Debunking Common Myths About Organizational Change Management During Digital Transformation

Written By: Eric Kimberling
Date: July 14, 2023

Change management is a widely misunderstood discipline in the realm of digital transformation. It is riddled with misconceptions that need to be addressed.

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Over the years, my experience in change management has consistently fascinated me. It is a discipline that is frequently misunderstood and often overlooked. Even when it does receive the attention it deserves, numerous misconceptions and myths surround it. Today, I will discuss the five most common misconceptions you should be aware of regarding change management.

Employees Won't Resist Change

One of the first common misconceptions about organizational change management is that employees won't resist change. This misconception is easy to fall into, especially for leaders and managers within an organization.

The reason this misconception is prevalent is that, on the surface, most people in organizations support change. They recognize the need for better processes, tools, and technologies to improve their job performance. So, when organizations introduce the idea of digital transformation, ERP implementations, or any technology initiative, employees generally understand and are excited about the opportunity. They are not outright resistant to change.

However, resistance to change typically exists below the surface, and it can be powerful and subtle. It is difficult to detect because employees are not intentionally hiding it from leaders. The main reason for its subtlety is that employees don't fully grasp the changes early on in a project. While they may be enthusiastic about it, they don't fully comprehend how it will affect them and their job.

As a project progresses and the future state becomes clearer, employees within organizations begin to resist the change. They feel threatened by it. For instance, while an employee may initially understand and acknowledge the need to improve tools and processes, once they delve into the specifics of how their spreadsheet, process, or their own expertise will be automated, they start to perceive the change as a threat. At this point, people subtly resist the change, question it, and lose their initial enthusiasm.

It's important to recognize that resistance to change will inevitably occur. The question is not whether it will happen, but rather when it will happen, how severe it will be, and what the underlying cause of the resistance is. Understanding these root causes and working towards mitigating them becomes crucial. It should be one of the initial steps taken as part of an organizational readiness strategy.

Training is the Center of a Change Management Strategy

A second common misconception in change management is that training is the primary focus or centerpiece of a change management strategy. This is simply not true. Training is undoubtedly important, but it serves as a capstone to an organizational change strategy. It is a later stage in the project, more of a formality and a way to conclude the organizational strategies and tactics that precede it.

The real change management work, the heavy lifting in organizational change management, happens before the training stage. It involves activities such as organizational assessments, change impact analysis, and organizational design. Understanding the impacts on the organization and how people are likely to react to the change becomes crucial. It entails providing support and guidance to help employees navigate through the change. All these tasks need to occur prior to end user training. If you wait until end user training to introduce a plethora of changes to your employees, they will undoubtedly become overwhelmed and panicked. It is important to address their concerns and potential resistance earlier in the project.

Of course, the goal is not to make employees freak out or panic. Ideally, we want them to embrace the change and be on board with it. That's the essence of a change management strategy – understanding and empathizing with people, identifying their motivations, and addressing the root causes that influence their reactions. This enables us to focus on training people to perform their jobs effectively during the end user training. However, training should not be considered the sole focal point or centerpiece of the change management strategy.

It's essential to recognize that change management extends far beyond training. In fact, the overwhelming majority of factors contributing to the success of a change initiative have nothing to do with the quality of the training itself. While effective training is necessary, the key determinants of project success lie in the activities leading up to the training.

Internal Alignment

Another common misconception in change management, which is actually more of an oversight, is the failure of most organizations to recognize or realize their internal misalignment. This internal misalignment becomes the root cause of struggles or ultimate failures in digital transformation initiatives. Organizations need to acknowledge the high probability of not being fully aligned and take steps to align themselves before progressing too far into the project.

Often, organizations and project teams only recognize their misalignment well into the digital transformation process. Waiting too long to address this misalignment leads to its trickle-down effect throughout the organization, resulting in increased resistance to change. When attempts are made to correct the misalignment at a later stage, it either consumes more time and money than if alignment was established from the beginning or leads to rushed project execution, which typically ends unfavorably.

To address this issue, organizations should first assess their level of alignment. It is crucial to acknowledge that complete alignment is unlikely, and that's acceptable. The larger, more global, complex, and diverse an organization is, the more true this statement becomes. The key is to recognize and measure areas of misalignment and determine how to achieve alignment.

For instance, alignment can be as simple as defining what the digital transformation means for the organization and how it will improve the business. While some common ideas may be shared across the organization, nuances and differing perspectives may exist among individuals. Ensuring internal alignment and making key decisions with a clear project vision early on is crucial.

Furthermore, alignment starts with the executive team. The executives set the tone, vision, and direction for the digital transformation. This alignment at the executive level should then permeate throughout the rest of the organization. It's important to note that this is particularly true in today's agile-focused deployments, where speed and immediate business value are prioritized. However, this can result in speed overshadowing alignment, creating issues later in the project.

In summary, recognizing and addressing internal misalignment is a vital aspect of successful change management. It requires early assessment, acknowledging the likelihood of misalignment, and ensuring alignment at all levels of the organization. Balancing speed and alignment is crucial for achieving favorable outcomes in transformation initiatives.

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Change Management is a Specialization

Many organizations and change teams perceive change management as a specialization, a discipline handled by a separate team dedicated to change management. While every project requires some level of specialization, including project management, business analysis, technical components, and change management, there are two significant problems with this approach.

Firstly, many people don't fully comprehend change management, leading them to rely on experts to handle it on their behalf. Secondly, and more importantly, change needs to be led by executives within the organization. While specialized individuals can bring methodologies, tools, and capabilities to facilitate change, it is the executives and project leadership who should drive and lead the change. Therefore, separating change management too much from the overall transformation is not ideal.

At Third Stage Consulting, we recently worked with a client who coined the phrase "Trojan Horse change management." They were reluctant to have a standalone change management team and believed it was the responsibility of the leadership team. This was an astute observation on their part. Instead of creating a separate change management initiative, they integrated change management into the very fabric of their business and transformation. While we provided methodologies, toolsets, and performed behind-the-scenes change management activities, it was the leadership and employees within the client organization who led the change and represented change management. This approach proved to be highly effective.

To avoid this problem, it is essential to view change management as a "Trojan Horse." Address change management, but ensure it is baked into every aspect of how the leadership team operates and delivers the project. Integration and alignment are key to successful change management within an organization.

Change Management is A Nice To Have

The last major misconception I will address today regarding change management is when people view it as a "nice to have" aspect. It becomes something that will be done if there is sufficient time, budget, and resources available. Instead of perceiving it as optional, organizations must recognize that change management is an absolute necessity. Given the limitations of time, resources, and budget, difficult decisions need to be made. It is impossible to do everything, and that is the reality of organizational life.

However, prioritized decisions can be made regarding the most crucial aspects of the transformation. Rather than overly focusing on technology, it is more beneficial to allocate time and effort to organizational change and the people involved. Based on our experience helping numerous organizations worldwide with their digital transformations over the past five years, we have found that the most successful organizations are the ones that invest slightly less in technology but prioritize change management. While the technology scope may be narrower than desired, effectively managing the people component of change greatly benefits them.

Therefore, it is important to consider whether having more technology deployed poorly is preferable to having less technology deployed successfully and effectively used by employees to drive business value throughout the organization. Falling into the trap of viewing change management as a mere "nice to have" should be avoided, as it is, in fact, an absolute necessity. Without it, there is no clear path to success in your digital transformation.

I would enjoy brainstorming ideas with you if you are looking to strategize an upcoming transformation or are looking at selecting an ERP system, so please feel free to contact me at eric.kimberling@thirdstage-consulting.com. I am happy to be a sounding board as you continue your digital transformation journey.

Be sure to download the newly released 2023 Digital Transformation Report to garner additional industry insight and project best practices.

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Eric Kimberling

Eric is known globally as a thought leader in the ERP consulting space. He has helped hundreds of high-profile enterprises worldwide with their technology initiatives, including Nucor Steel, Fisher and Paykel Healthcare, Kodak, Coors, Boeing, and Duke Energy. He has helped manage ERP implementations and reengineer global supply chains across the world.

Author:
Eric Kimberling
Eric is known globally as a thought leader in the ERP consulting space. He has helped hundreds of high-profile enterprises worldwide with their technology initiatives, including Nucor Steel, Fisher and Paykel Healthcare, Kodak, Coors, Boeing, and Duke Energy. He has helped manage ERP implementations and reengineer global supply chains across the world.
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