Change happens every day. In today’s business world, it is the only thing that is consistent. But why change? And why are some people better at it than others? And in an environment where everything is changing, why is it so difficult for some companies to change?
To answer these questions, it is important to consider several factors that are necessary in order to successfully implement change within an organization. These factors fall under three dimensions:
- The reason or cause of change
- The effects of change
- The business and organizational environments for implementing change.
By considering all three dimensions, practitioners more effectively can understand the scope of change in its entirety.
In the 1950s and ’60s, large companies developed business plans for the next one, three, five and, in some cases, 10 years. Today, most companies do not or cannot plan beyond 12 months. Advancements in technology have made an increasing number of resources available to all companies, large and small, and they have in turn opened up new markets around the globe. Because change is so prevalent, long-term plans may become outdated and possibly obsolete within months. Business plans must be reviewed, updated and revised quarterly.
Factors of Change
Change involves many components. Some, such as customers or competitors, initiate or are the cause of change. In other cases there are things that affect the implementation of change, such as processes and motivation. In still other cases, the environment contains elements that can promote or inhibit the success of change. The factors that follow will be discussed in terms of the three dimensions of change: reason or cause; effects or influences; and the environment.
1st Dimension: Reasons for Change
While there can be any number of reasons for change, there are three common causes: industry, customers and competition.
Industry — From time to time, every industry initiates change for any number of reasons, including standardization, new technology, quality or availability. For example, some industries have a governing board that sets forth standards that all competing companies within that industry must adhere to. In other cases, governments can regulate quality or availability of products or services. Industries also set the boundaries in which a company is trying to excel. Each industry has its own character in terms of business execution style, rate of change, application of technology and growth. This affects how a company implements change by guiding or favoring certain types of change.
Customers — The end customer is often a cause of change. Customer demands are monitored by a company’s customer service and business development department. If demands are widely held, the company may be forced to make changes to accommodate those demands, whether they are changes to the existing product or developing something new. Often the customer has a need, but may not know what will satisfy this need.
The business and social culture of the customer also influences change. Different customers may have different values or priorities, which can vary the level of formality, rapid response, quality, price and reliability they expect.
Competitors — Competition is a major instigator of change. If a competing company introduces a new product or adds new technology to an existing product and customers decide that there is value to the change, often all companies in the industry will be affected by the introduction. It might cause new development of a competing product or integration of the new technology. In either case, the primary reason for changing is to keep up with the competition.
2nd Dimension: Influences of Change
The second dimension looks at the organization where change will take place. Characteristics of the organization such as attitudes, work ethic and processes have a direct influence on the successful implementation of change.
Organization — Within an organization, the chemistry of the collective unit reflects an attitude toward change. In some cases it might be open to change. In other cases the attitude might be one of antagonism, denial, reluctant acceptance, skepticism or hopeful acceptance. This attitude can be the result of many influences, including age, industry and prior history.
Attitude also can be guided by perception within the organization. If the change is viewed as positive, the attitude can be quite favorable. But if the change is perceived to be negative, the attitude of the organization may become a significant obstacle during implementation. One example of the influence of attitude might occur if management proposes a change that appears inconsistent with the company’s strategic vision. The perceived conflict in objectives may bias the initial attitude. If an explanation or rationale is not given showing how the change relates to corporate strategy, the negative attitude may continue and grow into opposition.
In addition to the chemistry and attitude of an organization, work ethic can have a significant impact on change. If the work ethic is proactive, change will be embraced and incorporated almost immediately. If the work ethic is more reactive, there is less of a chance that change will be fully implemented. Typically a reactive environment is one where an organization is fighting fires. Only if someone with authority steps up and makes a difficult priority call will effort to incorporate change take precedence over daily efforts.
Process — One of the most important factors influencing the implementation of a change within an organization is process. What are the current behaviors of the organization? Management’s behavior in terms of priorities, decision making styles and responsiveness can influence the organization undergoing change as well as those that interact with that organization. Most changes in the organization are initiated by management. Those in the organization that are impacted by change look to see if:
- The change to be implemented is consistent with stated priorities.
- Decisions by management reflect those priorities.
- Management is responsive to questions that arise during the implementation of the change.
If at any time daily operations or a crisis takes precedence over the change, the organization’s perception of the change may turn more negative as a result.
For organizations that develop or manufacture products, any existing development processes that have been introduced as a result of Six Sigma, Lean, CMMI or other internal processes may impact the implementation of change. Most development processes are designed for repeatability and standardization. By definition, change is inconsistent with these. That does not mean that change is necessarily in conflict with process, but care must be taken so that any change introduced is in a structured, documented and repeatable manner. On the other hand, the change must not be bogged down in existing processes or debates. Any delay in implementing change as a result of process can result in a negative perception of the intended change, the process or both.
3rd Dimension: Environment
The environment where change is targeted will have a huge impact on its acceptance or rejection. The motivation for change within the environment and the culture in which the change will take place both play a role.
Motivation — Why is the organization or management interested in making the change? The goal of all change is to strengthen the organization. But the reason for change could be the result of some previous failure. It could also be to improve an area that is currently performing only at an “adequate” level. Or the change could be part of an area that is new to the organization. How is the motivation for change perceived by the organization in each of these cases?
There often are two distinct motivations associated with a proposed change. One is the primary motivation being marketed (internally or externally) with the change. A second motivation is the perceived rationale for the change. This motivation may not be explicitly stated or marketed. It may start at the grassroots worker level, and can be positive or negative. The point is that it may coexist with the stated motivation and in some cases, run contrary to the stated motivation.
Culture — Culture in a work environment relates to the socio-environmental influences. These influences reflect how the organization executes its daily tasks, everything from communication to social networks to management style. Culture is multifaceted and complex. Some examples follow:
- Management styles: The style of management used in an organization can have a huge impact on change. A supervisor who is a leader will be more successful than one who is a manager. Leaders know and understand the importance of implementing change and their role in making it happen. But leaders are rare in most organizations; managers make up the overwhelming majority of supervisors. While autocratic managers can be just as successful as participatory manager, it is the latter that will have significantly more buy-in from the employees. The manager who is more “hands-on” will be successful implementing change.
- Team, clique or individual work relationships: Today, the team approach is widely used. However, while some organizations profess a team approach, actual implementation may not reflect that approach. In some instances cliques form; these may be divided into groups of “doers” and “non-doers” or “watchers.” Or, the team may be nothing more than a collection of individuals, each member of the team working independently for the greater cause of the team.
- Open or closed environments: An open work environment describes a situation where there usually is high turnover among employees. But it might also describe an environment where there is continual growth and learning. A closed environment has minimal competition (usually contract or sole-source business) and is stable. The business may involve little change or is moderately slow to change.
There are many factors that contribute to the culture of an organization. Some are derived from the industry, service, product and size of the organization. The three examples here are representative of some of the aspects that should be taken into account when considering the environment intended for change.
Evaluate the Situation Before Making Change
While change can be difficult, it represents an integral part of today’s business cycle. Businesses are required to change at an incredible rate in order to compete and grow. Unfortunately, in many cases, organizations propose and implement change solely as an action to get from Point A to Point B.
To ensure successful implementation, any change should be evaluated and adapted to address the unique business environment of the organization. The change agents must consider the three dimensions of change, the reason, its influences and the environment.