Search

Four Types of Organisational Change

Organisational change refers to actions in which a brand, business, or company alters a significant component of its organisation. These changes can be culture, technology, the business’s infrastructure, and its internal processes. Organisational change management is a mandatory key to bringing a successful resolution into the company.

It typically includes three major phases:

1. Preparation

2. Implementation

3. Follow-through


What can cause organisational change?

The most common factors businesses face when it comes to organisational change are the following:

· New leadership at the helm of the company or within its departments

· Shifts in the managerial team structure

· The implementation of new technology

· The adoption of new business models



4 Types of Organisational Change

Each organisational change requires a different strategic approach. For example, strategic and structural changes may require additional training and gradual transitions, while a remedial change requires immediate action. On the other hand, people-centric changes benefit from a well-thought-out change management communication strategy so that you can navigate emotional reactions.


1. Strategic transformational change:

Each change will affect some aspects of the organisation, but this does not mean that all changes are transformational. For example, minor modifications to existing tools or policies will influence the organisation, but they may not redefine the business structure and policies completely. A more significant change, though, will change an organisation and transform it into something better or worse; and all this comes to a conclusion why the right strategy must be followed. The first step is identifying the ultimate goal and then designing the plan to achieve it. Preparation and ongoing change management are essential for implementing these large-scale types of organisational change. Strategic transformational changes should be made gradually and monitored closely.


Three examples of strategic transformational change:

a. Updating your mission as you grow:

The initial goal of a brand new company is to attract clients to buy and meet their brand. However, once a company is established and recognisable to its audience, the focus must shift to upselling. When the mission goal of the company is changing, the company needs to evolve as well.


b. Introducing new technology:

Technology can be tricky to learn but plays an essential role in helping improve the business. Therefore, new technology is good for being involved in business development. However, it is also crucial to have a solid plan when introducing something new because usually, people prefer to stick to what they already know. Moreover, you can build confidence in the change by explaining that the transition will be supported by various change management tools that offer in-app training, weekly check-ins, and an internal chat for handling questions.


c. Employee training and development of new skills:

Additional training is a great way to support existing talent while also helping the company evolve. Employees must understand that the goal is to support new strategies instead of fixing deficiencies. When presented properly, additional training will be viewed as a benefit. Employees are more likely to work harder when they see that you also invest in their personal growth.



2. People-centric organisational change

People-centric organisations are interested in their people first, and then the rest. Nowadays, it is not selling the product that matters, but understanding the customer’s and your personnel’s needs first. For example, a new parental leave policy or hiring new people can be considered a people-centric organisational change. People are characterised by their emotions, and it is likely to make decisions based on them.


Three examples of people-centric change:

a. New hires:

Bringing on new team members requires onboarding and training, affecting both the new hires and the established employees. Start with communication. Explain the reason for hiring new people. Be clear from the beginning about what you need from them and their responsibilities.


b. Changes to roles and responsibilities:

Offer your employees the possibility to get involved in more aspects based on what their job description says. Evolve the roles and responsibilities over time and offer additional training to show your interest in their personal growth. It’s essential to have a strategy for change implementation and communication.


c. Employee training and development for new skills

You risk extreme reactions when you alter policies that directly affect employees, such as parental leave, vacation, or remote work policies. Either your employees will feel grateful or cheated. Keep in mind that as a people-centric organization, you must improve your employees’ benefits while keeping in mind your business’s well-being.




3. Structural change

Structural changes involve significant shifts in the management hierarchy, team organisation, and the responsibilities attributed to different departments, employees, or teams. These changes often overlap with people-centric changes as they directly affect most, if not all, employees.


Here are three examples of structural change:

a. Mergers and acquisitions:

Mergers and acquisitions are the most common cause of structural change. Eliminating role redundancies, redefining goals, clearly defining new roles and responsibilities, and training on technology are essential parts of managing change during mergers and acquisitions.


b. The creation of new teams or departments:

Structural change can also be identified in creating a new team/department in the organisation. Shifting personnel and duties could be an excellent idea for unsatisfied employees in a specific department, but it also might raise some disappointments to some others. Make sure that your employees are happy where they work.


c. Changes to the company organizational chart:

A people-centric organisation makes sure you celebrate important achievements of your employees, such as wins, promotions, new adjustments, etc. It is necessary for them to feel valued. Structural changes influence how your company functions as a whole



4. Remedial change

Remedial changes are reactionary. This type of change occurs when a problem is identified and a solution needs to be implemented. These changes are designed to address an issue, they call for immediate action.


Three examples of remedial change:

a. Dealing with a loss of talent:

Losing a critical employee may raise questions. As an organisation, you need to be prepared to solve the problem, either by hiring someone new or promoting an existing talented employee. Moreover, you need to explain why that person decided to leave without harming your company’s reputation. Your employees will look to you for guidance. Make sure you are ready to provide it.


b. Addressing customer communication issues:

To be a successful organisation you will need an effective communication strategy for customers. You need to change your response if you see that it no longer works as soon as possible to protect your existing customers and your reputation in general.


c. Providing more training for new hires:

Highly inefficient processes often lead to remedial changes. For example, you might notice that new employees struggle to learn internal tools and software. As a result, they are running to established employees with questions. Try to offer them the proper training that they deserve and be prepared to answer their questions from the beginning. If it comes to your attention that they don’t know how to complete a task, help them by providing free training. Remedial changes begin with an issue and end with a solution.



Sources:

Stobierski, T. (2020). What is Organizational Change Management? | HBS Online. [online] Business Insights - Blog. Available at: https://online.hbs.edu/blog/post/organizational-change-management#:~:text=Organizational%20change%20refers%20to%20the.

Sharma, K. (2020). 4 Types of Organizational Change, Explained. [online] Whatfix Digital Adoption Blog | Insights, News, Tips, Trends - Whatfix Blog. Available at: https://whatfix.com/blog/types-of-organizational-change/.


Irwin, D. (2018). 7 Rs of Change Management. [online] Medium. Available at: https://medium.com/@marketing_99371/7-rs-of-change-management-7c5cde17c36a.


Aktas, M. (2021). What is Kotter’s 8 Step Change Management Model (All you need to know). [online] UserGuiding. Available at: https://userguiding.com/blog/kotters-8-step-change-model/.


Iqvia.com. (2020). 7 Challenges of Managing Change (and how to deal with them). [online] Available at: https://www.iqvia.com/locations/united-states/blogs/2020/05/7-challenges-of-managing-change-and-how-to-deal-with-them.


Connor, J. (2020). The 4 barriers to change and how to overcome them. [online] Fast Company. Available at: https://www.fastcompany.com/90462478/the-4-barriers-to-change-and-how-to-overcome-them.


Ryan, W. (2018). 6 Barriers to Organizational Change, and How to Overcome Them. [online] Kadabra | Leadership and Culture Experts | Expand What’s Possible. Available at: https://www.wearekadabra.com/2018/08/28/6-barriers-to-organizational-change-and-how-to-overcome-them/.


Garfinkle, J. (n.d.). Change Management Coaching & Industry Consulting. [online] Available at: https://garfinkleexecutivecoaching.com/articles/business-intelligence-and-company-strategy/prevent-change-management-failure.


34 views0 comments