Externalising the enemy

Written on 6 October 2015 in Features
Features

In his final article, in a series on change, Gary Wyles explores the uniting force of a common threat

There are few positive aspects of recession that readily spring to mind, but there is one over-riding one and it can be hugely beneficial. Recession forces us to look outside our own organisations. It means that we have to assess our competitive advantage. After all, the threats are palpable. Jobs will go. Organisations will be forced into liquidation.

So we unite towards a common objective – to keep our own jobs and secure the organisation for the future. Nothing unites people more than a common enemy and working together can be a very powerful force for change.

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However, when the very real threat of financial crisis passes, it is all too easy to fall back into our own, more complacent, internal view. We cease to think about the market. We don’t review our competition and often, we stop talking and really listening to our customers.

If change is brought about with purely an internal view, all it does is set colleague against colleague, department against department. Internal politics are brought to the fore. While we can agree that competition is helpful, unless that competition is externally focussed, it will simply create division internally. While short-term gains might be made, the long-term culture of the organisation can quickly become toxic.

For leaders undertaking change, it is always beneficial to be highly aware of what is happening beyond the reach of our own organisations. What conversations are your customers having in the market? What are the emerging changes in other markets that might impact your own organisation?

People need a compelling reason to accept change. One that overrides their own fears and concerns, although these will of course still need to be acknowledged and handled sensitively. A compelling reason to change is one that unites your people, where they can see the benefit of undertaking a change project – both from the company’s perspective and from their own viewpoints.

A useful tool for understanding the external environment is PESTLE, which helps leaders evaluate Political, Economic, Sociological, Technological, Legal and Environmental factors and what impact these might have on an organisation. It is also of use for HR and Training departments to assess how well prepared the workforce is for forthcoming changes, as well as the resources and infrastructure that the organisation will need in the future.

Here are just a few factors that can have far reaching consequences for organisations and, if not planned for, can threaten the long-term future of our organisations.

Political

Changes in leadership & elections
Devolution
Changes in European parliament
Emergence of Global super-powers
The impact of worldwide politics, religious and civil unrest

Economic

Rapid economic growth
Impact of interest rate hikes
Fluctuating currency
Price of raw materials
Rate of inflation
Overseas competition & cheaper imports

Sociological

Ageing workforce
Move towards greater work-life balance
Skills shortages
Global working
Flexible working
Generational differences and their different expectations
Diversity in work
Global changes and emergence of new markets

Technological

Consumerisation of devices
Increased system integration
Social media
Cloud-based technology
Automation
Artificial Intelligence
Customer expectation that accompanies technological advances

Legal

Environmental regulations
Employment law
WEEE regulations
EU Compliance
Health & Safety

Environmental

Energy resources – pricing and availability
Sustainability and recycling
Waste management
Transport

Climate change and natural disasters

PESTLE is often considered as a strategic planning tool, perhaps only used when our 5-year plans are being developed. It should not just be used for this purpose. Each department should be continuously assessing external impacts on the organisation and planning for different scenarios.

For production it might be a new automation technology that becomes available that will bring down production costs and increase productivity. A reason to change is not just about having the latest equipment or selling more products, it’s about how fit the company is to compete in the global marketplace, where there is a constant pressure not just on prices but on the quality of production.

We only have to hear the discussions on the Pound versus Euro to see how seriously companies are considering their future in either an independent Britain or if we still remain part of Europe. Or we could point to the recent debates that raged over the UK elections or Labour leadership election. 

Now the UK along with most of Western Europe is considering the impact of the refugee crisis on our own country and local economies.

If we believe that we exist solely in a microcosm of our own organisations, we will be brought up short. We constantly need to be assessing the world around us, the opportunities it offers and the threats it presents. Then we will have a truly compelling reason to change and a vision for the future that unites our people.  

 

About the author

Gary Wyles is Managing Director of Festo Training & Consulting

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