Major Change Management Principles

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What is change management and what does it deal with? Why is it important to focus on change management when implementing BSC? Find answers to these questions in this article. Check additional information about change management.

It's not a secret that Balanced Scorecard will only work if it initiates changes in the company. Very often these are radical changes. If an organization is not ready for structural changes balance scorecard will most certainly fail. Both company top management and ordinary employees need to be ready for changes that may concern just everything. This is where change management comes into play. This discipline is focused on shifting teams, individuals and the entire organizations from one state into another. Once a company makes a decision to implement Balanced Scorecard it should understand that in several years it will entirely change. At that changes need to be not only declared but also accepted and embraced by employees. It is a fact of common knowledge that Balanced Scorecard works at its fullest potential only when everyone in the company accepts this system and makes an everyday contribution to implementation of strategic goals. Inability to change or the wrong interpretation of such changes are one of the main causes of Balanced Scorecard failure. Many companies implement Balanced Scorecard but it remains just a control tool used by a dozen of top managers. Changes remain on paper and thus there is no value in them. Both company top management and ordinary employees have to learn to live with Balanced Scorecard, and make its part of the company everyday routine. Experience shows that many companies that have successfully implemented Balanced Scorecard now cannot imagine existence without this system.

So, what organization changes should employees and top management embrace? These are missionary changes, strategic changes, operational changes, technological changes and behavioral changes. Perhaps the last point is the most important. If employees oppose organization changes they will never happen. At the same time all the above issues are extremely important preconditions of Balanced Scorecard success.

Change management often deals with expectations and attitudes of personnel to changes being implemented in the company. One should understand that employees may go through loss curve, i.e. feel that something goes wrong. The mission of top management is to clarify these changes and explain their benefits to ordinary personnel who should accept them. Personal assistance is a common practice to educate personnel and deal with their fears and misconceptions. It is very important to organize training and coaching sessions for individuals and teams of employees to introduce Balanced Scorecard and changes it is about to bring in. Only having understood the way Balanced Scorecard works an employee can make a decision on whether or not to accept this system. Personal motivation matters much.

Another important task of change management is to organize effective communication between all managerial levels. If Balanced Scorecard is implemented from the top, ordinary employees and midlevel management should be fully aware of BSC and company goals. Every one may have his/her own concept of strategy, and this is one of the main reasons for Balanced Scorecard failure. Change management deals with personnel fears, expectations and even resistance in regard to Balanced Scorecard, as well as monitors BSC implementation process.

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