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What is Change Management and Why Is It Important?

Pretty much every organization in existence has to undergo significant change at some point. Knowing how to best manage these changes and transitions can be critical to your organizational structure and productivity. However, these changes aren’t always the easiest to adapt to. Individuals in your organization who are impacted by the transition may feel overwhelmed or intimidated. So, it is important to know how to provide effective change leadership, engagement, and communications. That’s where change management comes into play.

What is Change Management?

Change management is the approach or methodology that helps prepare and support employees during organizational changes. This encompasses changes that impact a small number of people within an organization or the entire company. No matter how large or small the change might be, the goal is to manage it in a way that makes the transition smooth for everyone involved.

The main goal is always to achieve the highest return on investment possible. For example, if a business purchases a new type of software to improve customer communications and satisfaction, they will want their employees to adopt the new technology. To ensure the new tool is widely accepted across the company, a good change management plan and execution of that plan is crucial to success.

The Various Types of Change

Some common transitions a company may go through that you would want to provide proper change management for include mergers and acquisitions, consolidations, business process changes, and organizational structure changes. New leadership may have entered the company, the organizational team structure may change, new technology may be introduced, or you may adopt a new business model. Each of these things has the potential to impact individual employees and how they do their jobs.

Organizational change is a broad umbrella term that covers various types of change. Certain types of change cause an overall shift in how a company does business. Other changes being made are smaller and less dramatic. Larger shifts are typically referred to as transformational changes, while smaller transitions are called adaptive changes.

Adaptive changes are usually small steps the organization needs to take in order to evolve in their respective industry. This includes things like adopting new technology or upgrading operating systems. While these transitions are being made, leadership teams may make additional changes to fine-tune processes around the new tech.

Transformational changes, on the other hand, tend to happen on a larger scale. Oftentimes, transformational changes involve a shift in the company’s overall mission or structure. These transitions typically take a large amount of time and energy to enact. Typically, they are also in response to an outside force, such as a competitor or an issue with the company’s supply chain.

OCM vs CM

Generally, organizational changes will land somewhere between adaptive and transformational. Managers need to be well-equipped with the knowledge they need to implement the proper processes that the situation requires. To start, there are two main areas of change management:

Organizational Change Management (OCM): These changes impact the entire company.

● Change Management (CM): This focuses on individual people and teams impacted by company transitions.

CM processes deal with people’s response to change in the workplace. The roots of this type of management compare how people deal with change to how they process grief. The earlier CM models tend to focus on the range of human emotions. While gauging employee’s emotions around change is still a large part of CM, it is now broken down into organizational phases for preparing, managing, and reinforcing change. OCM processes tend to look similar but are larger in scale.

Why is Change Management Important?

Now that you know what change management is and what the various types of change management are, you may be wondering why it is so important. Being able to help guide and lead change within an organization is key to continued growth. These days, it also plays an instrumental role in adopting new technology and “keeping up with the times.” It can also help lower overhead, increase profits, improve productivity, reduce turnover, and has a number of other benefits as well.

Reduces Chaos

One such benefit of implementing good change management is that it reduces chaos in your organization. When changes are being made, whether on a small or large scale, it can turn things upside down. Without proper change management, employees won’t have the tools and knowledge needed to adjust to whatever transition is occurring. So, having a CM plan will help reduce chaos and provide peace of mind to your staff.

Eases Transitions

You will also find that a good change strategy plan will help ease transitions within the company. When you have a step-by-step plan for how a transition is supposed to work, you will be about to effectively lead employees in the right direction. They will know what is happening and won’t be so overwhelmed with the transitions that are happening.

Increases Communication

Another perk of good change management is that it will increase communication within your organization as a whole. You will need to keep everyone in the loop about what is happening. Increased communication will help improve productivity and morale within your company. It will also help provide clarity for your team around transitions that are happening. So, if someone’s role within the company is changing due to an organizational change, more communication will help them understand what that change truly means for them.

Can Change Management Increase Retention?

Believe it or not, having proper change leadership, engagement, and communications can help improve your retention rates as well. This is because when proper change management happens your team will feel more in touch with what is happening in the organization. When they feel more in touch with what is going on, a sense of team purpose is created.

Good change management approaches will help your employees see their individual importance within the organization. You will be able to emphasize how their personal contribution is helping lead change and spur growth in the company. It can also help you reduce friction in the workplace and improve relationships. Each of these things can increase retention as well.

Responsibilities in Change Management

As you can imagine, there is a wide range of responsibilities that go hand-in-hand with change management. First, you will need to assign someone the role of assessing the impact of the changes that are going to be made. Then you must hold discussions with key stakeholders that will be impacted by the changes and make a plan for each group.

Once the initial assessment and discussions have been made, it is time to move forward into planning. You will need someone to be responsible for planning and reporting, communication, and training surrounding the transition. Additionally, you will need to define the business’ readiness to make the changes necessary. This means defining criteria for each individual group that is impacted by the change.

After all of these responsibilities are accounted for, you will also need someone to track the adoption of the change and the overall process. They will define metrics, collect statistics, and monitor progress.

Change Strategy

Having a strategy for change is key to making organizational transitions work. As mentioned above, it can be applied to an organization as a whole or specific projects or programs. Typically, the strategy will focus on smaller details, such as maintaining a budget and setting deadlines.

Your change strategy will also include information to help limit the amount of operational disruption that occurs. Of course, when a large transition is being made there will be some disruption in workflow. However, a good strategy will predict some of these challenges and help mitigate the risk. It will ensure that the employees, operations, and organization are all ready to move forward with the changes being made.

Change Training

As a part of change strategy, organizations need to think about how they will need to train their staff to deal with the transitions that are happening. Training needs to be suitable for all of your employees and emphasize the operational changes that need to be adopted by the entire company in order to make the transition go smoothly. Cost of training, the time it will take, and which employees need training should all be planned out.

Learning Management Systems

Learning management systems (LMS) can help you track training and progress when you are implementing changes in your organization. LMS is usually a software application that allows you to assign, deliver, track, and report progress on educational materials. This helps ensure that everyone on your team is getting the information they need and completing the training required to make your transition go smoothly.

For example, if you are enacting a new Customer Management System (CMS), you will want to be sure everyone in your organization is up to date on how to use the system. Using an LMS to deliver training materials and track progress on training will help you ensure that each person on the team has the information and tools they need to be successful. This will limit the amount of confusion and improve employee relations greatly.

Contact Clarity for Change Management Assistance Today

Change management is a huge task to take on for any organization. As you can see above, there are multiple moving parts to a successful CM plan. Clarity Consultants has a team devoted to helping companies manage change in an effective manner. Contact us to learn more about our CM services.