The Times, they are A-Changing
If Prince Hamlet were to stroll the aisles of his local grocery store, he very well might have a new thought to ponder: To change or not to change, that is the question.
But actually, in today's retail environment, it's not really a question. Change is inevitable, and often necessary to stay relevant in the consumer packaged goods (CPG) retail environment. And with mergers and acquisitions, downsizes, upsizes or retailers touting a new mission or philosophy seemingly at every turn these days, no retailer is safe from change. Nor should they be, for that matter.
"Initiating a change without a clear purpose, goals and a roadmap can be very detrimental to an organization because it becomes hard to measure success and maintain stakeholder buy-in."
– Courtney Albert,
"An organization has to be able to adapt and/or change to survive long term," says Courtney Albert, a management consultant specializing in change management for Atlanta-based Parker Avery, a retail consulting group. What worked 50 years ago or even last year, she continues, may no longer be the right approach due to a variety of factors such as technology constraints, consumer behaviors, employee competencies, governmental issues or economic factors.
That sort of change–the kind that is meeting a market need, or improves opportunities in the marketplace or can help grow a company–is good, and can be incredibly beneficial to a retailer.
It's the change for change's sake where organizations often get into trouble.
"Hopefully if the company is undertaking a transformational project it's going to be for the better," says Isaac Krakovsky, partner in the retail and consumer goods practice at Kurt Salmon, New York, and author of "Effective Change Management in Retailers." "Otherwise, why are you doing it?"
"Hopefully if the company is undertaking a transformational project it's going to be for the better. Otherwise, why are you doing it?"
– Isaac Krakovsky,
"Initiating a change without a clear purpose, goals and a roadmap can be very detrimental to an organization because it becomes hard to measure success and maintain stakeholder buy-in," adds Albert.
As change becomes an increasingly necessary element of the retail life, retailers must not jump into it blindly. Doing so will torpedo whatever efforts you make, but putting thought into and employing some essential best practices can be a beacon for success.
THE ART AND SCIENCE OF CHANGE
Rolling out change can be a turbulent time for an organization, but it doesn't have to be. If big changes are afoot, retailers need to make sure they are employing best practices within their organization so that change is successful. And while no two strategies for change, whether that change is expanding or shrinking the company, a revision of philosophy or strategy or really anything that will have a big impact on employees, will be exactly the same, there are a few commonalities that will help smooth the road for retailers.
First and foremost, before any change occurs, think about the consumer. "The customer perspective is paramount, and that should be the first place a retailer looks," Krakovsky says. "They need to think about how this is going to impact how consumers see the brand in the marketplace, what the consumer experience is going to be like, in a positive or negative way. The retailer has to find ways to deal with and address those issues."
With that external knowledge in place, retailers have then got to have a clear vision of what is needed inside their organization, and know the message they're sending to employees.
"Two essential elements needed when implementing change are key stakeholders and communications–the two go hand-in-hand," says Parker Avery's Albert. Senior leadership must be on board and on the same page as the change. That may sound like a no-brainer, but, says Albert, "Many times we have seen executives within the same organization deliver conflicting messages or unwittingly sabotage change management efforts" when not everyone is clear on the directives.
And that message, once in place, needs to be supported and managed throughout the change as it is occurring.
"Often you'll see the executive who is the sponsor behind the transformation project at the kickoff meeting and rallying the troops at the beginning, but then they don't fully engage in the project along the way," Krakovsky says. But for change to be successfully managed, active engagement is non-negotiable, he continues, to ensure that the right people are on the change initiative, that the scope of the project is being managed appropriately, and that the right decisions about the project are being made.
Once the priorities for the change initiative are in place and are communicated to employees–especially those who will be most affected by the changes coming–companies need to build urgency around the changes and show how and why they are important to the organization, says Pat Cormier, an engagement leader for Kotter International, Cambridge, Mass.
Unfortunately in the retail landscape, that urgency is often lacking, and the strategy and messaging goes out and down, Cormier explains. Once the message is cold, and so business-focused that as it goes down the line from head honcho to lowest man on the ladder, more and more of the reason behind the change gets lost.
"Even if the change stems from a real crisis, and everyone knows it has to be done," Cormier says, "often there is still a big piece missing. Employees may understand why the change is needed, but they're still missing the 'what can I do to help?' piece of the puzzle." It can be a struggle for those instituting the change to truly define or demonstrate what people can do to change, leaving a lot of disengaged people within an organization.
While employees may know the company is trying to accomplish certain changes, helping them understand what their role is and how they can help comes down to fostering an environment where they want the change.
"That's the next level, creating an environment where people are engaged and want to help the organization be successful, and want to help the changes come about."
– Pat Cormier,
"That's the next level, creating an environment where people are engaged and want to help the organization be successful, and want to help the changes come about," Cormier explains. "That's creating an environment that is open to change." At the end of the day, she adds, telling someone to change doesn't work, and it doesn't help anyone. Employees can't be told to change; they have to want it.
"Unfortunately, that's what a lot of organizations do," Cormier says. "They just tell their employees to change. It's like telling someone he or she has to lose weight. It doesn't help unless that person actually wants to."
REEVALUATING BEST PRACTICES
Heed words of wisdom and stay alert to the obstacles that try to thwart successful change, retailers. But also remember that there is no cookie-cutter way of managing change within an organization. Don't be afraid to reevaluate some of the old-school wisdom of change management.
"That can start with the belief that change can be managed," says Kotter International's Cormier. "There are elements that clearly need to be managed. However, we feel that change requires leadership, and more of it." By that, Cormier explains, she means behavioral rather than positional leadership, and operating in an environment where people from across the organization have the opportunity to lead.
"Whether they're leading their peers or direct reports, or even being mindful of how they conduct themselves, it's important to give people opportunities to lead because that's the way you start creating an engaged workforce and that's how you are successful both with what you're trying to accomplish and also celebrating it," she says.
Another piece of managing change is understanding exactly what that is–and is not.
"When I talk to retailers about change management, they call it change management, but it really amounts to training," says Kurt Salmon's Krakovsky. "Retailers need to think about change management more holistically than purely training. Training is an important part of any new change you're bringing into a company, but true change management goes beyond training."
As change can be a good thing, and change is inevitable, retailers do need to keep a close eye on why they are experiencing change. Always make sure it is for the right reasons, and not a sign of bigger issues.
"If an organization finds itself in a constant state of change, specifically targeted toward the same issues and areas," says Albert, "it's more susceptible to never fully realize the benefits of change."
A CHANGE WILL DO YOU GOOD
Change–for better or worse–in today's retail environment is inevitable. In the past the word "change" has been known to induce fear far and wide, but applying best practices to a given situation can reduce the fear and increase success, even if the change is already in motion. And if that motion isn't going in the right direction, it's not too late to steer it back on track.
"Do a temperature check and be completely honest about whether or not everyone who needs to embrace the change really understands why the change is needed, and what's at stake if the change doesn't happen," Cormier advises.
Often, the majority of people who need to understand don't understand, and that stems from a communication breakdown.
"Instead of communication, insert the word 'conversation,'" she suggests, as people need to be able to ask questions and challenge ideas and decisions a little bit.
"The more you can have those conversations and dialogues, the more buy-in you build, the more support you build, the more understanding you build," Cormier explains. "Without all of that, all you're really doing is creating awareness, and that doesn't help people want to change."
The Technology of Change
A retailer managing a change in its organization will undoubtedly rely on technology to help keep things running seamlessly, both for the employees and the consumer. Anuj Agrawal, vice president of product marketing for consulting firm Orchestro, says that a three-pronged approach can help make implementing change a little easier.
First, Agrawal notes, is to have a deep understanding of the business.
"If you're a new senior executive coming into the business, you've got to have access to knowledge, and what's happened in the business historically over the past three to four years." This provides insight to strengths, either from a product perspective, a geographic perspective, or even a demographic perspective.
The second prong is having automation in place.
"If you've got automation in place around understanding the business, whether it's managing the supply chain or managing your in-store execution, from the degree you can automate all of those processes, [it] will make this change management as little disruptive as possible," Agrawal says.
The third and final prong is all about collaboration.
"If you've got one person who knows everything, you're in trouble," Agrawal explains. "But if you enable collaboration of the organization, a change in one or two pieces of the puzzle is not going to be as disruptive because you've got people who can pick up the slack and educate other people. And when you tie that in with automation, everything runs very smoothly."
Molly Strzelecki is a freelance writer living in Chicago. She has been covering trends in the consumer packaged goods industry for more than a decade.