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Change is Part of Growth
Businesses need to change if
they want to grow. Change can be proactive or reactive, but without it
everything stays the same and growth is impossible.
Many organizations have found to their detriment that it’s unwise to
fail to anticipate changes in the external environment and suffer the
consequences. Change has to be carefully planned and implemented with
strict controls on both its extent and the pace at which it takes place.
First let’s look at changes that can happen to a business. These might
take place over an extended period of time, often so slowly that
management is unaware of the extent of the changes until it has been
confronted with the unpleasant financial results.
- Team morale decreases and productivity declines
- Customers depart and sales decrease
- Costs rise and profitability suffers
Each of these change paths can happen gradually and unless management
regularly monitors key business metrics and ratios they can cause an
unpleasant awakening to reality. Isn’t it much better to plan positive
changes to an organization and benefit from the outcomes?
Think instead of your business
experiencing these kinds of change:
- Team morale is improved by a program that creates greater job
satisfaction and productivity increases
- A customer relationship management system generates increased turnover
and word-of-mouth brings in new customers
- Active management of costs and better purchasing policies reduce
expenses and improve profitability
Plan and Implement Positive Change
Where the first set of changes happened to a business and would be
detrimental to growth, the second set of changes are the kind that are
planned and create growth. Planning and implanting positive change is an
essential element of management.
Yet change for its own sake can be a mistake. It’s important that when
considering making changes to an organization the effects are fully
identified and carefully analysed.
Discuss the proposed changes with two important groups of stakeholders –
your customers and team members. The first group has to accept the
changes or your sales will decrease; the second group has to accept them
or they won’t happen in the manner you intend.
Betty Krecji of the Purdue University Department of Consumer and Family
Sciences says that how one views change is dependent on many things:
The number of changes occurring at once - individuals can only handle so
much change. The greater the number of changes occurring simultaneously,
the more likely it is that they will be viewed negatively.
The pace at which change is occurring - the faster the changes come, the
more difficulty we have in adjusting to them and the more likely we are
to view change as loss.
The amount of control in times of change - the greater the involvement
individuals have in making change, the greater their sense of control.
The greater the sense of control, the more likely the change will be
viewed as an opportunity.
Remember the Human Element
Communicate the planned changes internally before they happen. Change
should never take place suddenly or unexpectedly; to do it this way is
to invite rejection. All team members need to know what’s going to
happen and why it’s a good idea.
Business owners often ignore the human element of change because they
believe it can be created through giving orders. Positive and lasting
organizational change isn’t like that; it’s ‘owned’ by the team and they
get behind it to make it happen.
Don’t expect change to go as quickly or as smoothly as you’ve planned.
No matter how much planning has gone into the process there will always
be unforeseen forces that impact the success of the change effort.
Harvard Business School’s Todd Jick conducted a study that identified
these problems that were experienced by a majority of firms implementing
change:
- change took more time than allocated
- unforeseen problems surfaced
- coordination of implementation activities was ineffective
- competing crises distracted attention
- insufficient capabilities and skills of those involved in the
implementation
- inadequate training was given
- uncontrollable external factors had a major adverse impact (e.g.
competitive, government, economic)
- inadequate support for change
- failure to define expectations and goals clearly
- failure to involve all those who will be affected by change
Change for the right reasons and done the right way can be a powerful
growth stimulant for any organization. Done badly, change can become a
business disaster. Consider change carefully, analyze it as critically
as possible, and implement it only after you’ve gained the support of
stakeholders.
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