This is one of the toughest challenges that organizations face as they grow from the startup phase. In my experience, and from what I’ve read, it’s difficult to implement, stressful for employees and usually value diminishing in the short term. In the worst case, it can permanently damage the culture and result in good talent abandoning the business.
If there’s one thing I think helps most, it’s to “Keep It Simple Stupid.” Don’t be clever with titles, don’t add needless hierarchy, and keep reporting lines and responsibility clean. Then, if this needs to be changed, do it quickly and communicate it to the people within the team first, then the larger business.
When you’re dealing with people’s livelihoods and their work – where people spend most of their lives – everyone will be incredibly sensitive. When communication needs to happen, don’t bury the lead, and don’t be condescending or patronizing. Just present the facts and the reason. Everyone will appreciate you for it.