The business environment is a very dynamic and often volatile space, full of challenges and possibilities. Therefore, to survive and prosper, organisations are often forced to make changes to their internal structure.
However, people generally have a natural aversion to change. Among other things, it represents uncertainty and risk, with workers unsure of where they will fit in the new order of things. It's not just those on the 'shop floor' that are prone to worry, either; resistance to reform can be found at all echelons of a business organisation.
As a business owner, this presents a unique management challenge. How can you successfully implement the necessary changes at the organisational level, while ensuring a smooth transition? As we will discuss below, the key is to analyse, persuade and prepare.
This is how to manage change effectively in your business.
1. Analyse the Need for Change
Change just for the sake of it is a needless expense at best, and a potential disaster at its worst. Therefore, the first step is to identify those areas where the organisation needs to change – and to understand why.
Organisational change does not affect all departments equally, so identify the departments and personnel who will be most affected. Then try to figure out the impact it will have on your organisational structure as a whole.
Prioritisation is of utmost importance here. You need to list all proposed changes in order of importance and necessity. Weed out the processes that do not align clearly with the broad operational goals of your organisation.
2. Share the Vision with Your Staff
Proper communication is essential for successful execution and management of change in your business. However, while it is necessary to share the basic details with all employees, certain groups of people should receive further insight.
Senior management is critical in these situations, since they are the ones who will be responsible for keeping the ship steady while changes are taking place. You need to develop an effective communication strategy to convince these people of the need for change while keeping them focused on their day-to-day targets and responsibilities.
Creating detailed presentations that convey the rationale behind the proposed changes – along with forecasts and projections of potential benefits – is a good idea. Early on, you should also address any personnel that will be affected significantly by the proposed changes and reassure them.
Once you share your plans with everyone, it is important that you seek feedback on them, too. This will help you to fine-tune your strategy and take into consideration anything that you might have previously overlooked.
3. Prepare the Staff for their New Roles
Once you get everyone on board, it is time to focus on readying your employees. Change often involves the up-gradation of existing equipment, or the creation of new departments, positions, or teams. Sometimes, it is more about changing the attitudes, behaviours, and approaches of your employees, rather than implementing any drastic organisational reform.
While you can manage some of these changes through practical orientation, others will require retraining, coaching, or close mentoring. Depending on the type of change desired, you will have to decide between formal or informal training methods.
While you can carry out some of these training sessions in-house, others may very well require the hiring of external specialists. During this period, consider that your staff will need extra support and care. The office environment can get quite stressful, leaving your employees in a vulnerable situation; take this into account when considering their short-term productivity and performance.
It is important not to rush this process, either. Ideally, training and preparation should start well in advance – at least several months before the actual implementation of change. This applies to both organisational changes as well as more material change.
During this time, management and HR will need to step up and provide support structures to help employees cope with change; this can include both emotional and professional counselling if necessary.
4. Assessment and Reinforcement of Change
Ensuring that the "change-train" does not go off the rails is an essential task in itself. Continuous vigilance and oversight are mandatory if you want your restructuring to be a successful endeavour.
You should try to normalise the changes as they happen, as the fallout of a revamp will involve a fair amount of uncertainty. Therefore, when it comes to assessing employee performance, updating your existing appraisal metrics is crucial.
You have to get the new appraisal cycle started as early as possible since employees need feedback and targets to meet. If they have a clear idea of their new duties and the new organisational expectations, they can focus on the job better.
At the same time, it is crucial to take steps to reinforce and sustain the change implemented across the organisation. If people are regressing to the old way of doing things, or they are refusing to adapt to the new, then it undermines the wider progress of the company.
Key Tips for Successful Change Management
Creating a sense of urgency can make all the difference in the world for change management; it can be highly beneficial in convincing people about the need to break the status quo.
Assembling a select leadership group to guide the entire organisation is one useful tactic. The members of this group can be open to prominent individuals at various levels of the organisation; try to appoint a range of influential people in your workplace - not just people who have authority in an official capacity.
Keep an active lookout for potential barriers that stand in the path of change, too. These can be organisational norms or customs, authority structures, technological assets, or even individuals who are resistant to change. The focus should be on neutralising these obstacles at the earliest opportunity.
Examples of Change Management
Perhaps no other company exemplifies successful change management as well as Apple. The company's transformation from a hardware startup into a consumer technology brand is legendary, with Steve Jobs taking the company from terminal decline to the most valuable brand in the world through his shrewd implementations.
The 2008 financial crisis put many companies in dire straits requiring massive organisational changes, too. For example, RBS Group was forced to hive off its insurance business to stay afloat with government aid. Despite getting cut adrift, the insurance wing took the challenge head-on and transformed into the highly successful independent insurance firm, Direct Line.
General Electric (GE) is another testament to change management done right. In 1981, new CEO Jack Welch decided to improve the $12bn conglomerate by implementing the Six Sigma Method – improving processes by testing them repetitively for faults and defects. The results were mind-blowing, with the company saving $10bn in six years and eventually growing into a $280bn juggernaut in less than two decades.
Change management can be optional, or it can be forced upon you by circumstance, but regardless, you need to know how to guide and manage the process.
Never take any drastic steps until you have thoroughly analysed where reform is required, and ensure that your team are on board before you implement anything. Trust in your senior people to drive the change, and ensure that you support your employees throughout. Finally, continuously assess and re-assess where barriers are being erected and neutralise them at the earliest opportunity, and update your appraisal metrics to reflect your company's new operating structure.
What other change management tips would you offer? Let us know your experiences in the comment section below.