By: Lauren Dellarocco
Throughout an organization’s lifetime, it will inevitably undergo at least one form of organizational change. Organizational changes reflect the inescapable and ever-changing reality of the competitive business world.
Technologies will continue to advance; outdated systems and processes will continue to be replaced, and the process of organizational change will continue to rear its head, prompting leaders to reevaluate processes and reestablish the new norm.
A successful process of organizational change safeguards a company from losing profits to the competition and missing out on opportunities to increase ROI, lower costs, and improve productivity. The process works to secure a persistent, competitive advantage in the market.
“Change is the only constant in life,” -Heraclitus, Greek philosopher
Now more than ever, companies need to institute organizational changes that respond to market trends, appeal to consumers, and advance parallel to the rapid digital age.
What is the process of organizational change?
The process of organizational change is the all-encompassing guideline for successful implementation of transformative changes throughout a company. Whether it’s in the form of a planned change, cultural change, process change, transformational change, or changes in the organizational structure, every company will eventually endure organizational change.
No matter the form of organizational change, it’s crucial that a detailed process is in place to avoid employee resistance, confusion, and fatal oversights.
Instead of focusing on the specific change at hand, the process of organizational change is in place to create the structure and guideline for any sort of large-scale change in a company.
Imagine the organizational change process as a hollow framework for individual initiatives to be inserted and interchanged as necessary. The focus in creating a process of organizational change doesn’t lie in the specifics of the change, but in the creation of a comprehensive, overall infrastructure.
Organizational change may occur when a startup company decides to expand the workforce, find a larger office space, or expand to another state. Or, say a company’s work culture no longer meets its business objectives, and top managers decide the company needs to refresh its mission, vision, and values. In either scenario, a process of organizational change will guide the change management team with proven steps to ensure a successful transformation.
When there’s potential for the company to operate in a more efficient and cost-effective manner, the current state of the business comes into question—and there’s always potential for a company to improve its operations.
The current state of the business should always be in question, which is why organizational change is a recurring operation that requires a thorough, 10-step process.
10 Critical Steps in the Process of Organizational Change:
1. Recognize the problem. Build urgency.
It’s important to build urgency around a change initiative to get everybody on the same page, with the same understanding and the same urgency. When team members and leaders agree that an aspect of the company needs to be changed, urgency can drive change efforts.
Facilitate open and honest communication with employees. Communicate what’s happening in the market, what the organization could be doing to ensure sustainable growth, where the company is falling short, and what this could mean for the future state of the company.
To support the urgency, speak to employees who face customers or consumers. Employees in the customer service department will have firsthand knowledge of the consumer’s pain points and frustrations.
Support your claims with real data and statistics—even if the numbers are worrying. Leaders often conceal data that could reflect poorly on their leadership skills or negatively affect the market. Real data is necessary for creating a sense of urgency and shedding light on the true need for change. Numbers can’t lie, and there’s no room for opinion in statistics. Numbers alone can trigger change.
In Kurt Lewin’s change model, this stage is considered the “unfreezing” stage. The existing model must unfreeze, thaw out, and melt down to enable the change model. In this stage, change leaders are unfreezing the current status quo, enabling the establishment of a new status quo.
2. Determine the type of organizational change and align it with business objectives.
In this stage, it’s critical to determine the type of organizational change taking place. Is this a complete strategy change? A cultural change? And the question that should live in the forefront of leaders’ minds throughout the process: Why is this change necessary?
Similar to step one, step two is in place to define the benefits of the change. Identify how this change aligns with individual business objectives as well as the overall objective.
Identify the threats facing the organization and anticipate potential obstacles that could arise in the future. How will these new changes work to mitigate threats, obstacles, and limitations?
How does this change initiative work to support and propel the business strategy? Create a projection of how and where these changes will fit into the current model, and how they’ll aid the company in reaching its goals.
Present data/statistics from step one, and identify how these changes align with the trajectory of the company’s success to strengthen buy-in from other leaders. John Kotter, a highly-regarded thought leader in business change, determines that 75% of a company’s leaders and managers must buy-in to the process of organizational change for it to be successful.
If the proposition of an organizational change is supported with data, market trends and historical evidence, other change leaders are more inclined to buy-in.
3. Communicate how these changes will affect each role.
Once change leaders create a compelling argument of why change is necessary, it’s important for employees and fellow team members to understand how these changes will directly affect their roles and responsibilities. The key is thorough internal communication.
Clear and open communication will inform team members of what’s to come, but it’ll also show team members that their roles are vital to the success of the company, which increases their sense of purpose.
When employees can see how their role fits into the equation and builds the bigger picture, they’re more likely to be engaged and enthusiastic. Ensuring employee engagement throughout the process of organizational change is vital, as employees will be the ones executing the new changes and establishing the new norm.
It’s crucial for employees to understand the initial value in these changes, the resulting effects of these changes, and what they can expect to experience everywhere in between.
4. Gather a group of interdepartmental change leaders to support the change initiative.
Surely if one leader understands the urgency for change, other leaders will share the same perception and motivation to carry out a change initiative. Once organizations ensure buy-in through strategies in steps one and two, gathering a group of interdepartmental change leaders shouldn’t be too challenging.
Ask leaders of various departments to join the change management process and help to drive change initiatives. Hearing the thoughts and opinions of leaders from other departments will widen your scope to the entire company, allowing you to see the true urgency behind the need for change and the potential effects of the transformation.
Open communication between departments will also allow fresh ideas to emerge as people with different backgrounds, skills, and experiences are brought together to collaborate in decision-making and problem-solving.
Fellow leaders and team members will feel valued and respected when their feedback, opinions, and perspectives are taken into consideration.
5. Develop a vision and strategy.
Change leaders have gathered their feedback and amassed a thorough understanding of the challenges each department faces. This feedback should directly affect the vision and strategy. In fact, feedback from other team members should create the vision and strategy.
Thorough planning is severely important when undergoing any organizational changes, especially ones affecting the entire company.
Change leaders must be thorough, inclusive, and absolutely meticulous in their strategy to mitigate business disruption and ensure a successful process.
Refer to the urgency built in step one. What drove this initiative? A change in the market? Changes in consumer behavior? The emergence of new trends? Factor these drives into the vision and strategy
Leaders and employees of all departments should collaborate in this step to establish an inclusive game plan that provides solutions and meets the needs of the entire company.
6. Communicate the vision, and initiate the change.
If you want your change leader peers and team members to share your vision, you have to communicate the vision clearly. What does the end result look like? How does the vision benefit the company’s overall mission?
Initiate clear, direct communication with team members and fellow change leaders. This is your chance to build excitement and encourage engagement from employees.
Work with employees to set a positive, earnest tone for the transformations to come. An effective vision will acknowledge employees and communicate the importance of their roles throughout the change process. When change leaders communicate a vision that speaks to the value of employees and how integral their contributions are to a successful end result, employees will feel a deeper involvement with the changes to come and a greater sense of purpose in the process.
With the support of other team members, initiating the change should be a relatively smooth process. The implementation of changes will transpire in phases, as a roadmap is constructed, milestones are created, and roles are designated.
7. Empower action from team members.
Encourage problem-solving & creative ideas. Maintain a high level of enthusiasm and excitement for the changes to come. Lead with the excitement that you want to see in your employees. It’s the job of the top management leaders to inspire other change leaders and team members with actionable behaviors. This is not where leaders sit back and delegate. This is where leaders model the behavior they want to see from team members.
Acknowledge any fear or resistance from employees with open communication. Employees are likely comfortable with the current processes and procedures, so it’s only natural that they express some resistance. Resistance to change is only natural, because people crave stability and we all experience fear of the unknown. To enact a successful process of organizational change, leaders should convey an understanding disposition and empower employees to feel heard and supported.
Respond to employee resistance with supportive, respectful and effective communications to mitigate disruptions in the business environment. Encourage employee participation and engagement from employees who resist the change, and empower them to take action. Ask these employees for their feedback as they engage with the process to not only refine the process and work as efficiently as possible, but also to show inclusion and consideration for employees.
8. Establish short-term milestones and goals to be met.
Create short-term goals and actions to be enforced by the team members leading change. Set small daily goals and assign daily tasks to ensure the team is taking action and change initiatives are progressing as planned.
Short-term milestones are important for accomplishing fundamental goals and driving the organizational process forward, but also for inciting motivation in the work environment. Use short-term goals as a way to reward employees and recognize them for their engagement and achievements.
A successful change management team will construct a roadmap of milestones and goals to facilitate effective and strategic project management. Top management has already communicated expectations with employees, but it’s critical to reestablish expectations and communicate responsibilities through goals and milestones.
Employees shouldn’t be left wondering what to do next, how to move forward, or how to fulfill tasks. An effective project management team will organize tasks clearly and coherently to reduce confusion and employee resistance.
9. Implement an effective change management process.
Monitor team members’ productivity and the rate of progression. Are things progressing as planned? Are team members reaching goals and meeting expectations and objectives? Or is it time to reevaluate timelines and milestones for the future?
Devise an effective communication strategy to encourage consistent communication throughout the organizational change process. If issues aren’t communicated and employees aren’t sharing their feedback throughout the process, problems cannot be addressed, which means solutions can’t arise.
Many successful companies implement communication journeys customized to their specific change initiatives to help bridge the communication gap between employees of all departments and all levels of leadership.
An effective organizational change management process will enable change agents to establish goals, roles, responsibilities, metrics of success, reporting, and processes of accountability. How will the company measure success? Generate reports and evaluate data regularly to gain a clear understanding of how these changes are affecting the company’s success and how employees are managing the new processes and technologies. Request feedback from employees regularly, and assess employees’ satisfaction and productivity levels.
Top management should never stop assessing work performance, employee satisfaction, and overall production levels. An effective change management process will prompt leaders to commit to persistent refinement of all strategies and processes.
10. Provide feedback to everyone involved.
It’s critical that team members have a grasp on how they’re performing and adapting to new changes. If certain employees aren’t quite acclimating to the new status quo, they need to be aware of their performance in order to correct it.
The organizational change management process (solidified in step 9) should include regular employee assessments that enable top management team members to provide constructive feedback. While many managers are hesitant to give their employees negative/constructive feedback, it’s proven that employees are actually eager to learn and refine their skills.
In a study by Harvard Business Review, 57% of employees say they prefer corrective feedback (constructive or negative feedback), while only 43% of employees say they prefer positive feedback (praise and recognition).
The majority of your employees want to be corrected and presented with constructive feedback, because employees want to contribute their most effective and efficient work.
Positive feedback is also one of the most effective strategies for motivating employees and maintaining high morale in the work environment. Create positive reinforcements to associate positivity, motivation and reward with the oncoming changes. A company’s employees are its greatest asset, and positive feedback is significantly effective for increasing productivity.
Honest feedback shows team members that their work doesn’t go unnoticed. Feedback empowers employees to perform at their greatest potential.
The Bottom Line
The purpose of organizational change is to continuously make strides toward improving the future state company. Effective change management strategies will ensure that organizational changes are always benefiting the company’s bigger picture, while mitigating employee resistance and business disruption.
As with any business initiative, attracting, acquiring and retaining the right talent pool can be monumental for change leaders. Talent management software is an effective tool for managing the performance of a company’s human resources. Having the right team behind a change initiative can make all the difference throughout the process of organizational change.
For as long as technology exists, the need for organizational change will be present—and for as long as organizational change exists, the process of organizational change will be critical.