Getting Organizational Change Management Process Right in the Digital Economy | HCL Blogs

Getting Organization Change Management Right in the Digital Economy

Getting Organization Change Management Right in the Digital Economy
August 18, 2020

In today’s rapidly evolving landscape, every organization is striving to remain competitive and relevant. The business environment around us is highly dynamic and continually changes with:

  • Emerging technologies and economic impact
  • Continuously changing customer’s expectations
  • Strenuous social and political changes
  • New hiring and layoffs
  • Reorgs and introduction of new products
  • Regulatory impacts

Rapid changes to external and internal environment alters the expectation from people, processes, and technologies in order to achieve anticipated business goals. And, even though managing change is not easy by any means, organizations would do well to realize the outcomes that can come from implementing a change. Companies often seek to bring about change with mergers and acquisitions. However, studies indicate that 70-90% of all acquisitions fail, and a lot of the failed acquisitions can be attributed to the failure of the change management process.

As you can see below, it’s a human tendency to resist change due to various reasons.

Rapid changes

Rapid changes

The traditional leadership and management models of yesteryears had not accounted for the today’s change velocity due to the need for digital transformation. Thus, some of those do not fit well with the current needs. A reason might be the fact that while the leaders were never shown the value of a sound change management process, the middle layer in the hierarchy did not hold accountability for a successful implementation.

A majority of the failures in digital transformation can be directed to ineffective human endeavors. People use alternatives instead of accepting new processes, methods, and technology. Old aids are still being applied though they never meet the new expectations.

Generally, organizations follow a traditional lifecycle for Organizational Change Management (OCM), which includes the following stages:

Rapid changes

  • Analyze and Identify:

    Someone from higher management in an organization, for example, a VP, an SVP, or a Director, starts an initiative to bring an organizational change. Typically, it can be applied to a single area or multiple areas where improvement is required for the survival of a business. This is followed by a formal presentation of the idea to all the required stakeholders including the issues in the current state and desired future state.

  • Engage people and work towards adoption:

    The next step is to involve people in planning. It is enabled to make them comfortable with the new idea. It is believed that they will gradually start accepting and recognizing the probable issues and may eventually become contributors to process perfection.

  • Implementation:

    The final stage is the drive towards the desired future state. Here, people, processes, and technology are equally critical. People who work with processes and technology are aware of how different components can be combined to achieve the desired results. Project Managers and technical leaders identify the milestones and continuously monitor people to make sure that they are meeting the interim deadlines. After successful implementation, it becomes an ongoing process of monitoring the implemented changes and continuously working to bring the new ideas so that the cycle never breaks from the current until the desired state is achieved.

However, in the ever-shifting times, it becomes imperative to bring additional changes to the cycle. Since it’s never easy to readjust an existing working culture and convince people to accept changes, the question arises; just what can be done? Perhaps, the answer lies with digitization that is focused on fast constant change instead of just one big-time change. Companies that have already adopted advanced ways of working believe that OCM is an enduring feature within the day-to-day operations of businesses. Thus, there is a need to transform our mindset to realign with digital practices and culture before opting for a full-scale digital transformation.

Rapid changes

Here, digital leaders have an essential role to play as the onus of communication with the stakeholders lies with them. Effective communication is the most important aspect when implementing a disruptive change such as digitization. And, since the modern workforce is using various mediums these days to work and collaborate on new ideas, leaders can encourage the use of internal forums and online channels to convey their message.

Digital Employees can take up the challenges of a digital culture. As the environment has become demanding, skill demands for specific roles keep changing. One way to counter the demand is to recruit people with required skills from the market each time you opt for a change while the other, more efficient, method is investing in your existing workforce. It is pertinent to make them understand the importance of upskilling, set the right expectations, train them for the near future and utilize them whenever needed. Paid training and online learnings are, therefore, becoming essential for embracing digitization.

Digital leaders should identify the change champions and share the change plan with the people, i.e., Gen ‘Z,’ who are easy to work with, have more adaptability, and can influence others to change their traditional mindset.

There is also a stark need to transform the siloed culture of operations to make the workforce more receptive to change. The need is to introduce digitization into the work culture where people coordinate with and value each other’s opinions. Effective team exercises and training play an important part to create a healthy workstyle in an organization. The use of tools where we can create a single conversation channel to work with each other also makes a huge difference.

Change management and project management should run hand-in-hand since the very beginning. It is impractical to deploy them in a linear manner. In our digital economy, the use of sprints i.e., iterative approach, is helpful as it makes our way for gradual adoption and implementation in pieces.  

The degree of success of an implemented change management process can be ascertained with the following parameters:

  • Do we have an adequate number of people with the right skills set?
  • Are we able to manage resistance and increase the adaptability?
  • Are we using effective communication channels and following the best practices?

To conclude, it becomes clear that an organization must understand the change cycle and the importance of digitization to introduce a successful organizational change in this age of digital economy.