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Technology surge forcing companies to adapt or die
Timeless principles that can boost change-management success rates
Technology-driven disruption is reshaping markets, business models and industries. It is also
forcing established companies to be more agile and take their change-management skills to
new levels. Those that cannot implement change fast enough risk corporate death. Change
management has been a staple topic in textbooks and MBA programs for years, yet many
companies and managers are poor at it. Getting staf to adapt to and embrace change is a skill
that is beyond many managers. A 2013 Strategy&/Katzenbach Center survey of global senior
executives found that the success rate of major change initiatives was only 54 per cent. Prominent
management journal Strategy + Business updated its 10 timeless principles of change management
that lift success rates, and republished them in February this year:
1. Lead with culture: Skilled managers, conscious of organisational change-management
best practices, make the most of the company's existing culture, rather than radically trying
to change it. They tap into the way people already think, behave, work and feel, to boost
2. Start at the top: All successful change initiatives start at the highest level with a well-aligned
group of senior executives who are strongly supported by the CEO. All executives must agree
on the need for change and the way to implement it.
3. Involve every layer: Do not underestimate the infuence that mid-level and frontline
employees have on change initiatives. Organisational change is immeasurably smoother if
employees at all levels are asked for their input on issues that afect their jobs.
4. Make the rational and emotional case together: Arguing for change based on rational or
strategic issues only goes so far. Successful change agents engage workforce hearts and minds,
and outline the emotional case for change, too.
5. Act your way into new thinking: Do not assume that staf will change their behaviours once
change initiatives are announced and implemented. Defne some key behaviours that are
required – for example, managers from diferent departments working together – and ensure
that they are highly visible in the organisation.
6. Engage, engage, engage: Conveying a strong message at the start of a change initiative is not
enough on its own. Powerful, sustained change requires constant communication during and
after the change initiative, says Strategy + Business.
7. Lead outside the lines: Change works best when everybody in the organisation with
authority is involved. But some staf members have ‘informal’ power and strong infuence
over their colleagues. Identify those with less obvious organisational power and get their buy-
in on change.
8. Leverage formal solutions: Understand how the organisation's structure and processes
afect the success of change programs. For example, how are managers who drive change
rewarded? Are there processes to capture the eforts of those who collaborate across teams and
whose output might be harder to record as a result?
9. Leverage informal solutions. Even the best-planned change programs can come unstuck
through strong organisational cultures that lead to employees reverting to long-held but
subconscious ways of behaving. For example, staf members might have always focused on
sales volumes more than proft margins. Identify subtle cues and reminders that help the
organisation's culture to support the change initiative and goals.
10. Assess and adapt: Always measure the success of change programs. Do not claim victory too
early; change eforts can easily come unstuck. Follow the process of organisational change
through its life cycle to identify what is working and what is not.
Clean technology powers up
Listed sector producing stronger
After years of horrible
underperformance, clean technology
stocks are posting stronger returns
than the share market, and starting to
deliver on their investment potential.
The Australian CleanTech Index,
a key barometer of 62 ASX-listed
clean technology and environment companies,
outperformed the S&P/ASX 200 index by 8.8
per cent over the 12 months to January 2016,
despite a small negative return in that period.
The index outperformed the ASX 200 by 15 per
cent in FY15, and seven per cent in FY14.
These returns will buoy long-sufering investors
and true believers in listed companies in sectors
such such as solar, wind, energy efciency and
storage, recycling, waste and the environment.
For all their promise, clean tech returns have
disappointed over the past decade.
The CleanTech Index's combined market
capitalisation of $16.3 billion compares to its
record valuation of $18.9 billion in March 2015.
That is a remarkable turnaround from the
Index's low of $6.2 billion in July 2012, when
clean tech stocks were on the nose.
As always, care is needed with index
performance. The CleanTech Index is weighted
by a company's market capitalisation, meaning
that signifcant rises or falls in its largest
constituents can greatly infuence returns. Also,
many companies in the Index have micro-cap
valuations, are yet to produce profts, and best
suit investors with higher risk tolerance.
But a sustained trend of better share-price
performance is emerging, with the clean tech
sector beating the broader share market over
three years running. Stronger investor interest
in high-tech companies generally might be
helping the clean tech sector.
Entrepreneurs will note this outperformance and
the growing interest in clean tech companies.
The initial public oferings market has had
few clean tech foats in recent years because
of a dearth of interest. The sector 's improving
performance could encourage emerging clean
tech companies to raise capital via IPO and go
public, and established clean tech companies to
raise equity capital through placements.
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