Rethinking Change: Moving from Management to Agility
Josh Bersin, who specialises in human resource management, discusses the types of practices organisations can put in place to lay a foundation for sustainability, resilience, and enduring success. He elaborates on recent research in areas such as employee experience, talent acquisition, well-being, and organisational design, and ways to initiate and sustain change for effective results.
In the wake of the COVID-19 pandemic, governments around the world now face the daunting task of implementing system-wide changes such as public sector transformation, reforms, and digitalisation to tackle the complex challenges of post-pandemic recovery, climate change, and rising inequalities. Successful change management in the private sector can offer many relevant lessons for the public sector.
Business leaders have typically approached change initiatives with project management tools such as spreadsheets, assigned deliverables, and rigid timelines. Today’s relentless pace of change, coupled with current workforce challenges, requires a new approach that is based on iterative and agile practices, employee impact, and even human nature.
Recent research carried out by my organisation, The Josh Bersin Company, coupled with the ongoing conversations conducted as part of our ongoing Big Reset working groups, shows that a traditional approach to change management is no longer sufficient for the rapid change that businesses in all sectors are experiencing.1
This is because traditional change management projects are designed as once-and-done initiatives. However, change requires changing business processes, job responsibilities and assignments, the associated employee behaviours, and more — all simultaneously. Not only is a big bang approach outside the realm of human nature, today’s pace of change just does not allow for lengthy and complex planning.
While old change models can offer the comfort of providing a structured approach, they also lead to a false sense of security. Even if you follow a change management methodology to a T, something will happen that will disrupt planning. We need to change the paradigm and move away from a focus on management to one that facilitates change and supports employees along the way.
In companies that successfully manage change, leaders and high performers reinforce the company’s mission and purpose; they explain how their reinvented business models will work; they create cross-functional teams to design and implement change; and they acknowledge that the initiative will never be completed — that is, that changes to any change process are inevitable. Our research shows that companies that build change agility are more profitable, enjoy higher rates of employee engagement and retention, and have happier customers.
The findings have universal application, as they focus on human behaviour. These best practices demonstrated in the private sector have broader applications in the public sector as well.
Our research sets out 10 lessons for change agility that hold true not just for the massive business changes brought on by the pandemic, but also for any transformational change. These include transparent communications, human-centred leadership, active employee listening, a clear mission that drives all actions, and recognising and rewarding behaviour changes. While all of these practices are very important, I will highlight five.
Macro-Transformation
When you think of big transformations, the sheer magnitude of the change involved can seem overwhelming. Big bang change projects are typically organised to facilitate the work being done by various teams. However, they usually fail to consider human nature when it comes to change and too often do not include affected employees in the process. The simple fact is that we humans find it difficult to accept a lot of change all at once. Additionally, people adapt to change at different rates. The answer is to look for ways to make incremental changes which, over time, result in significant changes.
For instance, Spectrum Health, a healthcare provider in Grand Rapids, Michigan, U.S., with more than 30,000 employees, adapted to hybrid work with a “virtual fishbowl” experiment. Rather than designing strict policies mandating specific attendance rules, the leadership team selected three groups to observe and experiment. Managers observed how employees were navigating the new style of work, shared best practices, and identified the tools, strategies, and mindset shifts that were needed. With this knowledge in hand, this approach then expanded to new groups and eventually the entire organisation. Such incremental experimentation is key to testing a change and gives people the opportunity to learn along the way.
Changed Behaviours
When people change behaviours, rewards and recognition are key to sustaining and reinforcing these new actions. Rewards and recognition can be monetary or intrinsic, public or private; but most importantly, they need to be fair and equitable. Research we conducted in 2021 shows that companies that achieve this are 7.3 times more likely to adapt to change well and 5.8 times more likely to innovate.
In the context of change and transformation, fair and equitable rewards practices are transparent and aligned with those behaviours the company wants to foster. This reinforcement makes “doing the right thing” also the thing that people want to do.
For instance, when the CEO of energy company DCP Midstream, based in Denver, Colorado, U.S., declared that he was willing to pay more for highly skilled employees, the HR team immediately put into effect an incentive plan for training. To boost the uptake of the upskilling programmes focused on key skills, the team instituted an increased hourly rate of US$ 1.50 for each certified skill an employee acquired. Needless to say, training took off.
Change into Solutions
Traditionally, employees are the “change targets” that need to be brought on board with a change management effort. Once a solution (a new technology, new business process, or new operating model) is designed, the people most affected by the upcoming change need to be motivated to adopt it. The problem? If we design without the active engagement and input of employees, solutions often fall short and may not even solve the actual problem. (Managers most often do not have a full understanding of issues or the nuances involved on the ground.) To make matters worse, employees will be far more likely to resist associated changes.
Enter design thinking. This discipline (understand the problem, simplify and digitise, fail fast and learn, scale, and iterate) not only helps design the right solution but also has change adaptability built into it. Rather than seeing employees as recipients of change, design thinking makes them active participants in the design of the solution itself.
Deutsche Telekom of Bonn, Germany, has been using design thinking for a decade. The company now has 600 design-thinking projects spanning initiatives such as HR transformation, technology implementations, and compensation. By starting all design work with the employee experience in mind, adoption is much easier because the solutions meet the needs of those most affected. Leaders have found that when employees see a series of positive changes, everyone is more open to change.
Inspire Change and Transformation
Every change management methodology emphasises the role of leadership in accomplishing change adoption. Leaders play an outsized role in shaping experiences, beliefs, actions, and outcomes. Traditional change management methodologies often put leaders in a communication role, assuming that if they are given the right scripts to communicate at the right time to the right people, change will magically follow.
In reality, leaders at all levels must play a much bigger role. Certainly what leaders say is important, but how they behave is even more important. Transparency, empathy, and a focus on people above profit are key leadership characteristics important to accomplishing any change. When leaders help employees translate the mission and purpose to their individual work, their organisation is 8.2 times more likely to be adaptable to change according to research contained in our report, The Big Reset: Change Agility, published in 2021.
Human-centred leaders know employees are the source of their organisation’s competitive advantage and business success. Therefore, they act in ways that promote employee trust and model the behaviours they want their employees to exhibit.
Return-to-work policies are excellent examples of different leadership approaches. Some senior leaders are demanding that their employees resume working in offices just as they had prior to the pandemic. Others are trying to implement policies that require a certain number of days or hours in the office, while allowing for some remote work. Others, such as Dow Jones, are giving employees much more flexibility. Dow Jones has adopted a “define your day” model in which each employee is tasked with defining the work location(s), activities, schedules, and support systems needed to get their jobs done.
Change Agility Are Critical
For the past two years, HR teams have been charged with catalysing change seamlessly and effectively for the workforce, while coping with changes in their own roles and personal lives. In fact, respondents to our ongoing Global HR Capability Assessment have put change and transformation as the top priority for HR professionals. However, 40% of HR professionals said that they lack the skills needed to lead effective change. HR organisations have to provide development opportunities for staff to build the muscle for change management.
Here are a few ways to get started:
Assess capability gaps. Evaluate the current state of HR capabilities in your organisation in order to prioritise development opportunities. The capabilities that matter most, as I discussed above, include continuous listening; the ability to analyse, interpret, and translate data into action; design thinking; and fostering human-centred leadership.
HR values and needs coaching. Our capability assessment also asks HR professionals to indicate the development opportunities they consider most important for their careers. Coaching and mentoring surfaced as the developmental opportunity that HR professionals consider most critical for advancing their skills and capabilities. HR leaders must focus on providing their teams with tailored coaching on short-term capability needs and mentoring to support the capabilities necessary for long-term career growth and business success.
Leverage capability academies and communities. Capability academies emphasise developing business capabilities and typically include developmental assignments and networks of people for sharing knowledge and information. Kaiser Permanente, an integrated manager care group based in Oakland, California, U.S., brought together a change management community of practice with nearly 100 people from HR, IT, and business operations to share success stories, and learn and support each other while dealing with various change initiatives. The community of practice shares knowledge and tools in monthly meetings and in online discussions, with a focus on increasing overall change capacity.
In conclusion, the most important shift to successfully adapt to change is a change in mindset. We must recognise that every interaction is a change interaction, from the seemingly trivial to the “big” moments. And we need to craft the small moments even more carefully than the big ones; it is in these small moments where we can create readiness and acceptance for change and transformation.
