Faced with the significant impacts of the COVID-19 pandemic on the global economy in general and the Vietnamese economy in particular, businesses have been forced to flexibly change their methods and areas of operation to survive and develop. It is evident that the pandemic or the government’s social distancing policies are merely some of the factors, changes, or risks that businesses may encounter while maintaining operations. So, what must managers do to overcome obstacles when changes occur? Is change management in business difficult or easy? Let’s explore this topic with HRDC.
1. The Concept of Change and Levels of Change in Business
Change is understood as a process of movement influenced by the interactions of objects, phenomena, and internal and external factors. Change is a common property of all objects and phenomena. It includes changes in quantity, quality, and structure.
When discussing change in business, it refers to all processes and proactive reforms aimed at creating greater competitiveness for a business or organization. This could involve applying new technology, making strategic shifts, reorganizing production lines, merging with or acquiring other businesses, restructuring business units, or optimizing corporate culture. It would be a mistake to maintain a conservative mindset resisting change, as this is a gradual step toward failure.
1.1 Common Levels of Change
- Improvement: Adjusting certain elements of an object to make them more suitable, without fundamentally altering its nature.
- Innovation: Replacing the old with the new, resulting in the emergence of a new object or innovation, which changes the essence of the object.
- Reform: Removing outdated, unreasonable aspects of an object and creating something new that aligns with the objective situation; this entails a fundamental and comprehensive change compared to innovation.
- Revolution: A profound and radical transformation, resulting in a complete change.
1.2 Why is Change Necessary?
Change is essential for maintaining balance and ensuring the development of an organization. For individuals, change creates opportunities for growth, exploration in new fields and environments, diversified personal experiences, and the refinement of skills.
2. Causes and Signs of Change in Businesses
2.1 Causes of Change
- Social Factors: Continuous societal development, increasing demand for education, and the need for a skilled workforce to support industrialization and modernization.
- Economic Factors: Globalization, industrialization, market economy dynamics, and the diverse development of the knowledge economy.
- Technological Factors: Rapid advances in the Internet and IT, the proliferation of smart devices, and widespread social media.
- Internal Factors: Adjustments to meet improvements, expansion, or transformations in corporate structure.
2.2 Identifying Changes in Business
- Internal Signals: Changes recognized by the top-tier management team within the organization.
- Competitors: New products, innovative management methods, product quality, and effective marketing campaigns.
- External Environment: Laws, societal trends, culture, customer base, customer demands, and quality requirements—all critical factors requiring businesses to adapt to meet customer expectations and solidify their position and brand.
3. The Role of Managers in Change Management in Business
The core of every reform lies in changes to principles, daily life, and work routines, bringing new development opportunities for an organization. However, to implement these positive changes is a challenging process that falls on the shoulders of managers. Their mission is to grasp the changes and direct them in a way that benefits the organization. Only then can they lead their organization to the pinnacle of development. As Peter Drucker once said: “The successful person is one who anticipates change.”
Change is always associated with a specific organization. Within the organization, the manager is the leader, overseeing all activities. Therefore, managers are the key agents of change management. Their role is reflected in being advocates, catalysts, and stimulators of change; linking resources for change; and maintaining stability within the organization.
Managers must be perceptive and foresee changes. Their role is to identify changes earlier than their employees. Managers need to recognize changes occurring within their organization from the outset. They must calculate the costs of implementing the changes, determine feasibility, provide feedback, ensure timely updates for their team, organize logistics, and maintain the continuity of other operations.
Managers prepare comprehensively in terms of facilities, psychology, objectives, and measures to implement changes. To successfully execute changes, managers also act as communicators, informing team members about organizational changes and mentally preparing employees to cooperate effectively.
The agents of change management also play a crucial role in monitoring and adjusting the implementation process and drawing lessons for future executions. To effectively fulfill their responsibilities, change management agents must be classified into different levels:
- Top-level managers: They oversee, direct, and lead all activities across all departments and areas of the organization. They play the primary and most critical role in managing change in a business.
- Middle-level managers: These intermediaries capture changes occurring in subordinate units and take timely actions to adjust within their scope of management, while supporting top management in overseeing changes across the organization.
- First-level managers: Although they are at the lowest managerial level, their role is undeniably crucial. They directly observe changes within the organization, make adjustments or report to higher management, propose timely corrective measures, and directly organize the execution of organizational requirements.
Thus, the agents of change management in a business play a crucial role, capable of transforming the face of an organization. However, in reality, we often encounter ineffective managers who are not respected and negatively impact the organization’s performance. A company with high salaries, friendly management policies, and other favorable factors may retain employees and foster their loyalty. Yet, all these advantages become meaningless if the organization has incompetent managers. Moreover, in key positions, an incompetent leader can hinder well-prepared plans aimed at improving performance.
Additionally, you may refer to several articles:
Source: VNU Journal of Science: Economics and Business, Issue 25.
