4 minute read 19 Jul 2021

Why considering context is key to successful organisational change

By Amy Walters

Manager, EY Lane4, EY Professional Services Limited

Specialises in human performance with a focus on applied psychology. Translates academic thinking and research into practical solutions for business. Visiting lecturer at Bath University.

Contributors
4 minute read 19 Jul 2021
Related topics Workforce

All change is not equal. Leaders must consider the type of organisational change and its context to maximise the chances of success.

In brief
  • We interviewed business leaders and senior consultants adept at organisational change to unveil the secrets behind successful change initiatives.
  • The findings revealed five contextual factors leaders should consider to make organisational change work.

Researchers have reported that 88% of change initiatives fail to deliver what they set out to achieve.1 This statistic stacks the odds firmly against organisations, bringing with it a sense of uncertainty when change initiatives are announced. This low success rate has been attributed to factors ranging from poor communication to insufficient commitment or engagement.2, 3

However, much of the change research fails to distinguish the different types of change or the varying contexts it happens within. When such a wide-ranging mixture of change is grouped together, much nuance is lost, which hinders the accuracy of subsequent recommendations.4 So, a more detailed approach was needed.

In response to this, we conducted research in which we interviewed 10 senior leaders undergoing change across a range of sectors as well as 9 senior consultants who are experienced in organisational change. From their insight, we gleaned five contextual factors which leaders should consider when implementing change.

Register to download the full report: All change is not equal (PDF, 3MB)

The context of change: factors leaders should consider

1. Other changes occurring within the business

The world is volatile, uncertain, complex and ambiguous. It also moves incredibly fast, as businesses have had to learn in the wake of the COVID-19 pandemic. This means that it’s likely there will be multiple changes occurring within any given organisation at a time. One participant in our research even reported 38 changes occurring simultaneously. To coordinate so many complex and intersecting initiatives, organisations should assign one person or a team to managing change throughout the business.

As a leader, when planning and actioning change, set time aside to map out other change initiatives occurring at the same time. Consider where they might overlap or contradict each other and anticipate what challenges might arise as a consequence.

2. The culture of the organisation you’re operating within

The role of culture in organisational change is all too often neglected. In fact, it’s a core component which should be considered to boost chances of success: organisational change can’t happen without impacting culture.5, 6  Two factors most often overlooked are cultural benchmarking and loss of cultural icons:

  • Cultural benchmarking is the set of habits in an organisation which dictate ‘how things are done around here’. To avoid alienating employees, as much as possible leaders should make sure that change is actioned in line with the existing culture and values.
  • Cultural icons are people who embody what your organisation is about. Losing these people can make undergoing change without losing who you are as an organisation a lot trickier. Leaders should engage these key cultural icons around the change, get them onboard, and get them to help make the change a success.
3. The change momentum

Change comes in all shapes and sizes, varying in both pace and scale, which together make up an initiative’s ‘change momentum’. Leaders should aim to classify where their change initiative lies in terms of momentum, and regularly reassess this throughout the project. The type of change momentum will dictate the challenges leaders may face. Indeed, each type of change has different watch outs:

  • For slow, large-scale changes, leaders should watch out for loss of engagement. This can be tackled with an effective communication strategy. By providing regular updates, people feel like they are being kept in the loop. Another issue with this type of change can be siloed working. To avoid this, leaders should refocus on the shared goals of the change and see the opportunities for collaboration which are being missed.
  • For fast, large-scale change, leaders can’t await absolute certainty to make every decision. To avoid delaying change processes, leaders should consider 80% certainty to be enough to make a decision on a given topic.7 Encouraging this rule will help leaders to make decisions when it matters. When facing fast change, leaders should also take extra care with their customers by providing extra support to smooth over any kinks created by the change.

Simultaneous change

38%

The number of changes occurring simultaneously in one organisation, reported by a leader as part of our research project.

Change comes in all shapes and sizes, varying in both pace and scale, which together make up an initiative’s ‘change momentum.
Amy Walters
Manager, EY Lane4, EY Professional Services Limited
4. Your organisation’s track record with change

In our research we found two specific sub-components to the ‘change baggage’:

  • The emotional hangover: A change hangover is where the ghosts of changes past come back to haunt leaders in the present.8 This is because our brains are wired to remember difficult emotional experiences, which change often brings up.9 Leaders should take some time to consider past organisational change and how this might impact how people subsequently feel facing new transitions. This awareness will help manage people’s reactions.
  • Employee expectations based on past experiences: It’s inevitable that people will refer back to their most recent or most comparable experience when facing a challenge, which change often feels like. To avoid negative expectations proliferating, leaders should check what beliefs their team is holding. This provides an opportunity to counter any unhelpful beliefs.
5. The type of change occurring

There are a multitude of different types of changes, each of which brings different considerations. Leaders managing a restructure, merger and acquisition, or culture change will all be facing different challenges. Below are some of the best practice insights from our research: 

  • IT systems change: Leaders should upskill people on the basics and establish a common language as a top priority.
  • Change of ownership: Leaders managing this should build trust by being honest. This will help ease them into the change by helping them picture how things will be going forward.
  • Restructure: Neuroscience research8 shows that if something seems unfair, it will lead to a strong emotional response and feelings of hostility. To avoid this, brief managers comprehensively so they can confidently have open conversations with their team about the change and reduce their fears about being treated unfairly.
  • Mergers and acquisitions: Leaders should conduct an in-depth analysis of the culture in each organisation and focus on identifying cultural icons who can champion the change and desired future outcomes. 
  • Show article references#Hide article references

    1. C. Macpherson, The Power to Change: How to Harness Change to Make it Work for You (Kogan Page Publishers, 2020).
    2. A. Mosadeghrad, & M. Ansarian, “Why do organisational change programmes fail?”, International Journal of Strategic Change Management, 2014.
    3. R. Caldwell, “Models of change agency: A fourfold classification”, British Journal of Management, 2003.
    4. B. Burnes, & P. Jackson, “Success and failure in organizational change: An exploration of the role of values”, Journal of Change Management, 2011.
    5. B.G. Hoag, H.V. Ritschard, & C.L. Cooper, “Obstacles to effective organization change: The underlying reasons”, Leadership & Organisation Development Journal, 2002.
    6. R.A. Weber, & C.F. Camerer, “Cultural conflict and merger failure: An experimental approach”, Management Science, 2003.
    7. Survey carried out by Lane4 Management Group in 2016 with 10 senior leaders from a range of industries and nine experienced organisational change consultants.
    8. A.M. Pettigrew, R.W. Woodman, & K.S. Cameron, “Studying organizational change and development: Challenges for future research”, Academy of Management Journal, 2001.
    9. Z. Whysall, “Managing change: Insights from neuropsychology”, Lane4 White Paper, 2014. 

Summary

All too often, change is approached as a global experience with comparable characteristics. The truth is, all change is not equal. Our research on business leaders and senior consultants proved that each change is unique in type and context. To boost the likelihood of change being successful, leaders should consider key contextual factors at every step of the change process.

About this article

By Amy Walters

Manager, EY Lane4, EY Professional Services Limited

Specialises in human performance with a focus on applied psychology. Translates academic thinking and research into practical solutions for business. Visiting lecturer at Bath University.

Contributors
Related topics Workforce