Change Management: Resistance to Change

Change Management: Resistance to Change

Symptoms of Resistance to Change

in change management, resistance to change can be visible or invisible. Higher gossip around the coffee points about the changes, lower morale, and productivity can be the signs of invisible resistance. In contrast, open debates are one obvious sign of visible resistance. A visible resistance is more beneficial to organizational changes than an invisible one. It is because open resistance may give challenges and constructive feedback to the changes. Besides, resistance can also be categorized into active and passive resistance. Symptoms of active resistance include being critical, spreading rumors, looking for fault, threatening, blaming, etc. Passive resistance’s symptoms include procrastinating, unfollowing the changes even though agreeing in person, withholding information, etc.

Throughout this post, I will include what I experienced at one of the companies that I used to work for as examples. I think it can illustrate my points here. For simplicity’s sake, I will refer to that company as “my company”. During 2017, my company was audited by Deloitte. Because the company had undergone a significant change in its accounting software program in 2016, there were a lot of issues with the systems, financial reports, internal control, etc. Deloitte pointed out those problems. They refused to give my company an audit clearance. Without an audit clearance, my company could not issue financial reports to its shareholder. My company was owned 100% by a big multinational firm headquartered in Tokyo, Japan. Thus, that big international firm was the sole shareholder of my company.

Under pressure from the parent company, my company’s CEO and CFO made some quick and profound changes in 2017. One of the most important changes was limiting access to the accounting software based on the corporate hierarchy. It meant that the controller had more access to the system than the accounting manager. The managers had more access than employees. This change was to fix the internal control problem. Before the change, everyone had full access to the system regardless of who they were. Despite the fact that the change improved internal control, it slowed down the workflow. It made the workflow more complicated and time-consuming. The passive form of resistance I observed from this change was the rumors among the employees. The rumors said that the controller wanted to control everything, even though he did not have the knowledge about the things that he wanted to control. The change was for his own satisfaction. Although no one stood up and criticized the change, the overall morale among employees was low. The employees were not happy because their full access to the system was revoked. They also had to spend more time getting their tasks done.

In terms of an active form of resistance to change, there was another change that was also made in 2017 by the CEO and CFO. This change was about the separation of duties between the tax department and the accounting department. The new accounting software did not capture sales tax when the billing department issued sales invoices to customers. The sales tax portions were not calculated, and sales tax accounts were not reconciled. Before 2017, the old accounting software automatically calculated everything. The CFO called the tax manager in for a meeting and demanded that the tax department be responsible for calculating sales tax and reconciling sales tax accounts. The tax manager did not agree. He argued that his department should not be responsible for reconciling the tax accounts. That should be the responsibility of the accounting department. The tax manager also criticized the accounting system for its failure to calculate sales tax. This is the symptom of active resistance that I experienced in my company.

Reasons for Resisting Changes

There are five main reasons why staff members have resistance to change. The first reason is that people are afraid of the unknown or surprise. This reason exists because changes are made without warnings or heads-up from the change managers. When organizational changes are implemented without signs or giving people more information about what the changes include and how the changes affect their jobs, people tend to push back the changes due to the distress of the unknown. The second reason for change resisting is the distrust in change managers. If the change managers are respectable among employees, employees are more likely to accept the changes than if the change managers are new and disreputable. It takes time for managers to win trust from employees.

The third reason is bad timing. In change management, if changes are implemented in a short period of time or at the wrong time, employees are more likely to resist the changes. I experienced this reason for resisting change at my company. In March 2018, the CFO decided to change the allocation rules. Because my company operated in different regions throughout the U.S., corporate overhead costs had to be allocated to all regions in order to calculate the bonuses for regional sales managers. The change was not big. However, March 2018 was the busiest time for the accounting department because it was the time when the fiscal year 2017 ended. For those who don’t know, in Japan, the financial starts from April 1st to March 31st. Even though the change was small and reasonable, accounting employees were not happy about it. This is something that change management needs to consider.

The fourth reason is people’s perceptions of changes. Different people feel differently about the changes. Some people feel they may end up being worse after the changes than the others (e.g., losing jobs, being moved to a lower position). Therefore, they are less likely to support the changes and develop resistance to change. In addition, some people may feel excited because changes are opportunities for them to learn new things. Thus, they support the changes. People who prefer routine tasks are more resistant to the changes. The fifth reason concerns the incentives and rewards of the changes. If the benefits of the changes are not worth the troubles involved, there is more chance people will resist the changes. Besides those reasons listed above, there are also other less common reasons for resisting changes. For example, people may not like the changes because they are afraid that they have to acquire new skills to adapt to the changes. Another reason can be that previous changes ended up failing. Thus, people will think these upcoming changes are no different and unnecessary. Finally, the company’s culture can be the reason for resisting changes. If employees feel attached to the company’s culture, they will resist new changes more than employees who feel less attached.

Depending on the companies, the “top three” reasons for resisting changes may vary regarding change management. There are three questions that a change manager should ask in order to identify what reasons for resisting changes are the most common among the majority of employees. The first question is what the changes include. If the changes are related to combining different positions into one and making several employees redundant, the most common reason for resisting changes among employees is more likely the fear that they will lose their jobs. If the changes involve upgrading the information system, the most common reason can be the fear of learning new skills.

The second reason the change manager should ask is who the changes will affect. If the changes only affect certain people in the company, the reason for resisting changes may restrict within that group only. The final question the change manager should ask is how the changes will affect employees. If the changes positively affect employees (e.g., shorten the time they do things, less work), there may not be any resistance at all. In my experience mentioned above, even though the changes enhance the internal control of my company, they make routine tasks more time-consuming, thus, create resistance among employees.

With regard to the most difficult reasons to deal with from a change manager’s perspective, it also depends on the company and the changes when asking the three questions mentioned above. For the first question, which is what changes include, if the changes include learning new computer skills and there are a lot of old employees who do not like to learn new skills in the company, this will be the most difficult reason for resisting change to deal with as a change manager. Providing training and creating clear and easy-to-understand computer guidance can help ease the change management process.

For the second question, which is whom the changes have impacts on, if the changes affect only one or two departments, the employees (both affected and unaffected by the changes) may think there is discrimination against them. This feeling of discrimination can create resistance to change. In this case, transparent and timely communications from managers can smooth out the process when it comes to change management. Lastly, for the question that asks how the changes affect employees, the challenge for change managers is that the goals of employees do not align with the goals of the company. For instance, if the changes are to make the company more profitable but more work for the employees, they will naturally resist the changes because their goals may not be the same. In this case, change managers can align the goals of the company with those of employees by rewarding the employees. If one percent of the company’s profit is used to reward employees, the employees will have the incentives to embrace the changes.

As mentioned in the previous example, the tax manager in my company actively resisted the changes. Because of the changes, his department had to work more to reconcile all tax accounts that had never been reconciled before. In addition, to tighten internal control, the tax manager had to report to the controller for tax payments that were greater than a certain threshold. The changes obviously decreased the impact of his role in the company. He did not have the freedom he once had when it came to filing tax returns and making tax payments.

There are several methods that companies can stop senior managers from resisting changes in change management. First of all, change leaders should consult senior managers in the early stage of the decision-making process. Informing them of all the problems, what the changes are for, and their feedback on the changes are necessary. In my example, the tax manager should have been asked about the tax account reconciliation problems and his suggestions on solving the issues. After all, he is the most crucial change agent when implementing the changes. Second, the senior managers should be given enough tools, resources, and time to implement the changes. Sometimes, senior managers oppose the changes because they feel they do not have all the necessary resources to make the changes happen. The tax manager at my company could have been supportive of the changes if he had been given more resources (e.g., hire more employees for the tax department, hire outside consultants). Finally, supports from change leaders are essential. If senior managers feel that their leaders are in favor of what they are doing, they will be less likely to resist the changes.

Managing Change Resistance

There are different approaches to managing resistance with respect to change management. The first approach is the attraction approach. Under this approach, people resist because they find the old system attractive. The tasks of change leaders are to find new attractors that can attract people to the new system. In order to create attractors, change leaders need to work together with the employees and have a close and trust relationship with them. There are several questions the change leaders can use to identify attractors (e.g. How will the changes benefit the employees? How do the changes relate to their interest? How to improve performance?) The bottom line is that resistance can be avoided if the change leaders make those who involve in the change process feel appealing to the changes.

Another approach is the contingency approach. Under this approach, there is no best way to handle resistance. People have different reasons why they resist changes. Thus, they need to be handled differently. There are diverse strategies to manage resistance. Depending on the situation, appropriate strategies can be used to manage resistance. In my company, the approach used was the attraction approach. The change leaders (the CEO and CFO) appealed employees to the changes by identifying attractors. For instance, there were emails to employees to inform them of new features of the latest IT system that would be implemented in July 2018. The emails said that the new IT system would be faster and would help employees shorten their work times.

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