Mitigating The ‘Cost’ of Internal Change

Cost of change blog image

Change is a must for organizations today. And all change requires adjustment—not just from the organization in terms of money or time, but from the employees who must adapt to the changing workplace. They must tap into their personal resource reservoirs and invest cognitive or physical energy to learn new information and change their behaviors. 

Many senior executives tend to thrive on change and get bored without it, but the majority of people fear, and, therefore, resist change.  If you try to introduce a change without bringing in concepts of effective change management, you’re much less likely to implement the change and realize the expected results and outcomes.  The cost of this can range from lost financial investments to decreased employee engagement and increased turnover.  

Therefore, it’s important for managers to map out the steps necessary to prepare employees for planned changes and to involve them as much as possible in every step of the process. Because mindset affects behavior, the level to which employees feel involved in and prepared for change is key to creating a culture that either succeeds or fails in implementing a strong strategy and the necessary tactics for execution.  

Regardless of the industry or the level of planned change, it’s important to remember the three roadblocks that impact the way employees react to change.  

  • All change requires investment. Every change, no matter how seemingly insignificant, requires employees to tap into their resource banks and drains corporate change capital. Try and implement changes that will ultimately improve the organization or employees’ jobs.
  • Recognize the cumulative cost of change. Employees must adapt to many changes beyond those identified as planned change initiatives. Prioritize, sequence, and coordinate changes throughout the organization to reduce or offset the cumulative change cost to employees.
  • Ensure change is perceived as positive. Employees need to feel that the changes they are asked to implement are worth the resource investment. Show employees how the change will positively affect their current resource pool to ensure a positive change perception.

Communicate Honestly, Strategically, and Often

Industry data suggest that organizations with effective change and communication practices are three and half times as likely to significantly outperform their peers.  Communication certainly isn’t new to organizations, and many have departments dedicated to this crucial task. However, when communication occurs in the context of a change, it’s not effective to simply tell people facts. To help individual employees successfully navigate a transition, communication must be focused and structured in specific ways. 

One aspect of structuring communication for change management involves intentionally and sequentially releasing messages into the organization. These communications should be designed and deliberate and delivered over a defined time frame. An effective communication plan first answers questions related to why the change is occurring, what it means to individuals, and allows time for employees to respond. When employees know a change is coming but don’t have answers to key questions, they tend to think the worst. Lack of communication early in a project can result in misinformation and rumors, which can be devastating to the project. This misinformation can breed resistance and can build large barriers to overcome later in the project lifecycle.

Unfortunately, only 50% of change projects are initially successful and only 25% are liable to be successful over the long run. Industry data suggest that those companies that focus on communication, training, and employee involvement in change planning are the most likely to sustain successful change.  

Learn how the Scientific Information Center at Boehringer Ingelheim was able to successfully engage their employees in implementing a major change to their legacy literature management solution in collaboration with ReadCube Papers.  

Why BI Switched to Papers

 1 Change and Communication ROI Study Report.  Towers Watson, 2014.

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Jill Shuman