How to keep employees onside during business transformations

Strategic decision-makers devote much attention to planning new business models, processes and systems, but they must never forget that employees have the power to make or break a transformation

The phrase ‘people are our most important asset’ has been trotted out for decades in the corporate world, even though they have yet to feature on a balance sheet. But, like any cliché, there is some truth behind it. If a firm can’t win its employees’ minds (if not their hearts), it’s unlikely to succeed, particularly when attempting fundamental changes.

It’s vital for any organisation seeking to transform its business to ensure that its people comprehend its strategy and know how to turn that into action, stresses Adaora Geiger, a partner at the Maitland/AMO consultancy. 

Business leaders must explain the rationale for change “in a way that’s clear and accessible”, she advises, noting that their language can be heavy on jargon. Using words such as ‘leveraging’, ‘synergistic’ and ‘pivot’ can be alienating to anyone who isn’t fond of management-speak, which makes it harder for leaders to ‘gain employee buy-in’. One of the more meaningful pieces of corporate-ese, this means winning enough support for, and commitment to, the planned changes among people at all levels of the organisation.

“It’s important to communicate the strategy in a way that crystallises value beyond the shareholders’ perspective,” Geiger says. “Employees want to understand what’s in it for them. Why should they want to be part of this change, especially if it comes with a certain level of uncertainty and discomfort?”

If they are to buy into the transformation, they have to be convinced that it’s crucial to their organisation’s continued success, says Emma Loizidis, head of people at B2B marketing firm Fox Agency. She adds that, while it isn’t necessary for everyone to agree with everything in the plan, the whole process must be managed with empathy and transparency, rewarding people’s acceptance. This can lead to improvements in motivation, loyalty and team cohesion, ultimately resulting in better performance.

Like Geiger, she stresses the importance of clear messaging, but notes that communication must also be a two-way process that “should, ideally, begin during the planning stage. It’s important to talk with people rather than at people. This will allow them to feel part of the change, engendering respect and support from the outset.” 

Loizidis continues: “Employees will have many concerns about issues such as a potential increase in workload, a loss of control or a change of culture, so effective communication really is key in helping to manage these.”

Another potential problem is a fear of failure, which manifests itself when employees lack confidence in their own adaptability. It’s therefore vital to provide the right tools and training to give them enough scope to develop new skills before any significant changes kick in. This will help to alleviate people’s fears and increase the level of buy-in.

Any transformation must account for the company’s culture, or it could fail on kick-off

Unsurprisingly, the HR department has a central role to play in business transformations. Giorgia Prestento, an independent consultant specialising in change management, observes that HR needs to have developed a deep understanding of the organisation’s culture. 

“Any transformation must account for the company’s culture, or it could fail on kick-off. A change that conflicts with the culture simply won’t work,” Prestento warns. “The challenge for the HR team, therefore, is to assess the likely impact of the change on the organisation and work with the C suite to adjust the scope of the change and how it’s to be implemented, if that’s required.” 

She adds: “In my experience, HR isn’t really involved in transformations at the grass-roots level, but it does play an important role in setting the tone and strategic direction. The C-level decision-makers have a larger role to play here. The problem is that they often forget to focus on the employee experience when planning a transformation. They tend to prioritise implementing new systems, streamlining operations, cutting costs and so on. They don’t consider employee buy-in until too late in the programme, which can create resistance.”

Sophie Austin, HR partner at accountancy firm Monahans, suggests that HR chiefs should school their C-suite colleagues on why buy-in is crucial by designing a business case that illustrates how neglecting to engage employees in the process could lead to failure. 

Once the importance of gaining buy-in has been demonstrated, the next step is to create a structure that enables the desired changes, and, again, to communicate effectively. 

“It’s important to send a unified message across management. HR may need to liaise with the firm’s communications specialists to implement this,” Austin says. “You will win engagement by being clear – about what you’re trying to achieve, what scope there is for employees to give feedback and what they have to gain from the process.”

Keep track of buy-in levels by seeking people’s views on the transformation through user-friendly pulse surveys and focus groups, she suggests. Also look at some of the company’s key performance indicators to get an idea of how things are going.

Austin recommends looking at trends in staff turnover, absence rates and the number of grievance cases, as well as the firm’s financial performance. “From there, you can gauge whether your strategy is delivering what it set out to do or adjustments need to be made.”

Zara Whysall, research and impact director at management consultancy Kiddy & Partners, offers a caveat to those seeking feedback from employees. They would do well to heed the words of David Ogilvy, the advertising tycoon who once said of consumers: “People don’t always think how they feel. They don’t say what they think and they don’t do what they say.” 

Whysall stresses that it’s “important to observe people’s actual behaviour. Are they operating in ways that are consistent with the direction of travel? Is their behaviour taking you towards or away from the desired transformation state?”

Lastly, remember that new beginnings often require an ending to occur first, advises Beth Pope, founder of brand consultancy Firehaus. She explains that, as soon as change starts, the organisation will enter a transitional phase known as the neutral zone. 

During this period, “people will need time to disengage from existing ways of thinking and behaving, so that they can reorient themselves”, Pope says. “If the organisation handles this in the right way – by acknowledging its existence and providing ‘guard rails’ – this can be a positive period of opportunity and creativity. As people wrestle with new ways of doing things, they make them their own. That’s where the secret to a true transformation lies.”