- December 14, 2020
- Posted by: avaltos
- Category: Thought Leadership
Strong megatrends of change were already underway before the pandemic, such as increasing remote work and online retail sales replacing in-person purchases. The pace of change was rapid. However, since the pandemic, the pace accelerated ten-fold in 2020.
FlexJobs reports that the growth of remote workers increased for the past five years before the pandemic. Remote work steadily increased by about 8% year-over-year from 2015 to 2019, then suddenly everyone had to work from home. In 2019, about five million Americans worked remotely. This was about 3% of the total employed in America.
After the pandemic hit in 2020, 64% to 85% of employees worked from home. This represented up to 100 million workers. The growth was suddenly off the charts with up twenty times more remote workers than the year before. The response to the pandemic proved that sudden, dramatic change is possible.
In 2020, Statista surveyed CFOs to ask them how many of the newly-created remote positions will continue permanently. About half of the CFOs said that at least 10% of the newly-reorganized positions would remain remote jobs after the pandemic subsides. A quarter of the CFOs said that the newly-created, permanent remote jobs would be 20 to 50% of the pandemic levels. This change was a huge surge, and it will not go back to zero after the pandemic passes. Probably remaining will be between 10 and 50 million newly-reorganized remote positions.
Another example of massive sudden change is the growth of online sales that Amazon and other big retailers experienced. The growth rate from the pandemic nearly doubled Amazon’s sales by May 2020. This growth over a few months was expected to take another ten years to achieve. The surge in demand was not all rosy either. Shipping delays, mistakes, and the policy Amazon implemented for the early part of the pandemic, of only accepting essential items for sale for its member-vendors, harmed many companies who sell on Amazon.
Those are just two examples of gigantic changes. There are many others. About 86% of CEOs now say their companies are undergoing major changes.
The changes caused by the pandemic were forced upon us; however, it is the way that companies dealt with the market changes that determined whether the companies thrived, survived, or perished. Transformational change is better when driven as a business strategy, not a reaction to unplanned outside forces. No matter what, CEOs have to deal with change.
Now, it is reasonably clear for most companies the extent of the pandemic’s impact on operations. Moving forward, transformational change will come in two phases: 1) adapting to the full extent of the pandemic and; 2) planning for the post-pandemic environment that starts sometime in late 2021 after widespread vaccination. Moreover, long-term planning must consider what would occur if another pandemic hits and the impacts of climate change. All of these dynamics create the need for ongoing change management.
Change as Continuous Improvement
A new motto for the vast majority of organizations should be “Change is Job One” (with a tip of the hat to Ford’s old slogan of “Quality is Job One”). The reason why change management has become the priority is that the changes occurring are not isolated. Change is not happening in one company or industry sector. Changes now occur across all companies in all industries in the entire world at a pace that is accelerating with no end in sight.
To maintain continuous change, at this pace, requires a new approach. A change agent, whether it is a C-level executive, project manager, or a hired external consulting team, must deal with the practical matters of change resistance and move past blockages that prevent changes from being implemented.
How to Unblock Change
First, to unblock change, identify the obstacles and problems, and then try the following suggestions for strategies to work with these circumstances.
Here are the common obstacles and problems.
- Reduced Resources: External forces, such as the pandemic, cause a sudden reduction of resources. This drives the change initiative, including corporate restructuring, downsizing, cost containment, and, in the worst-case scenario, bankruptcy proceedings with a corporate reorganization or the liquidation of assets.
- Costs and Return on Investment (ROI) Considerations: Estimating the cost of the change must be done and a calculation made of the estimated return on investment. However, many changes are driven by factors that are not determined by the cost, and some needed changes have no ROI or have a negative return, yet must be done for the company’s survival.
- Fear of Failing: Fear is a strong motivator and can cause indecisiveness about making a change. Fear makes it more difficult to decide if it is the correct change and to determine the proper scope of the change needed.
- Employee Resistance: Human beings naturally become complacent and almost instinctively resist change.
Here are the strategies to consider for each type of problem listed above. The strategies can be used in combinations if there are multiple obstacles.
- External Support: When internal resources are limited, or you do not have the capabilities needed, the appropriate way to manage a change initiative is to bring in external support to make the changes happen. An external team provides a more neutral perspective. This helps when forced to make difficult decisions such as furloughs, layoffs, and downsizing. Often an external team can better prepare a plan for limited-resource reallocations. The external team can handle the changes needed while a reduced internal team manages the continuing operations.
- KPI Tree: A KPI tree is a graphical representation of key performance indicators. This system works by showing the relationships between lower-level indicators that measure activities and high-level financial goals. As a transformational change is underway, the results can be tracked as financial gains using this system. The KPI tree identifies accountability, the person who makes each decision, and the financial contributions of activities and business processes. This effort works by mapping the KPI tree and then training the employees to work with the KPIs.
- A.L.I.C.E.: Overcoming fear and determining the scope of a change initiative can be aided by using the A.L.I.C.E. method, which stands for 1) Articulate the problem; 2) List the ways to solve it; 3) Identify the means to do the work; 4) Capture the enablers needed to create the change, and; 5) Evaluate interdependencies and synergies. The transformation area and the scope of the change are decided by analyzing physical constraints, functional areas, and organizational effectiveness. Another important way to overcome fear is to reject inappropriate self-censorship that creates a pessimistic mindset. Instead, have confidence, formulate a bold vision for the company, and create a strategy of achieving the goals, while understanding what will be the challenges.
- Put Resistors in Charge: Rather than let highly-influential resistors within a company block the change, enable them to make the change and put them in charge of the process. Acknowledge the fear, show empathy, be honest, gain trust, and strengthen the team’s relationships between those responsible for driving the change. Be sure that key players know what benefits they personally get from the change that makes sense for that individual, which may be completely unrelated to the transformation’s overall objectives.
One thing is certain, change is here to stay, and it is accelerating. People don’t change just because they are told there is a better way to move forward. Instead, change is often forced on them when they realize that not making a change will not work. As a leader, you should see change as inevitable and embrace it as continuous improvement to make your company thrive.