Anyone who’s ever tried to make a transformational change knows the difficulties of sticking with a change program.
Personal transformation is difficult enough; a UCLA study found at least one-third to two-thirds of people on diets regain more weight than they lost within four years of starting the diet. And the challenge of changing behavior only compounds when moving from personal transformation to organizational transformation. One study by McKinsey found “50 percent to 70 percent of the organizations that undertake a reengineering effort do not achieve the dramatic results they intended.”
Whatever brought you to seek organizational change, maybe the emergence of new competition, a management shake-up, or rapid growth, successfully managing that change requires a comprehensive roll-out strategy and acknowledgment of the risks.
The commitment required to change your organization means more time working on your business and less time working in your business. To make this trade-off worthwhile, managers need to take steps to make these efforts successful.
Let’s break down the most common pitfalls to avoid:
1. Lack of urgency
Successful change management usually begins when an individual, typically but not necessarily a CEO or executive, or small group takes account of the state of a business and determines that a concentrated change effort is required. They then begin to communicate this realization and build a coalition to address it.
According to Harvard Business professor John Kotter, well over 50% of companies fail in this first phase. Typically senior leadership overestimates the difficulty of implementing change and underestimates the costs of not making a change. Creating a real change entails sacrificing existing ways of doing things for new systems and processes. This requires leadership and can easily be sabotaged by a senior management team with, as Kotter says, “too many managers and not enough leaders”.
Bottom Line: Change can only be successful when enough people understand its importance. Presenting the costs of inaction alongside success stories from companies that underwent similar change can help build the sense of urgency amongst leaders required to power successful change.
2. Inadaquete guiding coalition
If you’ve developed a convincing message on the need for change, the next step is building the coalition to support those efforts. Serious change requires teamwork at the top. The number of change advocates required for a guiding coalition and their positions within the company will depend on the size and make-up of your organization. Regardless, the push for change must be done outside the existing hierarchy. According to Kotter, “since the current system is not working, reform generally demands activity outside formal boundaries, expectations, and protocol.” This may mean a coalition with executives, middle managers, and line managers united by an urgency for change.
Bottom Line: Building a strong, motivated team around a compelling impetus for change is indispensable to a successful effort. While this can start at the top, the next level of buy-in is critical in building a team with enough leverage to implement the change.
3. Lacking a clear and communicable vision
Change efforts can quickly become unfocused and confusing if they lack a single clear vision for the direction of the change. Similarly plans compiled and distributed in large binders or long slide presentations are unlikely to be meaningfully adopted throughout an organization. Kotter gives the guideline that if you can’t communicate the vision in five minutes or less, you are not ready to proceed.
At Align, we put this vision in the form of a single Big Hairy Audacious Goal (BHAG) and a One-Page Strategic Plan summary. This format makes the strategic vision easily digestible and is visible to all employees in our software. Communicating the vision also requires that leaders “walk the talk” and embody the principles they espouse in planning. Seeing buy-in from the guiding coalition raises the likelihood and speed of adoption through the organization.
Bottom Line: Successful change requires a plan that can be communicated in under 5 minutes. Make it come alive by walking the talk.
4. Not planning for short term wins
Change efforts can quickly lose momentum if employees don’t see wins quickly. Under any system of change management, leaders must define achievable short-term goals to support the long term vision. If communication is an area for improvement, celebrating the implementation of more regular, efficient meetings reinforces the positive habits. Tying compensation to achieving results is also an important strategy for creating momentum behind change efforts.
The implementation of a quarterly theme is another strategy for building excitement around strategic goals and change efforts. Overcoming organizational inertia requires forward thinking and consistent incentives. Tying progress to rewards, whether symbolic or compensation based, demonstrates a commitment from the top and elicits loyalty from employees for change efforts.
As HBR data confirms, “because small but consistent steps forward, shared by many people, can accumulate into excellent execution, progress events that often go unnoticed are critical to the overall performance of organizations.”
Bottom Line: Celebrate the success of change efforts early and often to maintain urgency and create excitement.
5. Not anchoring changes to Company Culture
The final and most difficult barrier to implementing lasting change is incorporating changes into your organizational culture. Even with urgency, leadership, and vision, change efforts will fizzle out and fail unless adopted as organizational norms and habits.
This begins with a clear expression of organizational culture that reflects the desired changes. While an organization may have developed a list of core values in the past, seeking change requires a reevaluation of whether the same values reflect this transformation. A clearly defined set of 5-7 core values that embody change efforts provides a cultural roadmap for change.
Walking-the-talk next means taking actions that reflect the updated values in a meaningful way. As start-up Psychologist Dr. Cameron Sepah explains, “no behavior will persist long term unless it is being perpetuated by either a positive reinforcer (providing a reward, such as a promotion or praise) or a negative reinforcer (removing a punishment, such as a probationary period or undesirable tasks).”
For employees, decisions around hiring, firing, promotion, and compensation become the reinforcers of cultural values. Incorporating values into personnel decisions, using something like the performance-value matrix, is the best way for leaders to demonstrate their commitment to change efforts and encourage employees to embody this change.
Finally, and most critically, as changes take effect, leadership must consciously attempt to demonstrate to employees and other stakeholders that change efforts are making a positive difference. A weekly announcement highlighting progress and quarterly celebrations around goal achievement can help reinforce the effectiveness of change efforts and keep them front of mind for employees.
Bottom Line: Lasting change only comes from cultural shifts. Shift culture by using incentives to reinforce values.
The Final Word
Transforming an organization can take years, but the results can be immediate. Some employees may help champion change, while others may need to transition roles or even leave the organization. Setting clear expectations around values helps employees understand what is expected of them during the change. As Michael Gove writes in his classic High Output Management, “When the environment changes more rapidly than one can change rules,… we need another mode of control, which is based on cultural values.”
The organizational change we empower at Align often entails helping businesses build a culture of accountability. When Fred Litwiniuk began using Align to increase accountability, he made personnel changes to reflect their new emphasis on transparency. Employees who weren’t comfortable with the increased accountability left. Hiring decisions also began to revolve around fit with the transformed culture. “If people run and hide from accountability, then we know they wouldn’t be a good fit for our culture,” says Fred. “If they are attracted to a culture of accountability, then that’s the kind of person we want to keep!”
If you’re ready to radically change your organization, come equipped with a system to structure your efforts that can support cultural transformation. The right tools can speed up the implementation of change and help maintain organizational focus on these efforts.
This type of radical transformation can be painful in the short-term, but is necessary for achieving long term goals. Remind stakeholders of the costs of not changing and consciously focus on celebrating the results when change does occur.
And results will come if an organization builds the commitment to change. Companies that use Align to implement their change management plans double the number of goals they complete per quarter in just one year!
If you are interested in learning more about how software can help change your organization, schedule a demo of Align today!
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