Change Management and Organization Psychology

Successful implementations rely on accepting change

Pretty much every article or book written on ERP implementations discusses the problems of Change Management. Well over 50% of project challenges are attributed to either Change Management or Business Process misalignment. To put a finer point on it, Change management is essential to an ERP implementation because it helps to ensure that the changes being made are understood and accepted by the people who will be using the system. Implementing an ERP system involves significant changes to the way an organization operates and manages its business processes, and these changes can be disruptive and challenging for employees to adjust to. If change management is not properly planned and implemented, it can lead to resistance to the new system, decreased productivity, and ultimately, the failure of the ERP project.

Effective change management helps to minimize the negative impact of these changes and maximize the benefits of the new system. This includes identifying and addressing the needs and concerns of stakeholders, providing training and support to employees, and communicating regularly with all parties involved to ensure that the transition to the new system is smooth and successful.

Again, these points are well understood. However, we think that the next breakthrough in Change Management is to address the problem head on with science and research, not hunches– In other words, Organizational Psychology.

Organizational psychology and ERP

The role of organizational psychology in ERP implementations is to apply scientific knowledge about human behavior in organizations to improve the well-being and effectiveness of individuals and groups during the change process. ERP implementations involve significant changes to the way an organization operates and manages its business processes, and these changes can be disruptive and challenging for employees to adjust to.

Organizational psychology can be used to identify the needs and concerns of stakeholders and to develop strategies for addressing them. This can include providing training and support to employees to help them adapt to the new system, as well as effective communication and engagement with all parties involved to ensure that the transition to the new system is smooth and successful. By taking a psychological approach to change management, organizations can better understand the factors that can impact the success of an ERP implementation and develop strategies to address these challenges.

Helping your employees accept change

The primary challenge of any implementation is change. People are not naturally accepting of change. Expectancy Theory, a focus within Organizational Psychology, postulates that people are their most fulfilled when they expect to do well in their daily tasks. We’ve often seen this portrayed in popular culture as visualization, if a person visualizes success then they will achieve it. The field goal kicker about to kick the game winner, the Little Train That Could, the examples go on and on. Change disrupts employee’s expectations of success. The new technology, tool, process, or boss will always cause anxiety because expectations are changing. Applying this theory to ERP implementations means convincing employees that they should expect to be successful with the new system.

When employee expectations are brought to the forefront, specific barriers to change can be identified. There will always be those in the organization who feel that their skillset is being replaced by the changes implementation imposes. This leads to fear, which leads to uncertainty, which leads to a desire for reestablishing certainty. Employees pursue this need for certainty by finding groups or individuals with the same interests. In this case the interests take the shape of concerns about change. Before too long, there is an entire camp of employees that rise up to resist change. This can result in cultural undertones that have a far reaching impact on how the organization functions. Culture eats strategy for breakfast, and the best planned implementation will fail if a culture of resistance is allowed to grow.

These individuals need to be identified early on, and should be incorporated into the implementation as subject matter experts, trained as super users, etc. This changes the resistors expectations from threat to success before they can become entrenched against the change. At OSI, we have found playing a bit of “Judo” can help turn resistant people into champions of change.