What is organizational change management?
Every business that undergoes transformation has probably asked this question.
After all, change isn’t as easy as flipping a light switch. It takes planning, strategy, and hard work.
Organizational change management puts all those pieces together and helps change initiatives succeed.
Let’s look at the definition of the term, how to understand it, and keys for success.
What Is Organizational Change Management?
Let’s say that an imaginary company, Acme Industries, is undergoing a major digital transformation.
The company needs to adopt new software tools, new workflows, new mindsets, and even needs to make a few structural changes.
Such big changes can’t happen overnight … and they certainly can’t happen without a systematic approach to change.
Organizational change management is the answer. It’s the system that governs, directs, and administers major business changes.
Key concerns of organizational change management include:
- Planning, monitoring, and directing cultural shifts
- Reducing employee resistance
- Educating and training
- Motivating employees
- Measuring and monitoring progress
Organizational change management is tasked with maximizing the chances of success, sidestepping risks, and minimizing negative impacts.
The first step to doing that is understanding the change – top to bottom, inside and out.
How to Understand the Scope of the Change
Every business transformation is unique.
But because businesses are themselves limited in scope, there are only so many types of organizational change.
Consider our imaginary company, Acme Industries.
Let’s say that they are adopting a suite of cloud-based office tools. Such a change would certainly offer a number of benefits, such as increased productivity, mobile collaboration, secure online storage, and so on.
However, consider ways that such a digital transformation could impact the company:
- Individuals’ work duties and job roles – Individual employees would need to learn new software, change the way they collaborate, and possibly take on new job responsibilities
- Team structures and organizations – Major changes could cause restructuring in certain areas of business, or the addition of new teams and departments
- Work culture – If Acme Industries wants to really keep pace with the digital economy, they’ll probably need to adopt a work culture that reflects today’s digital workplace – one that’s online, customer-centric, and mobile
These examples just highlight a few of the ways that a transformation can impact an organization.
Naturally, the scale and nature of the change could be greater or smaller. And the change management professional will need to consider many other factors, such as the timeline, budget, capacity for change, and so on.
As we can see, business changes are often deep and lasting. Careful planning and hard work is required to succeed.
Given the extensive nature of these kinds of organizational changes, it’s not surprising that many change initiatives fail.
Avoid Failure with These Keys for Success
In a widely cited book by change expert John Kotter, he found that only 1 in 3 large change programs succeed.
A McKinsey survey found similar results, with respondents reporting failure rates of 70%.
Since people drive change, change management often focus heavily on motivating, educating, and supporting employees. Maximize support for change, and you will cut many risk factors out of the picture.
Here are a few ways to do just that:
Develop a change story that includes what and how. The what is the negative that needs fixing. The how is the positive of how to fix it. Change managers and leaders can work together to create a story that articulates the vision for change, then relay that to employees.
Choose and implement a change model. Change models are change management tools used to understand organizational transformations. These often focus on employees, employee psychology, and group psychology. They can help managers understand the change process as it progresses.
Find executive sponsors. Without change leadership and executive sponsorship, buy-in and top-down support will be difficult to come by.
Lead and manage change – don’t do one or the other. Change leaders instill vision, drive change, and push the organization forward. This energy is necessary to move things forward … but unless managers govern the change process, serious problems can bring the whole process to a grinding halt.
Motivate and support from the bottom up. Some companies make the mistake of sidelining employees. This can leave employees feeling helpless, without purpose, and demotivated. Instead, include them in discussions – use creative change management exercises and total participation round tables to ensure success.
What is organizational change management … and how do you succeed at change management?
As mentioned, it focuses heavily on gaining support, providing ground-up training, and communicating with top-level business leaders. Ultimately, it’s a holistic approach to directing change, ensuring its success, and minimizing risks.
It’s also important to note that organizational change management happens before, during, and after the actual initiative is executed.
Finally, remember that today’s economy is evolving faster than ever before. The most agile organizations are those that can lead and manage change.
At the end of the day, this agility will provide a significant competitive edge in the marketplace.