Can Lloyds TSB navigate the storm?
In announcing that Lloyds TSB are to shed 15,000 jobs over the next three years probably contained little surprise to most people. Indeed there will be many that will be quite pleased that some bankers are reaping what they sowed without realising that the middle management and back-room boys losing their jobs are not those who will be receiving big bonuses over the next three years.
Restructured teams have an increased chance of failure
My real concern is that five thousand job losses each year, for three years, will mean a vast number of teams being restructured. The problem with team restructure is that only 60% tend to deliver targets. That means that 40% of teams fail to deliver on expectations. That’s one big storm of disruption for Lloyds TSB to navigate.
Costs can be huge
The cost of such failure in lost opportunity terms can often amount to ten times the salary of the team and in banking circles that can be huge! ( a team salary of £1million could produce a potential lost opportunity cost of £10m) However, when one’s focus on savings will be judged on salaries saved the actual costs of the restructure often get ignored.
That is until financial statistics reveal that further jobs have to be cut because the anticipated results haven’t been met!