Organizational Change: Signs of Trouble, Signs of Success
An organization, like an individual, goes through many changes whether or not those are anticipated and planned for. External changes in the economy, politics, regulations, technology, and competition can have huge impacts for a company. Organizational change may be prompted by leadership changes, new ideas, internal and external growth, or a myriad of other internal successes and failures. The basics for recognizing the need for change, enabling successful changes, and evaluating that success are the same regardless of the impetus.
Recognizing the Need for Change
The need for organizational change makes itself felt in the following areas:
- Missed goals: The company cannot meet its goals for profit and revenue; KPIs are falling; projects are late or incomplete.
- Mismatch between mission and strategy: The mission of the company has changed but the strategies have not—the company is trying to cling to a purpose or strategies that no longer work.
- Struggling culture: High turnover, low morale, employee disengagement, and ineffective leadership are all signs that change is necessary.
- Low responsiveness: Everyone is waiting on someone else to make a decision; everyone has to be in full agreement before an action is taken; no one is looking ahead for possible obstacles.
- Customer dissatisfaction: Customers are complaining—and complaining that their complaints are ignored. Profits may be constant but revenue is down, with fewer sales at higher prices.
- Poor talent management: New ideas are crushed; hiring concentrates on finding people who meet the current mold; online reviews of the company by past and current employees are dismal; there is no onboarding, training, or mentoring plan. Team dysfunction is rampant.
- Insufficient resources: Technology is out of date, employees are overworked; every job is a rush job; no one is prioritizing. The entire organization is stressed, personally and professionally.
Enabling Successful Change
If a change in any of these areas is going to be successful, then the organization and its leaders must be prepared to:
- Vision: Make sure you know exactly why you are making the change and exactly what you hope to accomplish by it; you cannot communicate what you do not understand. Prioritize your objectives and the steps to get there; you cannot successfully change everything at once.
- Leadership: Identify the true leaders—not just the ones with titles—and involve them early.
- Communication: Explain the need, progress, and steps of change to everyone who will be affected; continue communicating throughout the process.
- Participation: Encourage participation by and ideas from everyone who has a stake in the change.
- Buy-in: Get buy-in from the people who will be implementing the change, making decisions along the way, and influencing others.
- Resources: Assign the resources (including time) and provide the training needed to complete the change.
- Assistance: Remove barriers to change, such as interdepartmental rivalry or lack of technology. Call in outside help when needed to reach objectives, manage risks, reduce stress, or coach leadership.
- Oversight: Make sure that the change is being implemented on schedule and intermediate goals are being met.
- Celebration: Make milestones along the way and recognize the contribution of everyone.
- Caution: Avoid piling on further changes (or making too many changes at once) until the organization has time to settle.
Evaluating the Success of Change
You may believe that a change has been successful but the true success and value may not appear immediately. When you attempt to measure or define success, you should look at:
- Measurements: The change should meet the KPI, profit, revenue, turnover, or other measurable goal(s) you had in mind when you started.
- Internal and External Improvements: You should be able to track success by improvements in customer satisfaction, the organization’s ability to anticipate crisis and respond with more agility, internal collaboration and idea generation, and other signs of a thriving organization.
- Competitive Advantages: You’ve met or exceeded the benchmarks for your industry; you’ve expanded your market; you’ve introduced new products or services; your supply chain is stronger.
- Stickiness: The change has taken hold and is becoming normalized; turnover is low; morale is high or at least returned to pre-change levels; people are optimistic about the change; customers are interested in your new product or service.