That change is the only constant is an age-old adage, but today, it stands truer than ever before. In an increasingly globalized and dynamic world with blurring boundaries of business, there is an ongoing state of flux. This constant state of change periodically throws all business strategies in disarray, only to pave the way to new business imperatives. Leaders not only need to embrace this environment of constant change, but, must respond proactively to steer the ship in the right direction, and, attain the right objectives. This is easier said than done, with the increasing complexity that surrounds us in this VUCA (Volatile, Uncertain, Complex and Ambiguous) world. Effective change management is the only way to make it happen.
For decades, a number of change management models have been formulated and implemented to manage organisational transitions and transformations. In fact, the concept of change management itself is not new- Kurt Lewin’s 3-step model for change was developed way back in the 1940s, and, Bridges’ Transition Model came to light in 1979. This was followed by more contemporary change management approaches such as Kotter's 8-Step Process for Leading Change and the McKinsey 7S Framework. Yet, there is one thing that is certain- the nature of change management is varying in itself. It is becoming more an urgent and essential business agenda that organisations simply cannot avoid.
This is because business demands are ever increasing, organisations are fast moving from a place of stability to that of unparalleled growth. Earlier, the product life cycle would extend to years, whereas today, we have products hitting the markets in months and even weeks. Consumer expectations too are changing, with consumers demanding on-time, cheaper products and services which are highly personalized. Increased globalization, mobility, and competition have triggered companies to be always on their toes, for one is clueless as to what may strike the next moment. While the above‑mentioned change management models may help leaders deal with change on an overall level, the reality is that each change management exercise is unique and requires differential and unique treatment from its people. However, one thing is certain- the beginning of a successful change management exercise lies in correctly identifying the impending change, foreseeing the impact, and, preparing beforehand to smoothen that very change impact.
Identifying the change
People must invest time, effort, and other resources in getting the first step right i.e. identifying the basis for change and the type of change required. Typically, change originates from either of the following bases:
1. Change imposed by external factors such as a merger or acquisition, market consolidation, corporate restructuring, implementation of radically new technologies, operating changes for new market dynamics, and, even the introduction of new products or services to align with the changing market needs.
2. Change that is planned and adopted to encourage growth or improvement. This is mostly developmental change such as new systems added to support a new business strategy, or process improvement initiatives at an internal level etc.
It is important to understand and analyse which of these changes the organisation is up against. In earlier times, much of change was planned and deliberate. However, in today’s VUCA world, we see organisations often confronted by the first type of change situation- companies that are riddled with unexpected business situations, and, having no option other than undergoing a complete overhaul to ride this wave of uncertainty and gain better outcomes.
Depending on the degree of change, the change can be identified as:
1. Transformational Change: This is a radical change i.e. a large-scale transformation that affects the entire organisation. It is important that leaders enable and empower people to believe in the intrinsic organisational tenets, because, that is what will spearhead success while everything else around is changing.
2. Incremental Change: Such a change involves continuous, small improvements to achieve a desired objective.
3. Downsizing Change: Some business scenarios may demand a reduction in resources such as staff to enhance the efficiency and effectiveness.
4. Relocation Change: This change involves a move of site or assets, and the focus must be on devising the best way to offer continued service to customers despite the relocation.
5. Developmental Change: This change involves small but significant shifts without much process re-engineering. The intent is to enhance the capacity/capability of the organisation.
6. Remedial Change: This change is seen when the organisation is going through an unexpected internal problem or external threat.
7. Structural Change: Such a change involves a reassessment of the organisation’s hierarchical characteristics and involves reframing elements such as the hierarchical levels, span of control etc.
8. Process and System Change: Involves a shift in the infrastructure and systems, workflows, and other process elements.
9. People and Culture Change: This change involves recreating a lot of intangible “people elements” such as values, beliefs, norms, role assumptions, leadership principles, and ultimately the vision, mission and strategy. It is an extensive affair that aims to redesign how people work with one another to deliver the desired outcomes.
Various Facets Of Change
1. Transformational Change
2. Incremental Change
3. Downsizing Change
4. Relocation Change
5. Developmental Change
6. Remedial Change
7. Structural Change
8. Process and System Change
People and Culture Change
More often than not, a change management project cannot be segregated completely into one of these types, but, cuts across several types. For example, people-change is the part and parcel of most change processes, because, people are at the heart of any organisation, and, they are affected by any kind of change. Moreover, the ultimate objective of any change exercise is to improve an outcome, be it a process, functional metric or the overall business strategy. And, to be able to improve, leaders must holistically understand the imminent transition, involved risks, probable mitigation measures, and, create a suitable change programme. Identifying the change so as to enable a smooth and successful transition exercise starts with thorough due diligence involving the following steps:
1. Identifying the reason/basis for the change and the type/s
2. Drafting the change objective in accordance
3. Data gathering and analysis to validate the change agenda
4. Identifying change metrics to track along the change journey
5. Reinforcing the change consistently and continuously
In Quotes “People-change is a part and parcel of most change processes, because, people are at the heart of any organisation, and, they are affected by any kind of change.”
Challenges in the change management journey
Identifying the change is easier said than done, since it requires intensive attention to the finer nuances of change. Conventionally, most business leaders are used to focussing their attention on strategic and tactical plans, but the reality is that change is a much more deep-rooted process involving many intangibles. Many transition‑activities find their basis in deep-rooted psychology and behavioural science i.e. the people front of change management. Ignoring this “people element” is a grave mistake; one that can doom the organisation to failure. Leaders must, therefore, take it upon themselves to watch out and plan for the following common change management challenges.
1. Lack of active and ongoing sponsorship: A change management initiative can go on for years and requires significant resources and inputs to succeed. Hence, it is critical to ensure that there is active sponsorship for the change at a senior executive level within the organisation.
2. Inadequate stakeholder buy-in: A change management exercise is not limited to pockets, and, often sweeps through the entire organisation within the company. It frequently requires an overhaul of processes, values, beliefs etc., and has a significant impact on people’s lives. Hence, it is necessary to gain the necessary stakeholder buy-in from the people involved and affected. The lack of a valid and compelling business case will only serve to put off the active involvement of people, relegating the change-exercise to failure.
3. Lack of planning: A systematic approach is essential to manage change well. This means planning for the required resources such as infrastructure, equipment, tools and templates, communication measures, and most importantly, planning to have the right people on board to drive and manage the change. Leaders must put in place a “Change Task Force” who is skilled and dedicated to the change cause.
4. A unidirectional top-down approach: Many a change model starts with action only at the top leadership levels, with the CXO suite as the only originator of ideas. No one can deny the primary role of the top leadership in driving change effectively, however, such a traditional approach may require some tweaks among the flat and participative organisations of the day. This is where many leaders make a mistake- by dictating the terms of change without a participative approach. Employees across levels can prove to be a worthy source, offering insights on how the organisation can be bettered. After all, employees are mostly the ones who are most impacted by the change, and, may be more than willing to contribute towards positive outcomes.
5. Sporadic or inconsistent communication: Change is always uncomfortable, especially for the ground-level employees who are not so clear about what the organisation is going through. Clear, consistent and genuine communication is the hallmark of a successful change campaign. It is the nature of communication which can make or break trust- a crucial element that can jeopardize the entire change exercise if not taken care of. Leaders must understand, assimilate and propagate the human side of change management. Change leads people to become fearful and insecure, especially if the change is unjustified and unexplained. People must be openly informed and reassured at every stage, only then will they contribute their best selves with new and innovative ideas and insights.
In Quotes “People must be openly informed and reassured at every stage, and only then, will they contribute their best selves with new and innovative ideas and insights.”
1. Non-alignment of culture and values: An apt alignment of the company’s culture, values, people, and behaviours is one of the most intangible things that leaders must strive to achieve if they wish for sustainable and positive change. In the wake of change, some people may choose to leave and be replaced by folks with new work ethos, creating a loss of identity or culture. The organisation must build new skills and capabilities to ride over the change armed with the right tools. These tumultuous mandates can spark some very unexpected behaviours in people, stemming from fear and helplessness. People may start reacting in different ways, sometimes even putting their personal preferences above the organisational goals in a bid to “protect” themselves. Planning for this “human side of change” is the most difficult challenge, yet the most critical element of successful change management.
It is thus evident that change management is a mammoth effort, with a potential to impact every organisational touchpoint- top leaders, customers, partners, and employees. The challenge is to tune everyone in to a single tune- the tune of success, as defined by the change objective. This is possible only when the right people commit to a continued association and play their own parts as “Change Champions” in this rocky journey, bound together by the glue of a well-planned and well‑communicated change strategy.
Are we leading towards a sustainability-driven economy?
Top leaders must develop a ‘teachable’ point of view on business ideas and values, and they must have a personal vision that can be codified
We are surely living in paradoxical times. Even as observers bemoan the lack of upright and charismatic political leaders, the corporate sector continues to produce visionary leaders who are inspiring their organizations to greater heights all the time.