What Every Leader Must Understand About Change

Mark Herndon headshot
By Mark Herndon
President, M&A Partners
Nov 23, 2016

(Second in a Series on Change Management)

Early in my career, our firm was engaged to lead the acquisition integration of two dominant and highly competitive peer companies. A significant amount of headcount synergies, facility closures and product rationalization was fundamental to the deal economics. Our announcement-day change and communications plans were prepared, polished and presented without a hitch.

After the major town hall event at the target company site, the executives and project leaders from the “buyer-side” attended a lunch with the senior executive staff of the “seller-side.” I was seated next to the senior vice president of the selling company. This was a highly distinguished executive with an outstanding reputation in the industry. He was brilliant, successful and wealthy. Since most of the acquired company operations staff reported directly to him, this executive had been designated as the principal executive sponsor attached to our integration management office (IMO).

"'There’s no microwave solution and no SWAT team solution to transitioning people or companies through change."

Oh, and one more thing – this guy was completely clueless about change! I’ll never forget what he said at the end of our lunch: “I sure am glad that announcement went so well. Now everyone can just get back to work.” I almost spewed a mouthful of hot coffee right then and there.

Thankfully, that level of change blindness is rare. But the stakes are so high, we have to lay the foundation first before we can get to the really good stuff of how you can be more successful in leading change. So for this second in a series on change management, allow me to provide a quick recap on what every leader must understand about change.

As What Every Leader Must Understand About Change highlights, a couple of key definitions are in order. Change is an event. It is something that is situational and external to us. Something old stops and something different begins.

In major changes, or in situations that are ambiguous, uncertain or potentially threatening (such as M&A integration and related “me issues”), people and organizations by and large don’t respond to a change event as if with a binary “on/off” or “OK/not OK” switch. That’s where the transition part comes in. A transition can be defined as a natural and unavoidable response to a change event. It is a required adaptation – a gradual reorientation. It is both individual and organizational in nature. It takes time, concerted effort and real leadership to get through. As one of my change leadership mentors says, “There’s no microwave solution and no SWAT team solution” to transitioning people or companies through change.

William Bridges is one of the early and still preeminent experts on change. You’ve probably read his books, or if not, you’ve probably heard some of his core principles from one of his many best-sellers, Managing Transitions. As Bridges instructs, every change transition consists of three phases: the ending, losing or letting-go stage; the neutral zone; and the new beginning. Everyone and every organization must go through all three phases. You can’t just pass “Go” and collect $200. Skillful change leadership is about constructively managing and accelerating passage through the neutral zone in a way that mitigates the negative outcomes or risks and optimizes the positive outcomes and results.

Unfortunately, passage through the neutral zone is typically not an easy, straight, linear path. And especially not when confronted with major changes or loss. Each person, team, group and organization tends to take their own, different, and often circuitous path through their version of the neutral zone and arrives at the key milestones of awareness, understanding, acceptance, motivation and behavioral action at an entirely different pace and timing from one another.

That brings us full circle back to Mr. Clueless About Change. In his calculus, change was an event – no transition, planning, training and certainly no change leadership was needed. “So get over it and get back to work, what’s the big deal anyway? If I tell people once, that should be enough; after all, everyone is affected by this the same way, right?" Well, um, no, and I promise I said so respectfully.

Anyway, here’s the final reminder for this week. When you as an executive are communicating about or leading folks through change, always, always, always think about and address the topic from where your respective audience is in their particular change phase, not from where you are in your particular change phase.

Our Senior Vice President that day had been actively involved for weeks in the deal strategy, the transaction, due diligence and negotiations. For him, announcement day was a major culminating event that enabled him to psychologically move on. For everyone else just finding out about the deal and its implications, however, their world just got rocked and their cheese just got moved. Mr. Clueless was speaking out of good intentions but from his vantage point in the new beginnings phase, while his team was suddenly thrust into their ending, losing, letting go phase.

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