Managing organizational change: The ultimate test of leadership

Successful leaders who thrive during challenging times consistently demonstrate flexibility and a willingness to move their business in a new direction when necessary. Researchers have long known that in turbulent markets, individuals and organizations that are nimble will not only survive, but thrive. In fact, the key to sustainability and maintaining excellence is to be agile and embrace change.

However, many employees are resistant to organizational change, which often prevents business leaders from successfully implementing any comprehensive company-wide transformations. For some people change is exciting, while for others it creates a sense of anxiety and uncertainty. This is especially true when modifications in thinking or learning new behaviors are required, forcing an individual to get out of his or her “comfort zone.”

Assessing responses to change
The ultimate test of leadership during this process is the ability to demonstrate a delicate balance between the clarity of your vision for the company and sensitivity to the personal impact these changes will have on your employees. Researchers in the change-management field have identified how people respond to workplace change both in groups and as individuals.

In “Managing Transitions,” by William Bridges, he suggests there are three critical phases to experiencing change: letting go, the neutral zone and the new beginning. In the first phase, people are experiencing loss and sadness about things not being the same. In phase two they have started some acceptance that the old way of doing things is no longer viable, but they aren't quite ready for the new program. During this phase, learning new behavior takes place. Phase three is when people start to develop a new identity, experience new energy and commit to a sense of purpose that makes the new change work.

In his book, “Developing the Leader within You,” John Maxwell suggests that when change is introduced in an organization, people fall into five categories in terms of their response:
1. Innovators are the dreamers — they often have great ideas but are not generally acknowledged as leaders or policy makers.
2. Early adopters are respected in the organization. Although they did not create the idea, they will try to persuade others to accept it.
3. Middle adopters are the majority of people. They can be influenced by both the positive and negative influencers of the organization.
4. Late adopters are the last group to endorse an idea. They might never verbally acknowledge the benefit of the changes, but eventually will comply.
5. Laggards are always against change and may be divisive to the organization.
Identifying your key personnel's style and anticipating their reaction to change is critical to ensuring the support of your employees in this process. Specifically, management needs to demonstrate leadership skills such as empathy, optimism, assertiveness and agility. However, before you can lead your team through an effective transition, it is important to understand some basic principles related to change-management strategies.

Strategies for implementing change
Psychologists have identified three basic human needs that impact an individual's reaction to change in his or her environment. They are: a need for control, a need for inclusion and a need for openness. Although the level of need for these factors is different for everyone, there is always some element of each of these in an individual's reaction to change. If a change program does not address these issues, it is likely that you will encounter a negative reaction from your employees, ranging from ambivalence to outright opposition.

Research in change management suggests that four basic conditions have to be met before employees will positively embrace change in their behavior. They are:
1. A compelling story - People must see the point of change.
2. Role modeling - Employees must also see colleagues they admire modeling the desired behavior.
3. Reinforcement systems - Surrounding structures, systems, processes and incentives must be in tune with the new behavior.
4. The skills required for change - Individuals need to have the skills to do what is required of them.
Additionally, when we choose for ourselves, we are far more committed to the outcome. Specifically, someone is five times as likely to embrace a behavior if he or she is actively involved in the transformation process.

An effective organizational change-management program needs to incorporate these key behavioral principles. As importantly, the leadership team guiding this process needs to embrace an understanding of the factors that impact reactions to change to be effective role models and mentors guiding their team successfully through this process.

Denise P. Federer, Ph.D. is founder and principal of Federer Performance Management Group, and she has 27 years of experience working with key executives, business leaders and Fortune 500 companies as a behavioral psychologist, consultant, coach and trainer. Contact her at: dfederer@fpmg.info