Whether it be a workplace accident, natural disaster, data breach, corporate scandal, or fraud, crisis is inevitable. What is done immediately after such an event is critical to the future well-being of the company. Everyone in the organization suddenly wakes up from the autopilot they have been able to operate on for years. All eyes look to management for direction. It is their responsibility to take lead, bring stability to the company, and seize the opportunity for improvement. An organizational change management approach should be used to re-evaluate human capital, processes, and systems to overcome a crisis and create a solid foundation for future success.
After a crisis, people across the organization are willing to change their normal way of doing things in order to prevent a similar situation from happening in the future. Natural leaders will arise during that time. Management can make the most of the situation by identifying those leaders to help motivate others and lead transformation initiatives. Leveraging their strengths will help address current problems, improve processes, and establish them as valuable leaders moving forward.
Company culture is a strong predictor of financial and operational health. When a company’s culture is in a bad state, it usually means their communication is poor, processes are inefficient, work ethic is low, and many other crisis-provoking issues exist. The tone at the top drives company culture. A crisis presents the board and executives an opportunity to re-evaluate leadership styles and hit the reset button if needed. To overcome crisis, it's critical to determine which leadership style the company must follow in order to renew the culture and effectively make business improvements.
Management should focus on fixing process issues before making any other major changes. If a company waits to improve their processes until after system implementations and organization alignment, they will most likely have to re-implement and restructure, costing the company a lot of time and money. Client-facing, retention-focused processes take precedent. Internal processes, like improved asset utilization and better productivity measures, are next. When made early, process improvements increase efficiency and effectiveness and usually require little investment compared to system and organization changes. In addition to process improvements, management should also implement new policies and controls.
Systems should be used to support the business processes and overall business strategies, not the other way around. In order to ensure systems are used in this manner, the project management office (PMO) within IT should be reviewed. Proper approval processes and project governance practices will resolve most issues around duplicate systems, misallocation of resources, and more. Improving PMO practices leads to greater discipline within the organization, resulting in more efficient utilization of IT assets. The time following a crisis is a perfect time to make those changes to the PMO. Additionally, it's an ideal time to rationalize the application architecture, ensure cybersecurity practices, and begin discovery for different or additional system solutions. System changes take a lot of time and hard work, so using a crisis to launch new system selection and implementation projects would be wise.
The organization structure is often overlooked, but it's actually one of the most important factors in supporting the core competencies of the business. Effective organization structures promote better communication and improved productivity, leading to a reduced risk of crisis. When the organization structure is considered during the planning phase of a transformation, alignment with the process and system changes is straightforward. Even though people are more open to change following a crisis, organization restructuring can cause push-back and lead to lower employee morale. It is recommended to find outside change management experts to help make this less painful.
Trenegy is a management consulting firm that guides companies through crisis recovery by leveraging their project management and change management expertise.
