To Centralise Or Decentralise…That Is The Question!

Having consulted to organisations in Australia and South Africa over the years, I have encountered what appears to be a cyclical pattern of organisational change in large organisations. It seems that changes in process, systems and structure are frequently a result of the move toward a centralised or, conversely, decentralised business model. I refer to this change as ‘cyclical’ because in large, well-established organisations that have been in existence longer than 10 years, my experience has been that this shift in business model is seldom new. Consequently, almost without fail, one of the stumbling blocks I have encountered in helping clients manage change during a de/centralisation process has been the resistance from long tenured staff who invariably state ‘we tried this before years ago and it didn’t work!’ or ‘this is not a new model…we were de/centralised before - why are we going backward?’. I refer to this as the ‘we’ve seen it all before’ barrier and, early in my career, I found myself at a loss to address these very valid questions from exasperated staff suffering from change fatigue. Although it was possible to make the case for change and communicate the benefits, the question of ‘why didn’t it work before?’ was one that I came to dread (as did most of the senior leaders I worked with!).

So how does one manage change and resistance effectively in situations that appear to be ‘change for the sake of it’? Having watched the centralise/decentralise cycles long enough, I have come to realise that, given a business environment in constant flux, so the appropriateness and success of a centralised/decentralised model will wax and wane in response. The response to the question ‘why didn’t it work before?’  is most often ‘it did work then – but the environment changed and we no longer saw the results we needed to remain competitive, so we adapted. Now we are seeing a shift again to an environment in which that model will yield the best results – so we need to adapt again ‘. I have found this approach extremely useful in helping to shift mind-sets during a repeat de/centralisation process.

Staff have a long memory, especially if they have experienced a painful change in the past and too many organisations make the mistake of ignoring this history. If an organisation has gone through a de/centralisation process before (any change process, actually!), I believe it is critical to incorporate and validate the history into the change communication so that those impacted by the change have insight into the change cycles. It is important to do this early in order to pre-empt the questions and frustrations that are likely to emerge in response to a change cycle that has come full circle. So, in presenting the case for change in these cases, it is very useful to address the following questions:

  • What has changed in the broader context or business environment to result in the repeat shift in business model?
  • Are there differences between this de/centralised model and the last one we implemented?
  • How will we realise efficiencies/benefits in the current cycle that we cannot under the current model?
  • How long do we foresee the ‘new’ model working effectively?
  • What external factors will influence how we adapt and when we can expect to shift model again?

These can be very difficult questions to answer and can seldom be addressed in absolutes, but they are critical to get the buy-in of staff jaded by continuous cycles of change. Helping staff view a change in business model as an ongoing cycle, rather than the ‘end’ of a journey, also helps to foster change resilience and inculcate a culture of change readiness.

When helping clients to manage change in their organisations I strongly encourage change sponsors to adopt this view of change by engaging them in ‘history mapping’ and ‘strategic planning’ processes that occur in tandem. This helps those spearheading the change to be ready and committed to addressing resistance they are likely to face before announcing a return to de/centralisation. And if they cannot formulate a sound business case for making the shift in the current context - then perhaps the cycle has not yet turned and the change is ill advised after all!

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