Why does 99% of corporate change fail? What are the main reasons? This article will be discussed with you.
Can you imagine? Banknote printers are one day at risk of going out of business.
De LaRoux is the world's largest printing plant that prints banknotes for more than 140 countries, including the United Kingdom.
The 200-year-old, established printing company was once at its peak, contracting one-third of the world's banknote printing, and the weekly banknotes printed together are twice as high as Mount Everest.
One of the main factors in the bankruptcy crisis of De LaRoux was the change in payments.
Mobile payment has become a new way of life, and people's demand for banknotes is also declining sharply.
Some say that in a few years' time we may only be able to see banknotes and printing presses in museums, and see the sentence: "Unfortunately, it didn't do anything wrong, but the times don't need it." ”
What kind of inspiration does De LaRoux bring us?
The world is changing so fast that if businesses don't keep up with the changes, it's hard to survive in a complex and ever-changing business environment.
Why are almost all businesses pursuing change these days?
In my opinion, the current external business changes have reached a very drastic stage.
As an example, a very common consumption scenario is that we used to buy vegetables in vegetable markets, supermarkets and farmers' markets, but because of the epidemic, we all learned to buy vegetables on online platforms such as Hema and Dingdong, and Daily Fresh. After the end of the epidemic, most people still retained this habit.
This is the first category, the advancement of science and technology. The change in technology has changed the consumption scenarios and consumption methods of China's 1.4 billion people.
This is a big change, everyone thinks that my shop was opened well, now there are fewer people in the mall, and my business is not as good as before. In fact, every iteration of technology, the flow of customers will undergo a huge migration, then in this case, all our marketing methods will also be subversive innovation.
The second type of change is the outbreak. The epidemic has had a great impact on many industries, and I believe that everyone can feel it.
The third category is changes in the international situation. Cross-border trade in 2020 is doing very well, but by 2021, because of the impact of Sino-US relations, many products have been removed from the shelves on Amazon in large numbers.
The fourth category is changes in industrial policy. Last year's real estate, education and training industry has changed a lot.
The fifth category is the change from demographic dividend to talent dividend. I think this is the biggest fundamental change in China.
The Fourteenth Five-Year Plan report mentioned this article, we in China was originally a demographic dividend, so many industries around the demographic dividend have ushered in a vigorous development, but now the birth rate has dropped to the minimum, so we want high-quality development, so it has become a talent dividend.
From the government to the local government to every enterprise, everyone is emphasizing the competitiveness of talents, and we will change from the demographic dividend to the competitiveness of talents, and the impact on each enterprise is earth-shaking.
The sixth category is the main melody factor. China wants to end the era of extensive inefficiency, because the dividends of reform and opening up have made many industries soar, in fact, extensive development, such as energy, minerals, infrastructure, finance, real estate and so on. In the future, to do high-quality development, each enterprise will be required to carry out refined management.
These big changes have led to a change in the logic of business, which is actually the experience we have accumulated over decades, which can no longer be reused today. The old map can not find the new continent, so change is not the patent of large enterprises, nor is it the patent of traditional enterprises, and every industry is transforming and changing.
When I first came out of Alibaba more than 10 years ago, there were some big companies shouting every day, many traditional industries or many small and medium-sized enterprises, they are actually far from change.
Now whether it is state-owned enterprises, large central enterprises, or our private enterprises, whether it is technology companies or traditional enterprises, whether it is hundreds of billions of companies, or enterprises within 100 people, they are urgently calling for change.
Why does 99% of corporate change fail?
Change is important, but it's also very difficult to succeed. In China for thousands of years, very few real changes can be successful, reform and opening up are very successful, and the martingale transformation method has been partially successful.
In the world, only Microsoft can completely change and succeed in the market value of hundreds of billions of dollars.
Why is change so hard?
On the surface, the change seems to be that the chairman has seen a broad strategic direction, the wave is coming, and then he calls on everyone to rush to the wave, but this change has repeatedly failed.
There are usually four reasons why change fails.
First, change is a one-handed project, but the boss doesn't push it.
Change is actually a leading project, but many times the chairman himself does not rush up, let the people below rush up, and the people below end up being cannon fodder, and the change has to go bankrupt.
I'll give you an example, in the past, a very well-known real estate company was preparing to change and transform into an Internet business, during which he hired six CEOs, and the HIRED CEO either reported to the boss of the information department, or to the boss of the retail department store, or to the boss of the original business, rather than directly to the boss.
You must know that new things are bound to impact old things, and there will be entanglements and conflicts of interest in the middle. So I see that the biggest factor in the failure of change, in fact, it is a first-hand project, if the boss does not push, let an HR push, or let the boss of a business unit to push, basically will not succeed.
Second, there is no cultural soil for change.
The more successful the company was in the first 20 years, everyone would be very convinced of the company's original things. If the soil of culture remains the same, new businesses will not grow.
Culture is the belief of so many of us, and when you want to break the faith of these people, even Aunt Sweeper may "fight" with you. This is the pain of my dealings with a lot of entrepreneurs.
So a change in culture is about changing what so many people believe, including what we were once right and successful, and it's especially difficult to do that.
Third, there is no change in the team.
Is the success of the Shang martingale transformation method the credit of Qin Xiaogong or the credit of Shang Martin himself? Both. But in my opinion, the main credit is Qin Xiaogong.
Because before Qin Xiaogong changed the martingale, the first thing he did was to change the culture.
The second thing is to build a team of change. After the team of change achieved certain results, shang martingale was put on the horse, and Qin Xiaogong was actually a general director.
So the change team is very important, for example, you have to do an innovative business, if you use the original team 100%, I think it will fail, because you are all inertia.
But if we were to abandon our original experience today and come in entirely with a bunch of new business people, he would fail. Why? Experience is incompatible with the cultural soil of the organization.
He must be a mix-and-match team in this team, and many people fail to choose the wrong team, which is a big failure in my opinion.
The change we made to the PEOPLECC group was a mix-and-match team. They want to do the car aftermarket, they have the original people insurance, and we have recruited people who understand the Internet and people who understand cars.
This is the GTC model that I will talk about in the organizational innovation class, change is ordered, and change first changes culture.
Fourth, not enough patience.
Most companies lack patience, and after 6 months of change, the boss finds that there is no immediate results. Then, just when the most glued and changed the deep water area, the boss lost confidence.
It seems that the results have not yet come out, but in fact the organization has changed, and this is the delay effect that I talked about when I shared the Fifth Cultivation. Any change has a delay effect, so it takes time and patience to wait.
If the boss is impatient, the original team represents a different interest group, then they will come to fight back, in the face of such a situation, 99% of the boss is not firm, and finally this change team is sacrificed.
Final words
I summarize that in this era, in fact, every company needs to change, but the success rate of change is affected by these four reasons: the first is not done by the boss himself; the second culture is not done well; the third is that the team is not right; and the fourth is not enough tolerance and patience for change.
In the case of the change I did, it took three years. In the first year, you can do a good job in the culture of these people, set up these change teams, and start working well. The next year was the revolution into the deep waters, and everything was changing, and everyone was complaining, but it hadn't yet come to fruition. So there is a process of change, don't expect to succeed in half a year.
But I am very confident in helping companies to make changes, because there are more successful cases, of course, this is not unrelated to my organizational innovation class.
I have to give their senior management team a sense of understanding and consensus in the front, so that they are fully aware of the need for change and the hardships of the process that change has to go through, which is very important.
In the organizational innovation class, I will also teach them the steps and methods of change, because without these things, when we go in and help them consult, it is also a failure, and we will become cannon fodder.
So those companies that ask me to do consulting, I will let them participate in my organizational innovation class first, otherwise I will not accept consultation.
Finally, if you want to learn the organizational innovation class, learn how to make changes, and learn the top-level architecture system of finance, you can read the original article to understand.
This article was first published from the public account Zhang Lijun, want to know what are the trends in the future development of the organization? Stay tuned