Change management requires strategy, people and, above all, communication.
Strategy equals knowing where to go and how to get there, and companies focus far too often on the first of these. The speed of today's markets and technological change is such that the two questions (where/how) are merging. The effect of structure on strategy is today's concern. Mobility, speed and change have become the ongoing, cyclical pattern of an organization. Today, scales of economy are being combined with smallness in new ways. Web businesses represent a very new business dimension: customer segmentation organizations that exist without borders, whose definition is based on their products and customers.
The knowledge economy is producing innovations for both business and society. Business models and cultures are changing. And analysts are just beginning to grapple with the profound changes this is bringing about, in terms of wealth creation, the nature of work and the structure of the corporation itself.
One of the key reasons for the explosive growth in new knowledge companies is the inability of older firms to prepare themselves for change. There are six lessons of how old companies can learn from the new. First, old companies should make a strong case for change with employees and explain the impact of not changing. Second, old companies should provide a completely clear vision of what is needed, in terms of skills and money to change direction. Third, old companies should try and transplant the soul of a small company into the big company. Fourth, companies should set bold, unreasonable targets. Fifth, companies should empower employees at all levels, involving them at every step of the change process. Finally, the role of the manager should be architect, driver and coach, rather than sole problem-solver.
Without fear it is almost impossible to foster a culture of change, which is vital to the success of a company in his view.
Companies that cannot recognize changes in the business environment and react quickly will end up as road kill on the highway to the bottom line. That's the Possum Effect, named after a nocturnal critter known for freezing in fright at the sight of oncoming headlights.
Companies' also need "anchors", aspects that provide identity and some sense of security in a changing world.
The cultural challenge for many companies is this: will hybrid models work? Will companies do old things using a new medium like the Internet or create completely new things for this new medium.
New companies have much to learn from the old, such as understanding the value of continuity, experience and long-term thinking.
Businesses should not measure success by short-term returns to shareholders but by how long they survive in the face of constant change.