Companies must be willing to move with the times and adjust their operations in response to increased competition, technological advances, stakeholder expectations and other pressures. True business change is more than just a rudder shift, however. It’s the result of a structured and planned process to make the company more efficient and profitable. Business change occurs when an organization improves, restructures or transforms a major part of its operations disrupting systems, people and processes.
As entrepreneurs we need to be advocates of change within our organizaiton and not get “fat, dumb & happy” with the status quo. We need business change. This is defined as the act of moving the company from where it is now to where it wants to be. The change can be relatively small, such as improving the company’s billing procedures, to utterly transformative, such as reformulating entire product and service offerings in the light of unexpected competition. Most times though, it references an event that causes major disruption to your daily operations.
There are three types of change in a business context:
developmental, transitional and transformational change.
occurs when a business wishes to improve a process or procedure, such as updating the payroll system or refocusing its marketing strategy.
THE CHANGES ARE SMALL AND INCREMENTAL
– you aren’t redesigning the entire workflow, but are simply refining it to make it better. Developmental change usually occurs in response to technology upgrades or internal cost drives that aim to improve the efficiency of a work process. As long as you give staff the training they need to implement the changes, there should be minimal upheaval associated with this type of change.
is an act of replacing major processes with new ones, such as automating your manual production line or adopting a new ERP installation. It also includes mergers and acquisitions and other such courses of action.
TRANSITIONAL CHANGES ARE FREQUENTLY DRIVEN BY A DESIRE TO REMAIN COMPETITIVE IN THE MARKETPLACE.
The business is not exactly charting unknown waters when executing a transitional change, but it likely will have to reconsider its job functions, processes, culture and relationships to manage the change effectively. Management must proceed cautiously to minimize fear, doubt and insecurity in staff.
is the most disruptive since it requires a fundamental shift in the way a company operates. For example, a company might embark on a completely new mission or restructure the whole product line using new, proprietary operating systems, as Apple did when Steve Jobs took over the company in 1997.
BECAUSE OF THE UPHEAVAL, THESE TYPES OF CHANGES HAPPEN ONLY RARELY.
Navigating a transformation is complex, requiring significant skills from the management team and outside help from change specialists. When the change process is complete, the organization is unrecognizable from what it was before.
As a business owner and leader, we must be a proponent of good change that can be quantified by overall business growth.
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