Organisations frequently proclaim that people are the most important asset, but how many are merely paying lip service?
In a business world where companies have access to the same technology, the same interest rates, the same telecommunications systems and the same raw materials, it is logical that an organisation's people must be the one resource that is bound to be different from what its competitors have.
People are the prime competitive dynamic any organisation has, and this is the key principle behind winning competitive edge and differentiation.
An organisation's people become especially important when it is undergoing a crucial transition occasioned by a merger or acquisition, downsizing, a period of especially rapid growth, a major new technology being introduced, international expansion or major changes in the nature of the market.
In any of these circumstances an organisation's people are likely to be the defining factor in whether the transition is achieved successfully.
In practice, most organisational transitions do not wind up being carried out as smoothly or successfully as was originally hoped. This indicates that most organisations do not manage the people side of a change project very well.
Ultimately, any corporate change initiative is likely to involve one or more of the following types of change, and very possibly all of them:
- Changes in the nature of the quality of the products and services being delivered
- Reductions in time taken to carry out a particular activity or process
- Reductions in cost.
These changes affecting quality, time and cost are a "holy trinity" for change projects.
An organisation's IT department has a vital role to play as a catalyst for change. The IT department will be - or should be - providing the new and updated computing and telecommunications technology that will enable the changes to happen.
The IT department should be working at the heart of the change, and during this time of transition must be even more careful than usual to focus on solving the organisation's business challenges, rather than getting preoccupied with a particular technology.
It is extremely helpful for the IT department to regard its business users within the organisation as internal customers. That way, the changing needs of those business users during the time of transition will automatically become the core agenda of the IT department.
Whether the change process happens at just one of your offices or globally, the same fundamental dynamics apply. Because of this, and because people are predictably inconsistent in how they respond to organisational change, it is possible to set down some useful practical guidelines regarding how to make the people aspect of organisational change a real success.
The first crucial point to make is that "people" in this context does not only mean employees. They may be the most instrumental in contributing to the success of the transition, but the people element of that success actually applies to all of your organisation's stakeholders.
Typically these will include board directors, senior managers, external suppliers, customers and shareholders, as well as operational teams and any other employees.
These different stakeholder groups each have their own agenda and it is vital that you understand it and genuinely empathise with it.
Board directors will want to produce results for the company's owners if it is a commercial organisation, for the government if it is state funded, or for the donors if it is a charitable organisation.
Senior managers, operational teams and other employees will all be seeking the best deal for themselves from the organisation. What this "best deal" actually means varies between different people.
It will depend on a mix of factors such as job satisfaction, personal ambition, feelings of fellowship with other employees, a willingness to put "discretionary effort" into the job - the effort above and beyond what is actually required by the contract of employment - risk/reward trade off, and so on.
An important additional point is that most employees, even if they are willing to tolerate a high level of risk as part of their jobs, are going to be anxious about what the results of the change process are likely to be for them personally.
External suppliers, even if they have a genuine affection for your organisation and regard the relationship they have with you as more than just business, will instantly have one question when they are notified of a prospective major change at your organisation: how does this affect me?
Suppliers are going to be suspicious of change, very likely justifiably. They will probably have had experiences where a change at a client organisation has led to reduced business for them, or complete loss of that particular account.
Customers will be looking for the best deal and for what they consider to be value for money. But this will not be all they are seeking. Customers actively welcome finding organisations to which they feel comfortable about being loyal.
Enjoy the loyalty you have won from your customers, and remember that your customers will be concerned that changes at your organisation may result in a reduction of service or product quality.
Shareholders will want an appropriate reward for the risk they are taking on in investing in the organisation. They, too, are likely to be wary of change if it increases the risk, unless they can clearly see the potential benefits.
This very act of identifying the likely agenda of your stakeholders will put you in tune with their needs and will accomplish the vital task of allowing you to imagine yourself in the shoes of those whose support you seek.
This is an essential process for success in any kind of business activity, and especially important when handling the people side of a change initiative.
You need to give particular consideration to the following three factors in relation to the stakeholder in question:
- How is the change going to impact on them?
- How much influence are they likely to have on the change process and what is the nature of that impact?
- What attitude do they currently have towards the possible changes that could be put in place?
Answering these questions is not easy, and is best done with someone who knows the different stakeholders well.
The investigation needs to be especially thorough as far as your organisation's employees are concerned. After all, their role in actually delivering the new ways of working is going to be absolutely central to the success or otherwise of your change initiative.
No matter how cleverly-planned your change strategy, if your staff - who will actually deliver the new processes - do not know how to make the necessary changes, or cannot, or do not want to, then the changes will not happen. And if people do not implement the new process it will simply be a good idea sitting on a shelf.
Any resistance that you identity needs to be dealt with in a sensitive, tactful, but if necessary, firm manner.
Generally, IT departments - far from offering resistance to the change process - should be the engines of that change. By the very nature of the work of an IT department, the IT function will - or, again, should - regularly (or even continually) generate innovative new IT services to make the business more efficient.
The IT department should welcome a time of major organisational change as being likely to offer them the chance to do what they do best. If the IT people do not show themselves to be a crucial organisational resource at a time of major transition, they may find themselves suffering the worst fate that can befall an IT department they may get outsourced.
Where people are resistant to change, there will usually be three main reasons for this. First, they may know something that you do not about what the challenges or consequences of change will be. Second, they may not fully understand the benefits of what you are trying to achieve. Or third, they may believe that their position is under threat from the change and want to protect their position.
An important tactical point to make here is that sometimes highly capable people who have the capacity to be your allies resent change mainly because they feel left out of the decision that led to the change process being initiated.
The best way to avoid alienating such people is, of course, to prevent them from being left out of the decision. But if they have been - or if they feel they have been, which may not be the same thing - you need to find ways of re-involving them in the process and letting them see how important their participation is.
This is why understanding the reasons why people resist change is key. If you can achieve this either by finding out what they know that you do not and/or convincing them of the potential benefits, then you can turn them from an opponent to an advocate.
The secret here is to give the person in question a genuine and authentic reason to feel pride in the change initiative and ownership of it. Properly handled, a cynic can very often be converted into an enthusiast, and like converts in other walks of life, may well become a particularly fervent supporter of the cause.
All of the evidence points to effective communication with and involvement of the stakeholders in a project being the critical factor in the project's ultimate success. Power to the people? No - the fact is the power is with the people.
David Ollerhead is a director at professional services consultancy Decision FocusComment on this article: firstname.lastname@example.org