The conclusion of my last newsletter in 2024 was: “Employees’ desire for clarity is greater than their fear of change.” During the Christmas break, I read an article by sociologist Steffen Mau that explores how social change takes place, why societies struggle so much with change, and how it can succeed. It piqued my curiosity. Can we gain new perspectives on change initiatives in companies by analyzing social change?
It goes without saying that Mau’s question is highly relevant in Germany today. Keywords such as “economic upheaval—from the auto industry to artificial intelligence,” “energy costs,” “migration,” “a changing security landscape,” “America First,” and “climate change” are enough to illustrate that there are plenty of triggers for social transformation.
Societies generally struggle with change, says Mau, because all people strive for continuity and security. Any change that does not occur gradually and over the course of generations constitutes a “destabilizing event.” People confronted with change interpret change processes in terms of personal gain or loss and position themselves accordingly. Mau notes that citizens who enjoy a high degree of autonomy are often more willing to make personal concessions than those who are embedded in rigid hierarchical structures. According to Mau, there are essentially three positions toward change: pioneers, for whom things are moving too slowly; resisters, who feel they are being left behind and who have the potential to become politically radicalized. The largest group consists of laggards, who do not yet know exactly how to respond to change.
Governments, as elected executive bodies, have the task of initiating and implementing social transformations. The example of European unification illustrates an approach in which policymakers, through the founding of the European Union, instinctively created the right conditions—conditions into which citizens gradually adapt and which they view with “benevolent indifference” despite all their complaints, according to Mau. In retrospect, the transformation of East Germany after the fall of the Wall appears to have been an act of assimilation. The consequence of this heavy-handed policy is ongoing, vocal identity conflicts among segments of the East German population, which threaten to lead to political radicalization. In the context of the current ecological transformation, the previous federal government’s ill-advised actions regarding the Heating Act or the call for speed limits have created a sense among many citizens of a forced change in behavior and a desire to resist.
A desire for continuity and stability, initial skepticism, weighing one’s stance on change against an individual profit-and-loss statement—all of this sounds familiar to us. Even though companies are not democracies and CEOs are not decision-makers mandated by employees who must take all possible social trends into account, there are similar factors that contribute to the success of a transformation:
- Change requires the right momentum. This can be a crisis or the dysfunctionality of the status quo—such as an administrative bureaucracy that is clearly overwhelmed or an established corporate structure that has become so complex that it hinders decision-making and action.
- There is a legitimate need for clarity regarding the improvements that this change will bring. The costly restructuring of Argentina’s economy and society appears (for now) to have the support of a majority of the population. In the case of a company, a well-communicated strategy ensures support.
- To minimize resistance to implementing change, employees in companies or citizens at the local or state level should be able to feel that they are actively shaping that change.
- Transformation initiatives are learning processes that must systematically incorporate reviews to allow for adjustments and course corrections.
Two points in the comparison between social and organizational transformation are particularly noteworthy:
- First: Institutional change is rarely preceded by a shift in mindset, as in the case of the EU. Political decisions that are too far-reaching can result in a stubborn and obstinate clinging to the existing culture, as seen in parts of eastern Germany. This reminds me of a statement made by a managing partner we spoke with recently. Looking back on the transformation process in her company, she wonders whether she might not have reached her goal more quickly and effectively if she had first initiated a change in corporate culture before tackling the reorganization of the company.
- Second: Are employees and managers who have the freedom to act and a high degree of autonomy more open to ongoing change than those who are stuck in rigid structures? Can empowering employees and managers to take personal responsibility be a prerequisite for the success of change processes?
