Updated 03 December 2020
Your business won’t stand still. It should evolve over time, and part of your job is to make that process as smooth and beneficial as possible. For instance, you will need to adapt to a changing business environment, economic factors such as inflation or taxation, and social elements like the increasing preference for online shopping. On another level, you may need to change the team structure or hierarchy of your business as it grows.
As necessary as change may be, it can be disruptive and even a source of worry for your employees. The process of change may harm productivity in the short term, and if handled badly can have long-term impacts too. Proper planning and management is therefore essential.
Change management is the process of getting your organisation from here to there as smoothly as possible. You know where your business is now, and you have an idea of where you want it to be. What you now need to create is a series of steps, or a similar structure, that makes that transition happen without unwanted side-effects.
The aim of change management is to avoid ad hoc and reactive decision-making from your management process. If you are only implementing change as a response to a problem, you could find yourself backed into a corner with limited options. So you need to find ways to maximise your options and to be as proactive as possible.
There are a lot of reasons why business change may be needed. Perhaps your market is developing fast, or there is a dangerous new competitor. You might need to cut costs or increase productivity, or you might just want to introduce flexible working. Usually, business change will relate to increasing competitiveness, creating a better working environment or responding to external pressures.
Some common changes that businesses make include:
If your workforce, shareholders or customers don’t buy into the change you want to implement, the process could be a rocky one. Some of the biggest obstacles that companies encounter when trying to change are:
Sometimes problems can arise because you’re not clear enough about what you want to achieve, or how you will do it. Always ensure at every step that your employees know why the business is doing things differently, and encourage them to ask if they don’t understand.
An important first step is to lay the groundwork properly. Make sure the right resources are in place, and give plenty of thought to those who may be on the front line of the business changes: your employees and your customers.
Ensure that everyone in your company understands what changes you are making and why you want to make them. Notify your people well in advance and get them enthused, so that by the time you implement the process people are looking forward to it and fully onside.
If you are making changes that will affect the end product or service you provide to customers, tell them about what you are planning. Give them a clear picture with relevant details, as any indication that you are withholding information could harm your brand. Emphasise the positives in every case, to reassure people that any temporary disruption will be justified by the improvements you’re making.
There are three key steps to any process of change management. These are simply:
You can remember these steps via the abbreviation ‘APEx’ – which will also remind you that you’re trying to raise your business up to its peak performance.
Each step of the APEx process can be broken down into further steps, as explained below.
There are two main reasons for change: chasing opportunities, or mitigating risks. So it’s not just a question of asking ‘What is wrong?’ but also asking, ‘What could be better?’
You probably have some idea already about what needs changing. But dig deeper. Ask if the issues might have a deeper cause. Look to see if you could solve several problems or open up multiple opportunities with one change.
The steps of this stage are therefore:
To remind you, a SMART goal is Specific, Measurable, Achievable, Realistic, and Timely.
Who will deliver the change in your business? Your people. Therefore you'll need to prepare everyone fully so that they understand your plans and are fully supportive of them.
Communicate your vision clearly and explain how the changes will improve the business. Invite feedback from the start, and engage with any criticism. People on the front line of the business may have valid objections – don’t ignore these. Work together to anticipate any obstacles to the changes and any problems they may cause. Then work together on solutions.
All this will take time, so factor this into your timetable and start the process early. By the time you start to implement the changes, the whole business should be fully aware of their shared goal and keen to get started.
The steps of this stage are:
Change should be carried out in stages: a series of relatively small steps conducted one after the other. This helps to ensure a smooth transition and minimises the risk of major upheaval or things not working as expected. You should ensure that each step is fully complete (or as complete as practicable) and problem-free before moving onto the next. This way, you will not be overwhelmed by teething troubles from multiple areas of your business. If possible, also have back-up plans ready in case something doesn’t work.
For example, if you are changing your supply chain, you may want to ensure your new distribution system is fully bedded in before switching your upstream suppliers. In this scenario, it would also be a good idea to build up emergency stock so you could continue to meet orders even if your supply chain were to hit a problem.
To identify such problems, you’ll need solid reporting systems in place so you can objectively compare performance before and after the changeover. Also ensure that you have the right people taking responsibility for the success of each stage, holding them accountable while giving them all the support they need.
The steps of this stage are:
Throughout the process, monitor the situation with regular management meetings and share any lessons learned at each stage. At the end, hold a final debriefing session to compare the end results with your initial plans, to see where you might have fallen short of (or exceeded) expectations.
Another key part of change management is recognising that things won’t always go to plan. Keep a close eye on what is happening so you can manage unexpected developments, communicate them swiftly and adapt. Sticking to your script too rigidly will be counterproductive if it doesn’t match what’s happening in the real world. Being more responsive will mean you can deal with problems effectively and also grasp unexpected opportunities if they arise.
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