Balancing Company Culture Amid Restructures: Lessons from Leaders
Company culture faces its toughest test during restructures and layoffs. This article presents valuable insights from seasoned leaders on maintaining a strong company culture through challenging times. Learn how transparency, open communication, and empathy can preserve trust and forge resilient teams even in the face of difficult decisions.
- Transparency Strengthens Culture During Layoffs
- Precision and Candor Preserve Trust
- Layoffs Reveal True Company Culture
- Open Communication Maintains Team Morale
- Honesty and Support Protect Cultural Values
- Transparency Prevents Fear During Restructuring
- Culture Evolves Through Tough Decisions
- Performance-Based Culture Eases Restructuring Process
- Empathy and Dialogue Forge Stronger Teams
- Practical Support Boosts Former Employee Confidence
- Open Communication Preserves Trust During Change
- Authenticity Maintains Culture Through Difficult Times
- Involve Employees in Post-Restructuring Vision
- Respect and Support Define Cultural Resilience
Transparency Strengthens Culture During Layoffs
During a necessary 15% workforce reduction, we faced the challenge of maintaining our collaborative, transparent culture while making difficult decisions. Instead of hiding behind HR processes, our leadership team committed to over-communicating throughout the process.
We held all-hands meetings explaining the business rationale, timeline, and criteria for decisions before any layoffs occurred. We also involved remaining employees in redesigning workflows and team structures, giving them agency in shaping the path forward rather than just reacting to changes imposed on them.
Most importantly, we treated departing employees with the same respect we showed current ones — offering generous severance, job placement assistance, and allowing them to say goodbye to their teams. This demonstrated to remaining employees that our stated values about treating people well weren’t just words.
The outcome was painful but ultimately strengthened our culture. Employee engagement surveys six months later showed higher trust in leadership because we’d been transparent during the crisis. Several laid-off employees even referred candidates to us later because they felt the process was handled fairly.
The key learning was that culture isn’t about avoiding difficult decisions — it’s about how you make them. Transparency, consistency with stated values, and involving people in solutions rather than just announcing changes helped preserve what mattered most about our workplace even during a challenging transition.
Brittney Simpson
HR Consultant, Savvy HR Partner
Precision and Candor Preserve Trust
The best-run company I have ever seen handled layoffs the way a surgeon would approach a high-risk operation: with precision, thoughtfulness, and an eye toward long-term survival. They cut 18% of their workforce, but rather than relying on corporate messages, the top team engaged with employees at every level in live sessions. They explained precisely why 120 roles were eliminated, where the savings would be reinvested, and what would remain unchanged. It was not a happy event, but such candor prevented rumors and resentment from spreading throughout the culture.
Indeed, they learned that culture has little to do with free lunches or fun perks, and more to do with trust. The remaining employees didn’t worry if they were next, because the company was transparent. They even issued a retention bonus of 5% of base salary for the remaining employees. The cost was less than $1 million. The lesson: people will accept tough business decisions when the process is transparent, consistent, and humane.
Guillermo Triana
Founder and CEO, PEO-Marketplace.com
Layoffs Reveal True Company Culture
Most leaders try to figure out how to protect company culture during a layoff. I believe this is the wrong way to look at it. A layoff doesn’t damage your culture; it reveals what your culture truly is. All the talk about trust and transparency is tested in that moment. If the process is secretive, top-down, and impersonal, you send a clear signal that the stated culture was superficial.
The most important lesson I’ve learned is that the process itself must reflect the values you want to preserve. This means being radically transparent about the business realities that forced the decision. It means treating every single person with dignity, providing clear information, and focusing on the capabilities the business needs moving forward.
The people who remain watch how you treat those who leave. That is what determines whether trust is shattered or if the core of your culture survives.
Maria Matarelli
CEO, Formula Ink
Open Communication Maintains Team Morale
We went through a tough phase a couple of years ago when a significant project slowed down. It wasn’t performance-related, but rather a shift on the client’s side. Still, it led to restructuring, and that’s never easy.
We knew we had to make cuts, but we didn’t want to simply drop it on people. So we chose to communicate early, even before we had all the answers. I remember telling the team, “We don’t have the full picture yet, but here’s what we’re seeing.” That kind of openness helped more than any polished message could.
Our managers were involved right from the start. They spoke to their teams, mostly one-on-one. No mass emails. No sugarcoating. Just straight, honest conversations. People respected that.
We also made space for people to react. We didn’t try to force any positivity. Some were upset, some were quiet – all of it was okay. What mattered is that we didn’t disappear as leaders. We stayed present.
One thing that helped us maintain our culture was continuing to recognize good work. Even when the mood was heavy, we didn’t stop saying “thank you” or celebrating small wins. It reminded everyone that their effort still mattered.
Looking back, the biggest thing I learned was this: culture isn’t tested during the good times. It’s what shows up when things get uncomfortable. And you protect it by being real, even when it’s messy.
Vikrant Bhalodia
Head of Marketing & People Ops, WeblineIndia
Honesty and Support Protect Cultural Values
This is one of those moments no leader forgets. A few years ago, we faced a downturn that forced us to make tough decisions, including a significant restructuring. The business case was clear, but the emotional weight was enormous. Our team had been through a lot together — we’d celebrated big wins, worked late into the night on product launches, and built a culture of trust and transparency. I knew that if we handled the process poorly, the damage to morale and our values would linger long after the spreadsheets balanced.
I started by being brutally honest with the leadership team: we had to protect our culture as fiercely as we were protecting our runway. That meant overcommunicating, not sugarcoating. We brought the entire company into the conversation early — not to crowdsource decisions, but to explain the “why” behind them. Every person affected was given as much notice and support as we could offer: extended severance, resume coaching, and in several cases, personal referrals.
Internally, we reinforced that our values didn’t disappear with the org chart. We created space for grief and gratitude — team-wide sessions to acknowledge the contributions of those leaving, and small-group discussions where people could voice fears without being dismissed. We didn’t pretend everything was fine. Instead, we committed to rebuilding with intention: hiring more inclusively, improving cross-team trust, and holding ourselves accountable for how we showed up post-reorganization.
What I learned is this: culture isn’t a mood —it’s a series of behaviors, especially under pressure. And how you handle hard moments says more about your company than any all-hands meeting ever could.
Patric Edwards
Founder & Principal Software Architect, Cirrus Bridge
Transparency Prevents Fear During Restructuring
There’s nothing more detrimental to a company’s culture than letting valued and well-liked people go. During COVID, I had to lay off a few employees who were doing a great job but had to be let go for financial reasons. Delivering that news was one of the toughest things I’ve ever had to do as a leader.
What got me through it, and what got employees through the layoffs, was being honest and transparent. I openly shared our financials in a company meeting and showed why layoffs were necessary. I also explained that now that these layoffs had been made, what we had to do as a company over the next 6-12 months to ensure that no other layoffs would be necessary.
When it comes to layoffs, you want to prevent employees from asking themselves, “Am I next?” Trust and safety are key to doing great work, and transparency can help fill in the blanks when a company has to conduct layoffs or restructurings.
Brett Farmiloe
CEO, Featured
Culture Evolves Through Tough Decisions
A few years ago, a sudden drop in orders forced a restructuring that included some layoffs. This was especially challenging because the workplace culture was built on trust, teamwork, and treating people like family. The goal was to make the necessary business changes while still protecting the sense of respect and care that everyone valued.
The first priority was open and honest communication. Meetings were held with the whole team to clearly explain what was happening, why it was necessary, and how decisions would be made. Vague language was avoided so that everyone understood the changes were about protecting the future, not punishing individuals.
Every affected employee was treated with dignity. As much notice as possible was given, along with severance packages, job placement support, and connections to openings at partner organizations. For those remaining, “survivor’s guilt” was addressed through open discussions and by ensuring they had the resources to handle any increased workload.
Core values — respect, fairness, and support — guided every decision. Leaders stayed present and visible, showing genuine care for everyone involved. Small team gatherings were arranged afterward to help rebuild morale and reinforce a sense of unity moving forward.
The key lesson was that workplace culture isn’t defined by good times alone. It’s proven during the most difficult moments. Even in the middle of layoffs, transparency, consistency, and compassion can preserve trust and strengthen bonds. In this case, the approach helped people move forward with dignity, and many who left maintained positive connections long after the changes were complete.
Garrett Lehman
Co-Founder, Gapp Group
Performance-Based Culture Eases Restructuring Process
A few years back, we hit a rough patch — projects slowed down, overhead was climbing, and I had to make the hardest call I’ve ever faced: restructure the business. Not because I wanted to, but because survival demanded it. At the time, we had a tight crew. Most of them had been with me for years. But I knew if I held on to everyone hoping things would turn around, I’d sink the whole operation. That wasn’t leadership — that was denial.
I didn’t let a spreadsheet make the call. I sat down, looked at who was adding value where it counted, and who was coasting. There’s no room for deadweight when your worksite runs on precision and safety. I didn’t sugarcoat it either. I spoke to every team member one-on-one. No HR buzzwords. Just straight-up honesty.
Instead of just letting people go, I helped a couple of them get work with other contractors I trusted. One even ended up starting his own gig — he still calls when he needs a second opinion. That’s the culture I built from day one: no BS, no ego, just accountability and respect.
It was brutal, but it forced us to tighten the way we operate. Systems got sharper. The guys left standing stepped up. Our margins improved. The culture? It didn’t break — it evolved. It wasn’t about Friday beers anymore; it became about pride in your work and earning your spot.
What I learned is simple: culture isn’t built by keeping everyone happy — it’s built by making hard calls for the right reasons, and owning them without hiding behind corporate jargon. And that’s exactly what I did.
Alex Schepis
Electrician / CEO, Lightspeed Electrical
Empathy and Dialogue Forge Stronger Teams
I’ve learned that you don’t try to balance culture with restructuring during the event itself. The real work is done years before by building a culture based on radical transparency and objective performance. In our world, we work with the top 1% of producers. The expectation of high performance is the bedrock of our culture. There are clear metrics and everyone knows where they stand, always.
When restructuring is necessary, it’s not a subjective or surprising process. It’s the unfortunate outcome of a system everyone already understands and operates within. This doesn’t make it easy, but it removes the poison of perceived favoritism that truly shatters a culture. The remaining team sees a logical, if difficult, business decision, which reinforces the high standards they are all held to. The culture of performance is preserved because it was never compromised in the first place.
Rob Graham
Founder, MeetingsTech
Practical Support Boosts Former Employee Confidence
Several years ago, during a shift in market demand, we had to restructure a portion of our team to align with our evolving focus on AI-powered SEO. It wasn’t an easy decision, especially as a founder who values transparency and team cohesion.
Here’s how I approached it:
- Lead with empathy: Every conversation was held with care and honesty. We focused on preserving dignity and offering support, including referrals and transition help.
- Reaffirm our values: Even during change, we stayed rooted in our mission. This helped the remaining team feel grounded and clear on our direction.
- Create space for dialogue: We opened up time for team discussions and one-on-ones to process the transition, ask questions, and rebuild trust.
What I learned: Culture isn’t just tested in good times; it’s forged in the hard ones. How you show up when things get tough defines your leadership more than any strategy ever will.
Amber Wang
Co- Founder & Data Scientist, PressRoom AI
Open Communication Preserves Trust During Change
During a company restructuring or layoff period, we support former employees by providing them with a practical job search guidebook. This thoughtfully created booklet outlines step-by-step how to find a new job.
As HR and sourcing specialists, we understand the ins and outs of the job market and have used that expertise to create a practical, results-driven guide designed to genuinely support former employees during their transition and job search.
The guide covers essential strategies such as:
- How to optimize their LinkedIn profile
- How to write an effective cover letter
- How to find hidden jobs that are not advertised
We learned that it boosts former employees’ confidence and helps them optimize their approach to finding a new job.
Sari Schmidt
Co-Founder, Nala Talent
Authenticity Maintains Culture Through Difficult Times
We went through a restructure where some roles no longer fit our strategy. I was transparent about the reasons, the timeline, and the support we’d offer. We focused on preserving trust — keeping communication open with those staying and leaving. I learned that culture isn’t about avoiding hard calls; it’s about how you handle them.
Hillel Zafir
CEO, incentX
Involve Employees in Post-Restructuring Vision
Balancing company culture with restructuring and layoffs is one of the toughest challenges I’ve faced professionally. During a recent restructuring, we had to reduce staff to align with shifting business priorities. My approach was grounded in transparency, empathy, and clear communication.
First, we ensured leadership communicated openly about the reasons behind the restructuring — avoiding corporate jargon and addressing the realities candidly. We provided affected employees with generous severance packages, outplacement support, and clear timelines, which helped maintain trust even in difficult circumstances.
To preserve culture, we doubled down on supporting the remaining team through frequent check-ins, recognizing their contributions, and reiterating our shared mission. Importantly, we involved employees in shaping the post-restructuring vision, which reinforced their sense of ownership and belonging.
What I learned is that company culture isn’t just about perks or events — it’s about how you treat people during the hardest times. Authenticity, respect, and support make all the difference when navigating change.
Daria Turanska
Legal Manager, Faster Draft
Respect and Support Define Cultural Resilience
During a market downturn, we faced the difficult decision to restructure and reduce headcount while still protecting the collaborative culture that defined our work. The approach began with transparent communication — explaining the financial realities, the criteria for decisions, and the long-term plan for stability. We prioritized voluntary departures where possible and offered support such as job placement assistance and extended benefits.
For the remaining team, we immediately reinforced our core values through small group meetings, inviting input on how to adapt workloads and preserve morale. The key lesson was that culture survives not through the absence of hardship, but through consistent trust and respect during it. Even those who departed expressed appreciation for the honesty and support, which helped maintain relationships and the company’s reputation long after the restructuring was complete.
Ysabel Florendo
Marketing Coordinator, Ready Nation Contractors