As Welsh SMEs take up the opportunities that online technology delivers most businesses will undergo some form of change.
Whether that is making the most of cloud technology to remain competitive, dealing with the associated pains of accelerated growth, or implementing a new system; change management is a useful discipline to be aware of.
This guide outlines the value in assessing whether the risk of taking on change is outweighed by the benefit, and how to successfully manage transformation through stakeholder engagement. With well thought out communication from the outset; the board, employees, partners and customers are far more likely to take on the changes that will deliver value on your new investment.
2. What benefits might I expect?
Business benefits: Change management (CM) maximises the opportunities that can be gained from new technologies.
Reduced resistance: Involving people at the start of a project builds their commitment to change; driving efficiencies and supporting stable growth.
Company buy-in: CM creates a shared vision and smooths transition with communication and training for all new roles and responsibilities.
Minimised risk: Change management processes allow you to identify challenges and to respond to these effectively.
Less disruption: Disruptions to business operations can be identified, anticipated and minimised with careful preparation.
3. Real life example
Since Swansea based insolvency practice McAlister & Co, invested in a new digital infrastructure it has tripled in size, maintained a turnover of more than £1million for the last three years and, has increased staff efficiency and morale.
Founder and managing director Sandra McAlister said:
“During our digital transformation we took the opportunity to review the company’s processes and following staff feedback we upgraded to a cloud-based software that has significantly increased efficiency. Part of our role is to analyse entries on bank statements. Historically this was manually entered into a spreadsheet and could take an entire day, as well as be susceptible to human error. This action now takes just minutes and mitigates any errors.”
- Virtual meetings through a new VoIP (voice over IP) system cuts down on unproductive travel time and reduces administrative costs.
- A new cloud-based Customer Relationship Management (CRM) system allows McAlister & Co to assign staff to new meetings based on location, meaning travel time is further reduced.
- The app also enables the sales team to access customer data on their phone while on the move.
- Half of the firm’s commercial business comes from online marketing including Google ad campaigns.
4. What is change management?
Change management is a process that influences people’s feelings, attitudes, and behaviours. And unsurprisingly it is used to achieve support for large scale changes that will ultimately deliver business benefits.
The most obvious example is when a company implements a new IT system that alters the way people go about their day to day. But the discipline can help with many types of change; from leaving behind paper to focus on online processes, to breaking down the team silos that naturally form as employee numbers grow.
When referring to change management formally, the people who have some form of interest in the change are known as stakeholders - and there are two main types.
‘Sponsors’ are the people with power who have direct interest in the project so could include the management team or investors, for example. Whereas ‘targets’ are the people who will intentionally be affected by the change and include employees, business partners and customers.
5. Why consider change?
Many people subscribe to the adage; if it’s not broken don’t fix it. And in some cases that could be true.
But to remain competitive in today’s rapidly evolving business environment more often companies need to embrace change. Without it they risk losing their competitive edge and failing to meet emerging needs of their customers.
The changes could be something small, such as using social media for its commercial potential (as nearly two thirds of internet users purchase products online and use social for product research). Or it could involve implementing a new system. And in this instance, without changing people’s behaviour, at best its full potential won’t be achieved and more likely the new system will be rejected and any investment wasted.
6. Foreseeing and managing risks
Although any change presents risk, the potential impact may well be outweighed by the benefits it delivers.
To minimise disruption make sure these are calculated risks and consult relevant stakeholders in a planning session where you agree who will take responsibility for each area.
By involving stakeholders from the outset you are more likely to gain their commitment. Imposed change can encounter resistance and thwart implementation.
7. How to plan for change
Think strategically: Succinctly explain the purpose of the change and describe how things will be after the project has finished. This will help you to identify the different stakeholder groups and plan how to engage with them and which messages will resonate.
Analyse the gaps: Set out the changes that will need to happen between the before and after, and assess the gaps. These could be new ways of working and the new skills and behaviours or attitudes required.
Remove the obstacles: Amend or remove any obstacles that could hinder the change required. These could include current goals, targets and incentives, together with reporting criteria.
Determine the business benefits: This is integral to change management and will help you to increase the successful delivery of quantifiable and meaningful business benefits.
Develop a framework: Focus on how business areas will benefit from change and provide a framework for identifying, planning, measuring and actively managing these benefits.
Assess the readiness for change: Is there commitment for change from the top; how well have previous changes been planned and managed; what levels of risk are people allowed to take without criticism or formal action being taken; is there two-way communication at all levels?
Devise a business change roadmap: This timeline shows the sequence and nature of change through milestones, tasks and responsibilities. It maps out the journey from the current situation to the future.
Address cultural change: Engaging and managing the stakeholders will determine the success of the project. New systems are likely to require staff to work in different ways or even perform different tasks, which can be initially uncomfortable.
Involve people: Informal discussions in a relaxed setting with individuals will bring out concerns that may not be raised in a more formal context and help to formulate ways of dealing with them.
Manage the transition: It’s important to avoid any adverse impact on business operations while change is implemented. It may be necessary to decommission existing systems and migrate the historical data held in them.
Consider the impact: Successfully migrating data is essential for business continuity and will help to maintain staff moral and customer confidence.
8. What should I be considering?
- Engage the stakeholders: Change management is all about people so ensure the stakeholders feel engaged in the process from the outset.
- Be realistic: Make sure your solution suits both your business’ needs and your employees’ skillsets (consider other stakeholders such as partners).
- Encourage involvement: Regular workshops are the best way to analyse and understand business processes before introducing new systems.
- Communicate: Keep communication heartfelt and avoid complex and technical language. Do your homework and consider people’s feelings.
- Publicise the success of the quick wins: Communicate the achievement of quick wins and the various benefits they have brought to stakeholders.
- Be prepared to talk to key stakeholders individually: This will encourage people to identify benefits that could be delivered on a more personal level i.e. “What’s in it for me?”
- Recognise differences: Different people will have different needs and concerns and different speeds of understanding and adopting change.
- Delegate: Wherever possible give the responsibility and power to those who will be impacted by the change.
- Empowerment: Whenever feasible empower people to make decisions at a local operating level.
- Maintain communication: The best change programs reinforce core messages through regular, timely advice that is inspirational and practical.
- Don’t go too fast: It’s often prudent to take small steps when implementing new systems and processes. It is much less risky than a big bang approach when everything changes on a given day.
- Make sure change is embedded: Success will come if you can anchor change into an organisation’s culture. This will make sure the benefits are sustainable.
- Plan the long-term broadly: Detailed five year plans will be out-of-date almost as soon as they are published. Keep long-term plans broad and updated with all minor developments and changes in the business.
9. Additional information
- Use the Superfast Business Wales Software Directory to explore the software that could help you run your business
- Register to attend a fully-funded Superfast Business Wales workshop
- At the workshop, make an appointment to see a Business Adviser who will help you create a digital action plan to grow your business