Are you a successful leader of change?

It’s certainly true that in order to evolve and adapt to an increasingly complex future, businesses have to be constantly changing. Whether it’s implementing new technology, processes and ways of working or seeking new markets to explore, companies need to continuously think about the routes they’ll take.

Of all the major organisational projects that business leaders have to oversee, one of the most challenging can be change management. How do you promote a culture of constant, productive change, while still keeping everyone on board and without jeopardising the harmony of your organisation?

Change management is therefore one of the skills every executive should work on developing, given the massive implications it can have on the very future of the business. As recent research suggests, however, today’s organisations, managers and employees may not be entirely ready to embrace change.

Change still a stumbling block for many

Of course, to enable smooth and effective organisational transformation, a culture of change must be embedded across the enterprise. This involves having the people, strategies and tools required to drive change – but how many companies today can claim to be adequately equipped?

According to an Association for Talent Development survey of 765 professionals, 60 per cent of respondents said their business faces “three or more major changes” every year. Meanwhile, one out of four respondents said they face twice as many changes than that per year.

Despite this obvious need to make change management a top priority, the survey went on to reveal that fewer than one in five (17 per cent) said their organisation is effective at managing change.

Furthermore, less than a third (30 per cent) of respondents reported that their company actually has a change management team in place, while twice that proportion pinned their hopes of successful change on the CEO. With so few organisations having the necessary personnel to lead change, this signals a clear area for improvement for companies across the board.

However, that isn’t the only thing preventing many organisations from successfully enacting change.

What else is holding them back?

As outlined in the Katzenbach Center’s comprehensive 2013 Culture and Change Management Survey, there are myriad factors precluding modern organisations from fully embracing the prospect of change. The survey, which polled well over 2,000 people around the world, canvassed their opinions on the importance of transformation in the organisation, who is leading it and the obstacles that hamper lasting change.

When asked about the top barriers to change, the two most prominent responses were that clashing priorities lead to “change fatigue” and that the systems, processes and incentives in place do not support change.

A large part of the problem may also be behind the attitudes of the employees themselves. The survey revealed that the top three reasons staff resist change are because failed efforts in the past have made them sceptical, they don’t feel involved in the process and they do not understand the reasons behind the change.

All in all, half (48 per cent) of respondents said the critical capabilities required to sustain change are not in place.

Business leaders who can relate to these challenges and feel they are present in their organisation may want to take action immediately, as ineffective change management can have dire effects.

The consequences of poor change management

So what are some of the things that can happen if change is not properly managed in an organisation?

This was explored in Right Management’s ‘Ready, Get Set…Change!’ study, which provided some damning findings on the potential consequences of poor change management. As expected, the majority of the impact falls on employees – according to the study, companies that don’t manage change well are four times more likely to lose talent.

Additionally, of the respondents in the study who said their organisation’s change management is poor, three-quarters (75 per cent) reported being concerned with the company’s ability to attract talent in the future. A third (32 per cent) said they harboured negative feelings about whether they could hold on to their job in 12 months’ time.

As can be seen here, poor change management can have pervasive effects around the organisation, and business leaders need to think seriously about whether they are directing change in the right manner.

What are the best steps forward?

Of course, getting on the right path to change management can be a long process that takes time and effort – but it can help to know where the best places to start are.

McKinsey & Company provides one such perspective. Following extensive global research into the subject, it has come up with a list of what it purports to be the keys to transformation success.

According to the firm, companies that have been successful in transformational change have traditionally demonstrated behaviours such as making roles and responsibilities clear, engaging continuously through ongoing communication and tasking the organisation’s best talent with the most crucial change activities.

Leaders, obviously, have an important part to play too – they should make sure that frontline staff feel ownership for the change and role-model the desired changes.

Change should not be daunting to any organisation – in fact, if managed right, it can turn into a massive step forward for your company. Are you making sure your business is primed for change management success?

Identifying opportunities in the Asian Century

Asia has experienced rapid growth in the 21st century, which has driven a need for goods and services as its burgeoning middle class begins to expand.

Australia is well placed to take advantage of this growth. In fact, the country has already enjoyed a steep rise in demand for its natural resources over the last decade, helping to strengthen the mining sector.

However, as the resources boom begins to taper off, Australian companies must shift their efforts in order to continue benefiting from the multitude of opportunities available in Asia.

A 2012 whitepaper by PricewaterhouseCoopers (PwC) noted that while the majority of Australia’s trade is with Asia, the country only spends 6 per cent of its overseas direct investment in the region.

PwC said this figure is far too low for businesses to take full advantage of potential growth opportunities.

Similarly, a Deloitte report last month urged organisations to become ‘first movers’ rather than ‘fast followers’ when it comes to commercial deals abroad. This means firms must establish themselves as innovators rather than settling for second best.

Selwyn D’Souza, lead strategy partner at Deloitte, said: “Strengthening our already strong relationships with the new global giants such as China and India will become more important than ever as we seek to establish a stronger presence in their markets and their companies continue to enter ours.”

Opportunities in Asia

According to Deloitte, a billion people are expected to enter the middle-class globally within the next 20 years – and a significant proportion will be in Asia.

The OECD estimates 66 per cent of middle-class people will be Asian by 2030, compared with just 28 per cent in 2009.

This increase in consumption provides opportunities to Australian companies across a wide range of sectors, particularly financial services, telecommunications and retail.

Businesses that seek cross-sectoral collaboration between other companies, governments and non-profit organisations are likely to perform better, as this creates a greater social impact.

“It will be the forward-looking Australian businesses that proactively take opportunities to innovate and serve the needs of low-income consumers in the Asia-Pacific region which will enjoy the benefits of increased market share, profit growth and brand differentiation,” Ms D’Souza stated.

However, PwC said organisations must be willing to invest in Asia to have the best chance of gaining market share and forging ongoing relationships with businesses in the region.

Australian CEOs will also require a keen understanding of the many different Asian cultures in the region. The conflict between Western and Eastern values could be a stumbling block unless enterprises are adequately prepared.

Building an Asian presence

Despite the challenges businesses will face growing market share in Asia, the positive outcomes and expansion opportunities are significant.

Here are some strategies that PwC noted could help your company make the transition a little easier.

Invest in human capital: Recruiting or promoting people with extensive Asia expertise is vital.

Not only will this help your business to better understand the marketplace, it also facilitates relationships with Asian firms, which are typically built in person rather than over long distances.

Assess market potential: Review your existing growth strategy through an Asian perspective and identify the best opportunities for your particular business.

Isolate risks, re-evaluate existing brands and products, and strengthen any existing ties you may have in Asia.

Select appropriate market entry options: Entering new international markets can be a challenge, so consider different investment vehicles.

Whether you opt for a joint venture, export-only model, licensing arrangement or other operating structure will depend on your specific commercial objectives.

What next?

Given that the resources sector is already beginning to slow in Australia, the need to build further economic drivers in other sectors becomes more apparent.

Organisations that fail to cater to growing Asian demand could find themselves struggling to succeed against more forward-thinking competitors.

However, CEOs must move fast. These changes are already underway and building for the future must begin as soon as possible, particularly when it comes to attracting and retaining the right staff to excel in new market conditions.

“While many organisations understand the need to recruit resources with the necessary skill set, the demand for this key talent far outweighs supply,” PwC stated.

“It is imperative that companies start planning now how to position their organisations and their people for the Asian Century.”