Strategic Change Management Helps Improve Operational Performance

Today, businesses operate in a dynamic environment. Gone are the days of static business planning, these days managers have to deal with fiercer competition, social media effects, big data issues, new regulatory landscapes, global economic crises, new technological developments, changing customer wants and needs, operational risks, strategic risks, financial risks, political risks, environmental risks, supply chain risks etc.

These day to day operational issues require leaders who are strategic, innovative and dynamic in their approach. Leaders who are proactive, not reactive, and able to bring positive change and influence to the entire team.

In other words, a change in business strategies and organizational culture is the essential recipe for success.

Unfortunately, many change programs fail to achieve the intended results resulting in poor operational performance. Although the root causes vary, they include but are not limited to:

• Resistance to change because of fear of the unknown; people are comfortable with old ways of doing things
• Management taking a wrong coercive approach to implement a change initiative
• Change agents controlling their staff instead of engaging them
• Poor alignment between change objectives and business strategy
• Lack of physical, human and financial resources to support the change program
• Lack of senior management buy-in

Management need not sit down at the edges of the fence, observe from a distance, note down the changes and do nothing about it. If they do so, they will be doing it at their own peril.

Take for example, a football coach, for the greater part of the match, he is always standing on the sidelines of the pitch analyzing each and every part of the game.

After carefully studying the pitch conditions, his team’s and the opposition team’s strategies, strengths and weaknesses he employs new strategies.

If the opposing team is playing attacking football, his defensive strategies have to be in sync otherwise his team will conceive many goals. At the same time he has to make sure that his team is not only defending but also attacking so as to win.

This he can achieve by switching his players’ positions or making tactical substitutions.

Sir Alex Ferguson of Manchester United football club is well known for this. Not only is he good at motivating and instilling confidence in his players, but also at engaging them so that they play together as a winning team.

He is capable of dismantling loosing strategies and change the whole balance and outcome of the game.

When his team plays, they play to win and have understood what it means to win. Even if they are trailing behind the opposition, they have this “Never give up” mentality. For them it’s not over until the referee blows the final whistle.

The same can be said of organizations that want to experience positive operational results. They must become agile and responsive to the environment in which they operate.

At the same time, they should take advantage of strategic enterprise risk and performance management methodologies such as strategy maps, demand forecasting, customer profitability analysis, activity-based costing, product and channel profitability analysis, value based management, scorecards, dynamic pricing and driver-based resource capacity planning.

All these methodologies have proved to be great assets for improving business performance.

However, it should be noted that for these frameworks to work, management must create an environment that supports change, innovation and team spirit. The change program must be aligned with the business strategy otherwise the outcome will be outright failure.