Importance of Change Management
Imagine you’re the owner of a small business that’s suddenly taking off. The current state of the market is optimal for your business’s success, and your company is far exceeding expected profits.
You realize your company needs to undergo a major change for it to meet the current demand. You identify the need to double the number of employees, amend your business strategy, redefine business objectives, and implement an employee communication software that streamlines internal communications.
You decide your company needs to undergo a structural change for it to transform. You don’t have a change management strategy in place, but you implement the change anyway—and things get messy. Employees don’t receive proper training on the new technology, and they resist the change. Project deadlines are missed; deliverables are late; budgets were exceeded. Now what?
If you backtrack and decide to establish a thorough change management process, from the first step of identifying the gaps that need to be filled, to the last step of evaluating the process, change implementation is likely to be a smooth process. Effective change management ensures that change efforts are productive and on-schedule, team members are informed and on-board, and inefficiencies are identified and solved.
Organizational changes are unavoidable in today’s perpetually competitive climate. For a company to secure its longevity and economic success, it needs to continue improving. The change management process is never over; leaders need to be persistent in evaluating all aspects of the company and identifying gaps or oversights in processes and strategies.
As the competition evolves to adopt new technologies, and emerging advancements continue to elicit changes in the consumer’s behavior, companies are required to undergo organizational changes if they want to survive.
Importance of Change Management
To implement a successful organizational change, a company needs a structured approach toward managing change. An organizational change that transforms a company will affect everyone in the company, from the project management team to the human resources and customer service departments. Because an organizational change requires all team members to be on-board, these changes require an effective change management process in place.
Changes have to be overseen and guided by change managers and project managers in the company. There must be roadmaps, tasks, milestones, deadlines, and evaluations established to create accountability for team members and to ensure that nothing slips through the cracks throughout the change implementation.
If a change isn’t properly communicated, managed, mapped out or budgeted, the change process can become unproductive and stressful. A stressful change process can lead to lost profits, resistance and frustration from employees.
A well-managed change implementation will work to eliminate risks and disruptions, communicate expectations, prepare team members, and evaluate the change process to identify areas of improvement.
Each basic step is vital for leaders to implement a successful change, but the specifics in each step will vary with each change. Companies must take a structured approach by following an effective change management plan to ensure that all goals are met and accountability is established.
3 Types of Organizational Change
In a survey with nearly 3,000 executives about the success of their enterprise transformation efforts, McKinsey found the failure rate to be higher than 60%. But COVID-19 makes organizational change even more complex and challenging.
Some companies have temporarily closed their plants and shops while others have made remote work mandatory. More and more businesses are laying off a part of their staff because of business deterioration. As a result, unemployment rates are exploding.
They have to adapt on the fly and they have no visibility on what’s going to happen in the upcoming weeks. Check out the graph below where WTO presents how the world merchandise trade volume has been changing since COVID-19. 👇
In these uncertain times, businesses have to review their plans in no time. They are changing the way their employees are working as remote work has become the new norm and they also are rethinking the way their teams are functioning and collaborating. Most companies have already changed their organizational structure and their work arrangements.
Think about it: employees — including team leaders — have to instantly adapt to new ways of working and communicating, while change management programs usually take years to be implemented — whether it’s the launch of new technology or the implementation of a new internal organization.
Indeed, driving change doesn’t mean equipping employees with new software or new ways of communicating. Implementing change requires a preparation phase, a proper internal communication plan, training programs, and evaluating the program’s success.
“Digital transformation does not happen quickly. Some companies seem to expect it to happen over the course of a year. In my experience, particularly for larger organizations, closer to five years is more realistic. Even then, the task is never over”,
Most Common Change Management Challenges
Change is not always perceived as positive, and many employees may be resistant to changes within their organizations. Therefore, successful business transformation is all about getting employees’ buy-in and embedding new behaviors in the workplace.
1. Defining goals in a timely manner
Most changes get implemented with a goal to improve current processes, products, services or organizational cultures. However, it is critical to identify clear goals and milestones.
2. Poor leadership and lack of alignment
Poor leadership and lack of alignment among the leaders are some of the main reasons for organizational change fails. On the other hand, great leaders know how to inspire their workforce and embrace change.
3. Identifying the resources needed to make change a success
Before starting the change process, identifying the resources and individuals that will facilitate the process and lead the change is crucial for success. However, it can be hard to identify those resources and budgets before the process even starts.
4. A Lack of agility and slow approval process
5. Planning the next steps
Every change management process should have a well-set plan. The plan should consist of timelines, and change milestones should be identified. Without planning, it may be hard to understand the overall success of the change process.
6. Fear and conflicts
Changes within organizations can develop emotions of uncertainty and fear. This may cause employees to take their frustrations out on each other. Here, it is leaders’ responsibility to overcome difficulties and resolve conflicts.
7. Resistance to change and lack of commitment
Some employees resist change and do not want to collaborate or commit to new practices. Leaders should be able to address resistance on a psychological level and proactively remove behavioral barriers that restrict change.
8. Poor communication in the workplace
Communication is crucial for successful change management, and the cost of poor communication can be significant. Every employer that has a successful change management team expresses the need for constant communication during the change experience.
Sources:
https://www.guidespark.com/blog/importance-of-change-management/
https://haiilo.com/blog/change-management-definition-best-practices-examples/
https://tolerosolutions.com/what-is-change-management-why-is-it-important-to-your-organization/