Changes in the Business Environment: Why change management is important

Introduction

Change is an inevitable part of life. Change is also an important part of a business life; it allows a business to adapt to its environment and to improve its market position. Change signifies the willingness of the affected parties to embrace and function in a newly established order and their commitment to effect and implement the changes (Armstrong, 2004). The generic definition of change as defined by Hughes (2006) is “any alteration in the status quo.” Changes within an organisation may take place for many reasons. It is sometimes done in order to introduce a new more efficient way of working or producing a product. It is sometimes done to re-organise the organizations work force. Organisations will evolve and change within the course of their lives. Change management is referred to as the process of which change is executed and developed within the organization. Change is something that affects all business and therefore all business managers must prepare their personnel and processes for change.

Theories of Change Management

Changes in the business environment are happening all the time and organisations must change the way they operate to compete effectively in their market. In order to change organisations must adopt change theories and approaches however with so many different approaches available an organisation must choose an approach that best suits its needs. Different managers will have different theories as to how change should be implemented and executed. Kurt Lewin is considered the forefather of planned approaches to change.

Kurt Lewin’s Freeze Phases

[Source: Higgs & Rowland, 2005]

Lewins model shows that change involves a move from one static state via a state of activity to another static state.

Beer’s Model

Change is more complex than the Lewin model and requires a more in-depth look at the process of change. Beer’s model focuses on a six-step process to achieve effective change, these steps concentrate on ‘task alignment ‘whereby employees’ roles, responsibilities, and relationships are seen as the main component to bringing about effective change. The stages are:

Mobilise commitment to change through joint diagnosis.

Develop a shared vision of how to organise.

Foster consensus, competence and commitment to shared vision.

Spread the word about the change.

Institutionalise the change through formal policies

Kotter Model

Kotter developed what he believed to be the eight critical steps to the successful implementation of change these steps are:

Establish a sense of urgency – Examining market and competitive realities and identifying and discussing crises, potential crises and opportunities.

Form a powerful, guiding coalition – Assembling enough people with the enough power to lead the change.

Create a vision – Create a vision to help direct the change and develop strategies for achieving the vision

Communicate the vision – Use every medium possible to communicate the vision and strategies to be implemented

Empower others to act on the vision – Get rid of obstacles to change and encourage risk taking and non-traditional ideas.

Plan and create short term wins – Plan for visible performance results and recognise and reward employees who are involved in the improvements

Consolidate improvements and produce still more change – Hiring, promoting and developing employees who can implement the vision.

Institutionalising New Approaches – Develop the means to ensure leadership development and succession.

Impact and Barriers

If change is not implemented in the correct manner, the impact upon the business can be devastating. Some of the workforce may decide to leave as they do not agree with what is be implemented and that leaves managers trying to fulfil orders or provide services with half a workforce which puts pressure on the rest of the workforce. Communication is key to help reduce barriers, for any change strategy to achieve its goal every member of staff within the organisation must be constantly communicating with executive managers. If staff members ask, “Why do we need to do this?” a manager must be able to give them a valid answer. Change normally affects both a business’s internal and external environments. Internally staff may feel that they have been left out of the loop and are just being told that they must accept the change or the reverse may happen the staff may be contributing heavily to the change and helping to direct the new vision. Externally an organisation may make an impact on their market by promoting a new service or product.

There are a number of barriers to successful change – both in terms of actually implementing the change and sustaining it. Employees must be able to flourish within an every changing environment to allow them to contribute to an organisations success. Lisette Howlett, (2009) states the 10 main barriers to successful change these are listed below:

Not enough understanding about the change itself

Lack of leadership

Lack of focus and strong project management of the change

No engagement and/or buy-in of key stakeholders

No clear process for managing endings and beginnings, and co-ordinating the change process

Successes are not recognised, communicated

Progress is not measured and the learning is not reviewed

Change is very tiring and is often something that requires extra effort – people need to see that this effort is paying off and their contribution is valued

All of these barriers can be overcome if the correct procedures are put in place and communication is constant throughout the process. Employees need to feel that they are major contributors to a company’s success and will sometimes feel undervalued if they are not involved in the process of change this can lead to hostility amongst the workers and feelings of anger towards the management this in turn leads to barriers being erected due to the fear of change.

Conclusion

Change must be managed, implemented, and executed in such a way that there is always communication between staff and managers. This allows for equilibrium and encourages growth and innovation within a company. Each change management theory has its strengths and weaknesses and each can be adapted to an organisations needs but I believe that managers must invite all staff to offer ideas on a creating a new vision for the company and thus driving the company forward as a whole.

References

Hughes, M. (2006). Change Management: A Critical Perspective. Chartered Institute of Personnel and Development. ISBN: 1-84398-070-3.

Armstrong, M (2004). Managing Organizational Change in Nigeria Manufacturing Enterprises: Lessons from the Unilever Nigeria Plc. AC Associated Content. Retrieved from http://www.medwelljournals.com/fulltext/?doi=ibm.2009.15.21

Syque. (2007). Lewin’s Freeze Phases. Changing Minds. Retrieved from <http://changingminds.org/disciplines/change_management/lewin_change/lewin_change.htm>

Higgs, Malcolm, and John Wren. The Leadership of Change: a Study of Change Leadership within the UK Royal Air Force. Henley-on-Thames: Henley Management College, 2005. Print

Howlett, Lisette. “10 Common Barriers to Successful Change.” MLH Consulting. 15 Sept. 2009. Web. <http://www.mlhconsulting.co.uk/blog/10-common-barriers-to-change/38>.