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7 Key Components of a Change Management Strategy

7 Key Components of a Change Management Strategy

UPDATEDJun 27, 2023

Change can be intimidating for any business. Whether it’s at a professional services organization that has done things a certain way for decades or at a new startup business that’s still figuring out what works well for their nascent teams, changing processes, technology, company structure, methods of communication, and more can be intimidating and confusing. This is where change management comes into play.

Change management is the method through which a business defines and implements a change in how they work. However, successful change management strategies need a well-defined structure so the full scope of change can be determined, executed, and evaluated once it’s in place. Here are 7 key components for any change management strategy.

1. Recording Your Changes

Having a well-maintained system of record that tracks all requested changes, determines the stakeholders behind these changes, and keeps track of their development will help your business understand the changes that have been implemented over the years. Knowing the successes and failures of past changes can improve the changes you undertake in the future.

2. Understanding Reasons Behind Change

Change for change’s sake can quickly cost a company unnecessary funds with little long-term benefit. When a business is considering making a change, devote official meetings and reviews to consider why this change may or may not be necessary and when deploying that change would be most effective for the business. Having an agreed-upon portfolio of analysis criteria to use in change review will help your business make the right decisions.

3. Measuring The Financial Gain

All changes at a company should either be done for the sake of eliminating a factor that is costing unnecessary money or optimizing a potentially profitable factor in order to strengthen financial performance. Every change has financial ramifications, and it’s important to map these out in detail to understand why a change should be adopted – for example, a change in benefits packages for employees may cost more in the short term, but the potential impacts it could have on employee turnover and hiring effectiveness could save the business much more money in the long run. Consider the financial cost of a change and weigh it against the long-term financial benefit that it would be expected to bring to determine if this is the right path forward. If not, either keeping the element in place or finding an alternative change might be the best option.

4. Choosing an Implementation Model

There are 6 major change management models that can be used for implementing new processes, technology, or other necessary changes at a company. These can vary from the highly structured McKinsey 7-S Model to the psychology-focused Kotter’s Change Management Theory. Which one is right for you? Review the possibilities, compare their methodology to how your company works best, and consider what types of change approaches have worked best in the past to make an informed decision.

5. Buying Into Change

Successful change is not forced onto an organization, it’s embraced and adopted, with clear buy-in from all constituents.. While upper management and change stakeholders will be the ones to plan and implement the process, every team member affected by it will need to support the process and conform to the new way of doing business. Without buy-in, resistant resources will revert to old processes, not use new tools correctly, and slow down the pace of change.

6. Bringing Risk Management Into Change Management

Altering or completely replacing a key component of your business will always involve risk, but just how much risk is worth it? And in the event that something goes wrong, how will your business respond? An effective risk management strategy will determine the severity of potential risks, create a regression strategy in the event of a problem, and help guide your change implementation process past potential pitfalls.

7. Evaluating Your Change

A well-done change management process doesn’t mean much unless the change sticks. Having an evaluation process, both during and after implementation, will help your change stakeholders understand if employees are using the new technology, sticking to updated processes, communicating using the proper methods, and adhering to new company structure. Flagging any discrepancies and helping team members stick to the changed methods will play a huge role in making the most of your change.

With these 7 key components of change management in place, your professional services business will find the success that pushed you to change in the first place.

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