Regarding financial distress, change management can be just as disruptive as financial mismanagement or gross mismanagement by C Suite leaders.
Provided that change management is not a root cause of financial distress (because it very well can be), it can be an issue that accelerates or complicates the distress of a company already facing disruptive forces such as loadshedding or digitalisation.
For change management to be effective, the person driving the change – the Chief Transformation Officer or the business rescue practitioners/turnaround professionals – must run a tight ship. Employee buy-in is crucial to successfully implementing any change in a business.
Legitimacy: Engage your organizational change influencers
The HBR article points out that, when introducing change, organizations typically rely on their leadership teams, overlooking those individuals who may not hold a leadership title but are key influencers of company culture.
Whether they are middle managers, key sales personnel, or even the office receptionist, these people can make or break your plan. Why? Because, unlike traditional leadership roles, these informal influencers wield more power to shape organizational change acceptance, often through influence, intelligence, networking abilities, or simply the respect they hold within company ranks.
The article adds that folding in those influencers early into the change process will not only build confidence across the organization via trusted yet informal leaders but also establish a foundation for change rooted in reliable voices.
Ownership: Provide everyone with a table stake
The article points out that an open mic at a town hall meeting after you’ve decided what will be done does not amount to input. What’s more, your employees likely know that you’re not taking their suggestions seriously. Holding these meetings likely actually hurts your change initiative.
Research, however, shows when people have actual agency in shaping a change, they are significantly more likely to embrace it. Instead of unidirectional town halls, hold a series of small interactive discussions where departments can determine potential roadblocks and define how the change can come to life for their area of responsibility. This provides them with a way to tailor and adapt execution to fit their own unique circumstances, conditions, and restraints.
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Relevance: Focus on latent change
The HBR article adds that organizations have two types of change: one they are championing today, and others on the perpetual back burner, too unwieldy, complex, or politicized to tackle. While it feels counterintuitive, incorporating this second group can be the easiest way to increase buy-in for the first.
If a current change effort can be tied to other changes which have been festering and never addressed, you’re in for a win. By coupling components of known needs to today’s change, it reframes the change as crucial and integral rather than just extra work added to the pile. Further, it reinforces that leadership recognizes chronic front-line challenges and doesn’t simply brush them under the rug.
Attainability: Create a series of micro-changes
The article points out that the flip side of the above advice is to make sure your change is attainable. Oftentimes, change can be viewed as insurmountable due to its perceived magnitude. For instance, an IT department may have a deeply complex and intertwined technological infrastructure, limiting its ability to see the change as anything but intrusive, upending, or even catastrophic.
A useful approach, in many cases, is to break change efforts into a series of micro-changes. Any segmentation approach which enables change to be more digestible, achievable, and manageable will help reduce resistance by making progress attainable in the short term while establishing a sense of accomplishment for the long term.
Authenticity: Embody behaviours that support the change
The HBR article adds that logos, posters, stickers, t-shirts, and other swag — it’s all fodder for supposedly building buy-in and excitement. But just like a dog whistle, people know what it signals and are prepared to lie in wait until the initial excitement passes and things return to the status quo.
Instead of glossing change over with superficial gifts, represent through action what the change embodies. For example, if a changing focus is towards “giving more back to our community,” translate it into direct behaviours, from paid volunteer hours to employee donation matching. By providing behavioural illustrations of what the change represents, it transforms from something stated to something acted upon.
Impartiality: Establish a neutral change facilitator
The article points out that you need to be prepared for conflict. When the role of change is solely led by the CEO or C-Suite leadership, individual concerns and questions get funnelled to direct supervisors. Then, as conflicts between departments arise, teams jockey to have their opinion or perspective blessed over another, despite whether it’s beneficial to the larger change or not.
Bringing in a third party can help neutralize internal office politics, posturing, and infighting. Serving as part moderator, part engagement manager, and part counsellor, they are there to keep decisions unbiased and eliminate favouritism. This can be a trusted consultant or veteran industry expert, but ideally, someone from outside the organization.
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What happens when employees buy in to change
The article adds that, while change is never easy, how leaders approach it makes a significant difference in whether it’s embraced or rejected. By addressing the organizational buy-in context, it’s much easier to move past resistance and stagnation because your path forward will be shaped by realities rather than banalities.
Having employees’ buy-in to change doesn’t simply make implementation easier but rather forges an immutable and reciprocal relationship which pays infinite dividends. Without this, future endeavours will require re-engaging all over again, perpetuating the cycle of resistance. Remember, trust takes months to build and only seconds to break.
Don’t let employees unravel a company
People inherently fear what they do not know or cannot plan for. If you can see a challenge emerging before it becomes a problem, you can make plans to take evasive action.
Change management requires employees to step out of their comfort zone and take on different roles within the company. They may feel they are wholly unsuited to take on these roles confidently. This is where the management of that fear or discomfort is key. It takes one loose thread for financial distress to unravel within a company. Don’t let your employees, or their discomfort, be that thread.
The Mystery Practitioner is an industry commentator that focuses on the shifting dynamics and innovative thinking that BRPs and turnaround professionals will need to embrace in order to achieve success in their businesses.
