The new economy has created significant business opportunities, but on the other hand, it has also made disruption as well. However, such drastic change has not been observed since the Industrial Revolution in the 18th and 19th centuries. Similar to that era, many big industries stuck to their traditional practices and avoided up-gradation of their industrial setup. Such Industries saw a gradual downfall due to their static nature. On the other hand, other traditional industries either completely revamped and automized their factories or integrated machines while still keeping traditional practices.
Today, when the world is going through Industrial Revolution 4.0, many internet companies like Amazon, Netflix, eBay, and others find it imperative to manage change to adapt to the rapidly transforming technology and business models. Despite the success stories of transformation, we have often observed the success rate of the transformation remains challenging to manage and implement. So, with our years of research and experience, we can break down the reasons behind the failure of change initiatives that need to be addressed before taking on a transformation roadmap.
- Failure to Create a Sense of Urgency
When a company or business is performing well and sustaining in the market, people find organizational transformation unnecessary. This is the initial step where the stakeholders involved in the change process show resistance in the transformation roadmap. To encourage the key stakeholders, the leadership needs to understand how the change process will impact them and the company.
- Failure to Create a Bold Vision
Like the start of any project, business, or company, a transformation roadmap also requires a bold vision. This bold vision can create a sense of urgency among the entire company members and the management. The vision needs to be persuading and broad spectrum that it leads to business growth of the organization. Such a vision shared among the executives and understood by the stakeholders involved will diminish the chances of failure.
- Failure to Create Guiding Coalition
A company’s higher management pursues organizational changes, but they are often unsuccessful in transforming the operations in their firms. A common reason behind the failure is the divided opinion on the vision created. If the higher management is not aligned on the vision, the transformational journey will have a distorted start. This does not mean that the Executive (CEO) should not accept any suggestion from fellow leaders but instead, he should include the opinion of the other executives and then agree on a clear and unified vision.
- Failure to Communicate the Vision
It is often observed that companies come up with a perfect vision, and they communicate it through a meeting or a single communication. Similarly, sometimes the vision is expressed through speeches by the head of the organization. In both mediums, the members of the company often miss out on the vision. So the leaders must get involved in the communication vocally and initiate practical steps to communicate the vision.
- Failure to Recognize the Resources Needed
Managing the resources and reviewing them before the organizational change starts will be very crucial. Even for a company with vast resources, it is essential to sort out the resources, whether human resources or finances, before initiating a change effort. Moreover, the resources required during different stages of the change process need to be allocated accordingly and monitored throughout the process.
- Failure to Stay Focused on the Vision
Having a strong vision and communicating it to the employees is not enough for it to be successful. Often many employees face obstacles due to their personal limitations or the overall company’s operation capability in implementing or achieving the goal. In such scenarios, the higher management’s responsibility is to help the employee focus and adapt to the change culture.
- Failure to Engage and Mobilize People
While the company is going through organizational changes, the employees feel insecure throughout the process. To get the entire team on the same page, a leader needs to involve the team members in the process. Communicate and get suggestions from them. If the team shows authentic engagement in the organizational changes, the transformation is destined to succeed.
- Failure to Create Short Term Wins
A key aspect change leaders need to consider while implementing the transformation roadmap is dividing the process into more minor phases. Once they divide the entire change program into smaller steps, they will take one small action at a time. When these short-term goals can be achieved successfully, they will build on to play a crucial role in the result of the entire program.
- Failure to Scale Success
As the team gets involved deeply in the organizational change, the time to assess the progress comes. Feedback and analysis of the transition need to be done carefully. Feedback will evaluate the effectiveness of the transformation. Moreover, timely feedback and quick action will set the company on the right track. Otherwise, the leaders will fail to capitalize on the progress made.
- Failure to Anchor Cultural Change
During phases of a complete organizational transformation, changing the office or work culture also requires special attention. This change focuses on the way things work in a company. Culture Change includes adopting new practices such as working online during COVID or improving the overall work environment through leisure activities side-by-side.
Overall, if incorporated altogether, these aspects can be a win-win factor for the team and be critical in revolutionizing the organization as a whole. If implemented effectively, changes can create new corridors for the company and the individual team members. On the other hand, if the factors mentioned above do not get implemented together, they can become a reason for the company’s decline. Thus, a balanced and focused approach for Organizational changes can drive the company to success.