Looking closely at the fast pace by which businesses progress these days, one would get dizzy! For companies to keep up, it was critical to outgrow the pace of incremental change and enforce revolutionary transformations into their models. Yet, every management team needs to answer a key question before designing any process for change: How exactly is my organization changing?
There are 3 types of change an organization can undergo: developmental, transitional, and transformational. Each entail a completely different set of strategies, plans, and even degree of employee engagement. For example, change management is ideal for supporting developmental and transitional change, but would be insufficient to carry transformational change. Therefore we ask a critical question; what does each type entail?
1. Developmental Change
This type focuses on what your company already has rather than creating something new. It is about improving the existing skills, processes, methods, performance standards, or conditions. An example would be increasing sales, improving quality, interpersonal communication training, simple work process improvements, team development, or problem-solving efforts.
2. Transitional Change
It is here that companies start introducing new elements to the table. However, the new elements are not radically different from the existing ones, instead they require some adaptation to dismantle and emotionally let go of the old way of operating while the new system is put into place. This type is mainly defined by 2 variables: the end is predetermined, and so you can manage the change accordingly; people are only largely impacted by the levels of skills and actions, not the more personal levels of mindset, behavior and culture. Examples would be reorganizations, simple mergers or acquisitions, creation of new products or services replacing old ones, etc.
3. Transformational Change
Here is where it gets hard and tricky. There are 2 reasons for this: a) the future state is an unknown that can’t be managed through pre-determined, time-bound and linear project plans, the actual change process will emerge as you go through trial and error; b) the change is so radically different that people and culture must change to implement it successfully. Without the inner shifts, the external implementation of new structures, systems, processes or technology will not produce their intended ROI. For example, in a firm where there are strongly held boundaries & turfs, a large IT implementation that require people to share huge amounts of “privileged” information fails to meet its ROI.
Today our focus is on transformational change because even though its required from a lot of organizations, it is where most fail. The deficiencies are usually not in the external implementation of structures and processes, but rather in the inner shift and engagement the employees. The transformation of an organization means the transformation of its employees, which cannot happen if the company does not engage all of its employees on all levels.
As the leader of the business, it falls on the CEO to lead the organizational transformation. Managements that deal with transformation as an external process impacting people from outside fail to keep up with the momentum of the change, maximize its ROI, deeproot it into the living nature of the business. There are 4 key functions for the CEO to fulfill to be able to bring the transformation to life by successfully managing their people:
- Adding meaning to the change: employees can go great lengths for the causes they believe in. When CEOs are able to communicate the transformation in a way that personalizes it and makes it meaningful, they engage the employees on a personal and emotional level to the cause. They can do it through stories that personalize the process, openly engaging others, and spotlighting successes as they emerge.
- Role Modeling: CEOs need to practice what they preach when it comes to changing mind-sets and behavior. They should embark on their own personal transformation journeys to encourage employees to support and practice the new types of behavior.
- Creating a strong top team: making the tough decisions for who has the ability and motivation to harness the power of the transformations. CEOs also invest in the time it takes the team to be aligned toward the same direction. Set a “team charter” for leading the transformation, and periodically use the charter to ensure that the team is on the right track.
- Pursuit of impact: CEOs need to get personally and directly involved, especially when significant financial and symbolic value is at stake. They play a critical role in ensuring an appropriate balance between near-term profit initiatives and organizational-health initiatives including holding leaders accountable.
To stay on top of your market, you need more than just developing what already exists or transition to a new area. You need to transform your company from the roots, which essentially requires an inner shift in perspective across all of the workforce pyramid. Companies can’t do that from a top-down implementation of change, but through engaging every single employee as if it’s their own personal transformation.
Get in touch with our experts now, and find out how your company can start its own transformation.