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Research · 2024

Kicking the status quo: locking in change.

Maintaining the status quo is a risky business. Change is how businesses stay in the market, and making it stick is fundamentally a people issue.

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Published 2024 by HR Coach Australasia, the team behind STAR Workplace. Based on STAR Workplace Program data from 910 businesses.

Locking in change is the key to a business's longevity. It's also the hardest thing to do. Why? Because businesses don't make decisions, people do, and people hate change.

People resist change for a mix of psychological, social and practical reasons, and understanding them is the first step to designing change that works: clear communication, training and support to help people through the transition.

Psychological

Fear of the unknown and losing the comfort zone. Change creates anxiety about job security, new responsibilities and the ability to adapt to new systems.

Social

Change disrupts established relationships and hierarchies. People worry about their role, team dynamics and standing, and cling to familiar structures.

Practical

New skills and workflows take time and effort. People fear they won't meet new expectations, or that change will add workload without clear benefits.

  • 1 in 5businesses constantly struggle with implementing change
  • 1 in 4constantly struggle with employees' willingness to adapt to change

From a recent STAR study of 910 Australasian businesses. Change is a business imperative, but creating change is fundamentally a people issue.

High performers handle change 29% better

On average, high-performing businesses recognise, implement and adapt to change 29% more effectively than low performers.

  1. Organisation's ability to adapt to changeHigh 93%Low 67%
  2. Ability to implement new ideasHigh 94%Low 60%
  3. Getting employees to volunteer new ideas or improvementsHigh 89%Low 64%
  4. Employees' willingness to adapt to changeHigh 86%Low 56%

Why do high performers adapt more effectively?

For high performers, change is a continual process, not just an end result. Their formal and informal communication is valued by every employee, and they actively communicate how the business is performing and where it's heading.

  1. Knowing how the business is performing and its future directionHigh 78%Low 63%
  2. Efficient and effective change, planning and decision-making processesHigh 75%Low 60%
  3. Formal communication processHigh 77%Low 63%

Trust is the foundation of change

Trust is crucial to change for several reasons:

Reduces resistance

People who trust their leaders are more open to new initiatives and less fearful of change.

Enhances communication

People share concerns, feedback and ideas when they trust their input will be valued, which surfaces problems early.

Builds commitment

When people trust the change is in the business's and their own best interest, they invest the effort to make it work.

Encourages collaboration

Teams support each other, share knowledge and cooperate, which is vital during change.

Improves morale

Change is stressful, but trust keeps people motivated and positive through the transition.

Facilitates adaptation

People who believe in the vision adapt faster and are more willing to learn new skills and behaviours.

Strengthens leadership

Trusted leaders inspire confidence, give clear direction and provide the support people need.

By building trust, you create an environment where change initiatives are far more likely to succeed.

Building your change process

Eight steps to make change stick

Understanding the stages of change, and the pitfalls unique to each, boosts your chances of a successful transformation. This process follows John Kotter's eight-step model of leading change.

1

Establish a sense of urgency

Successful change starts when people look hard at the business's competitive position, market, technology trends and financial performance, then communicate it broadly and dramatically, especially around a crisis, a potential crisis or a timely opportunity. Without motivation, people won't help and the effort goes nowhere.

This step sounds easy. It isn't. Kotter found more than half of change efforts fail here: managers underestimate how hard it is to move people out of their comfort zones, overestimate how much urgency they've already created, or lose patience. Many become paralysed by the downside: defensive senior staff, falling morale, short-term results, or being blamed for creating a crisis.

Key actions

  • Examine market and competitive realities for potential crises and untapped opportunities.
  • Convince at least 75% of your managers that the status quo is more dangerous than the unknown.

Risks

  • Underestimating how hard it is to move people out of their comfort zones.
  • Becoming paralysed by risk.
2

Form a powerful stakeholder group

Major change often starts with one or two people. In successful transformations the group grows over time, but if a minimum critical mass isn't reached early, nothing worthwhile happens. It doesn't need the whole senior team, but it does need power: titles, information, expertise, reputation and relationships.

Key actions

  • Assemble a group with shared commitment and enough power to lead the change.
  • Encourage them to work as a team outside the normal hierarchy.

Risks

  • No prior experience of teamwork at the top.
  • Handing leadership to an HR, quality or strategic-planning manager rather than a senior line manager.
3

Create a vision

Change should be driven by the ideal outcome, not by fear. The vision is where the business wants to go, designed by the stakeholder group. Without a sensible vision, change dissolves into a list of confusing, incompatible projects that lead the wrong way, or nowhere.

Key actions

  • Create a vision to direct the change effort.
  • Develop strategies for realising it.

Risks

  • A vision too complicated or vague to explain in five minutes.
4

Communicate the vision

Change is impossible without people willing to help, sometimes with short-term sacrifices. They won't make them, even if they're unhappy with the status quo, unless they believe useful change is possible. That takes more than a company email: interpersonal communication captures hearts and minds, and businesses that weave the current situation and future direction into everyday messaging see the benefits.

Key actions

  • Use every vehicle possible to communicate the vision and the strategies to achieve it.
  • Teach new behaviours by the example of the guiding group.

Risks

  • Under-communicating the vision.
  • Behaving in ways at odds with the vision.
5

Empower others to act on the vision

As change progresses, successful projects involve a growing share of employees and embolden them to try new approaches, develop new ideas and lead, as long as it aligns with the vision.

Key actions

  • Remove or alter systems and structures that undermine the vision.
  • Encourage risk-taking and non-traditional ideas and actions.

Risks

  • Failing to remove powerful individuals who resist the change.
6

Plan for and create short-term wins

Change takes time and can fail without momentum. Most people won't lean in if they can't see at least some positive measure within the first three months. Identify metrics that capture early successes, and reward the people who achieve them.

Key actions

  • Define and engineer visible performance improvements.
  • Recognise and reward the people contributing to them.

Risks

  • Leaving short-term successes to chance.
  • Failing to score successes early enough.
7

Consolidate improvements and produce more change

Celebrate wins, but declaring the war won after one victory can be catastrophic. Until change sinks into the culture, you can throw away all your momentum. High performers use early wins as credibility to tackle bigger problems, going after systems and structures that don't fit the vision.

Key actions

  • Use the credibility from early wins to change systems, structures and policies that undermine the vision.
  • Hire, promote and develop people who can implement the vision.
  • Reinvigorate the process with new projects and change agents.

Risks

  • Declaring victory with the first performance improvement.
  • Letting resisters convince the team the job is done.
8

Institutionalise new approaches

Change sticks when it becomes 'the way we do things around here'. Until new behaviours are rooted in social norms and shared values, they degrade as soon as the pressure is off. Two things matter most: consciously showing people how the change has improved performance, and making sure future leaders personify the new approach.

Key actions

  • Spell out the connection between new behaviours and business success.
  • Create leadership development and succession plans consistent with the new approach.

Risks

  • Not creating new social norms and shared values consistent with the change.
  • Promoting people who don't personify the new approach.

Source: the eight steps follow John P. Kotter, Leading Change (Harvard Business School Press, 1996).

Self-assessment

How is your business positioned for change?

A business that's open to change, with people who can make it work, may be what separates you from your competitors. Rate your business on each item.

1The level of trust in the business
2The business's ability to adapt to change
3The business's ability to implement new ideas
4Employees' willingness to volunteer new ideas
5Employees' willingness to adapt to change

Answer all five to see your score.

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Find out how ready your people are for change.

STAR measures trust, adaptability and willingness to change anonymously, benchmarked against Australasian businesses.

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