New business owners are rightfully proud of the changes they bring to the market, so they readily admit that change is good. Yet these same entrepreneurs often quickly get set in their ways, and find themselves resisting changes to their own business, and begin to fear further customer change in their domain. Change is no longer seen as an opportunity, but as a big risk and cost.
I know we all hate risk, but I’m a big believer in the old adage – “No risk, no reward!” The challenge in business is manage risk, or take calculated risks, rather than blindly step into every risky unknown. One of the key ways I have found to calculate the business risk of a change, is to look for an alignment of interests across the range of constituents required for success.
The constituents of every business success go far beyond customers – they include employees, partners, investors, vendors, and may even include competitors. Every change requires an alignment check, and probable realignment, of some of these forces. For you as a business person leading the charge, I recommend the following principles for managing alignment:
Proactively make change happen, rather than react. You can’t win by always being in recovery mode. With the speed of change today, you need to develop a culture that loves change, build the ability to quickly realign into your organization, and reward members of the team who come up with ideas, and are instrumental in making them happen.
Regularly update and re-publish your vision and direction. On a quarterly basis, you need to re-assess your original vision, to make sure it is consistent with new realities. If the world is changing direction, you need to realign your thinking. Just as importantly, you have to bring all constituents along, or the business will be fragmented and left behind.
Review all business components for every re-alignment. Too many businesses handle change on a piecemeal basis – maybe they update the product, but don’t look at the revenue model, or the selling process. Nearly half of small businesses today still don’t have a website, despite a majority of people looking there for search, sale, and support.
Every change requires extra communication to constituents. It’s twice as hard to change an image in someone’s mind than it was to get the image there is the first place. That means all realignments require over-communication, in multiple medias – video, voice, documents, and actions. Don’t assume a simple press release will be enough.
The fastest way to change a business is to bring in new blood. Most successful business owners have learned that you usually need to seed change and realignment with new people. Even with good people, there is an existing team member confirmation bias that works against change. You always need to look for new skills and experience.
Plan to replace some tools and processes. It’s a bad strategy to assume that all existing processes and systems must be updated, rather than replaced to accommodate a market change. In reality, the costs in maintenance and usability are very high to do things the old way as well as the new. Always evaluate new tools and new systems.
Pick metrics to measure change implementation and results. Plan ahead to measure the results you expect from the realignment, as well as the extent of the change process. You will always hear the negatives and problems during a change, which can easily hide any positive results, or how near you are to success in the process.
Even with all the right planning and flexible systems, it takes the right people to make change happen – starting at the top. Consider what Steve Jobs had to do to change Apple from a computer company to consumer electronics, or how Howard Schultz changed all the rules of selling coffee with Starbucks. Every aspect of these business had to be realigned.
As much as change is good for new businesses, it is absolutely required for the long-term survival of existing businesses. Witness what resistance to change did for Blockbuster Video and Kodak. Also, real change takes more than the one person at the top – it takes the engagement of all team members internally, as well as external constituents. Are all your stars aligned for change?
*** First published on Inc.com on 01/24/2017 ***