Business Brilliance Unleashed
by Sovina Vijaykumar

Business restructuring is the process of changing the way a company operates to improve its financial performance. It involves reducing costs, increasing efficiency, or changing the company’s focus.
There are many reasons why a company might need to restructure. Some common factors include:
Financial difficulty: A company may need to restructure due to monetary challenges like excessive debt or declining profits.
Change in the market: A company may need to restructure if the market it operates in shifts, such as if there is a new competitor or if a customer needs change.
New opportunities: A company may also restructure to take advantage of new opportunities, such as entering a new market or expanding its product offerings.
According to a study by McKinsey & Company, 70% of restructurings fail to achieve their goals. Often, it’s due to a lack of planning or execution. When implemented effectively, restructuring can successfully enhance a company’s financial performance.
Also read: https://katharosconsultancy.com/business-mergers-impact-other-businesses/
Real-life examples
Here are a few real-life examples of successful business restructurings:

- General Electric: In 2001, General Electric (https://www.ge.com/) was facing financial difficulty. The company had a large debt load, and its stock price had declined significantly. In response, GE CEO Jeff Immelt implemented a restructuring plan. The plan included selling off businesses, cutting costs, and streamlining operations. As a result of the restructuring, GE reduced its debt by $20 billion, and its stock price more than doubled.
- IBM: In the early 2000s, IBM (https://www.ibm.com/us-en) faced competition from new entrants in the technology industry. The company’s mainframe business declined and struggled to compete in software and services. In response, IBM CEO Sam Palmisano implemented a restructuring plan. The plan included selling off businesses, cutting costs, and investing in new technologies. As a result of the restructuring, IBM was able to return to profitability and become a leader in the technology industry.
Here are some tips on how to do business restructuring:
- Set clear goals: What do you hope to achieve by restructuring your business? Do you want to improve efficiency, reduce costs, or expand into new markets? Once you have your goal, start planning.
- Assess your current situation: What are the strengths and weaknesses of your existing business structure? What areas could be improved? Once you have a good understanding of your current situation, you can start to develop options for restructuring.
- Develop a plan: Your plan should include a detailed timeline, budget, and communication strategy. It’s essential to involve all stakeholders in the planning process so that everyone is on board with the changes.
- Communicate effectively: Effective communication with all employees is crucial during restructuring. It will help to reduce uncertainty and anxiety, and it will help to ensure that everyone is on the same page.
- Be prepared for setbacks: Business restructuring is complex and challenging. There will be setbacks along the way. Prepare for setbacks and have a plan to overcome them.
- Get professional help: Seek professional help for business restructuring if unsure. A business consultant can help you assess your current situation, develop a plan, and communicate with employees.
- Be patient: Restructuring a business takes time. Don’t expect instant results. Be patient and persistent, and you will eventually achieve your goals.
Conclusion
Business restructuring can be a complex and challenging process. However, it can be a successful way to improve a company’s financial performance. When considering business restructuring, careful planning and execution is crucial. With careful planning and execution, restructuring can help your business achieve its goals.