What is the difference between change management and transformation (and when should you worry)?

What is the difference between change management and transformation (and when should you worry)?

I spoke with a colleague recently about the difference between change and transformation. Transformation is en vogue and suggests a significant shift carried out by heavy-weight leadership-types, whereas change suggests something dated and less meaningful. For me, if you find yourself in a state of transformation, it means that something has gone seriously wrong.

In this article:

• 3D Change & Transformation

• When a lack of change leads to transformation

• When change should make you worry

• Did energy companies miss the signal for 'digital transformation'?

3D Change & Transformation

Whether transformation or change, it starts with The There Ds - a sense of drift, displacement or disconnect. If an organisation has a developed sense of awareness - feedback loops and sense-making capability - it will rapidly sense these 3Ds and make appropriate change adjustments. If an organisation doesn't have this capability, it will find itself in need of transformation.

When a lack of change leads to transformation

Every organisation that wants to thrive - to be resilient and deliver meaningful value over time - must engage in continuous improvement and ongoing change. Your organisation operates in an open environment, where collaborators and competitors are working toward their version of an anticipated future. Every course adjustment you make provokes a collaborative or competitive response from other agents - individuals, organisations, communities - in your environment and vice-versa.

Transformation: noun - a change or alteration, esp a radical one (Collins English Dictionary)

Suppose your organisation possesses the requisite variety of feedback loops, and tunes into those feedback loops, and possesses the motivation to act. In that case, it should be able to rapidly anticipate and respond to changes in its environment. Such an organisation is in a state of continuous improvement or change, where you observe the transformation in hindsight.

Now, suppose your organisation lacks that requisite variety, awareness and motivation, you will find yourself adrift, disconnected and displaced. The longer this goes on, the greater the drift, disconnect or displacement, the greater the course adjustment required to re-establish sync with the environment. Eventually, the message gets through that the organisation fails to deliver enough meaningful value, and you find yourself in state of punctuated equilibrium or transformation.

[For more information, read our 2021 Change Management Thought Leadership article]

When change should make you worry

To avoid the need for transformation, leaders and managers need to question their understanding of change. Traditionally, organisational involves change agents - change managers - delivering change to the organisation using linear processes - for example, Kotter's 8 Stage Change Model. This recipe-based approach to change is where you should start to worry. I'll explain why.

Change Management models, such as Kotter's 8 Stage Change Model, assume that change consists of a clear beginning and an end. This linear approach stresses when it comes into contact with environments made up of multiple self-determining change agents with an independent vision for an anticipated future; that's every person in your organisation.

If you see change as involving people, and, therefore, about a change in beliefs, attitudes or behaviours, you have to be interested in influencing people. If you are interested in influencing people, you will see each person as a self-determining agent who will either compete or collaborate with your future vision. Change is not delivered, change is brought about by listening, empathising and building the rapport and trust required to gain the influence needed to bring about behavioural change.

The traditional change management delivery model works well in environments with low numbers of people, with little freedom of choice and a high degree of convergence around common motivations.

Change slows down and Change Managers experience unintended, and often adverse outcomes, when they attempt to deliver change when they should be influencing change. Every action you take as a change manager will meet with acceptance or resistance, which means that you need a variety of efficient and effective feedback loops to respond and anticipate emergent challenges and opportunities. This emergent environment is the world of the Change Influencer, a space brought about by known and unknown agents with freedom of choice and divergent motivations.

Did energy companies miss the signal for 'digital transformation'?

Take the case of the energy sector. Small disruptive start-ups have been emerging for well over a decade and increasingly combining and exploiting the opportunities opened up by regulatory pressures to decarbonise, the associated development of small-scale renewable technologies, new AI technology, as well as a Design Thinking attitude which puts customers at the heart of their solutions.

The older companies in the sector are now undergoing transformational changes, shedding old assets and technologies, restructuring in seismic ways, and re-defining their cultures and ways of being. The scale of transformations are taking time, precious time that the small disruptors are exploiting to gain ground and move forwards to capture customers and market value.

From working with some of these companies, we know that if they had established anticipatory awareness and the capability to move from awarenesses to action, then these transformations would have happened more organically over time.These companies had access to the information needed to act. However, they lacked either the ability to make sense of the signals they were receiving or the motivation to do something about it.

Ultimately, they missed the opportunity to make sense of their emerging environment, define the opportunities and conduct safe-to-fail experiments that would allow them to fail and amplify success rapidly. Instead, they find themselves drifting, disconnected from customer wants and needs, and displaced in the marketplace. At this point, survival means that transformation is their only option.

[For more information, read our article on the Change Delta - influencing change in complex environments]

What do you think, does your organisation focus on Change Management instead of change influence, and, in doing so, is about to experience a period of transformation?

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