Change management is key to successful business transformation. Whilst the adoption of new technology like artificial intelligence (AI) steals many of the headlines as businesses strive towards innovation and optimization, without the effective management of change, efforts are often doomed from the start.
Process improvement, operational excellence (OPEX), digital transformation and automation are high on the agenda for many modern organizations. Whilst these endeavors offer many benefits and advantages, they often require changes in processes, roles and responsibilities. This can be met with resistance from employees who are comfortable with the status quo. Change management is therefore integral to succeeding in an ever evolving business landscape.
What is change management?
Change management is a collective term for approaches to support and help individuals and teams in making organizational change. Organizational change refers to the actions in which a company or business alters major components of its business such as culture, internal processes, underlying technologies or infrastructure, according to Harvard Business School Online. Change management is considered the process of guiding organizational change to a successful resolution – typically including the three major phases of preparation, implementation and follow-through.
However, defining change management may be a little more complicated than that. “Ask organizations to define what they mean by change management and you will get a variety of answers,” Steve Hearsum, consultant, supervisor and developer of change practitioners, founder of Edge + Stretch and author of No Silver Bullet: Bursting the bubble of the organizational quick fix, tells PEX Network. “At one extreme, leaders with a high need for control will construe it as a bastardized form of project management, with an emphasis on control and unhelpful, top down approaches,” he says. Somewhere in the middle is buying in a methodology (like PROSCI) to structure an approach, but too often organizations forget that a methodology in and of itself may be useful but not sufficient.
“Finally, we get the more nuanced approach that recognizes that change management is about managing the tension between planned interventions and building capability of the right people in the organization to facilitate and lead change,” Hearsum says. That includes those commissioning change, who sometimes forget that leading change requires their own skills to be sharpened. “Change management, at its best, is about understanding and knowing how to intervene in human systems.”
READ: PEX Guide: What is change management?
Why change management is so important
Change management is as crucial to an organization’s process improvement, OPEX and business transformation efforts as exercise is to building strength and endurance, says Scott Simari, principal at Sendero Consulting. “These are all organizational changes that ultimately optimize performance. Effective change management is a foundational part of that optimization, the same way exercise is a foundational part of good health.”
Like starting a new exercise routine, if an organization has never experienced the benefits of regular and effective change management and starts to implement these practices, it may feel difficult initially, but the organization will likely see rapid results, he adds. “Once an organization has been disciplined and thoughtful about their change management practices, they will develop ‘a muscle.’ As the muscle strengthens, the organization will be capable of change that’s larger in scale and more difficult than what an organization with ‘weaker muscles’ could accomplish.”
Just as you cannot achieve optimal health without a balanced exercise routine, an organization cannot achieve optimal efficiency without embracing and effectively managing change. “Without the foundation of strong change management practices, initiatives aimed at optimizing business strategies can encounter resistance, lack of adoption or even failed implementation.”
REGISTER: All Access: Change Management for Business Transformation 2024
Change is scary
In an era of continuous technological advances, changing customer demands and evolving employee demographics, organizations face a need for rapid change and transformation. “The ability to rapidly transform and continuously adopt change is increasingly the most crucial competitive advantage and the most important deciding factor for whether a company flourishes or becomes obsolete,” says Andrea Schnepf, managing director at nepf LLC.
However, change is a truly scary thing for a lot of people in corporate America. “I don't know if you have seen the movie The Shawshank Redemption but I like to use the ‘institutionalized’ scene to illustrate that. As we become accustomed to a certain environment, alterations to that environment can have drastic effects on workers’ emotions, inducing fear, paranoia and loss of self,” says Eric Davison, software development and agile coach specializing in change management. Those feelings can result in them pushing back on the change, trying to fly under the radar by continuing to do what they have always done, deciding to not do anything or to ultimately leave the company, he adds. “The same goes for team members that want to make changes at an organizational level. Leaders/managers got to where they are by doing what they do. They generally don’t want those things that make them feel safe and in control to change.”
READ: Understanding the psychological dynamics in change management
Business change circles back to people
Even if you have identified the right thing to do, to get it done is quite a different matter altogether. This is true of a country, a company, a project or even in our own home. There will always be vested interests who like the status quo, or who are afraid to change, or external elements that don’t want you to improve, says Mohan Madhurakavi, chief evangelist of digital transformation at Kissflow. “The change normally involves humans in some way or the other. When people are involved, wanting all of them to move in one direction requires various skills.”
Navigating the complexities of technological advancements necessitates a robust change management strategy. The adoption of AI by organizations is increasing day-by-day through the introduction of new technologies like generative AI, for example. Prioritizing the human element within digital transformation highlights the critical balance between innovation and maintaining a people-first approach.
[inlinead-1]