Change management: lessons learned from top companies

Profitable businesses must keep changing for continued success. Sometimes it is unexpected, sometimes it is necessary. To maintain normalcy during periods of change, employees look to their leaders for guidance. The key is to get leadership on board with the change and establish methods to help your teams manage the change. Leaders must possess certain qualities for a smooth transition and to maintain momentum in the workplace.

Navigating change is difficult; even the best ideas will fail if they are not adapted correctly. Here are the top three companies that made major changes and what we can learn from their successes and failures.

Alphabet

Alphabet is now Google’s parent company and is led by Google co-founders Larry Page and Sergey Brin. The restructuring occurred so that Google’s search engine could remain focused on its original mission of organizing the world’s information. Among the companies that are now under Alphabet are the collection of companies that Brin and Page have delved into, including Google, Calico (their quest to cure death), and Nest Labs.

Since this was a major organization restructuring, the leaders should have minimized the uncertainty among their employees. Instead, they shocked their employees and the world at the same time when Larry Page posted a blog post on Google+. They didn’t give their employees much warning, and this brought the workday to a halt as everyone from interns to senior engineers staggered at the news.

The blog post addressed many of the questions leaders must answer during a time of change, including why change was necessary and where they are in the process. However, it took employees by surprise when the leadership could have been forthright about the changes and how they would affect their teams. As the situation unfolds, we will continue to learn how Alphabet is handling the transition and how its employees are adjusting.

Amazon

When you’re a giant retailer like Amazon, your name is synonymous with change. However, staying competitive isn’t an easy task because you’re up against other innovative retail giants. Without a solid strategy to ensure your business is ready for change, failure is inevitable.

Such was the case with the launch of the Amazon Fire phone. The online shopping company made its foray into the smartphone realm, which seemed like a smart move. But one detail was missing: the phone didn’t offer enough reasons for smartphone owners to swap out their Apple or Androids. The phone had some cool features, but it lacked a competitive price for what it had to offer and was sold in limited locations.

Was Amazon ready for this step? Maybe not. What was initially considered a great idea may now take “a lot of iterations” and “a few years to get it right,” said Amazon CEO Jeff Bezos. Preparing for change is a process that prepares your company to change direction, even while maintaining the same overall strategic focus. Having these conversations with employees can result in an even better product.

Nike

To successfully navigate change, leaders must initiate and foster change conversations within companies that represent positive reasons to support change. When change speech is used well, you can prevent the “drop in engagement” that often occurs when employees lose sight of the goal and revert to previous behaviors. This may have been a factor in Nike’s struggle over the years to maintain a favorable image after its factories in Asia were exposed for abusive labor practices in the early 1990s.

Those in power at Nike did not act on the need to implement a more ethical supply chain until they were called in by activists, college students and consumer protesters, until customers who boycotted their products affected the company’s bottom line. Their poor labor practices were a way to cut costs to increase profits, which ultimately ended up costing Nike its reputation in the court of public opinion. Since then, Nike has made positive changes, but the company was slow to recognize what it had to do to improve working conditions. By working closely with employees and having ongoing conversations about the actions that would be necessary to make lasting changes, Nike could have improved its supply chain practices before they made the headlines.

In each of these examples, adequately preparing employees for the changes and thoroughly discussing how the plans should be developed could have solidified the strategy execution efforts and led to profitable innovation.