By Richard Lepsinger
Profitable companies must keep changing for continued success. Sometimes it is unexpected, sometimes it is necessary. To maintain normalcy during periods of change, employees look to their leaders for guidance. The key is to get leadership on board with the change and establish methods for helping their teams handle the change. Leaders must possess certain qualities for a smooth transition and to keep momentum in the workplace.
Navigating change is difficult; even the best ideas will fail if they are not adapted correctly. Here are the top three companies that implemented major changes and what we can learn from their successes and failures.
Alphabet is now the parent company of Google and is run by Google’s co-founders Larry Page and Sergey Brin. The restructure came so that the Google search engine could remain focused on its original mission to organize the world’s information. Among the companies now under Alphabet are the collection of ventures Brin and Page have delved into, including Google, Calico (their quest to cure death) and Nest Labs.
Given that this was a restructuring of a major organization, leaders should have minimized uncertainty among their employees. Instead, they shocked their employees and the world at the same time when Larry Page published a blog post on Google+. They did not give their employees much warning, and it brought the workday to a halt as everyone from interns to senior engineers reeled at the news.
The blog post addressed many of the questions leaders should answer during a time of change, including why the change was necessary and where they are in the process. However, it took employees by surprise when leadership could have been upfront about the changes and how it would affect their teams. As the situation unfolds, we will continue to learn how Alphabet is managing the transition and how its employees are adjusting.
When you’re a giant retailer like Amazon, your name is synonymous with change. Staying competitive is no easy task, though, because you are up against other innovative retail giants. Without a solid strategy in place to ensure your company is ready for change, failure is inevitable.
Such was the case with the Amazon Fire phone launch. The online shopping company made its foray into the smartphone realm, which seemed to be a smart decision. But one detail was missing: The phone didn’t offer enough reasons for smartphone owners to switch from their Apples or Androids. The phone boasted some intriguing features, but lacked a competitive price for what it had to offer and was sold in limited locations.
Was Amazon ready for this step? Perhaps not. What at first was considered a great idea may now require “many iterations” and “some number of years to get it right,” said Amazon CEO Jeff Bezos. Change readiness is a process that prepares your company to shift directions, even if it is still keeping the same overall strategic focus. Having these discussions with employees can result in an even better product.
To successfully navigate change, leaders should initiate and encourage change talk- discussion within companies that represents positive reasons for supporting change. When change talk is used well, it can prevent the “commitment dip” that often occurs when employees lose sight of the goal and revert back to old behaviors. This may have been a factor in Nike’s struggled over the years to maintain a favorable image after its factories in Asia were exposed for their abusive labor practices in the early 1990s.
Those in power at Nike didn’t act on the need to implement a more ethical supply chain until they were called out by activists, college students and consumer protesters-until customers boycotting their products hit the company’s bottom line. Their substandard work practices were a way to cut corners on costs to increase profit, which ultimately ended up costing Nike its reputation in the court of public opinion. Since then Nike has made positive changes, but it took time for the company to acknowledge all that it needed to do to improve working conditions. By working closely with employees and having ongoing conversations about what actions would be necessary to make lasting changes, Nike could have improved its supply chain practices before they made headlines.
In each of these examples, adequately preparing employees for changes and thoroughly discussing how the plans should play out could have solidified strategy execution efforts and led to a profitable innovation.
About the author
Does your company have a plan in place to handle a large organizational change? Let OnPoint help you execute your strategy and achieve success. Download our eBook, Managing Change: 3 Secrets of Smart Leaders to help you implement change today.