As more organizations are being pushed to reduce costs while improving the quality of products so the management of change becomes more and more important.
Kotter proposes eight steps to leading organizational change and avoiding key mistakes.
Step one is establishing a sense of urgency by examining the market, competitors, and identifying potential problems and major opportunities.
Step two suggests leaders create a guiding coalition by assembling a team of people with sufficient power to lead the change to fruition while continuing to work as a team.
Step three is developing a vision and a strategy to direct the change effort while developing solid strategies for completion.
Step four is communicating the vision of the change to all employees and subordinate leaders.
Step five involves empowering broad-based action by getting rid of obstacles, changing systems or structures as necessary, encouraging risk taking, and generating new ideas.
Step six is generating short-term wins and recognize the people who make the wins a reality.
Step seven is consolidating gains and producing more change by hiring, promoting, and further developing change agents in the organization.
Finally,step eight in the change process advocates anchoring new approaches in the newly defined culture thereby creating more value for the customer and employees alike.
Since, establishing a sense of urgency is the first step in driving change; Kotter posits the leading causes of complacency include, too much success, a lack of a visible crisis, low performance standards, and insufficient feedback from external constituencies. If organizations catapult into changes without considering how and what they are trying to change, leaders and employees will fail to appreciate and fully comprehend the necessity for the change. Transformations fail if the objectives are not clearly understood by everyone. Therefore, establishing a sense of urgency is the first step in driving change. In order for the criteria to be implemented systematically, a sense of urgency must be maintained promoting full implementation.
Step two deals with failing to create a powerful guiding coalition of people who will support the change. The senior leader must support the change and direct the change by continual and periodic evaluation and reviews. These periodic evaluations and reviews must be designed to determine the status of the change and if any impetus is needed by the leaders to drive or energize the change further. If the change is on track, the leader may need to praise, reinforce, and continue to monitor. In the implementation of the criteria, senior leaders must appoint a strong guiding coalition from all levels of the organization who can must the necessary changes forward.
Step three suggests leaders most often underestimate the power of vision. Vision helps to align, direct, and inspire action by the employees. Without a vision, a transformational effort can dissolve into a list of confusing, incompatible, and time-consuming projects leading nowhere. Additionally, the vision must be simple and clearly understood to actually be accomplished. With regard to the criteria, the vision should be to improve customer service, improve the financial posture, or some other major improvement needed to improve overall organizational efforts. The senior leaders must ensure they have the right priorities assigned and build human talent around those priorities.
Step four is failing to communicate the vision sufficiently. Generally speaking, according to Kotter, most leaders have a pattern of ineffective communication by sending out memos or having a few meetings, making speeches, and by not setting the appropriate example about the change for subordinate leaders and the employees. To fully adopt and implement the criteria, the senior leaders must continually focus on what they are improving, establish firm priorities, and monitor purposefully. The monitoring of key metrics emphasizes the most important aspects of the organizations. Failure for senior leaders to require periodic briefings about the key processes reinforces apathy at all levels.
Step five, failing to lead change properly, occurs when leaders permit obstacles to block the new vision or by disempowering people with unrealistic requirements caused by barriers within the organization. The organizational structure, narrow job descriptions, low compensation and antiquated performance systems, along with demands of the employees which are inconsistent with the requirements of the change, are a few of the barriers that block organizational change and work towards disempowerment. Implementation of the criteria will underscore organizational inefficiencies, expose wrong thinking about work, illuminate weaker employees and leaders, and reveal inconsistencies with organizational priorities. The leaders must remove the barriers to efficiency which may point to some human problems as well as organizational barriers.
Kotter lists step six as failing to create short-term wins. Real transformation and organizational change takes time with few shortcuts. Momentum must be maintained by allowing the organization to celebrate success periodically. Short-term and intermediate goals which are accomplished can be a strong motivational tool leading to more success and more positive change. In order to promote the implementation of the criteria, senior leaders must capitalize on those short-term wins and build upon intermediate success toward the major goals. Failure to accomplish wins early works to doom the implementation and will most assuredly limit success.
Declaring the victory before the change is completed is step seven. Celebrating a win is positive reinforcement but the leader cannot celebrate too much or too soon and loose the precious momentum necessary to accomplish further successes. Monitoring the signs of intermediate goals can help keep the subordinate leaders and employees focused on the path of success to accomplish long-range goals.
Finally, step eight deals with leaders neglecting to anchor the changes firmly in the corporate culture. Change will be most effective when it becomes the way business is conducted on a regular basis. Conscious attempts to show employees how their behaviors and attitudes helped improve performance are necessary.
These steps are useful whether leading major companywide change or it can be scaled for a smaller change initiative.