Change management: Types, benefits, & key process steps
In a world where adaptability is the key to success, embracing change becomes the rule, not the exception. Navigating these transformational currents can be complex – the tried and true methods of today may seem preferable to the uncharted waters of change. Yet, with a significant 75% of organizations poised to ramp up their change initiatives in the coming years, stagnation could leave your business in the shadows.
And that’s where change management can help.
Change management is a framework to help your organization transition into a new way of working. These changes can range from minor to huge, including employee promotions, business operations changes, changes in leadership, and business mergers.
A good process will give your organization a roadmap to follow that improves your chances of a successful business change. It can also bring stakeholders and employees on board, giving you the help and support you need.
In this guide, you’ll learn the types of change management, the benefits of using a change management process, and a walkthrough of how to use it.
- What are the different types of change management?
- How can change management help your organization?
- What is the change management process?
- How to prepare stakeholders for change?
- What are some tips for successful change management?
- What are some change management tools for a smooth transition?
- How to unlock growth and innovation through effective change management?
What are the different types of change management?
Your change management process will vary based on your organization’s goals, the type of change you want to make, and your company culture. Here are the primary types of organizational change to consider for your organization.
- Strategic change management: Strategic change occurs when you need to make a change to meet your organizational goals and stay competitive in the marketplace. For instance, you may have a business strategy that is not delivering results or scaling well, such as a service business that offers consulting. Some organizations make a change to productized services to streamline their operations and offer similar products to competitors making the same changes.
- Technological change management: This happens when a company implements certain digital transformations. Instead of relying on old tools to handle the job, they invest in new technology to improve efficiency and automate processes. You can see this today with more companies adopting AI data analysis applications to get help analyzing company data for decision-making insights.
- Organizational change management: Organizational changes happen when businesses must make adjustments that can impact their overall processes and organizational culture. It’s all about the people involved and managing how they deal with change. An example of this is introducing a new remote or hybrid work environment – something that requires employees to adopt new ways of working and tools for managing remote work.
- Process change management: Process change management refers to when you need to lay out steps for moving from an old process to a new one. Manufacturing is one area where this happens. A company might need to start using new, different equipment, requiring employees to learn new skills and workflows.
- Cultural change management: Cultural change management happens when employees and managers must adapt to a new working mindset that better aligns with the organization’s mission and goals. Take, for example, a company with a hierarchical structure that doesn’t encourage communication with upper management. They might want to change their culture to adopt more open communication and create a flatter company hierarchy.
- People change management: People change management is when you focus on training or upskilling people to achieve your business goals. It involves employee training, leadership advancement, and new skill development. This process can happen as a company begins expanding and must do more, such as launching a new product in a different category.
- Structural change management: Structural changes impact an organization’s flow of authority and capital. It can include changes in managers and leadership teams or shifting resources from one department to another. This is commonly seen with business mergers and acquisitions, when two companies come together and combine resources. This might require the organization to change who’s in charge of what or shift focus from one initiative, project, or department to another.
How can change management help your organization?
Understanding the benefits of change management will help you increase buy-in so you can start making necessary organizational changes. Here are a few of the biggest improvements you’ll see when implementing a change management process.
- Improved communication: Employees who are properly informed about changes promotes better communication throughout the organization.
- Enhanced productivity: A clear plan for how you’ll implement changes lets employees focus on their work rather than worrying about what’s going on around them.
- Reduced stress: Uncertainty about the future can cause a lot of stress for employees; change management helps minimize this by providing clarity and structure.
- Improved morale: Employees who feel like they are part of the change process and that their concerns are being heard can boost morale and help create a more positive work environment.
- Enhanced creativity: With change comes opportunity, and change management can help unleash employees’ creativity as they explore new ways to do things.
- Improved decision-making: Change management can establish a clear process for decision-making to ensure everyone is on the same page when it comes to making changes that improve a company’s profitability.
Businesses that face resistance when introducing change to the status quo can refer back to these points and explain them to team members. This is why change management is such an important process – it helps ensure everyone is on the same page, understands why the change is happening, and knows what they need to do to adjust.
What is the change management process?
Smooth change management requires certain key methodologies, which we’ve boiled down to five steps:
1. Planning: The change management team needs a plan before making any big changes. Use this time to create a structured approach to change – establish clear goals, create project timelines, and delegate tasks.
2. Preparation: Sit down with stakeholders and employees to let them know what’s happening and what you expect of them. Include information about how to work with any new systems and make the most of the changes.
3. Implementation: This is where changes go into effect. A change management team should work with employees to ensure the change is implemented properly and everyone’s on board and ready.
4. Monitoring: Everything may not always go as planned when you’re trying to drive change, which is why monitoring is an important part of change management. Keep an eye on the change progress to look for problems and course-correct as necessary.
5. Evaluation: The evaluation stage is when the change management team examines the change process to see what worked and what didn’t. They will determine if the change was successful and if areas still need improvements.
How to prepare stakeholders for change
When changes happen in an organization, preparing everyone for what’s to come is important. This includes employees, company stakeholders, managers, suppliers, and everyone else with a stake in the company.
Do this by communicating the change early and often, providing training and support, and being available to answer questions. Create a sense of urgency by explaining why the company needs change, and offer incentives by clarifying what’s in it for employees. Otherwise, they may resist the change or become disgruntled.
Start by asking yourself who the change will directly impact. In many cases, these are employees and other workers.
Let them know what’s going on, find out if they have any questions, and discuss what kind of support they need. Ask them if your proposed change program makes sense and how they think these changes can help. Direct input from the people doing the job will put you on the path to a successful change.
Once you flesh out your plan with the team that will ultimately help you put it in place, you can share it with other stakeholders. That’s because your team’s feedback will help you adjust and solidify your plan, which stakeholders (such as investors and financiers) will want to see before supporting a proposed change.
Tips for successful change management
Given the complexity of the change management process, having every tool at your disposal is vital for ensuring a successful change management project. Follow these tips to run a more successful project.
- Establish a clear change management plan: This plan should outline why the change is happening, how you’ll implement it, and the expected outcomes. Not giving people a roadmap for change makes it hard for them to feel engaged in the process so they can help it succeed. And since lack of engagement is one of the top 10 reasons organizational change fails, communicating your plan in a way that clearly states each stakeholder’s role in the process is crucial.
- Communicate changes effectively: You must properly inform employees about changes so they understand why they are happening and what they need to do to adjust. Create a communication plan to keep people in the loop and informed of major changes as they happen.
- Manage expectations: Setting realistic expectations for how long it will take employees to adjust to changes is important. Change doesn’t happen overnight, and it may take some time for everyone to fully adjust.
- Encourage input from employees: Encourage employees to speak up and provide feedback on change initiatives, as their input can help ensure changes are implemented in a way that works for everyone.
- Provide support during the change process: It’s important to have clear communication channels during change management so employees can get the help they need when facing challenges or setbacks.
- Recognize successes along the way: Change is often difficult, but it’s important to recognize and celebrate any progress along the way. This can help reinforce positive behaviors and motivate employees as change continues.
- Track your progress: Keep an eye on your progress as you reach your change management milestones. Look at your efforts’ impacts on the organization and the response you’ve seen so far from everyone involved. Measuring your success with data metrics will show you the weak and strong points of the process so you can adjust as needed.
Following these tips for successful change management can help organizations implement change in an effective and efficient manner and minimize stress and confusion.
Change management tools for a smooth transition
When it comes to change management, having the right tools and resources can make all the difference and prepare you for anything. Here are a few of the most helpful ones:
- Change management software: Change management software can automate things like project management, planning, approval, execution, and tracking changes. It also streamlines collaboration, documentation, and analysis throughout the entire change lifecycle.
- Change management templates: Templates can help ensure everyone follows the same process when implementing change, which can minimize confusion and chaos.
- Change management training: Businesses must properly train employees to manage change to ensure successful implementation.
- Change management resources: Many resources are available online and in print to help with change management, from articles and e-books to webinars and workshops.
- Change management team: A dedicated team that can manage change and provide employee support is essential to successful change management.
- Regular employee feedback: Gathering regular input from employees can help organizations stay attuned to their needs and concerns, which can be invaluable when managing change.
Whether you’re implementing change at your company or simply trying to better understand the process, having access to these tools and resources will help ensure your success. With the right change management strategy in place, you can successfully navigate any change that comes your way!
Unlocking growth and innovation through effective change management
Leading change in an organization can be a complex process, but it makes for lasting improvements that can create greater business success. Ensure everyone involved is on board to make it work by using clear planning and communication and offering the right training and tools to get the job done.
If you’re a leader in your business and want to learn how to drive successful organizational change, IMD’s Change Management Program will show you how to succeed. This in-depth learning program offers the knowledge and tools to make your next big change work for everyone involved. Unlock your business’s growth potential and help your team succeed.