3 Change Stoppers in Small Business
This article introduces 3 reasons why change is slowed or stopped inside small businesses. Much has already been written about the problems for small businesses, but nowhere is their a current primer on how to bring an owner, CEO, or President to awareness about the initial phases of implementing change. We offer 4 “Change Ready Concepts” which serve the leadership with an appreciation of how to approach change.
Some Ideas Worth Exploring & Why this Should be Important to You
If you may have already read about organization ecology - inertia and change, you will have an initial understanding of the theory: we build on the ideas. We referenced this material because this article will allow you to understand why your company becomes effected during and by a change. We extracted two ideas from the materials and added one of our own from our small business experiences and understanding. We emphasize these three change stoppers and provide 4 "Change Ready Concepts" to assist in overcoming the inertia.
Newton's First Law On Motion: “A body at rest will remain at rest, and a body in motion will remain in motion unless it is acted upon by an external force (i.e. red ball).” This simply means that things cannot start, stop, or change direction all by themselves. It takes some force acting on them from the outside to cause such a change. This property of massive bodies to resist changes in their state of motion is sometimes called inertia. In this metaphoric image, we suggest the small business owner (SBO), president or founder become the red ball.
1. Organizational Inertia
Mature Organizations
"Organizational inertia is the tendency of a mature organization to continue on its current trajectory. Inertia includes two elements - resource rigidity and routine rigidity. Resource rigidity stems from an unwillingness to invest, while routine rigidity stems from an inability to change the patterns and logic that underlie those investments. Resource rigidity relates to the motivation to respond, routine rigidity to the structure of that response".
External Change
In the face of rapid or discontinuous external change, you must overcome organizational inertia if a firm is to survive. In a competitive situation where new players are entering the industry, it is the incumbents that are particularly susceptible to the downside of this inertia. In this case, it is often incumbent inertia." (Footnote 1)
"Hannan and Freeman defined organizational inertia in terms of internal and external restraints. Internal restraints include investment and sunk costs, availability of information for decision-makers; political restraints such as organizational culture; and organization history. External restraints include legal and fiscal barriers to market entry and exit, availability of information about the environment; external legitimacy; and collective rationality and strategy." (Footnote 2)
2. Cognitive Inertia & What It Looks Like
Within the context of organizational inertia, then the idea of cognitive inertia is easy to grasp. What occurs when implementing any change inside a small business typically shows-up in nonalignment, slow-downs, upsets, or stoppages.
(Wisdom Sidebar) This impact can be rather significant, but awareness gained can be heightened with outside talent and skills to both glean and measure the effect on your business. This activity requires time and effort to interview you and your leadership team and some critical domain members inside your company. This analysis is a precursor to determining whether or not your business is a candidate for accepting the change or not.
Varying & Unaligned Beliefs
In our experience, the business owner and the leadership team have varying or unaligned ideas about what works and what doesn’t. Most of this can be determined by understanding the current beliefs/processes in play and how they operate and the interplay among your people.
Example: Some companies define themselves as having an open-door policy (i.e., implying openness across the business), yet they make many decisions behind closed doors and exclude some major and next-level players. The wall-placards and published core-values/beliefs don’t match the marketing or public broadcasting. This mismatch typically inhibits innovation and problem-solving.
3. No Clear Direction for Moving Forward
Companies that don't define the reason why they exist, what they stand for, and where they are going can get bogged down when faced with external and internal forces. The worst-case impact of this is similar to walking into your business each day starting over. If your business maps to a level 1 or level 2 company, the change will be difficult but doable anyway.
Why Does Your Business Exist?
When you define why your business exists, you will likely continue. If you haven't made the definition more than producing money or creating a great product, you won't survive because that's not enough to sustain the enrollment of people committed to you and your business. If you experience some of these items here, you can re-create anyone. We encourage you to involve your leadership team and key players in deciding what's needed. When you bring people together and re-define key reasons for existence, they all become part of the process and usually take it on as their own.
(Hint) We can guide how to accomplish your group's efforts in these activities. For owners and senior leaders, we invite you to take a look at our Quick Business Review (QBR) to assist in determining the basics and what you deem necessary to you. You will likely be surprised at what insights you can gain from this exercise.
4 Change Ready Concepts to Consider
We have created four starter concepts for you to grasp as you consider the challenges that change will bring as you direct your business toward your future:
Be Open
Be Willing
Expect Positive Things to Show Up
Hold Judgement
These concepts are beliefs and approaches which will serve you well because it sets in place a series of principles (Footnote 3) to keep in mind as you move forward in your understanding of what’s occurring inside your leadership team, sales group, and other teams. These concepts can be used in every domain/department too.
4. New Business Insights
When you can answer the following questions, the results from such inquiries allow new business insights:
What are the motivations and their associated components in your company?
What compelling reasons exist today: how important are they, and when can we accomplish them?
Is the rest of the business ready to accept changes, and what impacts will show-up? Knowing about inertia is one thing, but defining and doing constructive results-based actions will propel you forward. When you identify the characteristics mentioned, we call this proclaiming an "Unmistakable Future." Can you describe one for your business?
Some More Things to Consider
Change isn't an effortless activity or process. Even when defining belief systems inside your business purposed to address the reasons that have created and sustained your business, it helps to remember that all our individual biases, preconditioning, unconscious beliefs, and humanness are acting against us during the change journey. One must over articulated that these stoppers are present and deal with on an ongoing basis. We suggest further reading in footnote 4 will open your eyes to these difficulties.
Footnotes
1. Managing Research Library, Organizational Inertia, Copyright 2013 - 2017, Create Advantage Inc., All Rights Reserved.
2. Hannan, M.T., and J. Freeman (1989) Organizational Ecology. Cambridge, MA: Harvard University Press.
3. Choice Awareness Management - Mission, Foundational Principles, Copyright 2001-2019, Benninghofen Company, All Rights Reserved.
4. Influencing Congruent, Unbiased Change: Serving with Integrity, Sharon Drew Morgen, November 20, 2017. Copyright Morgen Facilitations, Inc, 2017.
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