Before You Make Changes, Ask This Question

You Need to Assess the Tradeoffs of Change Before Implementation.

My experiences with change go back to the days of CEOs flying somewhere, opening the in-flight magazine, seeing some new idea in print, tearing out the article, then taking it back to the company expecting it to be implemented.

The process of change has changed over time, but often the motivation of change is the same – do the newest because new must be better. Of course, new is only better if it fits your organization and you can develop buy-in at all levels for the change.

Yes, we all know that change is constant and if you are not improving you are falling behind. Those truisms do not mean you should jump on any change bandwagon without thinking it through as you would any business decision.

I have seen many managers and executives put changes in place simply because they want to look good to peers and competitors. That is really a roll of the dice, because if the change does not work, you will not look good at all.

The first question you, as a leader, should asked when considering a major change in your organization – Is it worth it?

Dollar Cost. Most leaders are fairly adept at considering the costs and returns of change. Payback is a very common consideration when putting changes in place. Since leaders are always accountable for costs and returns, this consideration is appropriate. No surprises here. Make sure you the money you invest in change will create a return on that investment.

Productivity. It is a general rule that when you implement a change that will improve productivity, there will be a dip in between the old and the new. The processes and systems you are putting in place must get the bugs worked out, people must have a learning curve, and beta tests must be completed prior to going live with the change. All of these considerations cause productivity to dip in the short term, before they become institutionalized and productivity improves.

Customer Service. This is especially critical because one thing all businesses have in common is their objective of serving customers well. As a leader, you must really think through any changes that may affect customer service. In most businesses, customers have numerous choices and a couple slip-ups with one supplier may make the customer jump ship. If you are on the fence about this sort of change, it may be worth it to talk to customers about the change and see if it is worth it to them.

Benefits, Pay, etc. Sometimes, leaders forget about the Human Resources and Benefits processes as something that needs to be thought through prior to making changes in them. As far as employees are concerned, these parts of the business affect them very personally. They count on all the HR processes to keep their quality of life in a good place. When leaders of the company start messing with pay and vacations, employees get scared and upset. Ask yourself if the changes in pay and benefits are worth the uproar you may get from employees.

Promotions. The odds are that when you promoted someone, there will be at least one other employee that is upset about that move. In some cases, there may be a large group that is upset about someone getting advanced. Unfortunately, most employees will not tell you they are upset. That is why it is important to think it through before you promote someone. What is the downside? Will their performance ultimately exceed your expectations and quiet critics? Ensure that promotions are based on measurable performance, not because someone is a favorite.

Reorganization. In my experience, most new leaders reorganize within the first 90 days of taking a new position. They look at the old organization chart and see a lack of efficiency, poor transparency and accountability, and loose reporting relationships. So they move things around, in hopes of gaining improvement in all those areas. I have actually seen some leaders reorganize simply to cover up their own failings.

Regardless of your reasons for reorganizing, think about the costs of it before you make the moves. Is there solid data that says moving the boxes around will gain improvements? Are the complaints of moving people out of their comfort zones worth the changes? An argument can certainly be made for reorganizing to give employees a new perspective and to find out who the superstars are. The point is – be clear on your reorganization goals and how you will measure them.

Steve Schumacher is a management consultant, trainer and public speaker with more than 25 years of experience in numerous industries throughout North America, including aggregates operations. He can be reached at [email protected].

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