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The new change equation

Many leaders who want their companies to change look for a quick and easy formula. Michael Jarrett believes such an ...

By Michael Jarrett 01 December 2008

Many leaders who want their companies to change look for a quick and easy formula. Michael Jarrett believes such an approach is flawed from the start. Far better, he argues, to understand how change really happens.
ThenewchangeequationIt is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change. – Charles Darwin

Change means different things to different people. To the CEO, it may mean increasing profits, cutting costs, or saving the business; to you or me, it may mean no more or no less than keeping or losing our job. That is why change is so profoundly unsettling. And the less control we have over the change, the more unsettling it tends to be.

Of course, not every organizational change is job-threatening. A dictionary definition of change is “the act or an instance of making or becoming different; an alteration or modification”. This suggests, entirely accurately, that change comes in many shapes and sizes. Indeed, the word change is used to cover a multitude of situations: everything from the mundane – putting on a pair of clean socks – to the profound physiological alterations that occur during midlife. Organizational change, too, comes in different degrees and guises. I distinguish between four main types:


Temporary change


For a time, it looks as if things are going to change, but the organization reverts to type and nothing happens. Any initiative quickly peters out, often after creating false hope. The organization is simply not ready for change.

How often have you seen the Big Bang approach to change, in which considerable time and effort is placed on announcing the forthcoming strategic agenda and how everyone will gain from the benefits – yet life remains the same? In such instances, the illusion of change substitutes for any reality. More damp squid than big bang. Employees feel disappointed and let down. It’s something they have heard before. Soon lethargy and mistrust seep in and turn to chronic cynicism. The situation becomes toxic; only radical surgery can fix it.


Incremental or process change


This sort of change aims to provide some small improvements. It is easy and quick to implement, and you get quick returns. The risk of failure is low, but so are returns in terms of benefits. Incremental change means operating within strict controls to gain efficiencies from your company’s system of organization. Fine-tuning a winning formula usually characterizes this type of change.

You know the sort of thing. In one study, for example, a call centre in Sunderland increased its productivity by 20 per cent by introducing simple measures that included staff training and the implementation of new software. Similar results of incremental changes and training showed increased sales. Overall, in this separate study the company produced an extra $110.25 per month per sales agent, for a 500-seat call centre. Over a year, that translated to an estimated $661,500 in sales. This sort of incremental change is useful – worth having, certainly – but unlikely to transform the organization’s competitive position.

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