“The only constant in life is change.”
The concept of change has become so pervasive that no business leader could impress investors by saying things are status quo. Yet while driving change is a constant preoccupation for most CEOs and CFOs, relatively few change management programs succeed. Why is this so? Research has shown that around 70% of change in multinationals fails for the past 15 years.
The world trends such as liberalisation of government regulations, globalisation, Internet, emerging technology, corporate social responsibility and economic uncertainty are just some examples. Organisations are now forced to react and evolve, but a successful organisation knows it must not simply be reactive, but rather proactive.
Major strategic shifts now come around much quicker and more frequently. This highlights that the consequences, stakes and the costs of change management failure are big. Today, staff is being asked to take on three to four times as much change as they can naturally handle and some may lament about this “fluidity” in an organisation. Thus, change management is a definitive core competence as the ultimate corporate advantage in today’s business environment is the ability to transform. Change is seen by many as a positive force, an opportunity to reassess the fundamentals and keep excesses in check.
What are the steps that characterise successful change management efforts? Here are some key steps for starters.
1. Communicate- Prepare your troops
The logical first step to major change is convincing everyone that a fundamental shift is needed – and quickly. However, rather than knocking your employees over with a wave of change, it is important for leaders to ignite a sense of fire that inspires deep-seated, durable change. Especially for Generation Y who have been researched to need a sense of reason and personal interest, employers have to give them a reason to fight for.
Tone from the top is key in change management. It is essential that change is driven and communicated well by senior leaders. The required resource, desired outcome and the accountability should be clearly communicated. Some have indicated that failed change management initiatives often point to lack of communication from the management and audit committees.
2. Equipping your Troops with the Necessary Resources
To embrace change, an employee must be willing – and able to implement the changes. It is ironic for a company to spend millions on a merger or acquisition, yet spend only a fraction of that on training. Just like a soldier who needs his weapons to fight, employees need to be well-equipped in order to battle it out in business. The learning and development must be thoroughly thought-out and well implemented.
One must have a clear understanding of the new competencies required, target and tailor the training efforts so people are fit for the new purpose. With transformative change, the new skills are often more behavioral than technical. For example, an employee whose administrative role has been outsourced may be willing to take a stab at the more strategic job of business liaison, but lack the capabilities. In order for the employee to be rotated to fit the new shoes, such a shift will require time and in-depth education. It is also important for the senior management to communicate to manage any potential expectation gap before the employee takes on the new role.
3. Focus and reward on the right numbers
As most of us know, goals must be S.M.A.R.T. This means the goal must be specific and measureable. Tradition often overpower organisation at the on-set of changes since people are innately resistant to change. Thus, it is helpful to break down the transformation into smaller chunks of changes. This enables your organisation to monitor milestones and celebrate success. One can build on small, short-term victories to infuse the team with momentum, so they can carry out the full extent of the desired changes. It is crucial to measure and celebrate your results, instead of assuming there are achievements made.
More importantly, do ensure you are measuring the right things and rewarding them as well. The carrot incentivising the right behaviour must be the right one, whereby it enhances the value of your business. There is no magic to all this, so it is important to rally the troops through constant communication, equipping them with the necessary resources, as well as keeping an eye and rewarding the key indicators of success.