The rate of change in the world is constantly accelerating. We have increased accessibility to information, corporations and products are becoming more global, and there is more demand on the breadth and depth of workers. New technologies, like blockchain, that just a decade ago didn’t exist are now becoming mainstream. These technologies are also growing exponentially following Moore’s Law of doubling technology speeds every two years. In contrast, Bill Gates famously declared that 640 Kb of memory was enough for everyone. Important to note is that with today’s rapidly changing environment comes increasing complexity and uncertainty, and a need to prepare organizations to be change-ready.
A way to visualize this is through the Stacy Matrix, presented below, which can help with decision-making in a complicated and complex environment based on the certainty of outcome and level of agreement in a group. On the bottom left, you have simple situations where traditional approaches like waterfall development are great as plans don’t change. At the other extreme end, you have chaos and anarchy, where plans aren’t useful at all. Most businesses these days lie between these two extremes in the complexity zone, where you need to be agile.
In this environment, it is important for an organization to change quickly and respond to events. Thus you need to prepare your team or organization for inevitable changes that occur. We’ll explore this through mental models of the different phases of transitioning through a change, as well as how to use data tools to help measure your progress of change.
The Hard Thing About Change
Change is difficult and often involves fear and discomfort. There is a natural fear of the unknown, and a high perceived risk. This comes from our built-in human fight-or-flight response and it is natural for people to feel danger in unknown situations. We naturally prefer constancy where the brain can go automatic while remaining with the familiar.
Take for example the first time you learned how to drive. Every person has a different attitude towards change and this affects how they perceive this new experience. You might feel giddy from excitement with the new environment of driving. Or, you could have felt more stressed about doing maneuvers that you weren’t used to. Whatever the experience is, everyone has to go through the change at their own pace. Now, once you’ve driven a couple of miles, you’re creating new habit muscles on how to drive, and soon enough they become automatic, and you struggle to realize how it ever was difficult or stressful for you.
The purpose of a good leader is to create conditions where people of different change-readiness achieve high quality results that meet the need of the organization. Once you’ve created those conditions, embed them within the organization’s culture to help people face the discomfort of change. This embedding process serves as the momentum to propel change.
Models to Understand Transitions
Change processes can be seen in these three big stages: Unfreezing the old habits and processes, making the change itself, and then refreezing the habits into the culture and processes of the organization. Let’s look at this at a more detailed level.
8-Step Process on Change
You can make an actionable plan for creating that change for your organization using Kotter’s 8-step change process.
Credit to the author.
Establish a Sense of Urgency
As the first part of the unfreezing old norms process, the leader needs to create a strong need for change. You need significant buy-in that this change is critical. If this isn’t well understood, the importance and urgency for the change will not jumpstart the change. Examine the market and competitive realities to identify major opportunities or possible threats.
Form a Powerful Coalition
After establishing the sense of urgency, you’d need to assemble a group of people to take ownership of the change process, particularly with the leadership team. You shouldn’t underestimate the difficulties of producing change.
Create a Vision
Along with a coalition for change, you need to create a clear and compelling vision that is the cause of the change. Of course, the vision needs a clear strategy and plan with measurable outcomes to get people committed to the vision. Don’t “boil the ocean” and have too many visions; a narrow, focused vision is much more powerful.
Communicating the Vision
Continue to communicate the vision to the team. Most teams don’t communicate the vision enough and cause the change process to fail. In fact, according to IBM, 59% of all change initiatives fail. Use any channel that you have to communicate the vision, and teach new behaviors by example from the coalition team. One aspect of communicating is tying the vision to Key Performance Indicators (KPIs). Leaders need to walk the talk about aligning with the vision strategy.
Empowering Others to Act on the Vision
Here, you begin to move from the unfreezing process to the change process itself. For the change process to go smoothly, you need to empower people in the organization to be empowered to act on the vision. One way is to remove obstacles that are in the way of people doing these tasks. This sometimes involves having tough decisions of changing systems that seriously undermine the vision. Encourage people to take risks and non-traditional tasks, and empower them to make decisions.
Plan and Create Short-Term Wins
To create some early momentum, plan out and identify short-term wins. Quick and easy results will bring the momentum for bringing change later. Reward your team when you achieve these small wins. It could be as simple as ice-cream for everyone when they complete the first sale in the new organization structure. Make sure that there are results at most in 12 months.
Consolidating Improvements and Producing More Change
As you get more and more short-term wins under your belt, consolidate those improvements and measure the change. An example is to promote people who can implement the vision. Make sure you don’t have a nearsighted definition of success and measure the change for the long term. Don’t change too often too much, like having a “Flavor of the Month” attitude.
Institutionalize New Approaches
As the change initiative matures, make sure you re-freeze this into the corporate culture of the organization. Communicate the connections of the new behavior and the success of the team. This process should make the change initiative into the fabric of the organization.
Using Data to Guide Change
With these models in mind, you can use data to help you understand and measure where you are in the change process. Having a dashboard of your new Objectives and Key Results (OKRs) and KPIs can also be a great communication tool for your whole organization to keep focusing on the new vision. Make sure you have both quantitative and qualitative methods of collecting your data. Here are some metrics you can track:
Change readiness survey
A survey for questions on how employees felt during different times in the change process. Since each question has numeric values, you can create a heat map of the responses, and even break down on which departments are having trouble with the change.
Speed of execution / change progression
As with all projects, have a timeline on when particular milestones are due. This would include all the different change initiatives that are happening. You could use a bullet chart to track how well the progress is for each initiative.
Employee Net Promoter Score
Net Promoter Score (NPS) measures loyalty, and so providing an internal NPS survey to your employees could quickly give a sense of how well employees are liking the company in this phase of the change. You could track the progression of the NPS score via a bar line chart. Regularly check in with employees and read their feedback to get a better sense of their worldview.
Speed of adoption
Speed of adoption is how quickly employees are getting successfully onboard on your change initiative. Depending on the speed of adoption, you would need to adjust the roadmap of your change initiative.
Managing and transitioning an organization through change is difficult since we are dealing with people, and people all have different levels of change-readiness. Preparing your team to make sure that you’re prepared involves following the above steps in the order in which they are outlined. It helps to use data to help through your change process, both as a communication and measurement tool.
- Bridges, W. (1991). Managing transitions: Making the most of change. Reading, Mass: Addison-Wesley.
- Lewin K (1947) Group decision and social change. In: Newcomb TM and Hartley EL (eds) Readings in Social Psychology. New York: Henry Holt
- Kotter, J. P. (1996). Leading change: Why transformation efforts fail. Boston, Mass: Harvard Business School Press.