Taylor Clarke Blog

Leading change in tough times….an opportunity! by Alistair Brown, Principal Consultant

June 10th, 2010

Every so often in any organisation, whether in the public or private sector, the economy has a habit of delivering unexpected surprises, as with the current recession, which has been unpredictable in nature.
For many organisations this is a swift reminder of the need to take stock and re-evaluate many aspects of their organisation and in particular how they handle change.
While restructuring, headcount reduction, budget cuts can be unpleasant for those involved, it’s not all doom and gloom and smart organisations take the opportunity to step back rather than rush into short sighted “myopic” hastily planned and often insensitively communicated cost cutting exercises. Hasty action often creates more problems longer term which can exceed any short term benefits achieved…..and employees have long memories when it comes to poorly executed change. Its particularly important to avoid the attitude of believing employees “should just be lucky they have a job.” Remember what goes around, comes around.
As both a change practitioner and a consultant, I have experienced and survived two fairly major recessions and have a few lessons learned I’d like to share.
Change is unsettling and stressful for many at the best of times and while these lessons can be applied in less turbulent times, they take on even more significance in times like now.
In no particular order there are five key areas where your approach to change management style may need careful attention:
Review your short term goals and stick to your core fundamentals
·         Riskier new ventures and diversification can be delayed while you focus on improving your core offering as they often involve adding more change demands to an already stretching situation
·         Big challenges and hurdles can be overwhelming so focus more on shorter term goals and “quick wins” that will help in building confidence around the steps you are taking to “ride out the storm”
·         If you have to cut costs do it intelligently, with clear focus, rather than risk “panic” across-the-board measures. Avoid undermining the areas of the business that give you your competitive edge, that will underpin future growth and that are key to delivering short term results.
Don’t risk undermining your hard earned trust and credibility through lack of transparency in your communication
·         Particularly with high personal impact, but necessary changes like redundancies, cut backs and changes to benefits, managers often play their cards very close to their chest and put an embargo on communication for as long as possible. The management rationale is to reduce the risk of negative employee reactions and protracted unrest
·         In reality the workforce can see the signals and sense the bad news coming, rumours are rife and the truth eventually leaks out ….but from the wrong source.However, by pretending all is well and denying the rumours a bigger problem can be created. Life may go on as usual but the very damage management is trying to avoid…and more - in terms of low morale, productivity drops, quality and customer service problems - is already happening at a time when the organisation can least afford it. But the biggest price is the loss of respect for, trust in and credibility of, the management…which will take a long time to rebuild, if ever
·         When the bad news is eventually released and where lay offs are concerned, people then often have to leave the business quickly, with little time to train or handover to the people who will have to absorb some of their workload
·         Often we underestimate people’s ability to handle bad news and deal with the situation in an adult way. If management are more up front about the business challenges and risks to jobs, there is more likelihood that some of the workforce will rally round and try and reduce the impact of change by contributing to other solutions and also hand over responsibilities when they leave with a bit more commitment.
Involve your staff in the change planning process
·         A lot of the stress around change stems from a sense of loss of control and resentment over decisions that impact you, but which you haven’t even been able to influence
·         Involve staff in your thinking and ideas and help them have a sense of genuine “shared ownership” and the more they know the more likely they are to feel empowered to contribute their ideas
·         The above takes up management time and there is the scary element of “slowing down to move faster” at a time when there is pressure to improve financial performance quicker. However, involving staff often helps you make better decisions that people feel more able to support and will pay off in the long run with more of a shared sense of responsibility. People are after all much more committed to changes they have helped to shape
·         Obviously some aspects of the change may not be negotiable, so it’s important to be very clear about what is negotiable and what is fixed, so that expectations can be managed.
“Face to face” dialogue rather than remote mass communication
·         You can’t manage this kind of change from your desk or behind a lectern, people like to see the “white of your eyes” and hear it first hand
·         People’s need for accurate information is heightened at times like this, while the rumour mill is working overtime. If there is a void people often fill it with exaggerated predictions around the necessary tough decisions. Fear of the unknown and anxiety induces speculation
·         Be visible, listen more, welcome the tough questions and arm yourself with a first-hand understanding of any resistance to difficult changes and their true personal impact. You may well be able to reduce the impact of changes and increase employee support through making the right compromises, applying employees suggestions and creating more of a sense of “being in it together”. The more they know, the more they can contribute to local level solutions
·         Seek out the people who will be most impacted by the planned changes and also those who will be the most influential in supporting the changes. If you can win them around, they will bring many others with them
·         Keep ahead of the rumour mill by providing timely accurate information to dispel any scaremongering and help people understand the “true reality” and urgency of the need for change…don’t assume “they get it”! Be forthright but take your employees into your confidence…..they won’t thank you in six months if you are slow to react and the impact is higher
·         Use the insights gleaned through regular open dialogue to sharpen up the messages delivered through other communication channels and ensure they cover what people actually want to know rather than what you feel you need to tell them. The more open, informed, factual, clear and frequent your messages are, the more impact your communication will have.
If you need to reduce headcount, be mindful of the lasting impact on those remaining
·         Typically, they will be taking on additional workloads, have to learn new skills, adapt to new relationships and ways of working. All of this can be very uncomfortable, disruptive and stressful and way out of people’s “comfort zone”
·         Some stress can be positive but if the demand exceeds people’s ability to manage and cope you leave yourself wide open to increased absenteeism, retention problems, growing conflict with management…and a bigger problem
·         Make sure you recognize the effort and achievements of those who rise to the occasion and contribute positively to the recovery
·         See the article on “survivor syndrome” also included in this section for further advice on how to support those who remain with the business.
Get ready for moving on positively
·         A recession often serves to highlight the weaknesses in your business and can serve a positive role in stimulating more urgency around the need to address them than is possible in more stable conditions
·         Don’t stagnate and just focus on reviewing and reducing costs; also look at improving the business, developing your staff, refining your processes and understanding and addressing your customers differing needs in a recession
·         Support and coach your staff in how to deal with the impact of change and become more resilient to help you grow your capacity for change and make the transition to the new ways of working required.
·         The likelihood is that there will be no “back to normal” so use the down time to reposition your business to adapt to the changes in your markets that bring new opportunities.
So, to summarize, there are opportunities to use a recession to your advantage, question your old assumptions and capitalize on the urgency for change to prepare your organisation for recovery through an open and inclusive approach to leading change and a sensitivity to the impact of change on your people.

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