Why are so many organisations restructuring?

45% of Kiwi employers are currently restructuring their department or organisation

Why are so many organisations restructuring?

Nearly half of Kiwi businesses are restructuring to keep up with changing business needs.

Indeed, 45% of New Zealand employers are currently restructuring their department or organisation, according to the 2019/20 Hays Salary Guide, which surveyed almost 900 employers in New Zealand.

The research also found that 49% of these employers said the key driver of organisational restructures is a change in the required skill sets.

This is well ahead of digital transformation (25%), the requirement for a more flexible workforce (21%), a merger or acquisition (19%), downsizing (10%), outsourcing (6%), offshoring (5%) or inshoring (4%).

Adam Shapley, Managing Director of Hays in New Zealand, said restructures driven by a change in the required skill set are often the result of today’s growing trend of adopting cross functional operating models.

“Traditionally, an organisation consisted of functional departments, but given today’s pace of change, there’s a need to move toward matrix, cross-functional or hybrid structures to better enable collaboration and a customer-focused approach,” said Shapley.

“Customer centricity is a key focus and area of differentiation for most businesses, particularly in terms of how an organisation is most effectively and efficiently structured to deliver value to a customer.

“There’s a real focus on securing candidates who understand the customer journey and with competencies in agile methodology and business projects and change.”

The other factors include rapid technological developments (including AI and automation) which create a need for new capabilities, the requirement for additional expertise in response to outside factors, such as cybersecurity or risk & compliance, and the introduction of new and non-traditional executive roles.

READ MORE: How to ease employee fears during a restructure

Shapley added that these restructures are a clear indication that the supply of professionals with the skills that employers need is tightening.

“With candidate shortages remaining problematic for organisations, hiring in for specific skills – both technical and soft – will therefore be a priority for change, growth and competitive advantage.”

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