Some Things Don’t Change
By Georgeana Fung, Managing Director and Market Leader, B-M Hong Kong
October, 2008

Change management – it’s never a simple proposition but when the programme and its pace are well planned, there is a sense of control of the process.

Right now, we'd be forgiven for thinking change is unmanageable simply because many recent events have been so sudden and unpredictable. There's chaos out there and it is affecting companies and individuals. From the subprime meltdown to food safety issues, the reputations of governments and corporations are undergoing tremendous scrutiny. Reputations built over many years are besieged by crises that have emerged out of nowhere but were always lurking somewhere. Many governments and financial institutions are being vilified. A handful of politicians are being applauded for decisive action. Experts – and more than a few told-you-so’s – are gaining profile.

With 20/20 hindsight many of the critical issues which have emerged over recent months could have been addressed or at least mitigated. Now, however, governments and corporations have acted and as markets continue to rise and fall, officials have promised to enhance governance and re-organise financial structures and industries. They have promised to restore confidence and put the markets back on track. The need for change in certain sectors has never been clearer. Much of the change will be dramatic but the principles of managing change remain the same – and for a shell-shocked world, following those principles is vital to restoring calm and confidence.

In spite of the enormous challenges, it is not so hard to make the decision to bring in management experts, restructure existing processes and policies, and impose improved checks and balances. However, change is not just about incorporating new policies, systems or restructuring. It is about changing peoples’ mindsets and attitudes. Managing change is never easy as change can be unsettling and even frightening.

People resist change, especially when the status quo – or the recent past -- has been good to them. The recent financial meltdown has probably convinced most people that change is needed. Yet it would be easy to wait and hope that things will gradually return to “normal”. In the case of the financial markets, for example, without a shift in mindset – among officials, corporations, institutions and the investing public – there would be no acceptance of change, especially if new systems for the future appear punitive or restrictive in the short-term. It will be a case of creating the new “normal”.

Change is a protracted and complex process. To make change possible and acceptable, leaders must initially focus on the human side as much as – if not more than – structural transformation. Change programmes must be tailored and managed in a way that ensures that the people most affected will accept and handle the change effectively.

People need to understand and believe that they will be “beneficiaries” of change – that they will be better off in the changed environment or at least that change is necessary for the greater good. Transparency, engagement, openness, early and full communication are key when it comes to managing change.

Leaders who have failed to adequately consider the human aspect to change have often been left wondering why their seemingly well-laid plans have gone askew. In his famous Art of War, Sun Tzu identified five failings of leadership: (1) recklessness – a leader who acts without considering the after-effects on people; (2) cowardice – a major negative characteristic in a leader; (3) a hasty temper – impatience and a failure to listen to people will only lead to them being insulted; (4) a delicacy of honour – too much focus on glory makes a leader too sensitive to shame; and (5) over solicitude – which can create too much worry and concern. All ancient principles worth remembering by leaders of change.