Change is the only constant in today’s fast-paced environment. And as the pace of disruption and innovation accelerates, organizations that rise to the challenge will only be as successful as their ability to implement change.
This is even more important for corporate strategy teams as they look to undertake strategic initiatives that change the way organizations operate, scale, and drive growth in an increasingly volatile business environment. Without a successful change management plan, the likelihood of reaching the intended outcome diminishes — whether that's driving more efficiency, better serving customers, or driving profits.
In fact, it's one of the main reasons why 60-90% of strategic initiatives fail. And one of the main contributing factors is not thinking thoroughly about the implementation and execution of said strategy. But before we dig into the considerations strategy leaders like you should keep top of mind when undergoing your next initiative, let's first explore the value and importance of change management.
The Role of Change Management in Corporate Strategy Execution
If you consider the initiatives that corporate strategy teams plan to enact this year, you'll quickly realize that they're all an exercise in change. Let's take a look at this list of trends identified by CEOs and business leaders at Davos 2023 this year, for example.
It details how businesses will prioritize adopting new technologies (think AI, automation, metaverse, and more), identifying new growth strategies, and shifting the C-suite's focus on building business resiliency. The common denominator in all of these initiatives? Change.
A well-planned and documented change management plan in this context plays a crucial role in the successful execution of any of these initiatives. Change management helps to minimize resistance to change, mitigate potential negative impacts, and maximize the benefits and outcomes of the new strategy.
“A well-planned and documented change management plan in this context plays a crucial role in the successful execution of any of these initiatives. Change management helps to minimize resistance to change, mitigate potential negative impacts, and maximize the benefits and outcomes of the new strategy.”
For change to be successful, corporate strategy teams must prioritize change management at the strategic formulation and planning stages to enable its execution.
But it doesn't end there. Corporate strategy teams also need to ensure stakeholder engagement and alignment throughout the lifecycle of the strategy execution. They need to work with their CHRO counterparts and key stakeholders to ensure the successful execution of their strategies. So what exactly is change management, and what are its benefits?
Defining What Change Management Is
Change management refers to the process of planning and implementing change in an organization. The goal is to facilitate change in a controlled and structured way. Ultimately, it requires the ability to assess the impact of the change on the entire organization.
“Change management refers to the process of planning and implementing change in an organization. The goal is to facilitate change in a controlled and structured way.”
That means thinking through roles that will need to be changed, tools that will need to be adopted, and additional training and resources that will be needed to make sure the workforce can keep up. From there, the following steps are to develop the plan to manage the transition and generate a communication plan to educate stakeholders and provide support and training to those affected by the change.
It sounds simple enough, but here's where most teams get their wires crossed. Too often, the strategy only focuses on the external impact it will have without a clear understanding of the internal landscape. A lack of clarity into the internal resources, capabilities, and ongoing operational activities detracts from the efficacy of implementing the strategic changes leadership wants to see, along with minimal involvement with the execution plan.
When executed well, a change management plan can:
- Improve efficiency and productivity: Because change is implemented in a controlled and planned manner, corporate strategy teams can see minimal disruptions to strategic execution — ensuring a smooth implementation that results in improved efficiency and productivity.
- Increased employee engagement and buy-in: Change initiatives are successful when leadership and employees are bought in and engaged. As a result of higher levels of commitment, corporate strategy teams are more likely to achieve desired outcomes.
- Reduce resistance to change: Because employee concerns and issues are addressed early on, it builds trust and support for the initiative by ensuring everyone is aligned.
- Drive better alignment with strategic goals: Since there's more buy-in and engagement at the onset of the strategy execution, everyone is aware of the role they play in bringing the intended outcomes — improving performance and competitiveness over the long term.
- Enable better risk management: Corporate strategy teams can better identify and mitigate risks associated with changes by incorporating change management at the forefront of strategic formulation and planning. In doing so, they're better able to minimize negative impacts and improve the overall success of the strategic initiative.
How Corporate Strategy Teams Can Lead with Change Management
There are several resources out on the market that corporate strategy teams can leverage to lead corporate strategies with change management at its core. For example, Gartner has created a change management checklist for corporate strategy leaders. It provides a framework for assessing and implementing change and clearly outlines pitfalls to avoid and keys for success as they embark on a significant change initiative.
Likewise, many companies recognized the strategic importance of successful change management initiatives and started leveraging independent expertise to achieve their strategic goal in 2022.
We saw an uptick in spend for hiring independent experts with change management expertise by 838% YoY on Graphite as organizations sought to keep up with the pace of change. But in general, when looking to lead with change management, corporate strategy leaders would do well to keep a few things top of mind, such as:
- Incorporating change management throughout the strategy life cycle
- Involving key stakeholders like your CHROs and employees early on in the process and communicating frequently and often with them
- Monitoring and evaluating the progress of change and making proactive adjustments as needed
- Ensuring transparency across the entire strategy implementation life cycle with a robust communication plan
- Collaborating with internal and external stakeholders to understand the impact of change and developing a comprehensive plan that includes clear objectives, timelines, and milestones while keeping an eye on risks and challenges
Leading with Change Management in 2023
With corporate strategy teams looking to increasingly undertake strategic initiatives like digital transformation, for example, they'll have to pay close attention to their change management capabilities to bring these strategic initiatives alive.
Without it, the risk and consequences of a poor change management plan can result in diminished productivity, loss of valued workers, and reduced quality of work. And that's just from an internal perspective. It can also impact customers, suppliers, and more.
If you're looking to implement your strategic initiatives with change management expertise, we invite you to look at our network of certified experts who can help. To get a look at how corporate strategy teams leverage change management expertise, explore this client success story to learn how a change management expert facilitated a seamless M&A transition for a global private equity firm.