Effective change management – key to success |
In today’s fast paced world businesses are constantly adapting and reacting in order to remain competitive. Businesses must continually evaluate their ways of working and business models in order to achieve their goals.
Change is often complex, spanning multiple functions of a business. Change creates uncertainty and, if managed badly, can cause chaos.
Change management is a term that describes the approach to change, transformation or transition within a business. Effective change management leads to successful outcomes and does not put the business at risk.
So let’s explore change, change management and the benefits of putting a robust approach to change management in place.
What is business change?
Business change is exactly what it says on the tin; any kind of change or transformation that a business undertakes. Change can be planned or unplanned, simple or multi-faceted.
Change within a business can be triggered in many ways and often there are multiple triggers for business change. Let’s explore some examples of change triggers:
|Organisational growth||Organisational growth can be organic or the result of specific actions e.g. a marketing campaign or acquisition of another organisation|
|Technology, IT or systems implementations||Technology, IT or systems implementations often trigger change. Updated, consolidated or new technology impacts the way the business operates. The technology might be core to the business, such as finance or CRM systems, or may be related to modernisation such as websites or digital transformation.|
|Strategic business planning||Strategic business plans encompass vision, goals and approach to achieve goals, which in turn lead to the need for business change.|
|External factors||External factors regularly influence business operations. Political, economic, societal, technological, legal or environmental factors may be out of the control of your business but can still trigger the need for change. For example, new legislation may mean your business needs to make changes in order to comply. You may want to read our posts on SWOT analysis and PESTLE analysis to understand how to carry out a strategic review.|
Change management can be applied to any function within a business or to the business as a whole. There may be any number of different outputs as a result of change within a business, and often one output leads to another.
Changes is rarely simple or associated with only one aspect of the business.
Types of business change
There are several different ways in which change can affect a business. The type of change a business experiences is likely to depend on the change trigger. Change is rarely simple and often a business experiences multiple types of change.
The top 7 types of change are:
#1 Transformational change; a completely new way for the organisation and functions within the organisation to operate. This is often triggered by a strategic review of the entire business and will result in a new operating model. The intention of transformational change can be to improve efficiency, profit and overall bottom line of the organisation. This is also often referred to as organisational change.
#2 Business process change; change to the business processes or ways of working. Business process change generally occurs as a result of other change, such as technology, new operating model or reaction to customer feedback.
#3 People change can be the result of organisational change or just the natural progression or movement of employees. Although organisations should be able to cope with individuals moving on or leaving, it can have a significant impact, particularly where an individual is experienced or knowledgeable.
#4 Technology change is inevitable in today’s world. All businesses are reliant on IT systems working, supporting the business goals and being kept up-to-date. In the age of digital transformation, technology change can form a key part of remaining competitive.
#5 Product change or new product development are big areas of focus for many businesses. New product development and the associated marketing and sales are often driven from the strategy or business plans.
#6 Culture change can be necessary in order to remain competitive and relevant. Company culture is effectively the personality of the organisation. It encompasses the values of the organisation and the way the organisation behaves. For example, the behaviours and values at a very traditional, old-school law firm are likely to be completely different to those at a digital design start-up organisation. Because culture is generally ingrained within an organisation it can be the most difficult change to make.
#7 Knowledge management change relates to the improvement of information and skills of employees and the organisation as a whole. Knowledge management is often seen as a critical part of an organisations strategy.
“What is change?” in summary
In summary, change is triggered in many different ways. Change normally impacts more than one aspect of a business, and it can be challenging to define the scope of the change. Change can be planned but is also often unplanned, and the result of an external impact.
Now we understand more about what change can be, let’s look at why it is so important to manage change.
The key reason to manage change in your business is to ensure that you achieve the desired outcome of the change. Without properly defining and managing the change you are undertaking it is unlikely that your outcome will be successful or meet expectations.
Having a change management approach, or set of principles will help you to deliver successful change and reduce the risk of the change to your business. The following summarises our approach to change management:
|What is the background to the change?||Articulate how the change has come about, or what the motivation for change is. In doing this you ensure that you fully understand the need for the change. You are also able to articulate this need clearly to others.|
|Understand the goals of the change||Having clear goals for the change from the outset will provide focus and direction. Goals must be specific and realistic. Without knowing exactly what you want to achieve, you are unlikely to get there. For large scale transformational change this will be a new target operating model.|
|Understand what success looks like||Having clearly defined success criteria ensures that you know when you have reached the end point of your change. LIke goals, success criteria must be specific and realistic. It is also best practice to be able to measure them in some way.
For example, one of your success criteria may be that procurement processes are streamlined. You can measure this in terms of reduced time to complete specific actions, such as putting in an order for raw material.
|Be clear about scope||TThe main scope of your change will be to deliver the goals. However it is useful to be more specific about what is in-scope and, just as importantly, what is out-of-scope.
|Plan the change||Have an intended timescale for the change at the start, even if this is refined as you go along.
A great way of getting a timescale is to write down all of the key milestones or big activities that you are expecting to deliver and work out how long each one is likely to take. You can put them on a timeline, into a spreadsheet or project plan to help visualise.
Tracking and updating the plan as the change delivery progresses is a key part of change management.
For large scale transformational change this will start with a roadmap depicting how the change will progress. The roadmap will be broken down into more detailed planning.
|Are there any risks, assumptions or dependencies?||It might be that you have known risks at the start of the change, such as technology that you are reliant on that might not work as expected. You may also have made some assumptions or have dependencies, for example on other parts of the business to supply resource to your change team.
Making a note of these ensures you understand the overall picture before you start, and helps with managing stakeholder expectations.
Actively managing risks, assumptions and dependencies throughout the change delivery is essential to maintain control.
|Budget / finance||Determine overall budget for the change and where the funds are coming from. Track and manage the budget throughout the change delivery.|
|Resource plan||Identify the resources you need to deliver the change. Resources will include people, office space, equipment etc.
Put together a table or organisation chart that defines who is involved and what their role in the change delivery is. Having the right people involved will ultimately make the difference between success and failure, and often the difference between having fun along the way or not.
You will need a change manager, but there are some other roles that can help things go smoothly:
|Communication, communication, communication||Communication is king in any change transformation. Understanding who to communicate to, how and when will go a long way to managing anxiety and uncertainty. Effective communication can make the difference between successful and unsuccessful change. Starting early with communication and communicating regularly is key.|
|Embedding and sustaining change||Although last, this is by far the most important and most often often forgotten step.
Once the delivery of the change is complete it needs embedding and sustaining for the business to realise the benefits. Ensuring the business is ready and prepared to accept the change is the first part of successfully embedding the change. How this is done will vary from business to business, and depend on the business capacity to accept and cope with change. It is then important to continue to support the business throughout the transition period from old to new. Continuing with communication and reinforcing the value of the change will help to sustain the change.
Once again, managing change in your business regardless of how it has been triggered, is far more likely to lead to a successful outcome than if it is left to manifest itself.
Mentally for a business it’s a good idea to put some short term goals in place for the change to get wins in early, and get the team and employees feeling positive.
Managing change requires focus, tenacity and determination but can also be an extremely rewarding and positive experience.
We’d love to hear your comments and experiences of change management below. We’ve also pulled together a free PDF summary of this post for you to keep handy as you manage change and transformation in your business. Click the button to sign up for the free PDF. Signing up will also give you access to our members area with PDF summaries of every blog post we’ve written.
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