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How Do We Manage Strategic Change?
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Let’s first define Strategic Change.
A restructuring of an organization’s business or marketing plan that is typically performed in order to achieve an important objective. For example, a strategic change might include shifts in a corporation’s policies, target market, mission or organizational structure. — BusinessDictionary
There’s no doubt that Strategic Change–or any change of such magnitude and impact on an organization–is difficult. To successfully execute such a change initiative, we need to understand the Dimensions of Strategic Change, as identified by Andrew Pettigrew and Richard Whipp. There are 3 such dimensions:
- Content of Change – Objectives, purpose, and goals of the strategy.
- Process of Change – Implementation of the strategy.
- Context of Change – The internal (e.g. management decisions) and external (e.g. competition) environment, in which the strategy operates.
Among these 3 change dimensions, there is continuous interaction. The 3 dimensions are also interdependent with each other. For instance, Context and Process define the Content of change.
This model proposes change should not be considered only in terms of the processes, but should also consider the historical, cultural, and political features of the organization. In fact, successful change is a result of the interaction between the content or “what” of change; the process or “how” of change; and the organizational context or “where” of change.
Let’s delve a bit deeper into these dimensions.
Content of Change
As mentioned, this focuses on objectives, purposes, and goals of the strategy. Change as Content looks at organizational parameters before and after an event in the life of the organization. Here, we try to understand what the possible antecedents and consequences of the change could have been.
Process of Change
Change as Process is concerned with understanding the actual change as it unfolds, including the role of the manager as a change agent. It refers to the way the change in content occurs–e.g. the speed, sequence of activities, decision-making and communication systems deployed, and the resistance encountered. The key question here is: How do we create the benefits?
Context of Change
The Context of Change is the situation surrounding the organization–the playing field from where the forces of change emanate and where the change is accomplished. “Outer context” refers to the political, economic, social, technological, regulatory and competitive environment where the firm operates. “Inner context,” on the other hand, refers to the internal environment of the firm–its corporate culture, structure, formal and informal processes, political context, and power centers.
This Dimensions of Strategic Change framework is useful for understanding complexities of organizational change–even for smaller and ordinary levels of change.
Also, as identified in this model, there are 5 Central Interrelated Factors that allow for successfully managing strategic change:
- Environment Assessment
- Human Resources as Assets and Liabilities
- Linking Strategic and Operational Change
- Leading Change
You can learn more about the 5 factors and download an editable PowerPoint about the the Dimensions of Strategic Change here on the Flevy documents marketplace.
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"The only constant in life is change." – Heraclitus
Such is true for life, as it is for business. The entire ecosystem our organization operates in—our customers, competitors, suppliers, partners, the company itself, etc.—is constantly changing and evolving. Change can be driven by emerging technology, regulation, leadership change, crisis, changing consumer behavior, new business entrants, M&A activity, organizational restructuring, and so forth.
Thus, the understanding of, dealing with, and mastery of the Change Management process is one of the most critical capabilities for our organization to develop. Excellence in Change Management should be viewed as a source of Competitive Advantage.
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About David TangDavid Tang is an entrepreneur and management consultant. His current focus is Flevy, the marketplace for business best practices (e.g. frameworks & methodologies, presentation templates, financial models). Prior to Flevy, David worked as a management consultant for 8 years. His consulting experience spans corporate strategy, marketing, operations, change management, and IT; both domestic and international (EMEA + APAC). Industries served include Media & Entertainment, Telecommunications, Consumer Products/Retail, High-Tech, Life Sciences, and Business Services. You can connect with David here on LinkedIn.
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