QUESTION:
What are the biggest challenges in managing change?
No matter your level of confidence or state of progress in your efforts, leaders will benefit from reviewing this “Top 12” list of risks in achieving transformational change.
Lack of clarity on the “what, why and how” of change. Too often change efforts are a long list of initiatives and aspirations, lacking coherence and deep thinking. If top management are not totally clear and aligned, how can the rest of the organization get on board?
Leadership Team(s) alignment. A close cousin to above, if a critical mass of the leadership teams (at the top and in key parts of the organization), lack clarity on the process, their roles, and commitments - failure will follow.
Change Leadership: Skills and resources. The organization needs to be able to dedicate an adequate number of people with the right skills to craft and drive the change initiatives. Internally, these are often the best people – and therefore are in short supply. Consultants can help – but at great cost and can never completely fill the void. You will need an explicit effort to develop internal capabilities.
Structured engagement of the broader organization. New skills, mindsets and behaviors only happen with a process that finds ways to systematically engage individuals and groups in a disciplined working of their own component of the overall change agenda. Balancing “the hard and the soft” are key – i.e., clarifying both the task and “what is in it for me”?
Capacity to learn and adjust. Change is non-linear – and the only guarantee is that you will hit some dead-ends, make mistakes, and not fully anticipate all the challenges at the outset. Without a culture and a mechanism for sensing and adapting, efforts will stall.
Time horizon (aka “Stuff happens”). Most transformational changes do indeed take 5+ years – to go the distance from aspirations/objectives through to achieving a fundamentally new level of performance and organizational capabilities. Companies and CEO’s often just do not have the time – and get knocked off their game plan by intervening events (i.e., market downturns, activist shareholders, etc.)
Board support. The board needs to understand and support the efforts. Particularly the time frame and the investments required. Without this, a CEO’s efforts are at risk.
Risk tolerance. New business models or ways of operating are often, by definition, unproven. And risk disrupting existing customer relationships and organizational patterns. The key question is how much risk and disruption can your organization absorb?
Over-reliance on structure and systems to change behavior. Structural and systems changes help create a new context and orientation – and have the surface appeal of being visible and fast. But alone they rarely result in broad-based behavioral change. Just as often they can result in confusion and sap energy as people focus on figuring out “what the new organization means” rather than on “how to achieve business goals in new ways.”
Overly open-ended process. Achieving fundamental change is at least a 3-to-5-year process. However, organizations often run out of energy or lose focus after 9 to 15 months. The solution is to have a broad long-term plan and to supplement that with “change episodes” – clear phases with a beginning, middle and end, that allow the organization to see results, take stock and adjust, and then move on to the next set of challenges.
Lack of winning strategy. Finally, the best change program in the world cannot overcome a structurally disadvantaged industry position (e.g., inadequate scale, the wrong technology, a disadvantaged location.)
Inability to align and manage all the initiatives. Major change inevitably requires dozens of initiatives (strategy projects, restructuring, process redesign, training, communications, management system redesign, etc.). Often these initiatives have different consultants supporting them. The result: a massive “systems integration challenge” in which all initiatives are broadly targeted to the same objective (a higher performing organization) but invariably risk conflict and confusion as to how they relate to one another. Remember: “An initiative is easier to launch than it is manage….”
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Chances are all of the above are evident to some degree? Success requires situational awareness (a tough-minded assessment of all risks) and then selectively working the most pressing risks.