Introduction: In today’s dynamic business environment, ‘Change’ is something that every organization is grappling with all the time. Change can be a result of a wide range of business initiatives, which include consulting assignments, IT initiatives, M&A, Business process reengineering and organizational restructuring.
Firms are continuously looking to improve performance and gain competitive advantage through these initiatives. These are large scale programs that impact vast number of employees spread over multiple business units and locations. If not managed well, such large scale changes can lead to a dip in operational performance and employee morale. Many change initiatives fail to realize the intended benefits due to lack of sufficient planning, executive support and monitoring.
Change Management has been studied widely and different practitioners have suggested different methodologies for managing change, but the essence remains the same. In this article I will describe basic elements of a well defined and structured approach to ‘Change Management’.
Important aspects in managing change
Following are the most important aspects of any change management journey. If these are properly understood and internalized by the firm, the chances of going wrong are greatly reduced. All these are basic ingredients of any change management methodology.
• Understanding, articulating and communicating the need for change: A thorough analysis of the current realities of the organization and the need for change is a prerequisite for taking action. The need for change should be clearly articulated and communicated to all the stakeholders including employees, vendors and other business partners. This ensures that all the stakeholders are aware and readily embrace change when it is being executed.
• Putting in place a change management structure: The change should be entrusted to a ‘change management team’ which should be segregated from the operational staff for the duration of the change. This change management team should be led by ‘Change management leadership’ with clearly defined roles and appropriate authority to deal with organizational inertia. It is very important for the change leadership to have required levels of executive support to carry forward the change agenda.
• Impact assessment and addressing performance issues: The impact of change on the organization should be analyzed and documented. People, processes and technology are the three pillars of any organization and all of these are impacted. The resulting disruption of business should be addressed and alternatives should be identified. These alternatives and risk mitigation measures should be communicated to all the stakeholders.
• Communication: The importance of communication cannot be over stated. It is the cornerstone of any successful change program. The details of what will be communicated to whom and at what time should be worked out and documented. The communication should be tailored to the needs of the intended audience and delivered at appropriate intervals. The medium of communication and on whose behalf it is sent is also very important.
• Train and enhance skills: Rapid developments in technology are one of the main reasons organizations have to undertake change initiatives. Most of these changes require new skills and behaviors. For maximum benefit realization the employees should be trained and required skills should be imparted.
• Monitor and manage the transition: The transition to the ‘future state’ should be carefully monitored and adequate steps should be taken to resolve any issues that come up. The performance indicators should be continuously measured and the progress compared with the plan.
Phased approach to Managing change
A simple phased approach that incorporates all the basic aspects discussed above is described below. This framework gives structure to all the activities that need to be carried out while managing the change journey. It can be suitably modified depending on the ‘change initiative’ and the needs of the organization.
We start the change journey by understanding the context the organization is operating in. It also involves creating a business case for change, outlining the intended benefits. There may be a need for multiple changes in many different areas. These should be prioritized based on available resources and intended impact.
Effective leadership and executive support is an absolute necessity for successful execution of a change program. The existing leadership structure should be analyzed and the change practitioners should create a change leadership team that is committed to and capable of carrying out the change plans.
The stakeholders within and outside the organization should be identified. Finally a high level impact assessment should be done.
This phase should start with a detailed documentation of ‘future state’ as identified by the change plan. The transition from the current state to future state will involve many different roles and departments within the organization which should be ready for the change. A plan documenting the changes and the impact of the change should be prepared.
At this stage the stakeholders and the impact on these stakeholders should be documented in greater detail including the communication requirements.
The change implementation plan should incorporate the schedule of activities, stakeholder management, communication structure, training and risk mitigation plans. Identifying the measures of the change progress is an important aspect of the planning phase. The measures will help in monitoring the change process and in identifying the need for interventions.
It is now time to execute the change management plans. The analysis and planning in the previous phases will guide the implementation of the change. The communication and training plans are in operation and should be continuously assessed.
The performance measures identified during planning phase are monitored, which ensures that any issues that need attention are taken care of. During the transition all the stakeholders should be kept well informed and their involvement should be ensured. Finally quick wins should be communicated to everyone and celebrated to enhance employee morale.
Once the transition is complete, the change management structures should be dismantled and the new processes, structures etc should be merged into the organization. The continuation of new processes may require ongoing support and training which should be planned in advance.
At this stage we are ready to quantify the benefits that the change initiative brings about. These benefits should be reviewed and lessons learnt should be documented for the future. The benefits of the change should be communicated to all the employees and other stakeholders. This ensures that any future change initiatives will be welcomed.