Organizational Change Management: Everything You Need to Know
Organizational change management, OCM for short, is a way to manage new business processes & changes in the structure of organization & culture due to change.4 min read
What Is Organizational Change Management?
Organizational change management, OCM for short, is a way to manage new business processes and the changes in the structure of the organization and culture due to the change. OCM primarily deals with the human side of change management.
When an entire organization needs to learn new behaviors and skills, a methodical strategy to OCM is best. In order to ensure a problem free implementation among team members, it is important to set expectations, improve communication, and proactively reduce misinformation.
Whereas change management uses tools to assist the people side of change, project management tools such as project charter, statement of work, work breakdown structure, and scheduling help support OCM. The research done by Prosci shows that the holistic tool set of change management is effective in helping people get through change.
Approaches to Organizational Change Management
There are a number of important points to remember when approaching change management. These include the following:
- Unified vision for change
- Strong leadership to translate the vision and drive the change
- Plans to educate employees on how their daily work routine will change
- Strategy to measure change success (including plans for success and failure)
- Monetary and social incentives to drive commitment amongst employees
- Holistic, proactive, and integrated change management
Five Levels of Organizational Change Management
Prosci's change management methodology includes five sets of tools known as organizational change management levers.
1. Communication Plan
Communication is a fundamental part of managing change. Successful communication needs to be customized to the specific audiences being affected by the change. The communication plan needs to give team members the right information, at the correct time, and in the right way.
2. Sponsorship Roadmap
Sponsorship is cited as the leading reason for project success according to Prosci's change management benchmark studies. It creates additional structure in the process of change.
There are three important roles of the sponsor:
- Being an active and visible participant
- Having a support structure with other high-level leaders
- Direct communication with employees regarding change
Additionally, the sponsorship road map identifies:
- The project team
- Colleagues and high-level managers
- Frontline employees
3. Coaching Plan
The coaching plan illustrates management's involvement and tasks in change management. Management communicates the change and how it impacts employees, directly to the employees. Management's own feelings regarding the change can have significant effects on the employees and how they handle the change. It is important that management find and resolve any issues with acceptance of the change and further reinforce the implementation.
4. Training Plan
The training plan is a strategy to ensure employees develop the necessary skills needed for the change.
5. Resistance Management Plan
As the name suggests, the resistance management plan proactively seeks and manages any occurrence of resistance to change. By speculating what forms of resistance they can expect and where the resistance may stem from, managers are able to develop steps to quickly deal with resistance and prevent any permanent damage.
The Ten Principles of Change Management
Every organization is different and will require a customized implementation of OCM. The ten principles of change management provide a foundation for the leadership of the organization to fully understand the nature of change, the impact of the change on themselves and ways to ensure the entire organization is included in the process.
1. Handle the 'human side' strategically
Big changes within an organization create issues amongst the employees of the organization. It is important to create a plan as early as possible, starting with the executive leadership team and important team members, to proactively manage issues that may arise.
2. Begin at the top
Top management, being the leaders of the organization, should be the first to accept and implement the new changes, leading by example to motivate team members.
3. Include every level
Every level of the organization is affected by change in different ways. It is important to find the leaders at each level and push the strategy down through the company to ensure that the vision of change is implemented correctly.
4. Make the case for change
It is important to rationalize why the change needs to happen so that team members can understand the reasoning behind the change and whether they want to commit to that change. Three steps should be followed:
- Prove the need for change
- Illustrate the potential future of the company and how the leadership will get the company there
- Develop a road map to assist with decision making
5. Appoint ownership
Including individuals in finding and solving problems develops ownership. Managers can reinforce ownership with incentives; these rewards can be both financial and psychological, such as bonuses or recognition of effort.
6. Convey the message
The most successful implementations of change regularly communicate fundamental messages that are realistic, timely, and inspiring. The flow of communication begins at the bottom and flows out the top to give team members the correct information and receive their feedback at the same time.
7. Evaluate the company culture
The company culture at each level of the organization must be understood and accounted for in advance. This evaluation should identify beliefs, values, and behaviors that are core to the cultural landscape, to implement successful change management.
8. Look at culture completely
Leadership needs to identify and reward behaviors that support the business going forward.
9. Be ready for the unanticipated
Individuals will react to change in unpredictable ways. In order to account for unexpected resistance, consistent reassessment and remodeling are needed to successfully manage the change.
10. Communicate with the individual
Team members and their teams need to understand what exactly will change, specifically for them, and in what ways their efforts will be quantified and rewarded as well as penalized. Incentives should be clearly visible, and removal of individuals unable to change will strengthen the organization's commitment to change.
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