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January 6, 2017

How to Lead Change in an Organization

Summary:

No matter how we motivate people, and no matter how organized we are, our change efforts will suffer if we don’t accept human emotion.

Photo Courtesy of Pexels

Change is personal. So, change management has to be personal, too. No matter how we aim to motivate people to change, and no matter how organized we try to make our transformation plan, our change efforts will suffer if we don’t accept the reality of human emotion. People and their strengths, foibles, feelings and notions will be what determine the success of our transformation programs.

Can we afford to ignore the human dynamic in organizational change management?

If the answer is, “no,” then it means our change management plan must also positively influence individual mindsets. The benefit to a thoughtful approach will be lasting organizational impact during an era of digital transformation.

What you, as a leader (everyone behind important changes) need now is what will become ingrained culture (forward-thinking teams and a company that permanently enjoys the benefits of a unified, flexible organization).

That kind of corporate mental preparedness will help organizations respond to future digital shifts and growth with quick, fluid and unhindered movements. A change-ready culture isn’t as susceptible to the fears of unknowing.

So, in this series, we are going to focus on the insurance organization itself and the various people who drive it. We will look at why insurance leaders should consider organizational transformation as an instrumental part of technology modernization. And we’ll examine several considerations that are in some way crucial to finding transformational success. These all share one trait: They each touch on the human element of change management.

Leading outside the lines.

When we talk about change and people, it’s natural to look to leadership strategies and recognize that a lot of real leadership happens outside of the org chart. On the org chart, executives and managers have defined roles and responsibilities. But leading outside of those lines is far more crucial when it comes to change management. Leading change requires “working within the white space” — ignoring some degree of authority and being more concerned with perceptions and personalities. If you think you can dictate change, you can’t. You need to bring people along understanding their pace. Change has to be effectuated in some way outside of official protocol. It is in the white space where penetrating change leadership will happen. We’ll discuss more on white space and leading outside the lines as we move through the articles in this series.

See also: Can Risk Management Even Be Effective?

Leaders should know what is driving change.

It pays for leaders to know why they should be shifting their organizations away from traditional technologies and processes and toward flexible new technologies and processes that will enhance the customer experience. This understanding will help leaders communicate the relevance of change to the people who need to create change.

The insurance business environment is in the midst of a radical shift. For a quick look at the factors involved, see the then vs. now chart below. (Source: Future Trends: A Seismic Shift Underway.)

Understanding these concepts will allow leaders to operate and speak from a position of knowledge when they frame examples of the driving forces of change within the organization.

Leadership should lead the change.

“Change starts at the top,” is a phrase so common that it is cliché.

But what does that really mean? Does it mean that the leadership accepts that change needs to happen and then delegates the work of change out to the various stakeholders? Certainly some delegation will occur, but, in our experience, the best change happens through the well-articulated, well-planned hard work of the leadership. Instead of “Change starts at the top,” perhaps we should say, “The work of change begins at the top. The oversight of change stays at the top,” and, “Leaders should be just as engaged on Day 51 and Day 201 as they were on Day 1.” In fact, it isn’t leadership if leaders aren’t engaged.

Leaders must establish the driving force for change. The foundation you are building is important enough to clearly provide explanation around why the organization is going through transformation. When asked “Why are we changing?”, it is important and easy to be clear in this regard. Possible responses include:

  • “We want to be more competitive to the marketplace. Change is a part of our core business strategy.”
  • “Becoming a digital company requires us to change.”
  • “We are striving to stay relevant to a fickle consumer.”

There may be a number of reasons. But establishing the driving force for change will allow those reluctant to change to see a clear correlation between change and company survival.

Change is difficult, and many people will not be positive about it on Day 1. However, we shouldn’t assume that all people don’t want to change. Many times, people would love to change. It is simply a matter not knowing how to change. Change management helps your valued team members uncover a new paradigm and gives them a new context in which to grow within their role. They will learn how and will become more comfortable as you help them shift.

Focus on outcomes — organizational and individual.

To set the context and shift the paradigm, leaders should focus on two types of outcomes. Successful organizational outcomes are the focal points that every organization needs to stay on course. That focus will also help everyone in the organization release those time-honored, sacred approaches that may no longer be needed. Organizational outcomes won’t be hindered by a lack of understanding.

See also: A Revolution in Risk Management  

But people will also be looking toward their personal outcomes. People like to know where they are currently versus where they will end up. Remind people, “You are here. As the organization transforms, you will be here.That answers their questions about where the organization is headed and where their role is headed (questions such as “Will I lose my job?”, “Will I have more responsibilities on my plate?”, “What’s in it for me?”)

In fact, change leaders should do their best to continually answer the question, “What’s in it for me?”, because that is the context each individual needs. It’s like orienteering with a map and a compass. Hikers feel more comfortable when they can point to their current location on a map.

Change management is helping associates grasp that new paradigm. Communicating the outcome for the individual is just as important as communicating corporate direction.

In my next blog, we’ll discuss organizational change management from the standpoint of skills and understanding. Do we have enough experience to guide change? How do we mold change managers, grow understanding throughout the organization and conquer the fears and myths of transformational change?

Please join me in Part 2 as we uncover the “How To” details of change management.

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About the Author

William Freitag is executive vice president and leads the consulting business at Majesco. Prior to joining Majesco, Freitag was chief executive officer and managing partner of Agile Technologies (acquired by Majesco in 2015). He founded the company in 1997 to meet companies’ increasingly complex business processing and information technology requirements.

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