Managers at many of the world’s big companies must feel as if they are trying to control an oil tanker in the midst of a massive storm at the moment – as soon as they’ve negotiated one wave, along comes a squall or an even bigger wave requiring yet another course correction.
Not only is the global economy – and so global consumption – only spluttering along, leading to uncertain revenues and panicky shareholders, but managers must also deal with stubbornly high costs (73% of finance leaders said they were under pressure to reduce the growth of general and administrative costs in a recent CEB survey), and the worrying fact that new technology and an ever more globalized business environment mean almost unknown competitors can enter an industry and experiment with new products far more quickly than before.
All of this means one thing for big incumbent companies: change. In the past three years, for example, the typical big firm has taken on five large company-wide change projects. These are intentionally planned changes that affect significant parts of the company, and include things like M&A, a change to the corporate culture and all that that entails, change leadership, or organizational restructuring.
Lots of Change Management, Not Much Change
But even though a company may undertake a big change initiative, almost three-quarters of employees don’t actually change how they work, according to CEB data. This generally means that despite good intentions, the change initiative tends to fail. In fact, two-thirds of the big structural changes that CEB reviewed recently ended in failure and led to losses in revenue, productivity, and competitiveness.
Most management teams try deploy detailed plans for their change initiative to help employees understand what they need to do and whether they’re succeeding in doing it. Managers may base these plans on change management principals found in methods such as Kotter’s Eight-Step Process for Leading Change or Prosci’s ADKAR Model.
But regardless of what change model a company uses, all these approaches have one thing in common: they lead employees through change from the top down. Leaders choose this type of top down change management in the hope that it produce consistent, scalable, efficient, and fast results. But in reality top-down change strategies derail changes in three ways.
First, when leaders make all the big decisions in isolation it creates a workforce that waits to be told what to do; second, “leader-owned” implementation plans create a workforce that wastes time pursuing the wrong activities; and, third, companies’ top-down communication campaigns create a workforce that wrecks the change because they resist what they are being asked to do.
Taking a Wikipedia Approach
Work today is different than it was even five years ago, let alone 10, and so companies’ change strategies should be too. Rather than lead change from the top down, managers should think about using “open source” strategies that offer a more inclusive and participative way to work.
Perhaps, the most well-known example of an open source approach is Wikipedia. Its free internet encyclopedia uses members of the public to provide information and facts that are then shared back to the public. If managers apply these principles, and those of other open source products (such as Linux) to change management, they arrive at open source change where they draw on their own workforce to plan and implement change.
Specifically, open source change is defined by three components: a co-created change strategy; employee ownership of change implementation plans; and communications that “ask and talk” instead of “sell and tell”.
Open source change will help managers make the right changes, faster. Ongoing CEB research shows that open source change instead of top down change strategies are likely to double the probability of change success and speed up the implementation of change at your organization.