Management changes and its impact on business
Assignment Topic:
“Impact of business after changing the
board/management team of the organization”
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Management changes and its impact on business
Table of Contents
▪ Why Change Management?
▪ Types of Change Management.
▪ The Change Management Process.
▪ The Benefits of Change Management.
▪ The Challenges of Change Management.
▪ The Impact of Change Management.
▪ A Manager’s Role in Organizational Change.
▪ Preparing for Organizational Change.
▪ Developing the Skills You Need to Manage Organizational Change.
▪ Conclusion
▪ References
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Management changes and its impact on business
“One way to characterise and execute change inside an organisation is through a formal framework
or procedure called change management”- Change Management Review”.
Organisations must continually adapt, innovate, and change in the fast-paced, dynamic business
climate of today. Change has become a necessary component of organisational growth, whether it
be through the implementation of new technology, process reengineering, or responding to market
shifts. Effectively managing change is a difficult undertaking, though. Thorough preparation,
tactical implementation, and capable guidance are necessary.
Organisations may have both positive and negative effects from change. An organization's success
or failure will depend on how it manages change.
The impact that change management has on organisations will be covered in this assignment. We
will explore the advantages and difficulties of change management and offer advice on how to
handle changes in a business successfully!
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Management changes and its impact on business
Why Change Management?
Change management may be required by an organisation for a variety of reasons. Typical causes
include some of the following:
A change in leadership:
A change in the CEO, CFO, or other important leaders may be the cause of this. A shift in
leadership frequently indicates a shift in the organization's strategy or direction.
A change in business model
A new business model, market expansion, or company merger are all possible scenarios for
the organisation. Change management will be required if the business's operations undergo a
major alteration.
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Management changes and its impact on business
A crisis situation
Proceed to indicate there is a natural calamity, the company is having financial difficulties, or
someone has stolen its data. In order to promptly adjust as needed, the organisation should put up
change management procedures.
A change in strategy
This could be in response to changes in the industry, the economy, or customer needs. The
organization may be shifting its focus, goals, or target market.
A change in technology
Process or procedure modifications are frequently necessary when implementing new
technologies. Employees must have access to the tools and resources they require from any
location in order to operate remotely. This entails having access to the internet, a computer, and
any required files or software. Ensure that staff members receive training on the newest
technology.
All technological changes are guaranteed to go smoothly and effectively with the help of change
management.
A change in a company culture
A shift in an organization's culture can be caused by a variety of circumstances. A change of
ownership, a merger or acquisition, a management change, or a change in company strategy are a
few of the most frequent causes. Any modification to one of these components frequently has an
impact on the entire organisation. Don't start by attempting to change the culture of your firm.
Instead, follow the Harvard Business School's guidelines for business leaders conducting business
research.
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Management changes and its impact on business
Downsizing or restructuring
Change management is crucial to reducing the bad effects on the organisation when a company
goes through a reorganisation or downsizing. Restructuring or downsizing a company can cause a
great deal of disruption and uneasiness in the workplace.
Mergers and acquisitions
When a company undergoes a merger or an acquisition, it experiences change. The transition
should go smoothly and the company should achieve its goals.
There are a few key steps in change management for mergers and acquisitions. The first step
is to assess the situation and identify what needs to be changed.
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Management changes and its impact on business
The change plan should be tailored to the specific situation and should consider the resources
that are available. Finally, change management needs during implementation and monitoring
the transition to ensure that it is effective.
Changes in the external environment
Economic conditions, new regulations, or other factors outside of the organization’s control
can cause change.
Types of Change Management
Change management comes in a variety of forms, each having pros and cons of its own. Topdown change management is the most popular kind.
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Management changes and its impact on business
Top-Down Change
The change initiative begins at the top levels of the organisation and works its way down to the
lower levels. This kind of adjustment can help guarantee that all staff members are aware of the
company's new course and are supportive of the adjustments.
However, employees who believe they are not involved in decision-making may oppose top-down
change management.
Bottom-Up Change
Change proposals begin to come from the organization's lower echelons. Change from the bottom
up is more participatory and frequently results in higher employee buy-in. It might take longer to
see effects and be more challenging to implement, though.
The application of change management will vary depending on the particular circumstance and the
change's likelihood of success.
The Change Management Process
The process of organising, carrying out, and keeping an eye on changes to the company is called
change management. The process involves determining the necessity for change, weighing the
advantages and disadvantages of the change, creating a strategy for the change, carrying it out, and
keeping an eye on it.
Ensuring changes are implemented in a safe and controlled manner is facilitated by the change
management process. It also aids in ensuring that the modifications have no unfavourable effects
and are genuinely advantageous to the company.
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Management changes and its impact on business
It takes a little more work to make the changes than just breaking old habits. The following
actions are usually involved:
1. Establishing the need for change:
Finding an opportunity or issue that needs to be handled is the first stage in this process. Senior
executives inside the company, staff members, or external stakeholders may identify the issue or
opportunity.
2. Assessing the risks and benefits of change:
Evaluating the advantages and disadvantages of change is crucial for making safe and controlled
changes. This is assessing the advantages and disadvantages of a change and balancing them
against one another.
The risks of change include things like loss of revenue, loss of jobs, or even bankruptcy. The
benefits of change include things like increased efficiency, improved customer service, or
increased profits.
It is crucial to thoroughly consider the advantages and disadvantages of any change before deciding
on it. This will make it more likely that the organisation will benefit from the improvements.
3. Developing a change management plan:
The change management team will develop a change plan once it is clear that a change is
needed. They will identify the risks and benefits of the change and then create a plan, including
what the change will be when it will happen, what resources are needed, and how it will be
carried out.
The change plan should be tailored to the specific situation and should take into account the
resources that are available. The timeframe should be realistic to achieve the goal.
The change plan should also identify who will be responsible for each stage of the change
process. This will help to ensure that everyone knows their role and responsibilities.
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Management changes and its impact on business
All parties involved get all the information about the change plan. This includes employees,
suppliers, customers, and other stakeholders.
4. Implementing the change plan:
The implementation stage is when the plan really starts to take shape. This means gathering
data, analyzing results, and making decisions based on what you find out about your
employees’ needs as well as how they interact with one another in order for them all be
successful at work every day! This typically involves putting the change in place and
monitoring how it is working.
The change process will continue even after the changes’ implementation. This includes
monitoring the change over time and making changes if necessary.
5. Monitoring the change:
Once a change has been made, it is important to keep an eye on the situation and make any
necessary adjustments. This includes tracking things like revenue, profits, customer
satisfaction, and employee satisfaction.
Managing change quickly and effectively can help organizations avoid any negative impacts
on their productivity or operations after the changes’ implementation.
The change management process ensures that the implementation of changes is working in a
safe and controlled way. It also helps to ensure that the changes are actually beneficial to the
organization and that they don’t have any negative consequences.
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Management changes and its impact on business
1. Improved communication and collaboration between employees:
Enhancing communication and teamwork among staff members is a primary advantage of
change management. By doing so, business can make sure that everyone is on the same
page and pursuing the same objective.
Improved communication can also help to reduce conflict between employees and can
improve team morale.
Collaboration between employees can also lead to new and innovative ideas. This can help
to improve the organization and can help it stay competitive in the market.
2. Increased employee productivity and job satisfaction:
There is a greater chance of productivity and job satisfaction among employees who engage
in the transformation process. Individuals will experience a sense of inclusion and will be
inclined to endorse the change.
Staff members who are not actively participating in the change process could feel excluded
or even oppose the changes. This may result in a decline in output and job satisfaction.
Making ensuring staff members are informed and part of the process is made easier with
the aid of change management.
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Management changes and its impact on business
3. Reduced stress levels and fewer workplace accidents:
Stress levels and the frequency of workplace accidents can both be decreased with the use
of the change management process. This is so that modifications can be done in a regulated
and safe manner thanks to the assistance of change management.
Employees are more likely to be anxious if they believe their employers are forcing them to
alter their work without providing any input or control. Change management allows employees
to have a say in the change process and gives them a sense of ownership. This can help to
reduce stress levels and prevent workplace accidents.
4. Better decision-making due to streamlined processes:
One of the major benefits of change management is that it helps to ensure that changes are
made in a safe and controlled way. This can help to improve decision-making in organizations.
It can lead to confusion if changes are made in an unsystematic manner. This can make it
difficult to make decisions and can cause problems for the organization.
Change management helps to ensure that changes are made in a coordinated way. This can
help to improve communication between employees and can lead to better decision-making.
Streamlined processes can also help to improve decision-making. This is because when
processes are streamlined, everyone may understand what’s going on more easily. This can
reduce confusion and help to ensure that decisions are made in a timely manner.
These benefits help to ensure that the organization runs smoothly during times of change. They
also help to improve employee morale and create a more positive work environment.
A well-managed change process can help an organization thrive during difficult times!
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Management changes and its impact on business
1. Lack of employee engagement:
If employees don’t feel involved in the change process, they may resist the change. This can
lead to decreased productivity and job satisfaction.
Employees who engage in change are more likely to be productive and satisfied with their
jobs. They will feel like they are a part of the change, and they will be more likely to support
it.
Change management helps ensure employees are included in the process and understand what
is happening. This can help to increase employee productivity and job satisfaction.
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Management changes and its impact on business
“Employee engagement and collaboration are primary factors contributing to successful
organizations becoming more important during change implementation”- Change
Management Global Thought Leader.
2. Resistance to change:
One of the challenges of change management is when people don’t want to change. This can
happen when employees don’t feel like they are a part of the change process or when they
don’t understand what is happening.
When people resist change, it can lead to decreased productivity and job satisfaction. It can
also cause problems for the organization. Change management minimizes the chances of
unintentional or incorrect changes, allowing you to ensure that everyone is aware of the
change.
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Management changes and its impact on business
Impact of Change Management
When it comes to a change initiative, the impact refers to how the change will affect the
organisation, its personnel, and its procedures. Impact is the totality of how the project will
change how things are done in the workplace. This could include the organization's and its
stakeholders' possible outcomes, the degree of disturbance, and the process.
Naturally, those in charge of organisational change management work to ensure only positive
effects. The change's impact is, nevertheless, completely unforeseeable. Let's examine the causes
a little more thoroughly.
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Management changes and its impact on business
How Impact is Different from Outcomes
There are parallels between the notions of "impact" and outcomes, KPIs, and change
management measurements. The effect, though, is far more than the sum of these parts.
When a project first begins, its leaders create KPIs. They ought to have a restricted
emphasis in general. They highlight the most crucial goals you have for the project. In
contrast, the impact extends beyond the intended results. It includes all aspect of the change
project, including all of the fallout from the intended actions for change.
Some of those effects will be positive. But some of them will be negative – and it may be very
hard to see them coming.
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Management changes and its impact on business
Why is Impact so Difficult to Predict?
Corporate structures are complex, interconnected systems. Employees running them have
personal relationships to the companies they work for. Although these are unavoidable,
they make it challenging to forecast the effects of a single change initiative.
Change has a deep effect on people in an organization. Employees often have a strong feeling
of personal identity in their work – at whatever level of their business. Even small changes can
create a major hit on employee morale. We can call this “resistance to change.” But the reality
is we are dealing with very human emotions. And as we all know, feelings do not always
behave rationally or logically.
In terms of the organization itself, the system’s complexity makes it harder to predict impact.
For example, implementing a new ERP sounds easy – until you consider that every department
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Management changes and its impact on business
tracks its processes using a completely different set of legacy systems. Alternatively, a cultural
change is impossible when different staff groups have widely different values.
Finally, the interdependence of business units makes it difficult to see how impact will work.
A change in one small part of the business could have unexpected consequences in another
part. If you don’t understand these knock-on effects, they will come as a surprise further down
the line.
Why Impact of Change Management
If business fail to adapt to the impacts of change, the outcomes of its initiatives can spell big
losses. That might include:
• Lost profits
• Low staff morale
• Higher turnover.
However, if you plan for the impact of change, you can avoid these negative consequences.
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Management changes and its impact on business
How can Change have such a Negative Impact?
For a time, we shall imagine ourselves as regular employees. An important change is being
made by their employee. The leaders think those adjustments will be positively received.
So why would a single employee be concerned?
As we’ve said, when dealing with employees, we cannot think rationally. Researchers have
found that responses to change can include:
• Shock
• Denial
• Powerlessness
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Management changes and its impact on business
• Frustration
• loss of self-esteem
• alienation
• emptiness
• feelings of insecurity
In any situation, human responses are difficult to make plans for. But they are all potential
impacts of your project and quite aside from the human aspect of change management, every
project might have implementation issues and unintended consequences that lead to
completely unpredictable outcomes. Technical difficulties, unexpected costs, and problems
with training can all send a change initiative spiraling into the abyss.
How Plan for the Impact of Change Projects
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Management changes and its impact on business
So, some negative consequences will almost certainly come from your change project. What
can you do to mitigate them?
In this section, we’ll discuss a few ways to plan effectively for the best project outcomes.
1. Evaluate the Full System:
As far as possible, you must do an impact analysis considering every part of the organization.
This is much easier said than done.
Fortunately, one of several models can help you achieve this.
• ProSci’s model identifies ten areas that the change can impact. These are processes,
systems, tools, job roles, critical behaviors, attitudes/beliefs, reporting structure,
performance reviews, location, and compensation. This wide-ranging checklist will
make it much easier to predict problem areas.
• A simpler model is Leavitt’s Diamond. In this framework, leaders consider how a
change in one business unit can impact people, tasks, structure, and technology.
• Alternatively, there are several models for change management that will help to plan
for unpredictable events. Guiding your change management project with ProSci’s
ADKAR, the McKinsey 7Ss, or Kotter’s 8-step model will help you consider the impact
in many different areas of your company.
2. Plan for suspicion, hope for trust:
A 2020 report from Gartner showed that “Employees who report high trust have an average
capacity for change that is 2.6 times greater than those with low trust.” The implication is
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Management changes and its impact on business
simple. To improve all aspects of your employee’s experience of change, trust is one of your
most valuable assets.
Some of the strategies should be obvious to experienced leaders. Transparency, clear
communication, and involvement of staff will go a long way.
But just remember that the psychological impact of change can run extremely deep. As such,
your managers show empathy towards all employees. They must be ready to be understanding
and sympathetic, even if they will not compromise.
Building trust will come naturally to some leaders. To others, it will be a major challenge.
Make sure your whole leadership hierarchy is fully prepared for this challenge.
3. Phasing and chunking:
In a major change project, you don’t need to implement every change simultaneously. That’s
why a phased change program can be a critical strategy for mitigating negative impacts.
From the perspective of organizational change, the incremental approach has several benefits.
Minor changes only cause small disruptions – the unpredictable impacts can be handled one at
a time before moving on to the next stage. Each phase can teach valuable lessons about the
impact of the change process.
As a result, smaller efforts are easier to achieve and provide a fruitful learning curve.
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Management changes and its impact on business
4. Make Difficult Decisions As Soon as Possible:
Let’s face it: not everyone will make the cut in some change projects.
You might be looking to cut a big chunk of staff. Or perhaps your leadership team will need
some new faces.
Don’t waste time. Bring the decision-making process forward – and get the tough choices
sorted. That will make it easier to address changes with the remaining staff.
A Manager’s Role in Organizational Change
In change management, a manager’s duty is to assist with the safe and controlled introduction
of changes. The manager makes sure that all necessary changes are made and that employees
are involved.
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Management changes and its impact on business
Managers should also be sure to communicate with employees about changes and to provide
support during times of change. Change can be difficult, but with the right support, it can be
managed successfully.
A change manager is responsible for pushing change initiatives, setting change objectives, and
measuring achievements.
But a change manager’s role doesn’t stop there. They are also responsible for developing
change plans, which detail how the change will be implemented. The change management plan
should include timelines, budgets, and resources needed.
The change manager ensures that the change management plan is followed and that the
objectives are met. They will also need to communicate with stakeholders throughout the
process to ensure that everyone is on board with the changes.
Change managers need to have strong organizational skills and be able to think on their feet.
They must be able to adapt to changes as they happen and be able to make quick decisions.
While change management can be challenging, it is a very important role in any organization.
Change management professionals may help increase employee productivity and job
satisfaction by continually monitoring and implementing improvements. They can also help to
prevent problems for the organization. Change management is essential for any organization
that wants to thrive during times of change!
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Management changes and its impact on business
Developing Skills Need to Manage for Change
There are three steps in changing so that it can change the organization:
1. Understand your own reactions to change:
2. Get rid of your assumptions about change:
3. Create a change management plan:
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Management changes and its impact on business
When is change management needed?
When a change in an organisation has the potential to cause confusion, interruption, or
resistance, organisational change management becomes necessary. A faulty business plan,
changed corporate leadership (due to a merger or purchase, for example), the company's
inability to continue succeeding, and many other reasons may necessitate organisational
change management.
In other words, change management is necessary if the change appears to create confusion,
disruption, and/or resistance among employees.
Organizational change may occur deliberately because it’s required to evolve with changes
in the external environment; as a result, organizational change may take place gradually as
part of an overall process of evolution because it’s accomplished according to
predetermined objectives and goals that describe how organizational change will occur
within designated time frames with specific results achieved through change.
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Management changes and its impact on business
Organizational change management is the process of planning, implementing, and
monitoring changes in organizations. It helps ensure that changes are made in a controlled
and coordinated manner.
When organizational change management is needed, there are a few key steps that should
be taken in order to ensure successful change:
• Properly communicate the change to all employees
• Train employees on the new processes or procedures
• Create a plan for implementing the change
• Monitor the progress of the change implementation
• Adjust.
Conclusion
For any organisation to succeed, change management is essential. An organisation can
achieve its goals with fewer disruptions when changes are implemented in a coordinated
manner, which is made possible by having a plan. Employee participation in the process
may increase as a result.
The goal of change management in this situation is to help employees understand why the
changes are happening and to ensure that they can adapt as quickly as possible. This will
help them feel more comfortable with the changes and make the transition easier. Change
management will also help to ensure that the company remains productive and profitable
during this time of change.
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Management changes and its impact on business
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