There are three key reasons why you may need to undertake a change in your business or organisation.
Now you might be wondering if there are only three reasons for changing something? Well here’s the big thing about any change, it always carries a cost with it!
Most people immediately identify the monetary cost that’s involved with change. The reality is that is about more than just money. The 3 other things to consider are time, resources and, of course, risk!
These 3 can either work with you to make the change happen or can work against your business to make it flop.
So, it’s imperative that when making changes in your organisation, you’re choosing the right changes and the right reasons for the change.
There is always a risk involved in any change. And for that reason I believe there are only three real reasons for changing anything.
Three real reasons for the change
Now the first reason for change is one everyone will recognise. And that is to do with systems and software. With some systems you may need to update to keep abreast of regulatory or IT upgrades, to stay in business. If you don’t do these kinds of changes it can literally lead to going out of business because you may well not be compliant or because your software no longer works.
It’s a bit like changing your tyres! The car can only keep going toso long on the old tyres and if you don’t change them when the garage says you need to, then you fail your MOT or break down!
Consequently, these are going to be those changes that you need to make inside your business that will keep everything operating.
Moreover, identifying what those changes are is vital to allocate the right amount of time, effort and obviously the right amount of money. However, importantly you must realise this that kind of change does not push your business forwards. This kind of necessary change just keeps you where you are currently.
And then there is the second reason for change
The second kind of fundamental change, is one where you are looking to reduce your overheads, your running costs and your operational expenditure. Again, this is a change that a lot of businesses look at. And it is not just about saving money – it is about making things simpler, quicker more straightforward and more profitable.
This kind of change has an impact on your bottom line. And in some cases the risk associated with the change is probably going to be outweighed by the savings that you can make. If you can identify those kinds of changes in your organisation, you can produce more money for the same amount of effort, possibly even less effort.
This second type of change is still fundamentally the same as our first type of change. You are not driving your business forward. In some cases this type of change can actually be devastating. If the driver for the change is purely cost cutting, what can happen is the institutional knowledge in a busines can be lost by replacing people with proceess. This is one to manage carefull. Sometimes it can be right and sometimes it can be a really bad move.
Short term cost savings should be weighed against the risks of long term lost opportunity or market share.
Pushing your business forwards
Now the third kind of change is the one that I personally really enjoy, These sort of changes are usually found within a confident company. It’s about changing things in order to pushing the business forward.
This third category of change is all around revenue generation, and how can we produce more?
It’s all about how you can generate more of something, a better product, more service and solutions. Or how you can quickly solve other people’s problems. This is what your customers will pay for. Here you are in a place of growth, and will be moving your business forward. Because, the reality in nature is if you’re not growing, you’re dying! And it’s the same in business, if you stand still for long enough, eventually you will get knocked down.
You can only overcome stagnation by growth, by change, by making yourself go further, making things better, producing more solutions to new problems. And there is one thing certain in life – change happens! It happens all the time, it’s occurring within our bodies every single second of the day, and it also happens to our business, our market, our economy, whether we like it or not. It’s much better to be the business leading the changes, then one playing catch up.
So, when you are looking to make changes in your business, think about which of the reasons you are doing it for. And if you are not changing to generate growth – why not?
Becuase, do you know what, ‘no change’ is often the costliest change of all!