised, while less than one-third of employees agree.

The "200" middle managers have much less confidence in employees' understanding of their new roles and decision right than the "20" leaders have.

From the employee perspective, the "2000" generally understand what is changing, but not how to succeed in the new model.

Bain says this group is not necessarily resisting change, but they're signalling where they need help - with only 22% saying they receive enough support in training, coaching and tools.

According to Bain, structural changes can only succeed with genuine commitment from middle managers, so leaders must support them with clarity and practical tools as the best investment to ensure the redesign actually works.