Small and Medium Enterprises (SMEs) as well as Large Enterprises in the different sectors have to undergo change at some point of time in order to develop and survive in the market. The frequency of organizational changes has been consistently increasing. “There are three major drivers stirring organizational change faster than ever before are as follows: technology, government and globalisation” (Champy and Nohria, 1996). Change management and its purpose might be different for different organisations however the ethos of change management is the same that is to make the organizations more effective, efficient, and responsive to the turbulent environment changes.
Although it is of critical importance to have an organizational change the thought provoking question is how many of these changes have been successful? Have the aimed-goals been achieved? Has the profitability increased after implementing these changes? Etc. According to Management Literature Reports, there are many examples of managerial failure both in the formulation and implementation of strategy particularly that involve significant organizational change and development. It is therefore necessary to understand the different reasons why managerial strategies fail.
In a constantly changing environment both internal and external factors contribute to the failure of change management. Organizational change is a considerably huge project, thus even a small ignorance at some point can lead to the failure of change management strategies. Four different pillars – leadership, culture, people issues and quick response are the ones that determine whether change management is successful or not in an organization.
Leadership theories vary in approaches, thus it can be concluded that there is no ‘one best method’ for the theory of leadership. Leaders are required to utilize the capabilities and skills of the employees in different situations in a collaborative manner during change management. As per (Song, 2009) the contingency theories of leadership, leadership style and behaviour can vary as per the different characteristics of the different organizational situations. Therefore, it is important that leadership style be changed according to different situations, if not, it would result in the failure of change management strategies or in the death of organizations.
Culture, the second pillar itself is a complex concept. As per Drennan, 1992 “culture is how ‘things are done around here’. While according to Senior, 2002 “culture is an objective entity which can be identified and which delineates one human grouping from another”. It is henceforth, extremely important to access the role and influence of organizational culture in change management as it is quite possible for an organization or group to hold conflicting values and may result in inconsistent behaviour during mergers of the organizations.
The management of people is another considerable factor that determines the success of change management. As per (Song, 2009) failure to attend to the concerns of the people is one of the top tenmistakes in the process of change management.Moreover, it must be kept in mind that organizational change will also lead to redistribution of resources and power and this causes the fear to organizational change. As an example, a transformation from bureaucratic to a flatter structure in the organizational hierarchy would unavoidably place some top managers into the position of middle managers in the new organizational structure. This may decrease the personnel’s interests such as unemployment and a sense of job security which will therefore result in a resistance to organizational change. Additionally, people issues related to informal organizations must also be thought about as such organizations have their own core leader, structure, culture which is usually not compatible with that of a formal organization. Ignoring such an organization could prove to be a fatal flaw to managers.
Finally, the organizations must be capable of adapting to the external environment quickly in order to survive. Therefore, managers’ failure of adapting to external environment changes will further lead to a failure in the change management strategies. The consumer drives the market and thus it is essential that the companies realise the market shift and dominate this change by realising the new opportunities when a new technology comes up or when consumer tastes change.
Champy, J. &Nohria, N. 1996. Fast Forward: The Best Ideas on Managing Business Change. Boston:
Harvard Business School Press.
Drennan, D. 1992. Transforming Company Culture. London, McGraw-Hill
Xiongwei, Song. 2009. Why do change management strategies fail? — Illustrations with case studiese. Journal of Cambridge Studies