Managing Change: Lessons Learned From Top Companies

Profitable companies must keep changing for continued success. Sometimes it is unexpected, sometimes it is necessary. To maintain normalcy during periods of change, employees look to their leaders for guidance. The key is to get leadership on board with the change and establish methods for helping their teams handle the change. Leaders must possess certain qualities for a smooth transition and to keep momentum in the workplace.

Navigating change is difficult; even the best ideas will fail if they are not adapted correctly. Here are the top three companies that implemented major changes and what we can learn from their successes and failures.

Alphabet

Alphabet is now the parent company of Google and is run by Google’s co-founders Larry Page and Sergey Brin. The restructure came so that the Google search engine could remain focused on its original mission to organize the world’s information. Among the companies now under Alphabet are the collection of ventures Brin and Page have delved into, including Google, Calico (their quest to cure death) and Nest Labs.

Given that this was a restructuring of a major organization, leaders should have minimized uncertainty among their employees. Instead, they shocked their employees and the world at the same time when Larry Page published a blog post on Google+. They did not give their employees much warning, and it brought the workday to a halt as everyone from interns to senior engineers reeled at the news.

The blog post addressed many of the questions leaders should answer during a time of change, including why the change was necessary and where they are in the process. However, it took employees by surprise when leadership could have been upfront about the changes and how it would affect their teams. As the situation unfolds, we will continue to learn how Alphabet is managing the transition and how its employees are adjusting.

Amazon

When you’re a giant retailer like Amazon, your name is synonymous with change. Staying competitive is no easy task, though, because you are up against other innovative retail giants. Without a solid strategy in place to ensure your company is ready for change, failure is inevitable.

Such was the case with the Amazon Fire phone launch. The online shopping company made its foray into the smartphone realm, which seemed to be a smart decision. But one detail was missing: The phone didn’t offer enough reasons for smartphone owners to switch from their Apples or Androids. The phone boasted some intriguing features, but lacked a competitive price for what it had to offer and was sold in limited locations.

Was Amazon ready for this step? Perhaps not. What at first was considered a great idea may now require “many iterations” and “some number of years to get it right,” said Amazon CEO Jeff Bezos. Change readiness is a process that prepares your company to shift directions, even if it is still keeping the same overall strategic focus. Having these discussions with employees can result in an even better product.

Nike

To successfully navigate change, leaders should initiate and encourage change talk- discussion within companies that represents positive reasons for supporting change. When change talk is used well, it can prevent the “commitment dip” that often occurs when employees lose sight of the goal and revert back to old behaviors. This may have been a factor in Nike’s struggled over the years to maintain a favorable image after its factories in Asia were exposed for their abusive labor practices in the early 1990s.

Those in power at Nike didn’t act on the need to implement a more ethical supply chain until they were called out by activists, college students and consumer protesters-until customers boycotting their products hit the company’s bottom line. Their substandard work practices were a way to cut corners on costs to increase profit, which ultimately ended up costing Nike its reputation in the court of public opinion. Since then Nike has made positive changes, but it took time for the company to acknowledge all that it needed to do to improve working conditions. By working closely with employees and having ongoing conversations about what actions would be necessary to make lasting changes, Nike could have improved its supply chain practices before they made headlines.

In each of these examples, adequately preparing employees for changes and thoroughly discussing how the plans should play out could have solidified strategy execution efforts and led to a profitable innovation.

Managing Change

All the talk today is about managing change in organizations. Leaders talk about it like it is really something one can ‘manage’. Everywhere I go I see consulting practices with change leaders and much of what comes out the other end, is only slightly better than the snake oil salesmen of time gone by. So what is up with managing change?

The first thing to realize is that you cannot manage change you can only preferably lead or manage people. There is no such thing as organizational change, there is only people change. Organizations are large groups of people, yes organized in a particular way to accomplish a particular task, but they are still people. Right here is where most organizations, especially large ones, stumble when it comes to change.

Imagine with me you are looking straight at an iceberg, a huge iceberg. If you could look straight at it you’d see a small tip on top, above the water and a huge bottom, probably at least three to four times the size of what is floating above the water. Imagine this is your organization, it look a little like an org chart doesn’t it? What if we laid an organization chart over top of what you see of the iceberg?

If you did you’d see the CEO at the top sticking out of the water and his Lieutenants, the senior team as they say, sitting right out there with him. Under them around water level is where you start dropping in to middle management, according to the experts, the scourge of change management. Stick with me now and keep looking at the iceberg with the org chart overlay. Under the water level is everyone else in the organization.

The problem in today’s organizations is the gap that exists between the CEO and the work taking place down at the bottom of the iceberg. The gap has never been greater. Most CEO’s, while personally bright, articulate and politically savvy, don’t have a clue what is happening at the bottom of the iceberg. Not a single clue. And what’s worse is they don’t care. Herein is the issue of managing change, the incredible gap today between worker and boss man at the top.

There of course is the old adage of managing things and leading people and while it sounds trite there is truth to it. When you have a CEO come in like the one did at Home Depot and wreak havoc on the organization, destroy all semblance of customer service and leave with over $250 million you see the problem. He said all along he was managing change. He wasn’t managing change he was changing people to his way of doing business or else. Worked for him, he left an even richer man than when he came. And the gap, the organizational iceberg as I call it, has never been greater.

You see using the iceberg again, there is a way the organization says it does things, and then there is the way they really do things. The way they say they do things is above the line and the way they really do things is below the line. In well run organizations the gap between how you say you do it and how you really do it is small because the leaders, those above the water line, communicate, that means listen as well as talk, with those below the line. In most organizations the leaders make up change plans and simply expect their ‘orders’ to be followed. That is not going to happen in today’s world.

To manage change effectively leaders must be in tune with their organizations and not look upon their people as things, which in most organizations today, that is how they see them. Oh they have their policy manuals that say otherwise, but those manuals are high and dry, well out of the water and the bottom of the iceberg.

If you want to manage change in your organization you’re going to have to get off the top of your iceberg and get your feet wet and understand the work being done at the customer level everyday. You’re going to have to insure that your ‘senior team’ does the same. You must insure you know what is going on, really going on in your organization and that you aren’t just getting the fine treatment from your so called team.

To manage change you’ll have to lead, perhaps for the first time.

Ed Kugler

Managing Change – Get it Right

In any event, getting the process right is a vital component. The credibility of the change managers will be scrutinised closely enough on the issue itself, with all processes in place. If process is at fault too, then things can get very messy indeed.

Legalities

Legalities of how you are dealing with people issues must be resolved first and a clear understanding of HR technicalities requires the right level of expertise. Within this are elements of fairness, consistency and honesty. Although subsets of the well-researched HR framework, they save a lot of time, energy and emotion if considered in advance and protocols carefully positioned.

Timescales

Appropriate timescales in changing people issues, will need to be carefully dealt with as part of the HR overview, but it can be easy to slip. A good way to work is using a simple project management process for the whole event, working for as far back as week -12 to week +12 and setting this into a spreadsheet or a Gantt Chart.

Check and Check Again

This will give everyone a clear view of how the process will work and what needs to be done when. Time taken in this planning stage cannot be overdone and the change management team will need to work in a focused way, to deliver a credible plan. Double-check that everything has been thought of, because it probably still won’t have been.

Co-ordination

If multi-site, this all needs to be coordinated on a macro level with each site working to the same plan.

Purpose

The point of delivering a coherent and researched plan is not simply for the protection of the organisation. It is much more efficient and enables the organisation to recover more quickly after significant change has happened. Individuals, too, are protected technically and it is possible to have as good as and even better relationships with the individuals concerned, when they are dealt with fairly and openly.

Managing change to involve your people and treat them as well as possible is a doable process. It is the role of management to manage and get it right first time – it’s what they are paid for. Then successful outcomes will result and the organisation can move on from a potentially challenging time.