Change fatigue can strain employees and organizations, and it is getting worse. To reduce the harm, companies are turning to more thoughtful, gradual strategies.<\/em><\/h2>\nThe notion that \u201cchange is the only constant\u201d dates all the way back to the pre-Socratic Greek philosopher Heraclitus, some 2,500 years ago. But the pace of change in today\u2019s business world often seems to outdistance the capacity of executives and their teams to adapt.<\/p>\n
Hardly a fad pushed by human resources, the phenomenon known as \u201cchange fatigue\u201d can affect the bottom line through workforce churn, reduced ability of workers to adapt to further change, and lower productivity.<\/p>\n
Executives should \u201cbe treating change fatigue as a business risk,\u201d says Hilary Richards, Vice President and analyst in Finance Practice at Stamford, Connecticut-based consultant Gartner.<\/p>\n
Whether adopting new technologies or reacting to external change, many if not most companies appear to be in a constant state of flux. Over 75% of corporations revamp their business model every two to five years, according to a study by WalkMe, a San Franciso-based software-as-a-service firm.<\/p>\n
Nowhere does change fatigue ring truer than in corporate finance. Finance departments field a myriad of novel strategic roles when a company implements digital transformations, enterprise resource planning, and artificial intelligence (AI).<\/p>\n
\u201cCFOs have pretty significant mandates to support growth, manage cash, and process change,\u201d Richards notes. Yet, only one-third of corporate-change projects are deemed successful, according to the WalkMe report. Two-thirds of workers report burnout during transformation drives and workplace stress accounts for 8% of national healthcare spending in the US.<\/p>\n
Another recent report from Orgvue, a London-based organizational design and planning platform, found that 38% of CEOs would rather quit than lead a major transformation.<\/p>\n
\u2018Things Are Not Getting Better\u2019<\/h2>\n
Her clients ability to adapt to change began to wane around 2017, recalls Jenny Magic, founder & CEO of Build Better Change, an Austin, Texas-based consultancy and co-author of \u201cChange Fatigue: Flip Teams From Burnout to Buy-In.\u201d<\/p>\n
\u201cTop leadership was interested, but middle managers and the people who do the work were less capable of carrying it out,\u201d she recalls. A recently published report by her firm \u201cvalidates that things are not getting better.\u201d<\/p>\n
Some evidence shows them getting worse.<\/p>\n
\u201cThe average employee experienced 10 planned enterprise changes in 2022, up from two in 2016,\u201d a Gartner report notes, \u201cand there is no reason to expect the pace to slow. But the workforce has hit the wall; the share of employees willing to support enterprise change collapsed to just 38% in 2022, compared with 74% in 2016.\u201d<\/p>\n
In response, some organizations are getting creative; examples can be found among both corporate giants\u2014Danone, Liberty Mutual\u2014and relative upstarts. Companies opt for either change management consultants employed by big name consultancies or specialized emerging competitors. In addition to advising executives, these increasingly high-profile professionals hold conferences, provide training, and draft articles with titles such as \u201cThree Ways to Minimize Change Fatigue Among Financial Teams.\u201d<\/p>\n
The solutions that consultants promote address two distinct kinds of change\u2014large-scale transformation and accumulative change.<\/p>\n
Major initiatives tend to favor faster speed and larger scope. Yet there are signs that more gradual solutions might be more effective and less traumatic.<\/p>\n
These drives tend to be implemented in reaction to big external events, such as a severe economic downturn, the Covid pandemic and its fallout, or important trends in technology such as artificial intelligence. But this might reflect outdated thinking, argues Oliver Shaw, CEO of Orgvue.<\/p>\n
\u201cChange came along a lot less frequently\u201d even a couple of decades ago, he says. Executives \u201cdeveloped impulses [to act]: \u2018Change is needed now!\u2019\u201d As a banker who lived through the 2008 financial crisis, \u201cI thought at the end of that, I would never see anything like it again.\u201d<\/p>\n
Now, supposedly one-of-a-kind events seem run-of-the-mill.<\/p>\n
Full-bore transformation, often involving cutbacks, might be too blunt in an ever-changing world, Shaw argues. Risks include high severance pay and other costs related to large-scale layoffs. Companies in the Fortune 500 that underwent significant workforce restructuring in 2023 dished out $32.7 billion in severance pay that year and carried over another $10.9 billion into 2024 as charges or liabilities, according to data compiled by Orgvue.<\/p>\n
Additional costs of dumping workers, according to a 2024 Bloomberg study of Securities and Exchange Commission listings, include reduced productivity (about six months); an uptick in voluntary departures; increased unemployment insurance tax; and higher legal fees, mostly to avert lawsuits over alleged discrimination.<\/p>\n
Danone took a different path when it was contemplating a large-scale change; it used what an Orgvue case study calls a \u201ccontinuous design approach to organizational development to remove the need for costly, reactive, high-risk transformation projects.\u201d Instead of slashing jobs, the Paris-based multinational food and beverage company overhauled its human resources processes and shortened its planning period from annual to quarterly to better track labor demand and supply. They were able \u201cto understand how [to make adjustments] through time,\u201d Shaw says.<\/p>\n
As with any malady, sometimes the best \u201cremedy\u201d is preventative medicine. When the Swedish payments fintech Klarna wanted to reduce overhead in 2023, it reduced trauma via layoffs by outsourcing about 500 jobs in 10 markets to two partner firms. Internally, it implemented a hiring freeze and embarked on a drive to adopt money-saving AI. \u201cThey are leveraging their margins by levering AI,\u201d Shaw notes.<\/p>\n
Danone and Klarna are examples of companies where leaders \u201cunderstand organizations as systems.\u201d If the average firm has a 15% attrition rate, according to Shaw, it should be able to milk that in tandem with internal reassignments to make significant reductions without undue trauma.<\/p>\n
\u2018Slow Down Now, Speed Up Later\u2019<\/h2>\n
After a merger, San Diego-based broker C3 Risk & Insurance Services jumped into what at first seemed like a very complex and difficult integration process. Employees fretted over their future with the firm. Nobody could agree on which technology to adopt.<\/p>\n
Eric Brown, founder and CEO at Florida-based Imperio Consulting, was brought in to help facilitate the process. A veteran of the US Special Forces, Brown draws on that background in his practice. Instead of change fatigue, the American military calls it \u201coperator syndrome.\u201d Constant pressure and uncertainty can wear people down.<\/p>\n
\u201cThe corporate world mirrors that experience in many ways,\u201d he says, \u201cespecially in finance, with its tech overload, unpredictable markets, and ever-changing regulations. It\u2019s like trying to stay steady on shifting sand, and it can be exhausting.\u201d<\/p>\n
Brown recalls telling one client, \u201cLet\u2019s slow down now so we can speed up later.\u201d Soldiers think of it as a \u201ccrawl, walk, run\u201d sequence. With buy-in from C3\u2019s top brass, Brown was able to help incorporate that approach into the integration plan in large part by using team-building exercises and tools.<\/p>\n
\u201cThey took it to heart,\u201d he says, investing in training and dialogue with employees. In 2023 and 2024, C3 was tabbed as a top place to work by both Business Insurance and the San Diego Business Journal. \u201cC3 are rock stars,\u201d Brown adds.<\/p>\n
C3\u2019s experience also points up the need to address the second of the two types of change fatigue that consultants identify: the accumulation of small changes. Like water that builds up behind the proverbial creaky dam, they can ultimately threaten an organization\u2019s structural integrity.<\/p>\n
Employees feel increasingly harried by the nearly non-stop accumulation of relatively minor changes affecting managerial strategies, team composition, and job description, Gartner found. Employees feel disempowered by top-down change that comes without debate or discussion. Old-school burnout and increased turnover result if employees cannot recover and recharge from one disruptive event before the next one comes along.<\/p>\n
Hoping to ward off the fatigue cycle-of-death by 1,000 cuts, Liberty Mutual designed a process to identify employees\u2019 fears and assumptions. It started with questions aiming to help workers make peace with change. Tools included change workshops as well as employee engagement and feedback. Such initiatives can help address problems that lurk below the surface.<\/p>\n
\u201cMost of the senior C-suite focuses on the tip of the iceberg,\u201d Richards says. \u201cIt\u2019s what they\u2019re paid for. But your team will run into that iceberg.\u201d<\/p>\n<\/p><\/div>\n\n","protected":false},"excerpt":{"rendered":"
Change fatigue can strain employees and organizations, and it is getting worse. To reduce the harm, companies are turning to more thoughtful, gradual strategies. The notion that \u201cchange is the only constant\u201d dates all the way back to the pre-Socratic Greek philosopher Heraclitus, some 2,500 years ago. But the pace of change in today\u2019s business […]<\/p>\n","protected":false},"author":1,"featured_media":111648,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[93],"tags":[7441,7001,31509,11520,11513,528],"dealstore":[],"offerexpiration":[],"class_list":["post-111645","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-burnout","tag-change","tag-constant","tag-corporate","tag-creating","tag-fast"],"yoast_head":"\n
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