Is everyone ready for investment?

Change Management

Investment in a business can be hugely positive. It can also drive significant change. It is easy when facing into organisational change to say ‘be as prepared as you can be’ but what do we actually mean when we say that?

News can be old and new… depending on the audience

 

The first thing to remember is that team members are just catching up with the news of the investment and impending changes. 

 

Executive Team members have been on the journey for a while by the time any changes are announced to the wider business. They know what needs to change to support the desired growth. They may already have an idea of what the structure for the future business looks like. They are also excited about what lies ahead. However, what is now familiar to the Executive Team is new to everyone else. As we said at the start of this article, investment can be hugely positive for a business but individuals will react differently and will display the full range of emotions - excitement, surprise, curiosity, concern or fear. There is significant potential for negative emotions to take hold if team members are not engaged and supported. 

 

Change of this scale isn’t comfortable and creates a lot of uncertainty. The less prepared you are, the more uncertain people will feel and the greater the risk that the desired value will be eroded. Not a great result for anyone.

 

Take time to prepare

 

 

 

Humans have a natural tendency to jump into solution mode. We want to ‘fix’ a problem or remove a challenge or stop the pain. This is great but it can be very unhelpful when managing change. When the challenges are more complex, we need to take a breath and consciously stop ourselves to ensure that we are prepared. As former US President Abraham Lincoln said, “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” 

 

 

 

 

 

We need to prepare team members for the changes that lie ahead. This involves ensuring regular communication and building their capabilities and confidence while providing supportive management and leadership. 

Assessing change readiness

 

It is easy to say ‘be as prepared as you can be’’, but it is essential to clarify what this truly means in the context of organisational change. Let’s explore this further. 

 

We hear PE investors talk a lot about due diligence and the power that it has in determining whether a business is a good investment or not. The areas explored often include leadership & management, commercials, technical capabilities and technology & digital.  

 

Rarely (and please correct us if your experience is different), do we hear them talk about doing due diligence on change readiness within a business.

Change readiness encompasses many aspects including assessment of:

The focus on customers & markets

Does the company have a strong focus on its customers and markets? Does it act swiftly in response to market shifts?

Structure & ways of working

Is the business agile enough to adapt to new ways of working? Does the People function have the capacity and capability to support change? If there is a buy & build strategy planned, is there integration capability identified & senior level sponsorship primed?

Operations capabilities

Is there capacity & capability to drive service, process and digital changes whilst delivering business-as-usual and maintaining a strong focus on customers?

Change agents

Do you have people who have experience of leading change programmes? Is there a clearly articulated plan to monitor and realise benefits (revenue growth, cost down/out)? Is there a change framework in place?

Technology & digital adoption

The actual technical solutions will be covered in the technical DD. Change readiness explores whether you have the capabilities to adopt the new solutions and make the necessary changes to structure, processes and capabilities.

Effective communications

Is there communications & engagement expertise available to support the changes? Is there evidence of good execution of communications in the past?

Cultural alignment

Is there an understanding of the impact on culture of aggressive growth activity?

Ensuring you realise the benefits

 

Investment is probably the biggest and most challenging change programme a company will face into. It is fast-paced, significant in terms of its impact on all aspects of a company’s operation and relentless in its pursuit of benefits. In essence, team members will be running hard and fast for a long time. The best chance of success is to ensure everyone is prepared for that. The benefits of assessing readiness for change (and acting on the assessment) far outweigh the cost of undertaking the assessment.  

 

 

Change readiness and preparation is essential if you want to ensure…

 

  • that you retain and grow revenue because the business has the capacity and capability to remain focused on its customers whilst also adopting and adapting to changes 

 

  • you minimise duplication of effort and support efficient & effective decision-making because you have good people with the right capabilities and they are empowered in the right organisational structure 

 

  • you have the experience to deliver the changes you need to – on time, to budget and with minimal negative impact on the business 

 

  • you keep team members engaged and energised by communicating regularly 

 

  •  that you manage the unintended consequences on culture.  As we have said many times in our articles, investment demands change and change creates uncertainty.  If not managed, uncertainty can erode value and can also negatively impact culture.  The consequences are real because good team members leave, productivity drops, behaviours change and, suddenly, the ‘great place to work’ is known for its toxic culture

 

To the regular readers of our articles, you know we love a good sporting analogy – Lewis Hamilton, Muhammad Ali and now Mark Spitz:

 

 

“If you fail to prepare, you’re prepared to fail.” 

 

Need help or want to share success?

If you are struggling with change delivery or not realising the value from your investment or are absolutely knocking it out the park and just want to boast about it, contact us.