The unbearable difficulty of change

70% of organizational changes fail. Have you ever been a part of something like this? Based on your own experience, what have been the reasons for failure?

Changes are always on the one hand unique, on the other hand they have the same legalities. Change, transformation, renewal is currently topical in almost every organization and thus also for our clients. We aim to provide our clients with a few frameworks and practical models to help them navigate the change. One of our favorite frameworks is The Three Levels of Change. A framework that we have felt has helped many of our clients structure their thinking and lead change more effectively.

The 1st level of the change is the subject matter level and it answers questions such as Why, what and how. In addition to the vision for change and the implementation plan, it includes a lot of things like re-designing operating methods and processes. Here alone, the hands and the table are often full, and because of this, the management's focus in the change is often largely on this. After all, this is also the level at which metrics are set and monitored. Here, however, it is perhaps forgotten that the other two levels of change have a significant impact on whether progress is made in the change and whether the metrics and targeted benefits are achieved.

The 2nd level of the change is the emotional level. Change inevitably creates emotions. If this were not the case, this would mean that the organization is paralyzed, numb. There is a lot of energy in emotions, and if directed correctly, they can be used for enormous leverage. Feelings are often, however, not given enough attention during change, and they may be interpreted as resistance to change, which in turn may create a backlash in management. However, there is a great deal of wisdom in emotions. They tell about the connections between the heart and the mind, which should be studied more closely with curiosity. What do emotions tell us, what could we learn from them, what should we consider from their message? Management's feelings may also be overridden. Change is often a difficult phase, where the management can feel that they are between two layers and under too much work. The change, its reasons and goals are not necessarily clear to all management members either. Not to mention in a situation where the management itself would not have wanted the change in question, e.g. a business acquisition or merger of business operations. When it comes to management, it is too often thought that they should just commit to leading the change to the finish line and put their own feelings aside. Humans just don't work that way. A person cannot just put his feelings aside, but must face them in order to move on.

The 3rd level of change, the identity level is the level where we have a huge potential to be more successful in changes. This level is often the so-called deal breaker and at the same time a level that is ignored in leading change, apparently since a lack of understanding. Identity reflects what we are and want to be from our deepest essence . What we are as a company, what we represent as individuals, what we want to be promoting. In M&A situations, the identity of the company being acquired can be very different from that of the buying company. Within the company, the identities of the different businesses can also be different, and if you try to merge these two businesses together, it will not succeed if you are not ready to work on the identity level. In business acquisitions, this is often clearly visible if the identity of the company to be bought is very different from that of the buyer. Friends in hoodies do not become men/women in suits overnight and vice versa. If the change is not handled at the identity level, there is a high risk that the business benefits of the acquisition will not be achieved.

Too often in business acquisition situations, integration is only done on a technical, matter-of-fact level. A focus on the emotional and identity level would ensure the desired business benefits, people's commitment and a good employee experience. This requires time, courage and going into your own comfort zone. The reward promises growth as a person, shared joy and successful changes. Are you ready for a dance?

If you liked to discuss further, pls, do not hesitate to contact us, netco@netco.fi or give a call +358 40 730 4909, Sini Lindholm, Founder of Netco Advisors.