What is the nature of organizational change?
And what drives change?
In this article, we’ll see how the drivers of an organizational change determine the nature of that change.
Then we’ll look at 11 different drivers of change.
The drivers of an organizational change – its root causes – will determine many things about a change initiative, including:
- How the project should be managed and executed
- Optimal solutions
- Risks and potential obstacles
- Potential returns
Among other things.
Let’s dive a bit deeper and look at the specific drivers of organizational change.
The Nature of Organizational Change vs. Change Drivers
In many cases, there is a single root cause – or a set of causes – that drive organizational change.
For instance, competitive pressure may spur the implementation of a new software application.
Customer feedback may fuel the transformation of the customer service department.
In these instances, identifying the root cause of a change is fairly easy.
However, that organizational change may drive other changes.
- Competitive pressure may drive a business to develop new a set of services or products
- Launching those products and services may require other changes, such as rebranding or changing the organizational culture
- Those changes, in turn, may require strategic changes or cultural changes
The nature and true drivers of organizational change, therefore, can be complex.
11 Drivers of Organizational Change
Below, we will look at 11 different change drivers.
Some of these are strictly root causes.
An opportunity for growth, for instance, is a root driver of change.
However, some of the others covered here – such as rebranding or restructuring – can be two things at once.
They can be a type of organizational change as well as a driver of change.
To start with, let’s look at some common root causes of organizational change.
According to Altimeter, growth opportunities are a major driver of organizational change.
In today’s digitizing marketplace, this is no surprise.
The online economy has opened up countless new opportunities for growth, including:
- Innovative products
- New markets
- New business processes and practices
To name just a few.
Many people and organizations resist change.
They only change when they have to.
And one thing that pushes people to change is competitive pressure.
This pressure can come in the form of bigger competitors, digital disruptions, new products, and so forth.
Business cultures can be influenced deliberately by an organization, or these changes can occur naturally.
When cultural shifts occur organically, then organizations must respond to those shifts.
For instance, with every generation, cultures change.
These changes demand new workflows, processes, work environments, communication strategies, and so on.
As with every other change driver covered here, the nature of the change will depend on the root cause of that change.
Customer demands can also fuel organizational changes.
New buying habits, audience sophistication, new technologies – any of these can pressure an organization to make changes.
Those change projects can include everything from new products to new marketing approaches.
Today, technology itself is a major driver of change.
The fast-paced digital marketplace is fueling digital transformation across industry after industry.
The internet, for instance, has spurred the growth of countless markets, channels, and new economies.
Another basic reason to change is process efficiency.
Inefficiencies can stem from many causes, such as:
- Ineffective communication
- Poor teamwork
- Outdated software
- Inefficient procedures
Likewise, process improvements can come in many forms, from digital adoption to procedural changes.
A shift in an organization’s strategy can easily result in organizational change programs.
Organizations that adopt a digital-first business strategy, for instance, will likely undertake a variety of digital transformation initiatives.
A company that begins emphasizing a customer-centric strategy will certainly initiate a number of transformations to their customer-facing business functions.
New Products and Services
New products and services can – like many of the other change drivers covered here – be the result of other causes.
And they can also fuel other changes.
For instance, customer demand may push a company to create a new product. That decision, in turn, can cause a business to engage in other change programs, such as structural changes, strategic shifts, and so on.
Organizational restructuring can involve:
- Reshuffling management
- Changing job duties, roles, or responsibilities
Any time a business is restructured, it will often involve – and fuel – other changes, such as changes to procedures, processes, culture, and so forth.
Rebranding is another type of change that can drive other changes.
It can fuel:
- Cultural shifts
- Changes to customer service
- Shifts in PR strategies
- Changes to marketing strategies
To name a few examples.
Mergers and Acquisitions
Mergers and acquisitions are often large-scale, impactful changes that drive:
- Changes to processes and procedures
- Cultural changes
And so on.
These complex changes are often driven by other, high-level causes, rooted in business strategy, the business environment, and so on.