Last year (March 2008) the Journal of International Business & Economicspublished a study by Phapruke Ussahawanitchakit and Chaiyot Sumritsakun on the effect of Organizational Change (OC) on employees’ stress and performance. Among other findings, they reported:
- OC results in higher psychological stress (employees feeling psychologically and emotionally drained due to pressure during the organizational change).
- OC leads to lower job performance due to stress.
- Moreover, neither “organizational communication and support moderate the relationships” between organizational change, psychological stress, and job performance.
The implications are significant for a number of reasons.
- Historically organizations have relied on the hammer approach to organizational change, forcing change regardless of the human capital cost. Sadly, this recession has given many organizations the leverage to do this with seeming impunity because jobs are scarce.
- Many organizations either ignore or minimize the extent to which OC initiatives impact human performance.
- Even in ‘enlightened’ organizations, many change leaders find great comfort in traditional communications plans that are more based on what I call information broadcasting rather than real dialog.
The challenge remains: for organizations to survive and thrive in an increasingly global and interconnected economy where barriers to entry have been flattened as Tom Friedman suggests in The World Is Flat
, they must change. But change requires both change muscle and ability (not just brute force), something many companies either have neglected or think it’s unnecessary. Change muscle and ability is something that can be developed the way we develop any other muscle, through exercise and effective use of it.
The reality is that once the economy begins to stabilize (and many indicators seem to be pointing in that direction), the hammer approach to organizational change will not do. All things being equal, companies that can successfully introduce and implement organizational change will have a significant competitive advantage over those who don’t.
So (you may ask), I know this…what does one do about it?
First, develop a sense of urgency as to the effect of OC on individual and organizational performance is necessary. Whenever you introduce change, you can expect to see a decrease in performance and an increase in the level of effort required to produce the same or lesser output. This hits the bottom line squarely! Problem is..financial statements usually don’t account for this drain but it is real!
Second, once the urgency of attending to the need to address OC more effectively is clear and evident in the minds and hearts of key leaders in the organization (and this is half the battle…recognition isn’t enough, there’s got to be urgency), organizations are more ready to devote the time, attention, and resources required. Beyond a good communications plan, involve people as much as possible. People don’t resist change…people resist being changed!
Lastly, develop razor sharp strategies that do the following:
- Build awareness and understanding of what the change is, why, how, who, when, etc.
- Create acceptance of the change.
- Foster individual conviction and belief in the change.
- Enable and reinforce the desired behaviors.