By Dora Wang
Part 2 of 3
In our last article, we looked at some examples of successful change management. Now, let's shift our focus to some instances where things didn't work out as planned.
Change Management Examples to Avoid
The one upside to public failures of change initiatives is that the rest of us can learn from their mistakes. Here are three recent examples from the retail space:
01. Walmart
Nearly a decade ago, the “Everyday Low Prices” seller of food, home goods, electronics, music, clothing, and just about anything else you can think of looked to expand its market. They brought in higher-priced, upscale items like trendy fashion in order to attract new customers.
But the move never really took hold. Higher-end consumers were decidedly underwhelmed and lower-end consumers started looking elsewhere for bargains. Walmart got a new advertising agency and forged on. But it was not to be. In 2012, they announced plans to refocus efforts on low prices.
(Recently, however, now that its traditional superstores are losing traffic, Walmart has begun experimenting with upscale goods in smaller stores. Will this strategy work better the second time around? We’ll see.)
02. JCPenney
Sometimes, no matter how good or sensible an idea is, consumers won’t have it.
The year was 2012, and rather than offer sales and coupons, JCPenney had a better idea: “month-long values” that would do away with the hype and drama of specials and so-called “reductions.” Instead, consumers could rest assured they were always getting the best price. Period.
Unfortunately, customers hated the idea and criticized JCP’s implementation. The company suffered a 20% drop in profits in the first quarter of 2012, along with strong negative consumer feedback. JCP’s then-president, Michael Francis, announced his resignation soon thereafter.
Unfortunately for JCP, consumers want sales, and they want coupons even more. There's something about getting a deal, even a fake one, that feels good.
03. Borders
The giant brick-and-mortar store used to be the mainstay of the book market. But with the rise of online sales, physical stores suffered, and by 2011, Borders announced that it was closing its 399 stores and laying off 11,000 workers. Borders’ main competitor, Barnes & Noble, was having a tough time as well, but B&N had one thing Borders didn’t: an e-reader already entrenched in the market. Borders’ e-reader was simply too little, too late to make a difference.
Futher, as consumer sentiment shifted, Borders refused to build up its e-commerce capabilities. Instead of launching their own site like B&N had done, the company chose to outsource their internet sales to a relatively new company called Amazon.
We all know how that turned out.
When changes are too incompatible with the existing brand — or when they just come too late — the odds are stacked against them.
Now that you're familiar with what successful and unsuccessful organizational change efforts look like, it's time to learn about why companies opt to change in the first place.
Reasons for Organizational Change
Here are a few examples of obstacles you can turn into opportunities:
01. Company performance
Are your organization’s goals or productivity quotas not being met?
Take charge to close the gaps. Maybe reorganizing teams and reallocating personnel will result in more efficiency. You can take a look at the distribution of budget and resources to make sure everyone has the tools they need.
You might also work with individual employees during performance evaluations to align each person’s goals with the big-picture vision.
02. New technology
Has your organization kept up with the innovations in your industry? What about social media? Do your employees have mobile devices?
From attracting job candidates on Facebook to engaging with customers on Twitter, the rules of recruiting and marketing have been rewritten. Make sure you stay relevant —whether that means training your employees, hiring new personnel to bring in expertise, or restructuring some of your existing processes.
While you're at it, invest in new tools, devices, and platforms that enable your workers to stay productive wherever they happen to be. Not only will your team become more effective, they'll also become more engaged.
03. High turnover
If you’re not keeping as many employees for as long as you’d expect, reach out and find out why.
Exit interviews are vital. But don’t wait until someone quits to react. Reach out to see if the members of your company are happy — and if not, why not.
Do managers need additional training? Is the company culture in need of an overhaul? Engagement surveys let your employees tell you how your organization is doing now, before they decide to leave.
It isn’t always possible to predict when organizational change needs to happen. But you can keep an eye out for the signs that indicate the time of need is approaching. Being proactive gives you more time to prepare for success.
The Role Culture Plays in Change Initiatives
A report by Strategy& points to some of the reasons why having a strong company culture and involving your employees in change initiatives directly will increase your chances of success.
Take a look at some of the top reasons employees say that they resist change:
44% don’t understand the change they’re being asked to make
Over one-third don’t agree with it in the first place
If the members of a company don’t understand or agree with a change, that means there’s a deep disconnect between that change and the culture. It could be that the change goes against the established values — or maybe the overarching vision just hasn’t been communicated clearly.
And don’t get misled by early success. For the change to actually last, employees need to stay committed even when it’s all “done” and no longer a top priority.
On the other hand, values are permanent. If the change doesn’t mesh with them, the change won’t last. You can push and pull with temporary pressure or rewards. But that progress has to be reinforced by your culture to truly become a part of your organization.
This article by Dora Wang originally appeared in TINYpulse.
