What makes some companies able to absorb monumental change, while others struggle to accommodate even the smallest changes? Why do some organizations succeed at driving change and others excel when reacting to it?
Chris Musselwhite, president and CEO of Discovery Learning, has found that organizations have patterns of responding to change. “Some organizations are good at dealing with crisis or unexpected change, but not good at innovation or strategic change,” he says. “Other companies may excel at innovative change, but can get in real trouble with crisis or unexpected events. Something is going on in our organizational cultures.”
Change today is ongoing, rapid and necessary. Organizations today cannot choose to be skilled at just one or the other kind of response. They need to be good at both innovative, proactive change and defensive, reactive change.
Musselwhite and his colleagues at Discovery Learning have developed the Change Readiness Gauge — a tool for understanding both aspects of change readiness in order to develop the capacity of people and systems so they’re prepared for change. Change readiness requires building individual skills and organizational capabilities in four key areas: awareness, agility, reaction and mechanisms.
Change Awareness. Does your company have people responsible for regularly assessing the market for new opportunities and market changes? Does your company proactively search for opportunities for brand renewal and product innovation?
Change awareness is a company’s ability to redefine itself as necessary. This contextual focus is critical to innovation — the right product at the right time. Leaders need to be aware of emerging trends, opportunities and problems. Organizations with strong change awareness are future-focused and strategy-oriented, and they let business factors drive change.
Change Agility. How agile is your company? How effective are your managers at engaging and delivering the changes envisioned by your decision-makers? How well does your company actually facilitate and execute on change when it is needed?
Change agility represents your company’s ability to engage people in pending changes. Organizations with strong change agility have leadership that inspires confidence and trust and does so consistently. Implementation skills are strong across the board: projects are completed on time and employees are action-oriented. People are willing to stretch and build on success.
Change Reaction. How effectively do you and other leaders at your company assess risk and manage unplanned change? How well does your organization react and respond to crisis?
Change reaction is the ability to appropriately analyze problems, assess risks and manage the reactions of employees. Managers show composure under stress and people step up when needed. The ability to react to change (particularly crisis and unexpected events) improves when companies are marked by constructive handling of conflict, distributed decision-making and clear differentiation of critical and noncritical tasks.
Change Mechanisms. Does your organization have the structures and systems in place to support the successful implementation of change? How flexible are those systems?
Change mechanisms should encourage clear goal alignment across functions, the ability to integrate a change into existing systems, accountability for results and reward systems that reinforce desired change behaviors.
Building organizational capacity for change is an ongoing process. It requires a shift away from change management and toward making change readiness part of the organizational DNA, according to Musselwhite.
“The companies most likely to be successful in making change work to their advantage are the ones that no longer view change as a discrete event to be managed,” he says. “Instead, change is a constant opportunity to evolve the business.”
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