31. Why Reorgs Don't Work
It’s reorg season…again. And for many companies, it always is. Every 12 to 18 months, another wave of layoffs, leadership swaps, and org chart redraws rolls through the system. And yet, little changes. Strategy stalls. Trust erodes. Work doesn’t get better, just messier. So why do so many organizations keep reaching for the reorg lever first?
This week, Rodney and Sam unpack the seductive logic (and systemic failure) of reorgs as a change strategy. They dig into why structure work always feels like the fastest, most visible move a leader can make and why it so rarely delivers. Along the way, they explore the very real fallout of these moves on culture, trust, and performance, and offer smarter starting points for those considering a shake-up.
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Mentioned references:
The Ready's OS Canvas
"16% of reorgs deliver the expected value"
Sunshine, Twilight, and Midnight Zones: The Ready's Depthfinding
"layoffs episode": Brave New Work Ep. 152
Team Topologies, 2019 book by Matthew Skelton and Manuel Pais
holacracy
sociocracy
"retention increase if you have a best friend at work"
"new job is one of the most stressful life events": Holmes and Rahe stress scale, see combined score of “dismissal from work”, “change to different line of work”, and “Change in responsibilities at work”
DAO Miniseries
"Jeff Williams departure"
"value flow mapping"
Haier and micro-enterprises
00:00 Intro + Check-In: What feature is really important in your living space?
03:27 The Pattern: Orgs trapped in a cycle of endless reorgs
05:15 The fastest, most visible sign of change a CEO can show to a board or investors
09:55 Structure work should always come last, but most people do it first
12:22 Reorgs to hit a number come at the expense of workflow, culture, and strategy
19:07 Stop changing the structure without touching the ways of working
22:19 Fundamental components of structure work
25:14 How The Ready approached it’s own reorg
26:34 Fallout of bad reorgs on your team and culture
31:17 Companies underestimate the stress of reorgs on individuals
34:40 Hot takes: org structure in the age of AI; legal OS around restructuring
38:15 Idea 1: Use reorgs to recalibrate roles back to defaults
39:42 Idea 2: Value flow map your company before considering a standard reorg
42:53 Idea 3: Test new structure in parts of phases, not everything all at once
44:30 Idea 4: Accept that some centralization is required
47:50 Wrap up: Leave us a review and share the show with your coworkers!
Sound engineering and design by Taylor Marvin of Coupe Studios.
New Zealand