10 Principles of Change Management
By John Jones, DeAnne Aguirre, and Matthew Calderone
4/15/04
Tools and techniques to help companies transform quickly.
Way back when (pick your date), senior executives in large companies had a simple goal
for themselves and their organizations: stability. Shareholders wanted little more than
predictable earnings growth. Because so many markets were either closed or undeveloped,
leaders could deliver on those expectations through annual exercises that offered only
modest modifications to the strategic plan. Prices stayed in check; people stayed in their
jobs; life was good.
Market transparency, labor mobility, global capital flows, and instantaneous
communications have blown that comfortable scenario to smithereens. In most industries
*ƒ²*ƒ”€š and in almost all companies, from giants on down *ƒ²*ƒ”€š heightened global
competition has concentrated management collective mind on something that, in the past,
it happily avoided: change. Successful companies, as Harvard Business School professor
Rosabeth Moss Kanter told s+b in 1999, develop “a culture that just keeps moving all the
time.”“
This presents most senior executives with an unfamiliar challenge. In major
transformations of large enterprises, they and their advisors conventionally focus their
attention on devising the best strategic and tactical plans. But to succeed, they also must
have an intimate understanding of the human side of change management *ƒ²*ƒ”€š the
alignment of the company culture, values, people, and behaviors *ƒ²*ƒ”€š to encourage the
desired results. Plans themselves do not capture value; value is realized only through the
sustained, collective actions of the thousands *ƒ²*ƒ”€š perhaps the tens of thousands
*ƒ²*ƒ”€š of employees who are responsible for designing, executing, and living with the
changed environment.
Long-term structural transformation has four characteristics: scale (the change affects all
or most of the organization), magnitude (it involves significant alterations of the status
quo), duration (it lasts for months, if not years), and strategic importance. Yet companies
will reap the rewards only when change occurs at the level of the individual employee.
Many senior executives know this and worry about it. When asked what keeps them up at
night, CEOs involved in transformation often say they are concerned about how the work
force will react, how they can get their team to work together, and how they will be able to
lead their people. They also worry about retaining their company unique values and sense
of identity and about creating a culture of commitment and performance. Leadership teams
that fail to plan for the human side of change often find themselves wondering why their
