A Comprehensive Guide to Organizational Change

What is Organizational Change?

Organizational change refers to any type of change that has a major impact on an organization. This could include a cultural change or a change in equipment, processes, goals, or personnel. This is a broad category that may encompass many types of change that can have significant impacts on an organization.

This is a process that almost every organization goes through from time to time. If the team is adopting new software to streamline productivity, bringing in new team members, adjusting its goals, or even undergoing a huge culture shift, these are all types of organizational change. And since this can be a confusing and hectic time for any organization, it’s crucial to apply proper management of change to reduce the chance of issues and other bumps in the road.

But before managing organizational change, it’s important to fully understand what it is, what can trigger organizational change, and the different types of change that organizations may face.

What Makes It Necessary?

Many things can trigger organizational change and make it necessary to adopt. Most of the time, managers and leaders may not see organizational change coming, which is why it’s important to understand some of the things that trigger organizational change.

That said, it’s impossible to list down all the potential causes of organizational change. As this is a very broad term, many factors can trigger or affect it. Some of the most common things that can force organizational change may include:

• Complete shift’s in an organization’s structure

• New ownership or management taking over

• Adopting new technology 

• Revising certain business processes

• Using new business models and management practices (e.g., Total Quality Management)

Types

There are many types of organizational change since it’s such a broad term. Understanding the types of organizational change makes it easier to determine what change the company is facing and the best approaches to managing and facilitating the changes. Some of the most common types of organizational change include:

People-Centric

As the name suggests, these are changes that have a strong effect on the people and personnel in the company. For example, this could mean adjusting leave policies, which means workers will have to change how they apply for leaves and which types of leave they can apply for. On the flip side, this could also mean bringing in new hires that could have a huge impact on the team.

It’s important to understand that most employees will naturally resist people-centric organizational change. This can be a challenge for managers and is the reason why transparency, clear communication, and empathy are crucial when leading a team through this type of change.

Strategical

These are changes that deal with an organization’s overall strategy. Most of the time, organizations need to adjust their change management strategies to gain a competitive edge, improve efficiency, respond to opportunities and threats, or make it easier to achieve their business goals.

This could mean updating the company’s vision and mission, restructuring, or developing new skills and teams to handle certain tasks.

Structural

Structural changes in an organization can include changing the hierarchy, redistributing responsibilities, changing the chain of command, and any other major changes that can affect the way a company is run. Typically, these changes are caused by both internal and external factors.

Technological

To stay competitive in the market, it’s important for companies to stay updated with technology. Not adopting certain innovations before it’s too late can have drastic consequences. And when adopting new technology or changing the technology that’s currently in place, you’re dealing with a type of organizational change.

For example, many companies are struggling to shift to a digital structure. Asking employees to stop using paper and instead submit outputs digitally is a major organizational change and one of the most common examples of this type of change.

Remedial

These are changes aimed to solve specific problems. These are reactionary changes that only come as a result of an identified issue or problem. 

Most of the time, these changes are tailored specifically to target one issue in the company. This is far from ideal, as remedial change can be sudden and hard to execute. However, for most companies, this is an inevitable change that can happen at a moment’s notice.

Unplanned

Unplanned changes are a result of unforeseen events. A great example of this is how most companies around the world had to change the way they operate due to the COVID-19 pandemic. Other unplanned changes may be caused by natural disasters, societal shifts, and more.

The Manager’s Role in Organizational Change

Managers hold a huge responsibility when implementing organizational change. It’s on the manager to ensure that the entire team understands the changes taking place, why they are happening, and how they can affect the company moving forward. This includes speaking to employees, talking to higher-ups, and overseeing the entire change.

When implementing organizational change, there will be some problems along the way. For example, employees tend to resist changes within an organization. When this happens, the manager’s job is to get the team on board and help them understand why these changes are necessary.

Managing an organization or team in the middle of a change is hard. Doing so requires courage, leadership skills, and high levels of empathy. That way, morale within the company stays high during the change, and fewer issues will get in the way of smooth integration.