November 12, 2019
How to Leverage Change Management for Your Business
Many organizational leaders believe change management is a process that begins after a new solution, innovation, or initiative has been developed. The truth is that change management begins as soon as a project starts and that change management can even accelerate innovation and growth.
In this article, we’ll discuss what’s involved in change management, how it intersects with digital transformation, how your business can leverage change management to drive new revenue, and much more.
Clearly Defining Change Management
Change can occur to different degrees in multiple directions and at many different levels of an organization. For this reason, “change management” has acquired different meanings depending on the context in which it is used. And like many popular ideas, it has also become a bit of a buzzword that means less every time it gets used.
So, what is change management (CM), really? Change management is a process for effectively implementing changes to technology, procedures, and even company goals at the individual, organizational, and enterprise levels. But change management should also go beyond single projects and initiatives. It should help create a culture of change-readiness so you can become more nimble, flexible, and adaptable as an organization.
Companies don’t typically deploy CM for small changes like adding a cover page to TPS reports. Instead, dedicated CM efforts are utilized when a significant change will impact the day-to-day experience of many employees. Just a few examples of change include:
- New equipment
- New software
- Branding or rebranding
- Updating workflows
- Changing reporting structures
- Offering new products and services
- Mergers and acquisitions
All these changes (and many others) can affect team members at every level of your organization.
And this fact highlights the two basic elements of every change: a technical change and the people involved. Organizations can dictate a change, but that doesn’t always mean people will adopt it. To effectively implement something new, a CM plan needs to effectively address both sides of the change story.
Your organization needs to clearly articulate the change itself, the rationale, why alternatives were rejected, and how it will impact the future of the company. At the same time, you need to be transparent and empathetic about the effects (both positive and negative) that individuals may experience during a transition.
Three Primary Types of Change Management
Successful initiatives acknowledge both the human and logistical factors of change, but they also address the different types of change that need to occur. Below are the three primary types of change management.
Individual Change Management
Change often feels like it happens at a high level within a company, but the reality of change is that it happens person by person over the course of time. Some people will adopt and embrace change immediately, while others may take a month or more to reorient themselves and move forward. Individual change management addresses the most important part of any change initiative: the individuals who will be impacted.
To successfully effect change among individuals, companies need to:
- Discover what communication styles will resonate with people and create a coherent, aligned strategy for reaching employees multiple times across channels.
- Develop resources, training programs, and professional development opportunities that individuals can take advantage of.
- Establish specific, measurable, achievable, realistic, timely (SMART) goals for individuals that provide incentives and rewards for forward progress.
In short, organizations need to inform, convince, and enable individual employees so they will move forward with change.
Organizational Change Management
When most people think of “change management,” they typically envision organizational change management (or OCM). Successful OCM focuses on the people involved, but it also factors in broader strategies and tactics for moving change forward among many individuals and groups. Central to OCM is the issue of alignment: developing a clear vision for the change, coming to an agreement that the change is necessary, and making the change a priority across the organization.
Enterprise Change Management
The most comprehensive form of change management occurs at the enterprise level. Here, everything at a company is on the table for consideration, from individual responsibilities to the leadership team itself. Enterprise change management (ECM) goes beyond individuals and projects to incorporate change management capabilities, processes, skills, and tools throughout the entire organization.
The ultimate goal of ECM is to create an agile enterprise that can quickly respond to changes internally and in the marketplace to gain a competitive advantage. More than just training programs or standard procedures, ECM builds a workplace culture that embraces change.
These layers of change management are not mutually exclusive. Rather, they are approaches that a business can utilize depending on the scope of change they are facing—or aspiring to.
Digital Transformation and Enterprise Change Management
For many organizations, the biggest changes they need to manage are related to technology. In some cases, they are taking steps to modernize their software, applications, or ERP. In other cases, they are reacting to a crisis. That crisis can be urgent, like a disaster or other major outage. But a crisis can also develop over time because of changing consumer habits or disruptors entering the marketplace.
This is why enterprise change management and digital transformation are so closely linked. Both are transformational efforts that seek to improve and expand an organization’s capabilities to increase agility and adaptability in changing markets. Both are also examples of continual improvement (or continuous improvement) initiatives. And both are necessary for success in today’s highly competitive landscape.
One common example of the intersection between ECM and digital transformation is in the connected products space. When a company creates a connected product or medical device, its entire business needs to fundamentally change. New cloud, hybrid, or on-prem infrastructure needs to be maintained. Updates, fixes, and improvements to firmware, software, and apps need to be created and released on a regular basis, sometimes even daily. New competencies, budget models, and a wide variety of other changes need to be incorporated across the organization in order to successfully support a connected product.
Thus, in order to successfully move forward with digital transformation, organizations also need to have a robust approach to change management—and both need to work in concert to accelerate growth and innovation.
Why Businesses Need Change Management
Most businesses understand why change management is a necessity, especially at the project level. If you are instituting a new process, you can’t have employees continuing to use outdated methodologies. If you are implementing a new software tool, you can’t have employees using the old program.
Businesses are typically very adept at the logistics of these types of changes. Leadership makes a decision, sorts out the details, tells people what needs to change, and then officially makes the change. But communications about change are not equivalent to employee engagement. Creating a culture that’s amenable to change is a much more difficult proposition for businesses, especially ones that have a history of being change-averse.
In fact, trying to simply dictate change, even if it’s good for the business, can have disastrous results. Recurring proclamations of change often result in “change fatigue” at organizations. This occurs when too many change initiatives are undertaken without clear prioritization and without a clear change management plan. And it often means employees simply don’t adopt changes that are being made—or they wait and wait to make any change until it becomes an absolute necessity.
Change fatigue is also a symptom of siloed teams that lack alignment. For example, marketing may put together a great idea for a new mobile app. Leadership gets on board, and the project starts moving forward. But building an app requires more than marketing can accomplish on their own. IT needs to get involved to handle data, infrastructure, support, and other technical details to turn a good idea into a functioning app. Accounting needs to determine budgets, how to manage ad or subscription revenue, and address other financial considerations. Others may need to get pulled into the project on both a short-term and long-term basis, from legal to human resources and beyond.
These individuals and teams are suddenly faced with both short-term and long-term changes to their work that originated outside their purview, and they may or may not have had enough involvement in the planning process to get on board before the change was already underway. Other projects coming out of other siloed teams (sometimes even concurrently) can have the same impact across an organization.
That’s where change fatigue really starts to set in unless a business has committed to building a culture of change-readiness and alignment.
So, how do you accomplish that?
The Basic Steps for Effective Change Management
If you’ve been looking into change management at all, you know that you have hundreds of options when it comes to CM models. But no model will succeed on its own. Change management success depends on the people involved. In addition, many models share the same fundamental approaches. So whether you’ve been incorporating change management into your projects for a while or you’ve just recognized the need for change management at your organization, the most important processes and a few best practices can be broken down into three major steps:
Step 1: Planning for Change
From your very first “meeting before the meeting,” change management starts with careful, thoughtful planning. First, you need to gauge important change factors. What is the scope of change? What is the timeline for fully implementing this change? What objections will others have, and how can we recognize and address them?
Next, you need to develop a communications plan for change. Determine your key audiences, consider ways to create awareness about the need for change among them, and find ways to build buy-in across teams. You will also want to establish a schedule to ensure that the right people are receiving the right messages at the right time to maximize the impact of your communications.
Another key part of change management planning is identifying change sponsors within your company. Find individuals who will be excited about a change and get them involved in the process. This should include executives, directors, managers, and supervisors. But you should also look to include influencers of any kind at your organization, regardless of whether they are in leadership positions.
Step 2: Implementing Change
With a clear understanding of the change, a detailed plan for communications, and change advocates ready to move forward, you can begin implementing change. Often, that begins with training efforts. And it typically helps to train increasingly larger groups. Start with the change-ready sponsors you’ve identified. Then, you can leverage their new-found knowledge (and enthusiasm) to train other managers and supervisors. Those managers and supervisors can then train other employees.
It’s also important to provide resources (and the time to use them) for anyone who wants to learn more, discuss concerns, or revisit their training. Documentation, video tutorials, feedback submission mechanisms, open time with subject matter experts, and other solutions can all contribute to more efficient and effective change.
Step 3: Analyzing and Reflecting on Change
No change goes off without any problems. Hopefully, your team identifies any major issues during the planning stage or among small groups of early adopters. But you should still have a mechanism in place for collecting employee feedback throughout the process to help with issue spotting, resistance management, or other factors that can inhibit change adoption. With that feedback, managers can proactively intervene to continue making forward progress. Once change is underway, individual goal setting can also focus on moving change forward in a positive direction.
To reinforce the benefits of a change and encourage further progress, timely change adoption as well as short-term and long-term successes should be recognized and celebrated during and after implementation.
And, of course, the ongoing impact of any change should always be measured. Change should have a measurable positive effect on your business. If it doesn’t, it should be re-evaluated, which brings you right back to the planning step.
Successful change management obviously involves a great deal more, but these basic concepts should point you and your team in the right direction.
Successful Change Management Builds a Culture of Change Readiness
As changes are effectively implemented, employees have positive experiences with change, and the successes of changes are demonstrated and shared, this sets into motion a feedback loop of change-receptivity that builds toward a culture of change readiness.
Similarly, the more experience with change management your organization has, the more change-capable your team becomes. This not only makes the adoption of future planned changes more efficient but also equips your business to quickly change and adapt when a crisis arises.
OST: Your Strategic Partner for Change and Growth
At OST, clients often come to us with a specific request only to discover that what they actually need is a strategic partner who can work alongside their team to fulfill that request and facilitate change management and digital transformation along the way. Sometimes that’s exactly why they come to OST in the first place; other times, it’s the reason they circle back to OST after experiencing delays, rising budgets, or even failures.
To learn more about how OST can help your teams align toward a common goal and accelerate growth and innovation, contact us. We’d love to start a conversation.