Changes take place in companies on a day-to-day basis. New projects and new IT systems and technologies are designed to improve performance, increase profits or further develop a company’s competitive edge. However, companies can only successfully put the developments necessary for this in place if employees are fully on board with the organizational changes. In other words – and in concrete terms – this means that if you don’t manage to get those affected by change on board, they will not change their behavior. Consequently, you will fail to meet the targets you have set or achieve the improved business results you are hoping for. Neglecting the “human resources” aspect therefore carries huge risks and this is something that should be avoided at all costs in every change initiative.
The human factor – still seriously neglected, even today
Even though this insight is far from new, all too often it is disregarded, especially when it comes to release management for new technologies. All the focus is on the digital transformation and on meeting technical requirements, while acceptance by employees is ignored. Various figures back up this assertion. Approximately 70 percent of all IT projects fail because the management fails to create a suitable, comprehensive change program – in other words, the management takes no steps to achieve the level of acceptance that is needed. The same applies to managing the roll-out of new software. Here, too, the failure rate is around 70 percent. Three-quarters of the employees affected are dissatisfied with the roll-out of new tools, because there is insufficient focus on their needs, and they don’t have enough time to get to grips with the tools and technologies.
This clearly demonstrates that change management plays an important role in organizational development. Simply communicating the changes is not enough – change management also needs to be tailored to the needs of those affected. It all comes down to the correct method for managing change. After all, in times of rapid, dynamic change, what’s needed is a change management strategy that itself is dynamic and can react with the necessary agility.
However, what exactly is meant by the correct change management method? What crucial actions are involved? These are the questions we will address in this article.
Understanding change management terminology
Change management refers to all projects, activities, measures and tasks that help to alter the status quo in an organization and bring about a wide-ranging transformation. As a general rule, it’s a case of rolling out new strategies that cannot be achieved with the organizational structures that have evolved, the existing legacy systems and the processes and workflows based on these. This is why change initiatives very often also affect employees’ working routines and behavior patterns, and these need to be adapted as the company undergoes organizational change.
Change management has seen major developments in recent years – new models, processes and plans have been created time and again to steer the impact of changes within a company in the desired direction. However, what do the terms change management model, change management process and change management plan really mean? What’s the difference between them?
- Change management models are developed on the basis of experience and results from research. They show how changes within a company or in somebody’s private life can be best managed. The majority of these models offer a supportive process that can be applied to your company or your personal development.
- Change management processes describe the sequence of steps or activities that support the change from the beginning through to implementation.
- Change management plans, which are generally drawn up during the planning phase of the change management process, support the implementation of the transformation.
There are various approaches and theories relating to change management, such as the McKinsey framework for change management, John P. Kotter’s change management model, the Prosci ADKAR process model, Kurt Lewin’s three-step model or W. Edwards Deming’s PDCA cycle.
Which approach a company will opt for depends on its own framework conditions. In turn, the approach determines how the company – and the project team tasked with implementing the change – will proceed. However, the following factors for successful change management apply to all approaches.
Success factor 1: Change management starts with each employee
Changes take place at the “small” level, affecting every individual. An employee is given a new remit, digital workplaces are set up or an employee puts forward new ideas to improve workflows – how easy or difficult it is to roll out smaller changes such as these is an indication of how good or bad a company is overall at managing change. If change is successful at the “small” level, change management for major transformations is easier.
Success factor 2: Change management takes time
If, when introducing a new solution, all the focus is on meeting technical requirements with no regard given to the fact that acceptance by future users is also a vital aspect, this can result in costs that impact on the entire organization.
Analyses have shown that any change initiative divides employees into three groups – those who are enthusiastic and get on board with it (approximately 20 percent), those who react in a cautious and hesitant manner (approximately 60 percent), and those who oppose the new, say no, and would prefer to stick with the old ways (approximately 20 percent). Changes therefore need to be managed correctly – otherwise, there is a risk that change initiatives will come to nothing, open conflicts will break out and a company will flounder. The high-level managers of a company therefore face a particularly big challenge when it comes to enacting change efforts.
The four principles for successful change management
Organizations face continual changes. Whether it’s a case of rolling out new technologies, updating processes, or launching compliance initiatives or restructuring measures, constant changes are vital as a way of driving growth and profitability. A consistent approach to the management of change is essential if unwelcome effects on both the company and its employees are to be kept to a minimum.
1. Identify the changes
As a general rule, the aim of a change is to improve a process, a product or a result. Your task is to define your focus and clarify your objectives. This includes deciding on resources and selecting the individuals who will form the project team to support and lead the change program. The following questions will help you do this:
- Why is the change needed? What do I want to optimize? What do I want to achieve and which change-related process do I need for this?
- What does the concrete benefit that should be produced by the upcoming changes for my company look like?
- What conditions need to be in place if the planned change is to have a positive impact on employees? How do we pave the way for this?
- How and to what extent will the changes affect the way users work (new processes, new tasks)?
- What are the prerequisites if everyone in the company is to be able to master the process of change and the associated new working methods and procedures?
It is also helpful to think about the negative consequences that would arise if the change was not implemented. The change equation developed by Richard Beckhard and Reuben T. Harris shows that a change will only work if the level of dissatisfaction with the old procedure is high enough. Equally, however, the employees also need to be convinced that the new approach will be better – and that there’s a clear way of getting there.
2. Plan the transition
Effective change management doesn’t come down to chance. Every plan you make must suit your company. Different companies use different methods for managing change – some companies apply very rigid methods, while others proceed in a more open and flexible way.
Change projects only succeed when the process is supported and promoted at senior executive level. It’s therefore important to secure the buy-in of every manager involved in good time prior to the start of the project.
- Getting others on board:
Seek out allies. Which senior executives, managers and employees can best help you with the planned transformation? Can you use internal resources or do you need external expertise and external consulting?
To achieve your objectives, you need the support of employees throughout the company. How do you want to go about getting this support? Where do you expect to meet with resistance and how will you respond to this?
Ask yourself which concrete objectives you want to achieve and what your definition of a positive outcome would be. What consequences will the change bring with it that you will want to address? What are the possible worst-case scenarios and how will you deal with these?
3. Implement the change project
When it’s time to carry out your change project, there are many different strategies that can be employed. For example, Kotter’s 8-step change model explains how to make your measures sufficiently dynamic so as to encourage everybody to buy into the change and the new patterns of behavior associated with it.
Kotter’s change curve shows the importance of taking employees’ feelings into account when it comes to putting your project into practice. It outlines the different phases that are worked through during a change – from shock and denial through to the point at which the employees fully support the new approach.
It is not possible to make a general recommendation about choosing the appropriate method or suitable model. Instead, each company must itself decide what suits the framework conditions and structures, the planned process of change, the employees’ resistance to change and other relevant factors.
Nevertheless, no matter which bottom-up or top-down tools you decide upon, the following steps may help you to introduce change in a positive way:
- Make sure everybody involved has a clear understanding of what it’s all about, what’s being planned and what the changes mean in concrete terms for each individual.
- Define measurable success criteria for your change projects and use regular analysis in the form of reports to document progress made.
- Identify all stakeholders involved in the process of change and set out who should be included to what extent.
- Clarify the training measures that are needed to ensure you achieve your objectives.
- Appoint “change agents”. When new processes are being rolled out, change agents can provide valuable support. They act as role models and help engender a sense of positive momentum.
- When implementing the change, make sure those involved are provided with support in line with their needs.
- Think about suitable measures and incentives for breaking long-established routines so that the new ways of working quickly become a habit.
4. Communicate the change and the process being pursued
Creating transparency through communication is another important change management success factor. The upcoming process of change must be clear and relevant so that your employees understand what you want from them and why. However, managers also need to set the correct tone as this helps to elicit the emotional response you are hoping for.
Link the transformation project you are planning with your organization’s mission statement or vision. This helps your employees to understand how the change will impact positively on the big picture. At the same time, you will be providing all involved with a shared vision of the future that will both inspire your employees and create a sense of cohesion.
Tools and components that help with the implementation of processes relating to change management
Effective processes relating to change management are based on support activities and tools. This is the only way of providing employees and managers with both the support they need and the necessary resources for implementing the planned changes successfully in every phase of the project.
It is therefore best to use a mix of activities and tools for your change management projects, such as:
- Product or business roadmap
- Readiness assessments
- Tutorials and training content
- Forums for stakeholder feedback
- Management of resistance
- Ongoing optimization plan
- Digital adoption solution (DAS)
It is also important that you design the new processes to be as sustainable as possible, map these processes, and support your employees by providing them with a variety of contextualized learning content. By doing this, you can prevent your employees from being flooded with information and wasting too much time searching for the information that is relevant to them. You cut down on “digital friction” and guide your users through the process, step by step, to your end goal.
A digital adoption solution can play a key role when implementing change. When used correctly, it makes a contribution that is critical to success in every one of the four principles described. This is because it provides everybody involved in the transition with personal support in line with their needs in every phase of the project.
There’s no “one size fits all” in change management
When it comes to change management, there’s no magic formula and no perfect way of achieving your objectives. Every organization has to find its own best way – depending on its history, its corporate culture and the willingness of its managers and employees to embrace organizational change. What is crucial in all cases, however, is that you reduce initial resistance to a minimum by means of suitable methods, transparent communication and support for everybody involved in line with their needs After all, sustainable management of change processes will only succeed if you deal with skeptics by taking the wind out of their sails. You can do this by quickly creating a sense of achievement, as this will ensure that each individual can feel the benefits of far-reaching changes for themselves.