The UK’s business leaders are in a difficult bind. The general consensus for business remains cautious and UK growth has been relatively slow so far in 2026. And it’s predicted to slow further still. Ahead of the new Government’s Autumn Budget statement on 28th October 2026, uncertainty reigns. So, business leaders can either find new sources of growth or find ways to cut costs. Tariffs, cross-border trade barriers, wars and populist measures are restricting some commerce options. So, let’s look at why business restructuring is rising to the top of CEO priorities.
Business restructuring
Business restructuring is the reorganisation of the operational, financial or legal structure to lower costs/improve performance, prepare for growth or avoid financial distress. It can feel forced to hastily stabilise financial performance or recover lost efficiency. However, it can also be strategic to rapidly align to new strategic objectives to increase profits.
Normally, the first step is to review and document the organisation’s current situation.
- Where are we struggling?
- What financial pressures are showing?
- Where have we lost efficiency?
- What is misaligned on strategy?
- Where are our competitors beating us?
This enables leadership to form new objectives and quantification of improvement. Once done, the restructuring plan can be drawn up. This plan may include operational restructuring, finance or debt restructuring and/or structural simplification (i.e. disposals, closure of subsidiaries etc).
Executing business restructuring
Armed with a restructuring plan, it is time to move forward. Some changes are simple, tactical or informally implemented. Employee changes, including wide-ranging change of terms, redundancy programmes or redeployment may involve a formal consultation. Financial/debt issues may involve administration, the courts and voluntary arrangements with creditors. Operational restructuring and structural simplification typically impact employees. However, not all such changes run the risk of unfair dismissal, constructive dismissal, discrimination or other employment law issues.
Processes can be made more efficient, costs can be reduced and systems can be changed. Job roles can also be tweaked, objectives changed and people moved around without triggering formal mechanisms. However, it goes without saying that difficult decisions lay ahead. Sometimes, it means biting the bullet when change is required. Sometimes, it is forced upon you due to fading fortunes. Executing the plan, monitoring progress, refining the approach and communicating with stakeholders all contribute to success. The good news is that the process brings resilience, improved performance, stable finances and a platform to build on for growth.
Current economic context
Macroeconomic pressures are affecting oil, energy, Government gilt yields and inflation. This is in the context of escalating conflict in the Middle East and expanding Russian provocation in Eastern Europe. Tricky crossings of the Strait of Hormuz and the Saudi Arabian East-West oil pipeline shutdown have not helped. The Bank of England has signalled that if fuel prices stay at the current level, the base interest rate may have to increase above 3.75% at the next Monetary Policy Committee meeting on 5th November 2026.
Furthermore, the tax landscape is unfavourable since Employer’s National Insurance Contributions increased to 15% above £5,000 per employee. Additionally, the forecast for GDP growth is slippage from 0.6% in Q1 and 0.4% in Q2 to 0.2% in Q3. Many retailers and business suppliers are reporting that consumers and clients are putting off ‘big ticket’ purchases. The IoD continues to report subdued business confidence with a ‘red’ status. The British Chambers of Commerce reports the lowest level since just after COVID in 2021. This shows investment in plant, equipment and machinery in decline.
The result is that CEOs are rummaging in their toolbox for ways to trim waste and get back to growth. In summary, the answer may well be business restructuring.
Controlling the controllables and restructuring
Ultimately, if the macroeconomic situation is not improving, the options appear closer to home. Do we need to splurge £250k on that trade show? Do we need to replace that equipment for £1m? Should we hire a replacement for the senior manager that just resigned? Are there discretionary costs to reduce? Do we need to pay severance packages? Where are we obviously inefficient? When the good times roll, small things get overlooked. When times are tough, sweating the small things may just help you to remain competitive and financially stable.
Note that this is not all about cost-cutting and cost efficiency. No, this is also about efficiently carrying on business and forensically looking for growth opportunities. Critically, the growth is out there. You may not have a plan for it. You may not have the capabilities to seize upon it. In fact, you may not even have even identified it. But it is out there if you look hard enough. Counter-intuitively, organisations cut back on research, market and competitor intelligence, strategic planning, training and consultancy in the tough times. The truth is that this is when you SHOULD be investing in your future growth prospects. As we have said previously, you can’t cut your way to growth.
Help with the heavy load of business restructuring
So, you may be restructuring right now or thinking about ripping off the sticking plaster. Some CEOs are facing a preponderance of problems and lack the time for a large change. Others are in a holding pattern awaiting the Autumn Budget statement. The remainder may not be feeling the pinch just yet but they are readying plans just in case. Either way, Think Beyond acts as an extended capability for CEOs and senior leaders to assess the situation, craft the plan and execute for a better business.
If you would like to speak to our team, simply ask us to get in contact via our website. Alternatively, you can message us directly via our LinkedIn page.
Finally, why not check our thoughts on acquisition v retention and successfully managing uncertain times.