Successful Change Management: Principles and Processes

Managing the changes in an organization requires a broad set of skills like political skills, analytical skills, people skills, system skills, and business skills. Having good analytical skills will make you a good change agent. You should evaluate the financial and political impacts of the changes that can take place. You should know that following a particular process at that instant would fetch you immediate financial effects and start that process so that the change process is noted by the management. The workflow has to be changed in such a manner to reflect the financial changes that are taking place. Operations and systems in the organization should be reconfigured in such a manner that you get the desired financial impact.

Successful management improvement efforts require the active involvement of managers and staff throughout the organization to provide ideas for improvements and supply the energy and expertise needed to implement changes. Employees at all levels of high-performing organizations participate in–and have a stake in–improving operational and program performance to achieve results. Our work has shown that high-performing organizations use a number of strategies and techniques to effectively involve employees, including (1) fostering a performance oriented culture, (2) working to develop a consensus with unions on goals and strategies, (3) providing the training that staff need to work effectively, and (4) devolving authority while focusing accountability on results. Employees in high-performing organizations understand the importance of and the connection between their performance and the organization’s success. The failure to constructively involve staff in an organization’s improvement efforts means running the risk that the changes will be more difficult and protracted than necessary (Becher, 1989).

The various steps for a successful organizational change in any business organization can be carried out through the following steps:

Form the coalition.

Once we create the commitment of what we want to our vision to be, the second step is to form a coalition of all stakeholders. It’s not only your senior management, but it is everyone that is involved with your company as well. You must include both internal and external members of your organization. Because we work as a turnkey asset management provider to independent financial advisors, we needed their agreement to this commitment if we were going to move forward successfully.

Don’t underestimate the time you will need to form your coalition. All of us react negatively to change initially. We all need time to digest and understand “what’s in it for me.” Each of your stakeholders will be hearing it for the first time. You need to allow them time and provide them with information to reach their own conclusion that it is not only in the firm’s best interest, but also in their own interest to help make this commitment a reality.

Envision the future.

Paint a picture of what the firm is going to look like when this journey and transformation are complete. Many individuals who are part of your team will have difficulty understanding what the changes you are attempting to incorporate into the business really mean. They are going to ask how the change is going to affect the company and, more importantly, each individual within the company.

We showed how, by offering these services, we would be able to grow significantly faster while providing our clients with a much higher value service, and that this would create more opportunities for each of our stakeholders. At the same time, if we didn’t change, we were going to fall behind in the industry, leaving fewer opportunities for employees, becoming a less important partner in our financial advisors’ growth, and not doing all that we could in assisting our investors to achieve their financial goals. It was not a very tough decision for our stakeholders once they had the information and time to confirm our vision (Aldrich, 1999).

How do you see your future? Use your imagination to visualize what you would like your firm to be in five years. Share this vision with your group. Visualization will help guide you to the commitment that you will need to make to build the firm you want. It will also help your stakeholders assist you if they share your vision of the future. Very few great things in life are every created by a single individual, so allow your team to share in creating your new company with you.

Begin the transformation.

To begin, put together a step-by-step action plan with dates, milestones, and who’s responsible for the achievement of each. It easier to paint a picture of your future than it is to get started creating it. However, it is empowering to reduce the steps necessary to create the future into manageable steps. Let’s say that five years out you want to triple your asset under management while providing your clients with continuously improved private client services. By the fifth year you out, you want to deliver services that rivals what private banks offer. For many this commitment might be overwhelming. But if you break down all the steps you need to take by month, it can easily become a reality (Argyris, 1999).

Successful change is a real challenge because no one reacts well to change except the person that is driving it. When change comes, we all tend to immediately put our hands up and try to figure out how to avoid it. Behaviorists tell us that 80 percent of us are reactive thinkers who will do anything to avoid change. Twenty percent of us are creative thinkers, meaning we initially try to avoid the change, but then examine and judge whether it’s a good change or a bad change. If we think it is a good change we will incorporate it into our lives. If creative thinkers believe it is a change for the worse, they will just figure out ways to go around it.

The only way to ensure that change occurs smoothly is to have a road map that outlines the process that you will incorporate into your firm to make it work for your benefit.

Embed it in the culture.

Everything you’re doing should be consistent with the commitment. In so doing, you create a new culture. In our case, our commitment was to wealth management for private clients. We wanted to provide the best advice to private clients available in regards to their life management issues. So we had to in effect destroy our old company and create a new company that would be able to achieve the results we wanted (Becher, 1989). With every action we took, we asked ourselves if it was consistent with what we wanted to achieve. It is so easy to get side-tracked in our industry. Most of us are very tactical in our strategy so that we move from opportunity to opportunity and never give ourselves the chance to reach the next level of success. You have to establish systems in your organization that will embed both you commitment and vision of the future in your organization. We have established meetings where each employee gets together with their team leader and the team leaders get together with senior management to make sure we stay on track.

Accelerate the pace.

Create a sense of urgency. It’s important to recognize that most of us, in reacting to change, want to slow it down; but if we accelerate it, we can move ahead. There is no shortage of reasons for changing your firm. Help everyone see the increased competition and the need to differentiate yourself from all the other firms. Let them understand the likely outcome if you don’t make the changes. Let them know that it is okay to be uncomfortable with change but that the winner in business will always be the one who most effectively adapts to the new environment. The rewards of winning are great. Asked them if they have every have been on a team that made things happen, whether in business or in sports. Many will have and will know about the excitement and the feeling of satisfaction that only a winning team can bring.

Continuously reinvent yourself.

Start the journey all over again, recognize that there is no “there.” There is no final destination for this journey; it’s a continual process. The world is constantly changing. Think of some of the largest firms in our industry only twenty years ago that are no longer here. They stop reinventing themselves (Wenger, 1998). You owe it to all of your stakeholders to be all that you are capable of being. These seven steps will help you make it a reality.

Because it is important to start with determining the business goal, it’s critical to establish organizational priorities. The business goal ideally should be quantitative and time bound, and it needs to be a legitimate focus of the business. Additionally, some may be convinced that something is the real business goal when they’ve really only stated a possible way to meet a goal. These are instances where the goal stated actually implies or assumes other targets (Handy, 1995). One example is employee morale, a common issue for many organizations. Plenty of organizations do an organizational climate study, a culture audit, or an employee survey and discover that employee morale is low. Senior management is then mobilized to do something about the morale problem, and that’s when someone usually gets called into the office of the vice president of HR to find out that the new high-priority assignment is to improve company morale.

Clarity of purpose and terminology is an issue with any type of organizational change project, but is particularly important for knowledge management. The terms used in this realm— “knowledge,” “information,” “organizational learning”—are subject to varied use and interpretation. The successful knowledge management projects we found had paid attention to this issue, often by excluding some issues and concepts from their charters (Becher, 1989).

One way high-performing organizations can enhance employee involvement and gain agreement on an organization’s goals and strategies is by developing partnerships with employee unions. The U.S. Postal Service’s long-standing challenges in labor-management relations illustrate the importance of having a shared set of long-term goals and strategies agreed upon by managers, employees, and unions. As we have reported, labor-management relations at the Postal Service have been characterized by disagreements that have, among other things, hampered efforts to automate some postal systems that could have resulted in savings and helped the Service reach its performance goals.12 Although there has been some progress, problems persist and continue to contribute to higher mail processing and delivery costs. To help the Postal Service resolve its problems, we have long recommended that the Service and its unions and management associations establish a framework agreement to outline common goals. We have also noted that the Results Act can provide an effective framework for union and management representatives to discuss and agree upon goals and strategies (Watkins, 1993).

High-performing organizations also seek to involve and engage employees by devolving authority to lower levels of the organization. Employees are more likely to support changes when they have the necessary amount of authority and flexibility–along with commensurate accountability and incentives–to advance the agency’s goals and improve performance. Allowing employees to bring their expertise and judgement to bear in meeting their responsibilities can help agencies capitalize on their employees’ talents, leading to more effective and efficient operations and improved customer service


  • Aldrich, Howard E. 1999, Organizations evolving. Thousand Oaks, Sage Publications, CA
  • Argyris, C. 1999, On Organizational Learning, Blackwell Business, Oxford.
  • Becher, T. 1989, Academic Tribes and Territories, SRHE & Open University Press, Buckingham.
  • Watkins, K. & Marsick, V. 1993, Sculpting the Learning Organization, Jossey Bass, San Francisco.
  • Handy, C. 1995, ‘Managing the dream’, in Learning Organizations, eds S. Chawla & J. Renesch, Productivity Press, Oregon.
  • Wenger, E. 1998, Communities of Practice. Learning, Meaning, and Identity, Cambridge University Press, Cambridge.


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