Change Management Insights from a Fortune 500 Apparel Company’s Restructuring

Recently, consulting firm Emergent partnered with a Fortune 500 apparel company to undertake the biggest business transformation in the company’s history. Below is a mini case study that provides insights from that project. Building upon its solid performance in 2012, the company chose to implement a new global structure designed to fuel its long-term, international growth.

The project touched the company’s multiple brands, 3,000+ stores, and 130,000 employees  located in more than 40 countries. The company brought together its multiple divisions under a single global executive for each of its major brands.  In addition, to build upon the company’s considerable online success and industry-leading technological advances, the company formed a new innovation and digital strategy team to further its leadership position in this area.

The Business Objectives

Specifically, the restructuring was targeted at making improvements internally and also responding to changing customer demands in the external marketplace. The objectives of the restructuring could be summarized as follows:

• More aggressively capture apparel market share sitting outside of North America, especially in Asia
• Respond to customers’ increasing expectations for an integrated, multi-channel brand experience
• Leverage the company’s competitive advantages, including its iconic American brands, industry-leading creative talent, world-class e-commerce capabilities, and scale
• Simplify the organizational structures to reduce complexity and inefficiency
• Establish clearer accountability and accelerate decision-making

The Change Management Strategy

Emergent partnered with the company’s project team to provide strategic and tactical change management support during the pre-announcement, announcement, and post-announcement/business transition phases. The team developed a comprehensive change management strategy, designed to accomplish a number of objectives:

• Set proper business context and position the global growth story in a way that acknowledges the company’s 40+ year history and founders’ heritage
• Establish a baseline level of awareness and understanding for the restructuring among 130,000 employees worldwide
• Prepare global leaders to strongly lead their teams through the year-long transition process following the announcement
• Provide a flexible communications framework that could be tailored to brands, divisions, and geographies as needed
• Equip middle managers with tools and knowledge to communicate the change effectively, manage the transition process, and model new behaviors
• Showcase the benefits of the future state to employees so that they are inspired and eager to participate in the change effort
• Design engagement strategies that foster buy-in and mitigate change resistance

The team employed a number of methods to accomplish these objectives:

• A storytelling communications strategy that leveraged the company’s culture, heritage, and founder’s vision
• A strong public affairs and community outreach approach, given one of the brands was moving its headquarters as part of the restructuring
• Strong branding of the initiative, reinforced with a global video and professionally designed and printed handouts to explain the restructuring
• A change leadership guide for senior leaders and change management tools and training for middle managers
• A global town hall to support the announcement followed by a week-long series of team-specific town halls around the world
• A web and intranet communications strategy that used social media to provide a holistic view of the changes
• A structured organizations redesign process to help leaders align their teams with the  new global structure, with facilitation support as needed
• New employee feedback channels and a proactive enterprise-wide employee feedback management process
• A change agents network composed of individuals from each of the business organizations affected by the restructuring
• An employee transition management approach that respected the company’s core values

The Outcomes

The global town hall announcement and printed materials explaining the restructuring were well received. Employees worldwide had a common understanding of the restructuring initiative and why it was needed. Senior leaders found the information in the change leadership guide to be very helpful in communicating the changes to their teams. Thanks to the robust feedback process, leaders at all levels had a clear line of site as to the risk areas across the company. The company is currently in the process of redesigning their internal organizations to align with the new global structure, which will be implemented throughout 2013.

If you’d like additional insights about this project or Emergent’s other Fortune 500 client engagements, you may contact them for more information.