Leading Change

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Change is one of the few constants (along with taxes and death) upon which one can depend. Life in the modern world is all about change, and business and markets are no exception to this rule. Businesses need to stay aware of and adapt to changing market conditions and demands or risk becoming irrelevant.

Though change is inevitable, many people (managers and employees included) find change aversive and actively resist it. They become comfortable and reliant upon established procedures, thinking that if procedures have worked in the past they will continue to work in the future (a dubious assumption). They cease to be motivated to innovate. Innovation and improvement requires active work and strain whereas just repeating what has worked in the past requires minimal effort.

Though it may be more comfortable (at least in the short run) to avoid change, companies that make a habit of doing so frequently suffer negative consequences, as competitors copy their secrets and steal their market share. Simply put, a business' failure to adapt to changing conditions generally means missing opportunities for growth, and losing established market share.

Leadership is the key to effective organizational change. Leadership's attitudes towards change determine in large part whether a company's change efforts will succeed. Up to 75% of corporate change programs fail, but this high statistic is in large part due to subtle self-sabotage on the part of leaders who only half-heartedly embrace the need for change. Instead of denying that change needs to occur, effective new leaders instead seek to channel the forces of change in directions that benefit their organization. Though people don't like change for changes sake they are quite capable of adapting to it, and will even willingly embrace change when they are properly motivated.

Employees are far more likely to embrace change when they are supported in taking risks associated with the change and when they come to believe that participating in the change will improve their working conditions. One reason people resist change is that they perceive risks associated with the change. Consequently, actual or perceived risks associated with changing need to be assessed, removed, and replaced with a culture of support for appropriate change-associated risk-taking behavior. Often old-style leadership shoves all the risks to subordinates while taking few if any risks themselves. New leaders, however, are willing to absorb risk and help employees take risks of their own. They analyze conditions and form a vision for what effective and corrective change should look like. They educate their employees regarding reasons why changes are necessary and how their vision will help the company adapt. They actively solicit employees' input regarding ways to make changes more effective, and then empower their employees to fulfill the necessary changes through effective delegation. Finally, they work to consolidate those changes that have worked into the general company culture, while weeding out those changes that have proven ineffective. In sum, new leaders realize that to do their jobs they must be willing to risk their jobs. Employees will risk more when their leaders are also sharing the risk with them.