Change management

Business change can come from internal factors, such as restructuring, or external ones, like market instability. It is important to recognise types of change to plan effectively and support staff at individual, team, or organisational levels.

Types of change

Depending on what causes it, business change can be reactive or planned.

Planned change

Planned change is often implemented to improve how your business operates or to achieve specific goals. For example, introducing new products and services or reorganising your structure.

Reactive change

Reactive change happens in response to unexpected events outside your control. For example, reduced demand for your product or service, or a crisis such as the COVID-19 pandemic. A strong response to such events can transform your business, changing how people work, innovate and collaborate. 

In situations like this, follow good change management practices to protect business continuity.

Other types of change

Other types of change include:

• developmental change - ie incremental improvements
• transitional - eg mergers
• transformational - due to major shifts
• remedial - intending to fix issues and problems

Each type of change has a different degree of complexity and uncertainty, and may require different implementation methods and commitment of resources.

Levels of change

Change affects businesses at three main levels:

• individual level - eg change in job assignment, transfer, change in job maturity level, etc
• team or group level - eg changes due to inefficiencies, lack of communication, etc
• organisational level - eg changes due to relocation, restructuring, mergers, acquisitions, etc

Change at one level can affect others. Understand the impact across all levels to plan support and interventions effectively.

Categories of organisational change

Organisational change typically falls into four distinct categories:

• strategic
• structural
• technological or process-oriented
• people-oriented

Strategic organisational change is concerned with the overall goals and purpose of the business, and any changes in the vision and mission of the organisation. Process-oriented change focuses on new technologies, new skills and operating processes, while people-oriented change relates to employee performance, skills, attitudes, behaviours and relationships.

Change in organisational structure

Structural change in an organisation occurs when the business changes its:

• organisational hierarchy
• chain of command
• management systems
• job structure
• administrative procedures

A structural change may involve, for example:

• relocation or adaptation of business premises to accommodate extra staff
• relocation to a cheaper location or one nearer to customers, labour or transport links
• mergers and acquisitions to allow you to enter new markets, seize new opportunities or increase efficiencies
• flattening of your management structure

Read more about the reasons for changing your organisational structure.

Risks associated with change

Any type of major organisational change can be stressful and risky. Challenges may come up around staff retention, redundancies, relocation, staff communication, merging of organisational cultures and processes, or altering your business structure.

Before you initiate change, weigh the benefits against disruption, and follow a change management process to minimise potential disruption and risks.