We bring you a full guide and the top 10 key points to master Change Management in your organization.
We live in an age where change is constant. Information travels faster than ever. We’re all connected, distances are practically nonexistent in our online world, and trends continuously modify our way of living. Change Management is the way organizations best adapt to this reality.
This fast-paced reality and our new way of understanding life affect the way we interact with people and organizations. Businesses have to face the changes in consumer behavior: from the product and services themselves to how we want to receive them, how we look for them or let them find us. For many organizations, this means: change or die. To this, I say “if you need change, at least die trying”.
But we don’t need to get to that point. The sooner you start modifying your company’s inefficient activities, the better you’ll overcome your threats and weaknesses. So, let us show you what change in an organization should look like, and how to manage it correctly.
What is change management?
When an organization undertakes projects to improve performance, seize opportunities or address key issues, they often require changes. These changes can affect processes, job roles, organizational structures, or technology.
Change management is the method an organization uses to conduct the internal and external changes necessary to implement a new system. Many times, managers believe organizational transformation means devising huge strategic, tactical plans. However, for change management to succeed, we need to go further into how change affects each component of the organization.
Conventionally managers view a company purely as a system and forget its essential component: the human factor. Organizations work under rules, values, and a culture that shapes the behavior of each one of the workers. It might seem relatively easy to change the formal organizational structure of a company. Nonetheless, if the workforce doesn’t embrace this change, you’ll never be able to escape the issues you were trying to solve in the first place.
Therefore, managers must understand it’s essential to align the change proposal with the company’s culture, values, people, and behaviors. Plans for change, by themselves, do not ensure arriving at your desired results. Nor will they convince the people in the organization of the true value behind the transition. Yet real change comes from sustained collective actions by the employees in the company. Only by making them comprehend the power and value of the initiative will you be able to effectively install it. Communication is key.
So, to sum up, it is the employees of your organization who have to ultimately change how they do their jobs. If these individuals are unsuccessful in their personal transitions the organization’s initiative will fail. Change management is the discipline that guides how we prepare, equip and support individuals to successfully adopt change, in order to drive organizational success.
How is it implemented? How can we overcome resistance to change?
The real challenge behind organizational change is it requires many levels of cooperation, from top to bottom and sideways. Many times, it might involve external entities that you had a relationship with, and independent branches inside the organization that might not be subject to said change. This means, developing a structured approach to change is essential to ensure a beneficial transition. Also, as we’ve said, a good change management approach will help mitigate disruptions. This includes preparing and supporting employees, establishing steps for change, and monitoring previous and post-implementation activities.
Change management’s main focus is assessing human resources. This is because failure to change is usually due to the inadaptation of the workforce. Effective communication is one of the most important success factors for change management. All involved individuals must understand the progress through the various stages and see results as the initiative materializes. So, how can we do this?
Mckinsey & Co published an article on 4 psychological principles to achieve effective change on the human factor of a company – a way to modify organizational culture from its core. These are:
1. Establishing a purpose to believe in
Cognitive dissonance is a well-known psychological principle studied by Leon Festinger. It shows the importance of aligning one’s beliefs with their actions and reality. People are not comfortable with accepting a reality that does not respond to their preconceptions or ideas.
In the workplace, employees are also affected by this phenomenon. It happens when they’re told to act in a certain way or complete tasks they don’t see the point in doing. If a worker is forced to take on duties they don’t value they won’t feel motivated to do those tasks. This lack of motivation becomes clearer over time. Sustained inconsistency between their beliefs and their actions will drive them to go back to their old habits. Furthermore, when people up the ladder with executive positions feel this way, an initiative to change is at an even higher risk of failure.
Change is supposed to be sustainable over time. To achieve this, everyone must be involved in the process and embrace the change. From top management to the last employee, they must feel something deeper than just the logical explanation of why the transition is valuable to the company. People tend to value their personal feelings over logical reasoning. So, they should feel part of the initiative in a way that resonates with their purpose inside the organization. A way to get to this level of commitment is by developing a compelling narrative that accentuates the importance of change in the survival of the organization.
2. Reinforcing systems and behaviors
One of the most basic functions of the brain is reacting to positive reinforcement by repeating certain actions. This was tested around a century ago by BF Skinner’s research on rats. People are (generally) more complex and not as easily taught to change behavior. However, there’s an underlying animal instinct in all of us that responds in the same manner.
We’re talking about the most basic way of motivation. We use this reinforcement to shape people’s habits in the workplace. Its purpose is to clear the way for them to assume their new roles and responsibilities inside the organization. Rats are easily manipulated with treats when they’re good and shocks when they fail. But hopefully, most managers won’t want to treat their employees like rats. Positive reinforcement has many shapes and forms inside the company, but the basics are notably the same:
- Setting targets aligned with desired changes
- Measuring performance
- Providing incentives (be that financial or non-financial) to employees that achieve them.
3. Teaching skills required for change
Many change initiatives make the mistake of expecting employees to behave differently without teaching them how to adapt to their new individual situation. Leaders need to show workers what is expected of them. They need to know how to achieve those expectations by transitioning from their previous work to their new current situation.
But it’s no easy task for many managers to teach their employees how to do this. Adults are not as good learners as children. It takes time and effort for them to learn new skills and change their work dynamic. They usually work best by following a 4-stage cycle, studied by David Kolb (specialist in adult learning).
Merely listening to instructions won’t do the trick with these people, this is just stage 1. Adults need to absorb the new information over time by breaking it down into several digestible chunks (stage 2). They then should be able to experiment with this information, put it into practice, and integrate it into their existing knowledge (stages 3 and 4). Large change happens with small iterative steps by adding new information once the last one has settled. To make sure they understood what’s taught is to ask them to explain it to people that don’t know about the subject.
4. Having consistent role models
Last but not least, there will need to be role models at every level that pave the way for change. People that walk the walk and collaborate in the change program in a position of influence to their peers. Having consistent role models means that certain people at different levels and functions embrace the values of change consistently.
10 Commandments to great Change Management
Behavior in organizations is deeply affected not only by role models but also by the groups with which people identify. This includes formal organizational groups, like company branches; as well as informal groups that many times pop up around a natural leader or the best worker amongst peers. Role modeling by individuals must therefore be confirmed by the groups that surround them to have a permanent influence.
Now, let’s go over 5 guiding principles to inspire what change management should look like in your company; and 5 steps to make your initiative successful.
5 Guiding Principles of Change Management
First things first. To promote a change proposal or initiative in your organization you must understand it yourself. Analyze and make sure you’re completely aware of everything that the change proposal entails. Try to look for the following: Reasons, Return, Risks, Resources, Responsibility, Relationships. Or, in other words:
- Why do we need change? What are the reasons and what are the objectives?
- What do we expect to gain from it? What’s the return on investment?
- How costly is it? What resources do we need to make it happen?
- What risks are there to the proposal?
- How will it affect the people at the company? Who is responsible for implementing the change?
- What relationship is there between this initiative and others?
But there are more factors to a change proposal’s success than the vision or plan you have for it. Beckhard and Harris’ Change Equation makes it clear that one key element to implementing a change initiative is Dissatisfaction. For change to work, there needs to be dissatisfaction amongst the people in the organization in the old way of doing things. Many times this is not the case. As we said before, people grow accustomed to a series of work habits and responsibilities. They might not even be aware they’re causing the downfall of the whole company.
This is where Communication and our previous 4 psychological principles come in. Individuals must comprehend the need for change to the point their current state causes dissatisfaction. But more on communication later…
Effective change is a very complex process, it won’t come by chance. The bigger the organization the harder it will be to coordinate every part of it to follow your plan. The older the company the more rigid and averse it will be to change. So it’s no secret that having a well-structured, step-by-step plan must be at the core of any change proposal. Each organization has its own needs and will opt for different approaches to change (some more rigid than others).
In any case, the plan should be one fitted to the organization’s present reality more so than to what you wish to achieve, at least to start with. Just as we said before, people (especially adults) take a long time to adapt to new realities. Feeding them change little by little will ultimately modify your company in the long run. Yet changes need to be big enough so that they’re perceivable by individuals. Not doing so might make them fall into old habits and dismiss their new roles or responsibilities.
Any way you plan it, usually for your plan to succeed you’ll need to consider:
- Sponsorship: Find ways to engage and secure support from high-level individuals that back up your initiative.
- Involvement: Look for the people that are in the best position to help you design and implement the change you envision.
- Buy-in: People across the business, from different functional areas and levels, should be convinced that change is necessary
- Impact: Establish what success looks like, how to predict and measure the change.
There are several tools you can use to start planning your change initiative. Some of the most noticeable are:
- The Burke-Litwin Change Model: allows you to formulate an approach that suits the structure, dynamics and current context of your business.
- McKinsey 7s model: centered around the alignment of seven fundamental elements of any organization.
- PDCA (Plan, Do, Check, Act): a cyclical and iterative change management process focused on continuous improvement.
As we’ve said before in the article, communication can be change management’s key to success or its reason for failure. Change must be clearly communicated and relevant to everyone receiving the information. People have to understand what you want from them and, most importantly, why you need them to do it. But you’ll have to balance the cold facts and logical reasoning with the right tone to engage the employees’ internal emotional reactions. They need to believe what you ask of them is something they’d want to do on their own. Employees will want to benefit themselves and the organization.
Workers are not the only people you should be considering when communicating your change initiative. It’s important to take into account all stakeholders in the company, internal and external. Change must be well seen amongst everyone involved in the organization’s well-being. A good way to do this is by staying true to your company’s vision and mission, the highest values behind the organization, and its purpose.
The ADKAR Change Management Model gives a good general view of the issues you should address in your communication: Awareness of the need to change, Desire to improve the situation, Knowledge of how to make it happen, Ability to change, and Reinforcement to sustain that change over time.
But how should you take on this communication? Well, here are 4 tips to make your communication that much better:
A. Make the logical case.
Humans are inherently rational, at least to some extent. When confronting the situation, it’s essential to have a logical solid background that supports your initiative to change. An analytical base with factual reasons to implement change. From there, you can build on and articulate an emotional approach that digs deeper into the feelings of the people you want to reach. There are three steps to making the formal case: confronting reality and articulating a convincing need for change; demonstrating faith in the capabilities of the company to have a viable future; providing a guide to achieve said future.
B. Evaluate the culture.
Real change happens when the new initiative is backed up in different levels of the organization as it cascades down. The leaders in charge of making it happen must understand the culture. Role models must account for the behaviors in each level of the organization. It’s easy to make the mistake of using the same message in the same way for different areas and levels of the same company, but that won’t get you to where you want to go efficiently. Adapting communication to culture is not about changing the endgame of the new business proposal. It’s about adapting the means on how to get there depending on your cultural diagnosis. This includes identifying conflicts, influential factors, and possible resistant points; as well as studying core values, beliefs, and behavior.
C. Communicate the message regularly – shape the vision.
Even when explained thoroughly and believing the workforce has understood the need for change, it’s essential to reinforce the ideas behind the message. Too often leaders can feel like their crew understands the issues and feel that same need for change. It’s most likely not the case for everyone. The best way to make sure the message resonates is by regular, timely advice that is practicable and inspires that need for change. Communication flows from top to bottom. It should provide employees with help and not commands. Try to find a way for them to consider their needs to be fulfilled by the values behind the change. It’s important to not become excessively repetitive or redundant. However, multiple channels of communication should be put into place to get the same concepts delivered by different sources.
D. Speak to the individual.
As we’ve said multiple times, although change ultimately happens organizationally, it always comes down to a personal journey. For the organization to change, the people have to change individually. Everyone should know how their work will change, what’s expected of them during the change program and how all of that will contribute to the big picture. Team leaders and role models should be honest and clear when communicating the practical reality of their change. People appreciate honesty and embrace the message when they feel involved in the process in a clear way. They also react to what they feel and hear around them. It’s not a bad idea to reinforce desired behavior through recognition or promotion in a clear manner.
There are many approaches to implementing a change in your organization. Many strategies have been studied and tested looking for different reactions in personnel involved in taking action. Some try to tap into the need for urgent change for people to elevate the momentum and get behind a big project, like Kotter’s 8-step model. While others try to encourage everyone to get behind changes by being mindful and sensitive about employees’ feelings throughout the transition. The Change Curve shows the stages that people tend to go through during a change in your job. From shock and denial to fully invested in the new way of doing things.
Tips to implementing change
Whatever method you choose to try out, there are some steps to help you along the way:
- Make sure everyone involved is actually on board with the change and believes it’s the way to succeed. They need to know what needs to happen, why it has to happen, and what it means for them and the people around them.
- Know what you want to achieve, set up measuring systems and criteria to see the change, making it tangible and purposeful.
- Identify the stakeholders you want to attract to support the change. This includes employees: they’re the most involved stakeholders.
- Assess training needs that may be necessary to address the issues that might slow down implementation.
- Find ways to change people’s habits to introduce the new practices you want to put in place until those are the norm – reward desired actions.
- Make sure everyone is supported during the process, and that they can all feel that everyone is adapting to the new reality.
One key aspect of implementation comes by involving every organizational level. Transformation evolves from defining strategy and setting targets to designing and implementing it. As you go along, you’ll have to involve every layer of your organization to put on the effort for change. To do this, identify leaders and push responsibility down the ladder in a cascade fashion to reach every level. Leaders must align to the company’s vision and mission while showing the way to follow to go through
Last but certainly not least, controlling progress along the transformation period might be one of the most important principles for change management to succeed. As you might know, it’s easy to lose track of one’s objectives when everyone around you follows a certain routine. Change initiatives often grow longer because there aren’t well-structured measures to keep you from going back to old habits.
When you start planning your change proposal it’s necessary to study the organization’s circumstances and the gap between the present and the desired situation. Quantifying this gap with performance indicators and measurable data allows to correctly follow a plan and adjust along the way. This way you can also assess resistance and evaluate what elements are slowing down your transition to take action. Basically, change management’s control principle consists of monitoring progress relative to your expectations and emerging issues to anchor the change steadily and succeed.
The basic functions of controlling a change proposal are:
- Collecting and analyzing data
- Monitoring progress relative to your plans
- Quantifying gaps
- Understanding resistance and taking action
- Making sure to anchor the change
5 Steps to Successful Change Management
1. Identifying what, why, and how to change:
Before starting any change process, you need to go through a series of steps to assess your organization’s situation. You need to make sure you understand what isn’t working, what’s missing, why it’s happening, where you want to go, and how you want to get there. Organizational change is not always the answer. Companies often find themselves stuck in a difficult situation without needing to restructure or change any of their processes, so try not to find yourself using sledgehammers to crack nuts.
We recommend you take these 4 basic steps before embarking on any change process:
Conduct an internal analysis.
Identify the different aspects of the organization that are causing the problems you want to change. Collect data and establish parameters for the main issues you want to handle. This internal analysis should be focused on the aspects that will be subject to change. This is because it’s important to study how possible changes could affect the people in the company and start spotting where resistance to change can appear.
Identifying what needs to change.
There are always many ways to tackle a bad situation. In some cases, it’s obvious what needs to change, in others, it’ll take some creativity to solve them. Depending on what you consider to be at the root of the problem you’ll take on different approaches. So, it’s important you objectively identify what needs to change and how to follow the progress you desire. A good internal analysis can help you identify problems easily.
Undertake a gap analysis.
Having studied your present situation, compare it to the desired future of the company. At this point, you’ve already identified what needed to change and you have established objective data and parameters for it. Now, compare those flaws you stand on at the moment to where you want to be after implementing change.
Plan the change.
This is where you build your roadmap to go from where you stand to where you want to be. You’ll have to find this path to follow with a step-by-step guide towards a better future for the organization and its individuals. To make it happen, identify key factors for change and those that will help you along the way, the actors who will effectively implement your proposal. On the plan, you need to be specific about responsibilities, resources, objectives, measurable targets, incentives, etc.
2. Provide Resources and Data
As we said, resource identification and cost management are a big part of the planning process. Time and money are the two most basic resources a company is ultimately worried about when initiating any type of change. You must have a clear vision of what you think these investments will look like and how you’ll spend them on the specific measures or tools for change. From infrastructure, equipment, or software to training employees and adapting to new practices. Reporting data allows for better analysis, communication and adjustment of the measures and incentives you’ll have to put in place. It’s also basic to follow progress along the way.
3. Communicating the message
We can’t stress this enough: communication is the thread by which change management hangs. By now, we all understand organizations are made up of individuals and they need to comprehend and interiorize change individually. The best way to achieve this is through a good communication strategy. The entire practice of change management is built around effective communication from start to finish. From involving high ranks in the organization to each and every one of the people involved, communication has to inspire them to change. Their skill sets, knowledge, and experiences will have to be shaped into a different mold to fit the new needs of the company. Culture, customs, habits, behaviors… might contribute to resistance to change. These are all fought through clear and open lines of communication and following the tips and guiding points we’ve explained all in the article.
4. Monitor resistance, manage risks
Resistance will always be a part of change management, in fact, one of the main concerns of any change leader. It often spreads amongst members in the organization behaving like a wildfire – if it’s dealt with at first, it’s easy to manage but as soon as it spreads it’s nearly impossible to put out. That’s why it’s important to know how to deal with these situations since they can seriously threaten the viability of the plan. Resistance is often linked to the risks associated with change and the aversion to the unknown, both individually and organizationally. It’s important to anticipate possible resistance points and prepare for any kind of trouble that might appear. People value the sense of security over promises of having a better future. It’s the manager’s responsibility to let the employees feel safe during the transition by preventing risks and monitoring resistance.
5. Celebrate success
Recognizing progress as you achieve milestones is an essential part of every project, even more so in a transformation process. Celebrating achievements and goals is especially important in a change period since the objective is to modify how a system works, rather than accomplishing an objective through your normal system. People need to feel reinforced when doing something that is out of their ordinary routine because they feel more insecure and lost when doing them. It’s important to recognize the success of teams and individuals throughout the process. This helps to adopt change itself and reward desired behaviors. Therefore, you can anchor change and shape people’s behaviors as you keep track of the progress you’re making.
Change Management is the discipline that guides how we prepare, equip and support individuals to successfully adopt change. There will always be resistance to change in organizations. People are resilient to modify their routine or go against old company habits and behavior. Having a well-structured plan, communicating the message, and monitoring resistance while managing risks are your main way to success. You should always consider organizations are made up of individuals and only by making them change will your project succeed.
Organizations don’t change, people do.