Why Corporate Change Management Often Fails (Hint: It's Not the People)
In the book Switch, Chip and Dan Heath argue that when it comes to lack of change, “What looks like a people problem is often a situation problem.” This is what is known as the “Fundamental Attribution Error,” where we attribute problems to intrinsic characteristics of someone’s personality when really the issue is the environment.
Geary Rummler, author of Improving Performance: How to Manage the White Space on the Organizational Chart, said my favorite quote about scapegoating people: “When you put good people up against a broken system, the broken system wins almost every time.”
With all the change in the world these days – and all the changes in the business world – corporate “change management” is a huge fad. The problem is that most corporate “change management” is bad. Not because the concept is bad. But because it is almost always structured around the bad assumption that whenever there is an organizational change, the people themselves need to be changed. This is wrong.
Saying “our people don’t like change” is just a form of scapegoating people when the situation around a change is not dealt with properly in a company. If you truly want change to succeed in your company, focus first on changing the environment to enable it. Then, deal with peoples’ emotions.
Change the environment
A company’s environment is largely a function of its infrastructure. Four key infrastructure components must be addressed in order for change to take hold and last.
- Formal reporting structure / organizational chart. Although it may seem extreme, you may need to redesign your organization to ensure there is official cross-functional alignment built in, so the org chart stops hindering progress and change. Most important processes involve almost all functions in an organization. Yet very few companies actually structure themselves this way, even though it is very helpful.
- Compensation / recognition. As Upton Sinclair said, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” Even if people are excited about the change, if their compensation is not tied to them doing it – or, worse, if their compensation structure supports them doing things the old way, they are unlikely to change. Same thing with recognition.
- Expectations / feedback. Set clear expectations about the change for all parties, and give people regular, specific feedback about how they are doing. Make sure there are clear standards, processes and SOPs that show how people should accomplish the change.
- Tools / resources. Even if you have appropriate formal reporting structure; fully aligned compensation and recognition; and strong mechanisms for setting expectations and giving relevant, helpful feedback, you still need to make sure that people have the tools and resources they need to get the job done. Tools and resources are highly dependent on the specific task and desired outcome. As you redesign the work of the people in the company, brainstorm what tools and resources people will need to do an outstanding job. Ideally, learn from the top performers who are already successful. Whatever tools and resources they are using, make sure everyone has them.
Deal with peoples’ emotions
The other problem with typical corporate-style change management models is that they tend to focus almost exclusively on logic and rational items associated with the change, like mapping out stakeholders or creating a communications plan for each of the stakeholders to make them aware of the change.
Not that this is unnecessary. It’s actually very important. And you certainly need a process for managing change in your company that includes things like this. But these things are more project management. They aren’t actually helping people to make the change that much.
By focusing your change management efforts on dealing with peoples’ emotions about the change, as well as shaping the work environment (not just the people) to enable the change, then the change will take care of itself and be much more successful with a lot less pain.
One of the best ways to change manage the emotional realm is to openly and honestly talk through all the concerns people have about the change – and all the things that are standing in the way of them making it. Recognize there is fear underneath all of this, so you need to deeply understand those peoples’ fears.
It’s a great idea to ask them directly, “What fears do you have about this change?” Or “What exactly is making you hesitant or unconvinced about the change?” Then, listen to what they have to say and make sure you address it.
If you don’t ask people directly, you will get helpful clues about peoples’ fears from the resistance they provide.
But by then it may be too late…