Take away 3 points
- Businesses need to continuously adjust to changes in the environment in order to survive. It is widely agreed that innovation is necessary and wanted.
- The process of delivering change in an organization is complex and depends on a number of variables.
- Successful implementation of change depends on whether the process is lead and managed by someone with sufficient knowledge and experience in the area.
Change is inevitable in organizations that want to grow and prosper. Introducing innovation allows businesses to improve processes and gain a competitive edge in the market. However, without sufficient experience and knowledge, even the best ideas will fail. Having a good strategy is only the beginning. The key to success often lies in knowing how to implement and communicate new ideas in an organization.
Understanding and leading change
Today's organizations face various challenges arising from the development of new technologies, changing employee demographics, and global economic competition. The ability to adapt quickly and adequately has become a critical factor in an organization's success. As a result, an organization's competitive advantage increasingly depends on its ability to manage change. Many organizations acknowledge the need to innovate, however, new solutions are often still met with significant resistance. There are numerous studies on change management available. Most of them suggest that between 40 and 70 percent of innovative initiatives in organizations fail . A closer investigation of this claim reveals that, although widely reproduced, it lacks sufficient empirical backing. Available data suggest, however, that bad time management, inadequate planning, poor coordination, insufficient change agency competence, and lack of appropriate leadership are among the most prominent reasons for the failure of introducing innovation to companies [1,4]. At the individual level, studies suggest that resistance to change stems from lack of knowledge, fear of the unknown, and feeling of incompetence. It is therefore crucial that the introduction of new solutions to an organization is done by someone with sufficient expertise, in-depth knowledge of the process and experience, and the change is competently and sufficiently communicated to employees.
Steps in managing change
In order to introduce change in an organization, it is necessary to understand how this process works. There are various theoretical models explaining how change is applied. The most acclaimed model has been developed by Lewin who describes change as a simple, three-step process . The model suggests that organizations should seek to unfreeze, change, and then refreeze the status quo. "Unfreezing" means undermining the status quo by creating the need for change and preparing for innovation. "Change" involves moving to the desired future state. "Refreezing" occurs when the change is implemented and results in a new culture, behaviors, and practices. However, it is argued that the model is too simplistic and does not correspond to the contemporary conditions of the business world [3,4]. More advanced models have been developed in response. One suggests a 12 step model in which change is managed :
- Step 1: Setting up the idea and its context
Understand the need for change and innovation and make sure this is shared by the organization. Persuade employees to recognize change as necessary for the organization.
- Step 2: Defining the change initiative
Define the roles of the key agents of change and their competencies. Make sure the target audience is aware of the innovation happening and that you have the key players on board.
- Step 3: Evaluating the climate for change
Choose the strategists and the advocates of change within the organization. It is imperative they understand how the innovative solutions will be applied and fit in the business.
- Step 4: Developing a change plan
Clearly set up goals for everyone involved in the process and make sure the end users of the new solutions are aware of them and deem them necessary.
- Step 5: Finding and cultivating a sponsor
Know the individuals or groups whose commitment to the change is clear. It is crucial that the organization’s leadership is convinced that the innovation is necessary and wanted. Make sure you have a monitoring system in place in order to adjust the various factors involved in the process.
- Step 6: Preparing a target audience
Plan to deal with resistance to change in the organization. Most employees usually declare openness to change and readiness to embrace innovation. Studies show, however, that this happens mostly out of need for social acceptance and that unconscious bias causing resistance to change plays a key role in introducing new solutions.
- Step 7: Creating a cultural fit
Embed change efforts in the existing corporate culture. Ignoring the governance model or the employees’ attitude towards proposed solutions will cost any agent of change greatly and will most probably derail the entire process.
- Step 8: Developing and choosing a leading team
Ensure you have the people with the right skills set on board. Leadership plays a key role in corporate vision. It inspires employees to embrace change and sets up a structure in which it is introduced. Telling the right story will allow people to understand why change is needed.
- Step 9: Creating small wins for motivation
Create short-term, relatively easy to reach targets. It is critical in keeping employees involved. Plan for, and create visible and attainable objectives.
- Step 10: Constantly and strategically communicating the change
Set up an effective communication plan. Employees who feel that they have been adequately trained and possess sufficient knowledge to competently take advantage of the proposed solutions will act as further promoters of the innovation.
- Step 11: Measuring progress of the change effort
Make sure you have the appropriate tools at hand and can monitor the change process and introduce adjustments when necessary. This can be difficult if not paired with expert knowledge of the industry.
- Step 12: Integrating lessons learned
Make use of previous experience and integrate lessons learned in future practice. This is what allows agents of change to excel.
The authors of this model based it on the experiences of the American defense industry. A business area that is usually strongly exposed to innovation and change and that considers innovative solutions as imperative. It draws on previous theories but expands them into a more applicable, step by step, pattern. However, understanding the model, although very useful in developing a strategy, does not guarantee success in implementation.
OviDrive Project Methodology
Fleet Projects require a specific methodology in order to ensure the longevity and continuous adequateness of the solution. OviDrive uses the Deming Circle (commonly PDCA) because of its unique combination of 1. Including formal preparation phases, 2. Data focus, 3. Embedding correction and improvement reiterations in the methodology.
- ❶ Pro-Act (Step 1,2,3) :
Ultimately, Pro-Act is the pre-design phase of a Fleet Readjustment Project. It measure the status quo of the Fleet and provides the data to set the objectives of the project (cars, costs, vendors, emissions…). Pro-Act also delivers a vision or design that describes the desired outcome of the project.
- ❷ Plan (Step 4, 5, 6,7, 8):
During the Plan phase, the design is translated into measurable key performance indicators. Plan requires measurable and specific KPIs, but also integrates adjacent conditionals, such as HR policies, corporate structures and budgets. In addition, potential disruptions need to be captured and contained.
- ❸ Do (Step 9,10):
The Do-phase is about execution, based on the outcome of the Plan phase. This includes tendering, policy writing, governance, savings and sustainability initiatives. It is common to activate sub-project plans during Do. Progress and results are constantly measured.
- ❹ Check (Step 11):
Check triggers either acceptation or gap correction between results and ambitions. In the Fleet world, it’s typically the most difficult phase, because the outcome of vendor/savings/sustainability projects are difficult to measure. Anticipating, (already in Pro-Act) how the Check phase is done, is crucial to achieve & maintain the benefits of the project.
- ❺ Re-Act (Step 12):
Re-Act offers 2 major opportunities. First, it creates the right context to correct actions that were not accomplished the desired results, but, secondly, it also allows to readjust the strategy and the design of the Pro-Act phase to new conditions, requirements or imperatives.
The goal of a project methodology is to enable efficient management of the car fleet and mobility programs, with focus on cost, sustainability, supply chain and operational efficiency – the foundations of Fleet Management.
From a methodology point of view, this implies that the project focus needs to be at the same time strategic (long term) and tactical (day-to-day): the correct policies and vendors need to be in place (strategic), but corporates also need the tools to manage the fleet efficiently on a daily basis. For this reason, we’ve broken down the Check phase into 2 processes: 1. Controlling and readjusting the outcome of the transformation projects: Support from the OviDrive Consulting Team, 2. Controlling the fleet operationally: Support from the OviDrive system and the OviDrive Service Team.
Managing the drivers of change in organizations
Understanding how the process works allows for developing a strategy but change is a complex process depending on a number of interconnected factors. A global study involving over 117 000 participants involved in or affected by organizational change projects identified six key drivers of successful change that need to be carefully managed on top of the theoretical models. These drivers are turbulence, resources, aligned direction, change leadership, work roles, and emotional energy. Appropriate handling of these aspects maximizes chances to successfully implement new solutions in the organization and may contribute to the overall performance of the business.
- Turbulence refers to the characteristics of the change process, including the overall scope of the change taking place, its pace, and the risks and obstacles encountered along the way.
- Resources refer to the capabilities and skills of the team managing the change process and whether it has the systems and processes needed to achieve their objectives.
- Aligned direction refers to the quality of communication with employees and their understanding of the need and process of change.
- Change leadership refers to the quality of support and engagement with employees throughout the change process.
- Work roles refer to employee involvement in planning and implementing change, and the extent to which people are held accountable, have role clarity, and clear, measurable targets.
- Emotional energy refers to the emotions experienced by the employees involved in or affected by the change process, and their approval or disapproval of the innovation.
These drivers constitute the change capabilities in the organization influencing performance on two dimensions: project objectives and organizational performance. In other words, their adequate management will impact not only the performance of the change project itself but also the overall output of the organization. The definition of the drivers is based on a factor analysis that confirms the complexity and interrelatedness of the different characteristics of change. The authors named the system that emerged as a result of the study the ChangeTracking model as it allows change agents to constantly track the developments in change projects and instantly make appropriate adjustments when they notice that things are not going in the right direction. Experienced consultants will easily identify the challenging areas and adjust the process accordingly in order to maximize the performance of the entire process.
Businesses that want to be successful understand change as an inherent element of their functioning. Introducing innovative solutions to organizations is a process that is easily disturbed. It requires not only the understanding of how businesses adapt to the change once it is announced but also how it is managed and communicated. Experienced consultants can help organizations not only in setting up the right strategy for putting change forward but also in its successful implementation and completion.
- Burnes, Bernard. "Introduction: Why does change fail, and what can we do about it?." Journal of change management 11, no. 4 (2011): 445-450.
- Lewin, Kurt. Field theory in social science: Selected theoretical papers. ed. by Dorwin Cartwright. Harper & Row, 1964.
- Mento, Anthony, Raymond Jones, and Walter Dirndorfer. "A change management process: Grounded in both theory and practice." Journal of Change Management 3, no. 1 (2002): 45-59.
- Parry, Warren, Christina Kirsch, Paul Carey, and Doug Shaw. "Empirical development of a model of performance drivers in organizational change projects." Journal of Change Management 14, no. 1 (2014): 99-125.