MORE than two-thirds of companies which axe jobs are forced to recruit staff during the cuts because of skills shortages, warns a report.

"Parallel hiring and firing" is a pitfall of poor restructuring, says the Chartered Institute of Personnel and Development (CIPD).

Too many organisations are failing to audit skills before making redundancies with the respondents recognising that they are likely to be letting talent walk away.

CIPD research involving 800 CEOs (chief executive officers) and HR (Human Resources) managers suggests that "getting it wrong is common".

On average they each experienced seven corporate-wide reorganisations over the past three years.

But those reorganisations failed to deliver "real improvement in performance" in 40 per cent of cases, warns the institute.

"All too often organisations find themselves in trouble because of poor management of the change process," said spokesman Prof Richard Whittington.

The CIPD report cites high profile examples of success and failure.

In February 2002, the reorganisation of chemical firm DuPont, was followed by a 12 per cent rise in stock price, taking the company's market value from $42bn to $48bn.

In contrast in 1999, the new chief executive of Proctor & Gamble, Durk Jager, launched 'Organisation 2005'. "By the summer of 2000 the reorganisation was considered a failure and Durk Jager had lost his job."

Reorganisations rarely provided training or coaching for those managing the process or those affected by it.

Employees were rarely given the chance to participate in decisions about the reorganisation (41 per cent) and were less likely to be involved in decisions on the implementation (36 per cent).

Reorganising For Success: CEOs' & HR Managers' Perceptions is downloadable free from www.cipd.co.uk/surveys or by calling 0208 263 3355