by teamrecExploring the link between Strategy and Change Management
With the present times showing a greater level of uncertainty and ambiguity, it has become pertinent to understand the deeper determinants of sustainable competitive advantage. If we look at the developments over the last three years, the Indian Industry has witnessed tremendous changes – the unbundling of electricity sector, revision in mobile tariff-structure, banking norms, disinvestments in PSUs, liberalization of foreign investment regulations etc. All these indicate that reform and deregulation would be a norm. Traditional bureaucracies would be struggling to come out of a protectionist regime and don the mantle of Corporate; domestic players would be evaluating the opportunities of strategic alliances, cross-border mergers and acquisitions to enter transnational markets. Competition would become fiercer as entry of new players would be easier.
The recessionary phase might get over sooner or later but it is sure to leave a strong impact on how organizations would shape their future growth story. The challenge for organizations in the emerging scenario would be to build a sustainable competitive advantage. The easy access and availability of high-end technology, better quality products at lower prices, mobility of human resources have redefined the determinants of competitive advantage. The focus has shifted to better internal resource management – people being the most important of them. What is increasingly gaining credence is creation of a work culture that is open, flexible and adaptive and breeds creativity to suite the environment.
Taking an analogy from Charles Darwin’s theory on human evolution, organizations have their own DNA in the form of shared vision, values, beliefs and customs. In a changing business environment, business entities need to master the art of modifying their DNA structure to survive. The timely the effort, better the chances of survival. This need shifts the focus to ‘people’ who need to change in terms of attitude, values, competencies, roles and behaviors. Behavioral Training has become important from this standpoint. Organizations-in-transition need to identify their needs and make a concerted effort to build the competencies to initiate, manage and institutionalize change.
The Indian scenario would witness an era of wide-scale changes in terms of Strategy and Change Management be it – restructuring businesses, management of cross-cultural workforce, creating better workplaces, ethical dimensions of business, transparency and objectivity or quality of life. The daunting task before the CEOs and HR Heads would be to understand these fast changing patterns in industry and businesses and skillfully craft their human resource strategy.
But the intriguing fact is that change management plans more often fail. The most often neglected area when it comes to strategy implementation is ‘people processes’. The usual change drive gets riveted to technology and financial considerations. Organizations spend lot of effort and time in preparing elaborate plans, policies and manuals but when it comes to execution, they lack the enthusiasm to lead change, communicate and relate to peoples’ apprehensions. They do not get desired results. The impact of such failed interventions takes a heavy toll on the economy and triggers loss of confidence in the industry vertical as a whole. Some of the commonly observed reasons are
- Lack of proper understanding of people issues
- Lack of proper communication during change
- Absence of core team for change management
- Lack of employee involvement mechanisms
- Absence of a structured approach
The inertia in the system is not well understood. There is lack of behavioral skills that can take employees through a change process. These skills are needed on multiple frontiers:
- To develop a positive attitude towards change
- To strike a better rapport with stakeholders
- To manage conflict and stress
- Performance and Rewards management
- To build better interpersonal relations
- To improve team performance
- To create a better workplace for employees
- To enhance customer satisfaction
These processes if not well established retard the change process and often lead to undesired outcomes. Most of the M&As are not able to realize ‘calculated’ synergies because they fail to integrate the divergent cultures and ‘people processes’. “A corporation’s culture can be its greatest strength when it is consistent with its strategies. But a culture that prevents a company from meeting competitive threats, or from adapting to changing economic or social environments, can lead to the company’s stagnation and ultimate demise,” is how Business Week put it.
So how do organizations need to go about it?
First, they need to identify and understand the source and nature of resistors to change. These sources could be related to some deeply ingrained values which have manifested in the form of an attitude or it can be related to strong sub-cultures.
Second, leaders need to appreciate that change cannot be introduced ‘in a jiffy’. It has its own incubation time and in order to hasten change, leaders need to ‘walk’ the ‘talk’ and get involved at ground level to make things happen.
Third, a top management team must be constituted to work in a structured manner to address stakeholders’ apprehensions, communicate to drive change and engage efforts constructively.
In order to achieve this, organizations need to create the ‘learning’ environment where people gain clarity about the organization’s change objectives, their role, mutual expectations etc and can take an informed decision. Most of the confusions prevail because of ‘grapevine’.
The interventions are to be designed to help people make the ‘psychological’ transition to a newer state. This is essential for the success of the strategy implementation. So, however strong the technical and financial indicators are, it is ultimately the human resources that would decide their fate at the delivery end.
People – a valuable asset
The war to attract, develop and retain talent would be a daunting task for CEOs and their HR Heads. Organizations would increasingly need to change quickly that would also have a bearing on their processes. Different sectors would have different imperatives.
Organizations need to step out of the conventional mode of training to a ‘strategic’ orientation. The training need analysis must not only remain focused on technical inputs but also on behavioral skills which are more important in the changing environment.
Training is an important tool not only for personal development but also to help in realizing the organization’s vision.
The Indian Scenario:
Many government set-ups are undergoing transformation exercise be it the Central, State or District level administrative machinery or the PSUs. The objective is to make the erstwhile ‘sarkari’ strongholds adapt themselves to market conditions and deliver services effectively.
The traditional bureaucracies in the PSUs and Government Set-ups will undergo a massive change. In order to survive strong competition from MNCs, high expectations from customers and a ‘highly-resistant’ workforce, they need to act fast but judiciously. The employees need to be carefully taken through a Change Implementation Plan. Invariably, the HR function is nowhere to be seen in many government organizations. These departments need to be created, the structures, systems, policies and processes defined.
The organizations-in-transition would be facing the toughest challenge in terms of ‘shaping’ their HR Strategy for a successful transition. In many such cases, the employees would need to interact in different ways with their employees and customers, have a different way of measuring performance, have a different reporting relationship and have different work processes. These ‘desired’ behaviors that would be the outcome of a change process need to be ‘accepted’, ‘learnt’ and ‘demonstrated’. This would be an uphill task as the employee profile is more skewed towards the older employees. However, most government departments somehow tend to ignore these finer aspects of change management leading to an imperfect transition which in fact creates more problems.
ABOUT THE AUTHOR
Mr. G V P Rajan is a keen strategist with the flair for designing and implementing innovative strategies and HR Interventions for accelerated growth of the organization. He has more than 9 years of experience in handling HR issues pertaining to large organizations.
After his post-graduation in Psychology from Allahabad University, he joined NTPC in 2000 where he worked in various HR roles spanning diverse areas – performance management, rewards, administration, industrial relations, training, TQM, welfare, employee benefits, CSR, education, public relations, OD interventions and various HR initiatives. As an internal change agent, he had spearheaded many change initiatives which were a part of an organization transformation exercise.
In 2008, he left NTPC to join the Indian Institute of Management, Lucknow. After completing his PGDM (Strategy) he has moved to Strategy Consulting. He has handled consulting assignments for a State Power Transmission Utility for restructuring of their organization structure, growth strategies and development of HR systems and policies. He has helped develop HR strategies for organizations in appraisal processes, selection processes, compensation and benefits, career development, communication strategies, change management plans etc.
