Change doesn’t come easily…or cheaply. Here’s a scenario: The Board or Executive Team, meet and hammer out their strategic plan and go back to work at their desks and begin putting the building blocks in place to reach the goals they’ve set. A few months, or a year into the plan, they suddenly discover that not only is change expensive, but it’s costly in ways and areas the strategic plan, well had no plan for. Every type of change comes with a price tag.
Employee Costs: Regardless of whether the change is small, drastic, incremental, sudden, planned, or unplanned, people will pay a price in terms of emotion and productivity. People handle change differently. Some will create havoc and slow the change process down through change resistance. Others experience stress as they may fear losing their jobs, or they may struggle learning a new process or technology, or they may express anger over the merge with a bitter business rival. These reactions cost your teams and business heavily in lost productivity.
Christmas, Hanukah, MLK Day, and St. Patrick’s Day, and other celebrations come once a year, every year. Some of these may cost us time, money, and other resources that we invest in their celebration. We know they are coming, they are all on our calendars. So we always prepare for them. Right?
Business growth comes in the form of higher revenues, more customers, through mergers and acquisitions, or maybe franchising. Regardless of the growth methodology, the fact is that businesses must grow or die. Growth brings change. So, we expect change and are always prepared for it. Right?
An executive client knows his organization is engaged in aggressive growth. However, when I asked how his department might change with the next two acquisitions, all he could replay was, “That’s a good question.” Well, yes, indeed it is. The fact that the thought had apparently not entered his mind was a surprise; and it’s especially surprising given the fact that he wants to be president of the company upon the current president’s retirement. So much for planning. So how can this executive better prepare his department for growth and change?
When your business is new and small, you may change business models often. Of course, this ends after you grow and become established. Not so fast. Organizations of any size can change their business model. Organiztions like PayPal, Google, Facebook, Microsoft, and Tiffany & Co. just to name a few have all found it necessary to change business models. Some changes were more radical than others.
There may be good reasons to change your business model. Beating the competition, what you have just isn’t working, trends, and the fickle market have changed are some reasons it might be necessary to change your business model. Other times, it might be a decision to cut losses for one business unit that’s dragging down revenues and sell it off. One organization simply doesn’t have the qualified staff to run a division that’s lipping along right now. You may think it an easy solution to just hire a staff, but they are in an area of the country that doesn’t have a good talent pool and it’s even worse for technical talent. This can pose a real problem for the growth of the organization.