Change Management Continues to be a Major Challenge for Modern Corporations

July 8, 2011 - PRLog -- One of the biggest headaches facing any management team within modern American corporations is the challenge of dealing with the changes which are happening within the companies and their operating business environment. As the old saying goes, "Change is the only constant". And indeed changes are to be expected in an increasingly competitive economy where many companies face the unenviable task of managing rising costs while trying to maximize profits even as their customers are tightening their wallets and resisting increases in prices.

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To deal with the ever changing environment, corporations need to adapt their operating models constantly and many companies have to undergo massive transformations within the organization to cope with competitive pressures in the market. Transformations can be very varied and some common examples include organizational streamlining, process re-engineering, headcount reduction, outsourcing and automation. These changes often have lasting on the companies and can be quite traumatic for both the management and employees.

Some studies suggested that people tend to resist massive changes to their way of life, and such resistances are also found in the work place. If people fight the changes which companies are trying to implement, it can turn out to be very costly for the organizations as it may mean failure to implement critical reforms for the businesses. High costs may be incurred in the form of consultancy or advisory fees, ERP licenses or disrupted service deliveries. Failure to pull through much needed transformations may also mean lost business opportunities as the companies are not able to react to market needs to improve sales, battled morale among the staff, or quality deterioration in the product creation processes.

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With the previously mentioned considerations fresh in all our minds, the leadership and senior managers of companies can no longer rest on their laurels and try to force through changes without proper consideration of the impact and ensuring that changes will be implemented successfully with the employees' full support. The associated risks and costs will be simply too great to be dealt with as a consequence of bad management. It is thus important to ensure that any significant corporate changes are managed properly using established change management models.

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One popular change management model frequently quoted was designed by renowned change management guru, John Kotter. In Kotter’s famous Eight Steps Change Model, he advocated a set of systematic steps to prepare the organization for impending changes. Regardless of the types of frameworks or models adopted, the key is for the management and the team in charge of managing changes to begin with a clear strategy and vision in their mind. The vision will set the guiding principles and will aid the team in-charge in discharging their responsibilities. There must also be constant and deep involvement of the employees to secure buy-in from the rank and file. Clear communications will be important to ensure that the entire company share the same vision of change and understand why it is necessary to embark on such a move. The people should be empowered to make a difference in their work area as long as the activities are aligned to broader strategic direction. Staff should be trained and be provided with the right change management tools to help them in the process. With the right elements in place, and properly executed projects, the organization would be able to cope with the changes more confidently.