In any organization, there is always a reason to make changes. If we ask the leader of any business if they are satisfied with their sales figures, they will say no.
If we ask him whether he is confident that his salespeople are working at 100% efficiency, he will say no.
However, if it comes to suggesting any changes to increase efficiency, he will say no again. There are two reasons for this: one is obvious, the other is not.
The obvious reason is that the company leader believes that if something is happening in a certain way, it has always been that way and is unlikely to change. Moreover, he is confident—rightly so—that introducing any changes will reduce the efficiency of his company. Yes, it will decrease. Yes, it will be uncomfortable. However, the productivity curve of a company, when changes are introduced, always goes down first. So why make changes? Because after it goes down, it then goes up and rises higher than it was before. It’s like shifting gears in a car. To change gears, you have to lower the RPMs and lose power.
An unexpected reason is that the company leader is simply afraid of change. This is quite normal—he has worked so hard to bring his business to this comfortable and convenient state that the thought of having to change anything makes him tremble. For him, the success of change is a 50/50 risk (will I encounter a dinosaur or not?). The risk of change feels the same to him as the risk of surgery does to an amateur (will I wake up or not?). Every healthy person will postpone surgery until the last possible moment, until it becomes unbearable, which actually complicates the doctors’ work. A suppurative appendicitis is always more complicated than a simple appendectomy, and the latter can be performed without any invasive surgery at all.
The prospect of complications from surgical treatment leads most clear-thinking patients to opt for earlier surgical intervention; however, for this to happen, they need to see a surgeon. Every doctor’s dream is a system of regular health check-ups, which is the very path that gives each patient a chance for early disease diagnosis. Unfortunately, patients only seek the services of specialists when it’s already too late to treat the condition. This means that the work of a specialist often comes down to burying the dead and starting the process from scratch, sometimes even changing not just the entire staff, but also the brand, the office, and the bank accounts.
Dentists often offer free check-ups. Yes, they have an interest in finding out what needs to be treated in the patient. However, a conscientious doctor doesn’t prioritize money; otherwise, they would lose patients. Their thoughts are focused on easing their work in treating complicated cases. The same goes for business consultants. Some offer their first consultation for free, specifically for diagnostic purposes.
In my career, there have been several instances (a total of six) when I was called upon to implement changes. I’ll share two of them. Once, a change in the company’s business model was required, but we ran out of time. I wasn’t the one to bury the corpse; in fact, it wasn’t buried at all, but rather picked apart 🙂 At that time, I was responsible for economics and pricing, and I managed to complete my part of the work—I transitioned the pricing from a system where all overhead costs were allocated to the planned production of goods, meaning that the less product was produced, the higher its price was set, to a system of marginal costs, where fixed overhead costs should not influence pricing at all. For a large, unwieldy organization in agony, this was a bold, seemingly illogical step, but a desperate one. The company was already dying.
The second scenario is more favorable, where the need for change was recognized in advance and steps were taken to implement it. However, it seemed that the company had a full three years to make these changes. In reality, the urgent need for change arose just six months after they began. They didn’t manage to execute everything smoothly, but if they hadn’t started implementing changes, the company would already be dead. On the day the first step towards change was taken, everyone except a small group of people thought everything was fine and that there was no reason to change the company’s distribution model, especially since things were going well. Why, everyone asked, expend effort on creating a new, less efficient sales channel that required more management effort when money was practically flowing in on its own, needing only a little “greasing”?
This entire first post is dedicated to the idea that the most important aspect of change is to recognize the necessity and urgency of that change. It’s crucial to have a clear and vivid understanding of what will happen if changes are not implemented and what will happen if they are. It should be crystal clear that without change, the company is headed for disaster. Moreover, this understanding must be established long before the difficulties in the business start to be felt physically.
We won’t be able to create a sense of urgency and necessity for change unless we enlist supporters among the decision-making employees of the company. On one hand, we can spend a long time gathering data, analyzing it, and building business models, but there will always be a critic who says it’s all nonsense! Of course, presenting information logically can lead to a shift in mindset, but it doesn’t provide that crucial sense of urgency for change that we need. Without this sense, all work related to change will be pushed to the back burner, leading the project to failure.
It turns out that we, as serious and business-minded individuals, need to appeal to people’s emotions. To demonstrate the necessity and urgency of change, we should use analogies, visualizations, and the experiences of other companies—experiences that change specialists have in abundance. In any case, we need to structure the information delivery in such a way that those listening (excluding the critics, of course) feel a chill down their spine from the realization and vision of the disaster that awaits them. Only then will the critics be silenced—not by you, but by others who will start thinking alongside you about not just what to change, but how to change it.
If you need to convince a group of decision-makers, start your work with individual meetings with each group member, refining your arguments and addressing objections step by step, so you won’t have to stand under the crossfire of criticism while presenting charts in a spotlight. Don’t engage the most conservative members of the group at all. They are conservatives, and the best way to convince them is to show that the “conservative” viewpoint—the viewpoint of the entire group—requires change. They will agree with the majority. However, they will fiercely argue with you in one-on-one conversations, as they will conservatively assume that the entire group is against change by default.
When working with the group chairperson, do not do it alone; have a respected member of the group present who can introduce you and express their concern about the issue in advance. It’s important to understand that a conversation with the chairperson will immediately lead to a group meeting. Therefore, you should be as prepared as possible for that conversation.
So, changes cannot be implemented without the decision-makers in the company not only feeling that something needs to change but also being confident in the necessity and urgency of those changes.
The next thing to understand is that no changes can be made alone. A team must be formed to manage the changes. This team should include people with various skills and qualities. Some should have authority, some should inspire trust in others, some should be able to communicate effectively, some should analyze information, and there should be a leader. Everyone must understand the urgency of the changes.
This team should lead the change project, and all ideas and proposals should be brought to its discussion. This same team will be responsible for determining what information will be shared with others and what will be used internally. There should be no censorship within the team, and it should be well-coordinated to avoid a bureaucratic approach and allow for discussions about issues to take place remotely—in pairs, small groups, or via email. It’s important to understand that this team is responsible for shaping the changes that need to be made. After all, when we realize that something needs to change, we may understand what needs to be changed, but not how to do it.
Once we have a clear understanding of the problem and a team capable of working on its solution, we need to develop a resolution. This is not just a matter of words. A comprehensive vision of what the future will look like must be formed, including how and to what extent it will differ from the present. If necessary, “what if” scenarios should be calculated. For example, if you are changing the salespeople’s reward system, you should take the current sales volumes for each salesperson and their managers and calculate how much they are earning now and how much they will earn after the changes are implemented. Additionally, you need to understand how the new system is better not only for you but also for them. You must be fully and thoroughly armed with facts.
It is also necessary to develop an understanding of how this future will be achieved. This is not just about managing a straightforward project to achieve results, but also about establishing a “line” along which decisions will be made. If the changes you plan to implement affect a significant number of people, you may encounter unpleasant situations where outstanding individuals—those who perform best—do not fit into the general framework. However, creating a list of exceptions is detrimental for three reasons:
- It’s a cumbersome process. You either have to keep it in mind all the time or implement special algorithms linked to surnames in the accounting system.
- It’s difficult from a management perspective. A general policy is easier for the team to “buy into” compared to a policy of exceptions.
- The policy of exceptions opens the door to new exceptions, as it sets a precedent for them.
The ability to create a simple yet universal system is what makes change management specialists highly valued.
It is important to understand that changes cannot be implemented “just like that.” There must be transitional states. Some of these states can be established before the changes are announced. For example, you can modify the document flow so that it is suitable for both the state before the changes and the state after. Alternatively, you can introduce procedures and improvements that will be beneficial in the current state while also significantly easing, if not catalyzing, future changes.
Some transitional states should be implemented only after the organization is on the path to change. Therefore, they will be part of the information package for the “others.”
After deciding what changes are needed and how to implement them, it’s important to think about communication. You need to ensure that everyone is on the same page.
- listen attentively,
- they understand what they are being told,
- see the big picture
- Feel free to ask questions.
- They like it and fully support the changes.
My practice looks like this. At the stage of developing a change strategy, I involve several representatives from the team in discussions about the changes. These individuals are both successful and serve as “typical representatives” of various groups of people, based on their expected reactions to the news. The group should be small, no more than 5 people, and the discussion should be moderated, but not authoritarian. In such a group, there should be a “chief of grievances,” a “chief constructivist,” the “most successful” member, a “chief paranoid,” and, if possible, an “informal leader.” It’s best not to invite a “chief conservative,” as they would make up 20% of the group and influence its behavior.
These discussions should be held “in secret” from the rest. However, it’s clear that there will be a leak of information. Moreover, it will be the negative aspects of the information that leak out and circulate as rumors. Other team members will approach you asking for clarification on these rumors. They should respond that what they know is only part of the truth and that there is no need to worry. Changes during their implementation should not disturb people’s financial well-being; however, if a change in the reward system is necessary, it should include mechanisms that allow for easy modification of financial rewards later on, using fair or “fair” algorithms. In other words, you tell the truth—financial well-being will not change, and there is nothing to worry about.
By engaging in such preliminary discussions, you achieve three goals at once:
- you receive preliminary feedback and modify your message to the rest so that it appeals to everyone
- Bring key points to the discussion and take into account the wishes and comments of the participants. You are likely to have overlooked something, and some things may not seem reasonable. It’s better to address this at the initial stage.
- You pique the interest of others about what is really being prepared. If the group is indeed silent, you can hint that changes are coming and that part of the team is involved in the discussions. It’s important for you to capture everyone’s eager attention so that the overwhelming majority understands everything the first time during the presentation of the changes.
Once the essence of the changes and the message for the rest are ready, you need to present this message properly to everyone. You may need to change your working relationships with all team members. In that case, you should aim to accomplish everything in one day—talk to each team member individually and prepare a general presentation of the changes, which should be done in a classic format—a set of slides:
- statement of the problem,
- options for solutions,
- the choice of the most reasonable solution,
- presentation of specific steps for its implementation,
- the illustration of the “new world,”
- answers to questions.
You need to give the presentation. If you lack charisma, that’s your problem. The entire presentation should be aimed at getting the audience to “buy into” the idea of change and understanding that the option to “leave everything as it is” is not available.
If the team is large enough, you’ll need to conduct interviews before, during, and after the presentation to save time and fit everything into one day. You don’t want a collective outcry in the form of an organized protest that could arise if this process drags on.
Of course, interviews before and during the presentation should be conducted with those who are already informed. Then with those who will quickly understand the topic if it is explained briefly. And only after that, with those who learned the news from the presentation. You should carefully consider how to divide people into groups based on their potential reactions. Leave the most challenging individuals for later. Serve the most favorable ones first; they will be your “influencers” in the audience during the presentation.
With such a procedure for informing about changes, you will not lose the loyalty of people or the majority of them. People will look to the future with optimism, reassure pessimists, and “sell” them good news. All changes in labor relations will be received smoothly, and you will not face any protests.
More about communication:
I completely forgot. If you plan to resort to internal promotion of changes and what benefits they bring to employees (which will be necessary in a large organization), you will need to carefully calculate, for example, the timing of printing posters for internal use. They must be distributed on time. A delay of just a week makes them extremely ineffective. Timing is everything.
Support the initiative.
When implementing any changes in your organization, a shift in people’s behavior will be required. They will need to invest time in these changes and must be confident that they are acting correctly. Keep an eye on proactive individuals, give them space, and support them.
Assistance, in general, is a very powerful tool. By helping certain individuals and explaining to others why and how you are assisting these chosen ones, you encourage the rest to join this exclusive club.
You will need to showcase examples of successful work under the new rules. Shine a spotlight on successful initiators. Show people “quick wins” so that everyone can see and believe that the changes are not just announced but are also effective in practice. The “small wins” tactic will help keep the team informed and engaged during the initial phase of the changes, without creating unnecessary reasons for concern. Have you changed the reward system that, on one hand, saves you money, and on the other, allows salespeople to earn more? Highlight those who have started earning more. Share their experiences. “Put them on a pedestal and ask them to recite a poem.” They will appreciate it, and it will motivate them. Additionally, understanding…achievabilityThe result will motivate others.
The quick victories I mentioned earlier should not make you complacent. Under no circumstances should you let things slide. Initial successes do not necessarily mean that everything is fine. Often, innovators need support—not moral support. Doing something new or different always means redistributing your work and resources. Therefore, you need to organize the work in your organization in such a way that other employees take on a slightly heavier workload, allowing innovators and change agents—those involved in the technical implementation of these changes—to move forward with some free time to focus on their tasks.
It’s time for you to think about the “victory machine.” You’ve gotten the train moving, and now it needs to pick up speed. It should keep accelerating until the vision you developed at the very beginning becomes a reality. The worst thing that can happen is to stop halfway. I have experienced being halted (by circumstances) midway. Believe me, nothing could be worse. The fact is that during any changes, productivity tends to drop. This should only concern those who can’t see a step ahead. Eventually, productivity starts to rise again and surpasses the plateau or “gentle decline” that was observed before. If you stop the changes in the organization during a downturn, it’s the same as ceasing to operate on a patient. Not even stitching them up. Just walking away.
A clear action plan should drive the success of the project. It should include the team, resources, goals, tasks, and optimization—just like in a textbook. Never hesitate to make changes to the project if circumstances are favorable or, conversely, if they take a turn for the worse. You shouldn’t cling to an old plan in such cases; instead, make decisions based on the current situation. For example, if you had planned to replace or retrain a certain department in your organization in August, but then a similar, already trained department from a competitor unexpectedly comes your way, don’t make the new team wait until August just because that’s what your project says. Find a solution to keep both departments running for a while, or take a tougher approach—simply close the less effective one and open the new one.
However, all your actions should be part of a series of victories leading to your ultimate goal. Don’t give up and don’t ease the pressure. Think of how athletes behave on the final stretch. Have the strength and resources for this, even from the start of the changes. Then, from the outside, you will appear tireless, and that intimidates your enemies 🙂
…while every change paves the way for other changes.
N. Machiavelli, “The Prince”
Well, the organization has reached its new state. Very often, the transition to a new state is accompanied by significant personnel upheavals. New people come in who have no knowledge of or have never seen what the organization looked like before the changes, and they believe that this is how it should be. They think that the new rules and the new style of work are the company’s tradition, and they cannot imagine any changes. But this is a dead end.
Indeed, change is always necessary for successful organizations. The most significant achievement of an organization that has undergone change is the realization that change is a new philosophy. Now, with a more flexible structure that is better adapted to change, when nothing is done “for eternity,” and everyone understands that “today is one way, and tomorrow is another,” when the burdens that hinder progress have been shed—resources are used more efficiently and purposefully, with the understanding that the results of resource expenditure should appear very quickly.
Now, when new documents or procedures are created in the company, a method for their quick modification and approval of such changes is always provided. Now, when asked whether to remove the air conditioning from the office or to buy our own air conditioner, the answer is clear. Now, if we don’t like something, we can easily raise the issue and quickly “fix” that something.
Once we’ve set off from the dock, “stripped the threads,” we will never stop. Yes, this is a nightmare for many leaders of companies in the former USSR, who don’t even attempt to lead. They are simply too afraid to do so. They’ve been placed in the role of ship captains under conditions where they have no education, no skills, and no idea where the helm is. They will only take the wheel if an iceberg emerges from the fog ahead, and even then, they will likely consult with the crew on the matter, seeking salvation from them, while the crew waits for instructions from the captain. The iceberg will collide with the ship long before anyone touches the helm.
At the helm, there should be people who know how to steer the ship, not just settle conflicts between the cook and the sailor or give orders on how clean the deck should be. Yes, the latter is a good role for a “captain,” but not for a true captain. After all, a “captain” thinks that the helmsman should steer, the navigator should chart the course, and the stoker should throw coal into the furnace. But a real captain simply knows where to sail and what to do if an iceberg appears on the horizon.
However, if the company has managed to steer its ship even once, everyone now knows where the helm is and how to use it. Now they can consciously navigate this ship to sail where it needs to go, rather than where it has been drifting until now.
The main thing about change is the possibility of new changes! So, let’s raise a glass, yo-ho!
“Resistance is futile!”
Actually, having talked about the changes, I want to focus, in this last post, on overcoming resistance. People who are seriously involved in martial arts will confirm that you should strike in a way that prevents your opponent from getting back up. If you have to strike, of course. Also, in one… known The work states that one should “only hire professional killers who work for money. Those who work for pleasure usually do silly things like leveling the playing field with the victim for a fair fight.”
So, the first weapon in the fight against resistance that you should have and use without hesitation is deadly. If you have a way to effectively discredit, trample into the dirt, strip of authority, ridicule, or come up with something else against those who resist change—use it quickly, ruthlessly, and without looking back.
It’s better for you to be seen as a tough ruler than a pushover. Moreover, just the awareness of having such a weapon will make you behave differently, and potential opponents, seeing your inner strength, are unlikely to start plotting against you. Of course, you must follow the rules of engagement, meaning you shouldn’t threaten with your weapon but act unexpectedly. When an opponent attacks you, they shouldn’t know that you have a knife. Otherwise, they will change their attack strategy, and your knife will become useless.
An example from life.
A relatively large company. There are a lot of group sales managers. In the company, with my involvement, a new incentive system for salespeople and their managers is being introduced. Among the managers, there is a star manager who is unhappy with the new system because he immediately loses half of his income. This star manager is well-known and respected by the others as an authority (often on stage as a winner), and he himself is quite articulate. However, for the other managers, the new reward structure looks attractive or, at the very least, no worse than before. The half of his income that is being taken away from this star manager is earned unfairly, and the previous system simply allowed him to exploit certain loopholes within it.
And so, the group managers gather in Kyiv for their conference, already informed about the new system. Of course, our “star boy” is there too. Before this, he had met with me and the company’s management several times, searching for arguments on why the new system “cannot work” and what needs to be fixed so that he and others like him don’t lose their motivation. Notice the level of demagoguery: “others like him.” He means “stars,” but I see that he is the only one like that, and even then, he is not a representative example. He doesn’t work himself, yet he still gets money from the “channel,” which he doesn’t even bother to manage.
I’m keeping an eye on the star’s activities. And from the information I’m receiving, I understand that in the evening, the “star” gathers everyone in the attic (literally) to discuss the new reward system. I realize he’s planning to stir things up and provoke people. He’s a truly talented speaker, a gifted salesman, and the gullible ones will listen to him. He works, the rascal, with intonations and emotions, weaving a tapestry of words with the right tone and framing it as well-placed questions. Arguing with him “on stage” using logic is absolutely out of the question. You’d just be stooping to a marketplace brawl.
And so, when the “May Day” celebration starts to gain momentum, and our agitator gets into character, I quietly head up to the attic, tell everyone, “Don’t worry, I’ll just sit here and listen,” and go to the back of the attic to actually sit and listen. Zvezda’s mood seems to have dropped a bit. It’s no longer possible to blatantly lie, taking advantage of the fact that no one has really delved into the details of the reward system — I’m sitting there observing. Moreover, for some reason, I took a pen and a notepad with me. My visit wasn’t part of his plans at all. However, the role is set, the pace must be maintained, and he continues on.
His speech is ready, at times accusatory, and he can’t seem to get off track. Sooner or later, he mentions me and my “foolish ideas.” I smile and count to two. Just as I reach the end of the second second, three events I’ve been anticipating occur:
- The star realizes that he has frozen out too much.
- The hall turns towards me.
- One of the attendees says, “Why are we even discussing this when we can just ask Roman?”
Bingo! Finally, it clicked that I should be the one they ask, not the Star. I step out of my dark corner and, with three pre-prepared phrases, I knock the “Star” out, explaining to everyone present that the “Star” has personal and dishonest interests against the introduction of the new system, inciting you all, to your detriment, and has actually gathered you all here not to “discuss” anything—there’s nothing to discuss, it’s all written down—but to stir you up against the new system. After that, I said, “Now, I’m ready to answer all your questions.” The Star tried to say something, but the others shut him down.
Now that we’ve sorted out adrenaline and the romance of battle, it’s worth taking a look at
a) the motives that guide the resistors and
b) “non-violent” methods of managing resistance.
First, let’s consider the objective motive: Changes bring bad news to a person. It is very important for you that these changes do not appear to be something bloody and overwhelming from the outside. If a few people are laid off, the domino effect might kick in, and everyone will start looking for new jobs, like a school of fish mindlessly swimming in the direction of the fish in front of them.
The only solution in such cases is to present bad news as if it were good. I managed to do this. This is essentially the essence of sales. Moreover, one very cunning guy, while observing my work, remarked that “the worst thing he could imagine in his life is becoming my enemy.”
Now, let’s talk about subjective motives. In such cases, unfulfilled ambitions play a role, as does the status of an informal leader who is vying for influence, or simply a conservative, or a plain “denier”—a person who feels overlooked and is desperately seeking attention, even in the form of such reactions.
“Non-violent” reactions to resistance can theoretically be divided into the following categories:
- To win someone over by giving the resistor some element of formal leadership,
- Strengthen your influence.
- Analysis of motivation and the involvement of motivators in behavior correction.
- Evaluate the group dynamics and make adjustments.
However, it’s important to understand one very crucial thing! “Non-violent” methods should only be used when you know who to expect resistance from and should be applied before that resistance arises! Otherwise, the use of such methods will be perceived as a concession or weakness. What you “lack” when implementing changes is the loss of respect from those around you.
An example from life.
Changes in the organization. The organization is of medium size, and the changes affect no more than 30 people, one of whom is the “I fear no one” type—he loves to complain and is confrontational, taking an active and unyielding stance. He definitely won’t like the changes simply because they might not be to his liking.
What was done? He was whispered to, in his ear, about the wonderful career prospects specifically for him after the changes were made, and that a fate better than the others awaited him. Later on, these prospects were formalized and accompanied by conditions that, while achievable, were not suitable for this person.
The most important thing is that when the changes were being introduced and discussed, he remained silent and walked around with an air of importance, as if he knew more than everyone else.
Well, that’s actually everything I wanted to share about the changes.