Change management in business structures under the conditions of digitalization

Размещено на http://www.allbest.ru/

Change management in business structures under the conditions of digitalization

T. Grynko,

Doctor of Economic Sciences, Professor, Dean of the Faculty of Economics, Oles Honchar Dnipro National University

T. Hviniashvili,

PhD in Economics, Associate Professor, Associate Professor of the Department of Economics, Entrepreneurship and Enterprise Management,

Oles Honchar Dnipro National University

V. Filippova,Oles Honchar Dnipro national university

The article examines the peculiarities of managing changes in business structures in the conditions of digitalization. An analysis of existing approaches to defining the essence of the "change management" concept was carried out, the main factors causing changes in the enterprise were determined, and the reasons for the need to manage changes in the enterprise under the influence of digitalization processes were also established. According to the results of the study of the main approaches to defining the essence of the "change" concept, the work defines the so- called "areas of change" and thefactors of itsformation. The influence of such factors causing changes as the dependence of the enterprise on the micro- and macro-environment is proven; crisis situations; stages of the organization's life cycle. Based on the analysis of foreign experience, as well as scientific approaches to the management of changes in business structures, the need to ensure the systematicity of the change management process, in which the transformation of organizational goals, values, technologies and business processes takes place, has been established and proven. In addition, based on the results of the foreign experience analysis in managing changes in business structures in conditions of digitalization, there were identified the main problems that affect the success of the changes implementation, such as the difficulty in determining goals in a timely manner, lack of actions coherence in the organization, problems in determining the resources necessary for successful implementation of changes at the enterprise, lack of a clear plan for the implementation of the change program, ineffective communication at the workplace and untimely changes. In order to prevent the opposition of the company's staff and ensure the success of the change project, the work proposes a system of change management strategies, which contains a list of organizational measures for their implementation, as well as measures for motivating staff in order to reduce resistance from employees. It is proposed to choose a specific change management strategy based on the following criteria: the degree of radicality of the planned changes; terms of implementation of changes; resources allocated to the implementation of the change program, while special attention should be paid to evaluating the intellectual potential of employees involved in the process of implementing changes. Further research should be aimed at improving the methodical approach to evaluating the effectiveness of managing changes in business structures in the context of digitalization.

Key words: changes, change management, knowledge management, strategy, business structures.

УПРАВЛІННЯ ЗМІНАМИ ПІДПРИЄМНИЦЬКИХ СТРУКТУР В УМОВАХ ЦИФРОВІЗАЦІЇ

Т.В. Гринько,

д.е.н., професор, декан факультету економіки, Дніпровський національний університет імені Олеся Гончара

Т.З. Гвініашвілі,

к.е.н., доцент, доцент кафедри економіки, підприємництва та управління підприємствами,

Дніпровський національний університет імені Олеся Гончара

В.Ю. Філіппова,

Дніпровський національний університет імені Олеся Гончара

У статті досліджено особливості управління змінами підприємницьких структур в умовах цифровізації. Проведено аналіз існуючих підходів до визначення сутності поняття «управління змінами», визначено основні фактори, що викликають зміни на підприємстві, а також встановлено причини необхідності управління змінами на підприємстві під впливом процесів цифровізації. Наголошено на ролі інтелектуальних ресурсів в забезпеченні конкурентоспроможності сучасних підприємницьких структур в умовах масштабної цифровізації суспільства, що також є головною причиною зростання інтересу до управління знаннями. В контексті управління знаннями, як нового виду управлінської діяльності, доведено необхідність впровадження механізмів управління змінами підприємницьких структур в умовах цифровізації бізнес середовища.

За результатами дослідження основних підходів до визначення сутності поняття «зміна», в роботі визначено так звані «області зміни» та чинники її формування. Доведено вплив таких факторів, що викликають зміни, як залежність підприємства від факторів мікро- та макро-оточення; кризові ситуації; етапи життєвого циклу організації. На основі аналізу закордонного досвіду, а також наукових підходів до управління змінами, встановлено та доведено необхідність забезпечення системності процесу управління змінами, у якому відбувається трансформація організаційних цілей, цінностей, технологій та бізнес-процесів. Крім того, за результатами аналізу закордонного досвіду щодо управління змінами підприємницьких структур в умовах цифровізації, виділено основні проблеми, що впливають на успішність впровадження змін, таких як складність у своєчасному визначенні цілей, відсутність узгодженості дій в організації, проблеми у визначенні ресурсів, що необхідні задля успішного здійснення змін на підприємстві, відсутність чіткого плану реалізації програми змін, неефективна комунікація на робочому місці та несвоєчасність змін.

Отже, з метою запобігання протидії персоналу підприємства та забезпечення успіху проєкту змін, в роботі запропоновано систему стратегій управління змінами, що містить перелік організаційних заходів щодо їх реалізації, а також заходів щодо мотивації персоналу з метою зниження опору з боку співробітників. Вибір конкретної стратегії управління змінами пропонується здійснювати виходячи з наступних критеріїв: ступінь радикальності запланованих змін; терміни реалізації змін; ресурси, що виділяються на реалізацію програми змін, при цьому особливу увагу слід приділяти оцінюванню інтелектуального потенціалу співробітників, що залучені до процесу впровадження змін.

Ключові слова: зміни, управління змінами, управління знаннями, стратегія, підприємницькі структури.

Statement of the problem in a general form and its connection with important scientific or practical tasks. In modern conditions, business structures face new tasks. On the one hand, the level of business activity is increasing. Due to internationalization and globalization, the number of sales markets for enterprises is increasing; the flow of goods and capital becomes more accessible, and modern means of business communication contribute to faster establishment of business relations. On the other hand, the aggravation of armed conflicts, military aggression, full-scale invasion of the territory of our state endangers the sustainable development of the country's economy. In addition, the rapid flow of information, computerization and large-scale digitalization of society lead to destabilization of the operating conditions and instability of the external business environment. As a result, business structures are not able to cope with new problems and are not able to ensure the appropriate level of competitiveness in the market. change management business digitalization

Digitalization has a significant impact on the business environment and corporate style of enterprise work, affects its operating environment and internal functioning conditions. On the one hand, digitalization opens up new opportunities for business, and on the other hand, it causes radical changes in business roles. For example, through the use of digital technologies, it is possible to remove traditional intermediate links in the supply chain and create new ones, which can be connected, for example, with direct access to consumers through the use of mobile devices, applications, etc. Neglecting digitization can lead to the risk of losing in highly competitive markets.

Analysis of recent research and publications

Yu. Kotelnikova, L. Ligonenko, O. Dzhusov, M. Ustenko, A. Ruskykh, G. Zhosan, N. Kyrychenko, O. Hrybinenko, O. Mykolyuk, V. Bobrovnyk, V. Dergacheva, Yu. Vorzhakova, O. Khlebynska and others devoted their scientific works to issues related to the development and influence of the digital economy on the activities of entrepreneurial structures. Viewpoints on the peculiarities of the business structures transformation in the conditions of digitalization by such authors as O. Gudz, S. Strelnikova, G. Chmeruk, L. Frolova, I. Boyko, Y. Shulzhik, R. Hrytsko, S. Pekanets,

M. Zhelikhovska, K. Buzymska, L. Kvasnii, O. Soltysik, M. Kovalko definitely deserve attention. However, the impact of digitalization on the activities of business structures is so rapid and comprehensive that it leads to rapid changes in business conditions and instability. Therefore, some enterprises are unable to cope with new problems and ensure the appropriate level of competitiveness in the market. Under such circumstances, the issues of managing changes in business structures in the context of digitalization require further comprehensive research.

The purpose of the article is to deepen the scientific and methodological approach to the change management of in business structures and to develop practical recommendations to ensure the successful implementation of the project of changes at the enterprise under the influence of digital transformation factors of the business environment.

Presentation of the main research material

Today, change management has become an integral part of modern management theory. Business structures of various activity spheres are regularly affected by factors of the external environment, such as economic, political, social, technological, etc. This requires management to pay special attention within the organization to change management processes at enterprises when developing measures for their adaptation to these factors or their neutralization. As a rule, all changes in the organization by scale can be divided into two types: operational changes related to the improvement of production processes and procedures, and transformation of the organization as a whole, radical reengineering of its work. The main objects of change are the goals and strategy of the organization, organizational structure, redistribution of roles and powers, principles and methods of conducting activities, technologies, products, personnel, organizational culture, etc.

It is obvious that today the economy is developing at a rapid pace. New technologies open up many opportunities to increase productivity, in connection with which the issue of change management becomes extremely relevant. Most organizations today are in constant motion as they respond to the changing external business environment, global economy, NTP, etc. This means that all processes, systems and strategies must constantly change and develop in order for the enterprise to remain competitive. In addition, the changes affect the most important asset of the company - people. Losing employees is costly because of the associated recruiting costs and, most importantly, the time spent on onboarding and more. Every time an enterprise loses employees, it also loses important professional knowledge and skills regarding the specifics of the implementation of its functional areas of activity. Whether it's the introduction of new technologies, business process upgrades, compliance initiatives, reorganization, or improved customer service, change is a constant and necessary for growth and profitability. Therefore, it can be argued that without a competent organization of the change management process, the enterprise will not develop, and, therefore, will not meet the requirements of the changing external business environment, in particular, the state of the market environment.

In recent years, the term "change management" has become popular in corporate practice: when and where the intention to implement changes quickly, efficiently and with the support of employees prevails; any projects are carried out on the basis of "change management" [23].

If we consider change management in a broad sense, then it is a process of changing business units and transforming them into new forms [18].

The XXI century is called the age of the global information society. In this context, information in the development of the economy and society is of great importance. As mentioned, the introduction of modern computer and digital technologies, as well as telecommunication means in all spheres of activity, has led to a change in the business environment. And this leads to the emergence of new problems, tasks for enterprise management, which are increasingly characterized by non-linearity, a lack of knowledge, a lack of qualified personnel, a high level of uncertainty and risk. Today, new abilities and competencies are required from managers: the organization of innovative processes, a broad vision and understanding of the global context, its dynamics and driving forces, possession of tools for increasing the intellectual potential of human resources and working with personnel with completely different values and communication models, the ability to quickly implement fundamentally new digital businesses - models [3]. The subject and content of the managers work is changing: it increasingly includes human-machine procedures (defined by a software product), as well as analytics, algorithms, and huge data sets [2]. Managers have to interact with many experts and consultants: on the basis of knowledge, forecasting, information security, artificial intelligence [11]. The broad opportunities that open up to business due to modern scientific and technical achievements require managers' knowledge of the technical and economic characteristics of the latest equipment and the needs of customers (existing and potential), the ability to predict the direction of changes and ensure organizational readiness for them [7].

Therefore, in ensuring the competitiveness of any modern enterprise, intellectual resources play a significant role, as they allow non-material methods to significantly increase work efficiency. In addition, the development of communication and information technologies, as well as the large-scale digitalization of society, are the main reasons for the growing interest in knowledge management.

The concept of "knowledge management" ("knowledge management") was introduced by Karl Wiig, who used this phenomenon for the first time during a report at the UN conference and defined it as "systematic formation, updating and application of knowledge in order to maximize the efficiency of enterprises"[12].

Knowledge management is a general name for methods that ensure the process of communications, allow you to acquire new and update existing knowledge, provide quick and convenient access to knowledge, help employees to perform tasks and make decisions faster. Usually, these methods consist of only 20% of information technology solutions and 80% of humanitarian technologies. The application of knowledge management techniques enables the use of collective experience and knowledge and their transformation into corporate capital. People are carriers of knowledge and experience, the value of which is ultimately converted into the company's profit. Knowledge exchange occurs during communication between people, so it is important to form communities and establish communications in which employees will receive the necessary knowledge to solve current tasks and make effective decisions. Modern enterprises are faced with the need to adapt to the constantly changing conditions of the external environment (market situation, political situation, ecological, epidemiological, etc.), in this regard, they are forced to look for resources and tools that ensure the competitiveness of the enterprise and reduce the level of economic losses. In this regard, analyst Charlene Lee noted during her speech at the KMWorldConnect 2020 conference: “Disruption is difficult, but it also provides an opportunity for change and growth. The safe zone is not completely safe. People and organizations may want to stick with what is familiar, which can actually be a risky choice. In the conditions of radical changes that continue to occur today, companies are looking for new approaches to improve access to information and its use» [8]. In the conditions of the information society, such a resource for enterprises is the information and knowledge of employees, which allows to respond adequately and quickly to changes in the internal and external environment.

In addition, knowledge allows you to reduce the uncertainty of the situation. Knowledge as a resource has strategic importance and allows you to acquire competitive advantages, therefore, there is a need to manage them. Knowledge management is a new type of management activity that involves the intensive use of intangible assets as the main resource of the knowledge economy and the stimulation of innovations in order to maximize the efficiency of the enterprise [22].

Under such circumstances, it is necessary to form conditions for the adaptation of the enterprise to the constantly changing conditions of its operating environment, which, in turn, helps to increase the level of its competitiveness. Hence, there is a need to implement change management mechanisms at the enterprise in the conditions of transformations of the enterprise's business environment. As experience shows, the concept of "change" is interpreted differently by different companies. A change is an improvement, modification or removal of anything that can affect the operation of an enterprise, including business processes, assets, organizational structure, etc. According to this understanding, almost any activity falls under the definition of the concept of "change". However, according to this approach, there is a need to separate the activity that refers to "changes" from other transformations in the enterprise, both small and global.

In general, a change means a transition to a qualitatively new level of organizational development, which allows you to expand your understanding of competitive advantages and rethink the potential of both individual employees and company divisions, to achieve a new position on the product/service market, significantly enriching corporate culture and philosophy [16]. If we consider the concept of "change" in relation to an intra-organizational process, then the change process can be represented as a transformation or converting of one object (process) into another or transformation into a completely different object [14].Conventionally, all changes can be divided into four groups [18]:

- management changes (this group includes changes in the organizational structure of management, company personnel policy, intra-organizational relations, motivation system, management technology);

- technological changes (including introduction of new production technology, modernization of production facilities, use of resource-saving technologies);

- product changes (change in product range, use of new materials; ensuring profitability of the product, provided it is brought to the market);

- social changes (emergence of new functional relationships, change in terms of employment; change in the principle of units interaction).

Change as a rule always involves one or more of the following factors. The factors are the so-called "areas of change". The area of change can be described by the following four factors [19]:

- processes (for example, organizational structure, interfaces, duties, etc.);

- technologies (for example, information and communication technologies, production technologies, automation level, etc.);

- organization/structure (for example, the structure of the organization, the number of hierarchies, the distribution of roles, skills and competencies, the distribution of power, etc.);

culture/values (for example, leadership style, norms and principles, readiness, motivation, innovation climate, risk level, knowledge, identity, confidence, ability to learn, etc.).

In the case of change, they affect employees as a trigger for change. At the same time, "areas of change" interact both with employees and with each other (as a link between system elements): for example, processes established in an enterprise require certain behavior of employees, but on the other hand, employees can also influence how both on processes and on these changes. In particular, there is a particularly high level of interaction in the field of "culture/values". For example, a certain corporate culture attracts a certain type of employees, who will then in turn contribute to the preservation of the corporate culture. On the other hand, technology can also influence processes. Or the organizational structure influences the formation of the corporate culture of the enterprise. The range of such changes is determined as part of the evaluation and definition of the change strategy [23].

In addition, the following factors that cause changes can be identified: the dependence of the enterprise on the factors of the micro- and macro-environment; crisis situations; stages of the organization's life cycle [24].

To date, there are several approaches to the classification of changes, which differ from each other depending on the criterion. The most significant classification criteria that must be taken into account when building a change management system are shown in fig. 1.

Fig. 1. The most significant classification criteria that must be taken into account when building a change management system

In addition, as is known, the causes of changes are divided into three levels [15]:

- individual level: inertia, fear of changes negative consequences, lack of respect and trust in managers, demographic features;

- group level: group cohesion when the goals of the group and the organization differ, group norms contradicting the content of the innovation, the threat of subdivisions power loss;

- organizational level: the structure of the company, peculiarities of organizational culture, lack of a clear strategy for the enterprise development, ineffective management of organizational changes, imperfect system of organizational communications.

Foreign experience shows that change processes are usually initiated with the help of modern innovative technologies, digital transformations and with the aim of unifying consumer requests [5; 6]. In particular, in American companies, business adaptation to market changes begins with the stage of assessing the areas that require transformations and determining their impact on the company's market position. Thus, the management on an ongoing basis should determine not only those areas that require changes, but also, as a result, the results of their improvement, which contributes to maintaining the stable financial position of the company and ensuring its competitiveness. For example, if the company has outdated production technology, the production process changes, which will be reflected in the development of a change program, the purpose of which will be to modernize production, master new technologies, assess personnel potential, etc [27]. We can also talk about changing the technological infrastructure of companies, developing new marketing strategies, management methods and making management decisions.

The well-known scientist P. Drucker devoted his book to the problems affecting new ways of doing business and expanding the market in the face of increasing competition in the global economy [4]. This book emphasizes the challenges of effective change management, which can be solved by revising the corporate mission, goals, and business functions. Companies are interested in constantly changing their business strategies, changing hierarchical management structures, and forming teams focused on a specific result.

As stated in the scientific literature (Ahmad, Chowdhury, 2021 [1], Miethlich, Belotserkovich, Abasova, Zatsarinnaya & Veselitsky, 2022 [10]), change management made a significant contribution to supporting the sustainable development of business in the conditions of the global financial and economic crisis of 2008-2009.

The impact of external and internal (intra-organizational) factors of change on enterprises requires them to develop strategic development programs in a timely manner, to change the organization of the management system, and to apply new forms of interaction between business structures. Therefore, one of the most effective ways to manage changes is to look at it precisely as a process and not just as a structured activity.

Thus, change management in today's world should be talked about primarily as a systemic process in which the transformation of organizational goals, values, technologies, and business processes takes place. Schematically, the change management process at the enterprise is presented in Fig. 2.

Fig. 2. Change management process at the enterprise

Any enterprise operates in a constantly changing environment, therefore the management system is entrusted with the main responsibility of maintaining the enterprise in a stable position, despite the factors of the changing external environment. Achieving the set goal is carried out at the expense of adapting the company's activities to changes. The form of response to changes is decision-making regarding each individual change that affects the enterprise from the external environment.

For successful change management at the top management level, it is necessary to ensure the following chain of sequential actions: personnel involvement - development of a change program - program support (financial and organizational) - coordination and organization of effective communications. The human factor plays a huge role in the implementation of changes, and the biggest threat is not the mistakes of planning and implementation of changes, but the resistance of employees directly to the changes themselves, which can be caused by various (psychological, social, organizational, professional and economic) factors. Any changes always cause increasing resistance from the company's employees due to the fact that changes occur both in the company itself and in specific people. For example, if we consider the existing changes in working conditions and the transfer of most workers during the pandemic to remote work, then these changes affect the change in work technology and require new skills from the staff; a change in the product range leads to the fact that the company faces new competitors on the market or new markets, a change in management in most cases leads to a change in business processes at the company and in personnel policy. In this regard, when developing of the change management system, special attention should be paid to the issues of motivation of the personnel involved in the implementation of the change project.

In modern economic realities, the process of change management is associated with certain difficulties.

1. Difficulty in defining goals in a timely manner. Changes are made to improve current processes, products, services, or organizational culture, and it is important to define clear goals and milestones. For example, in the conditions of the coronavirus pandemic, the complexity of defining goals is associated with high uncertainty, but at the same time, organizations must create a culture of change; update best practices; introduce new technologies; create checkpoints for checking deviations; new incentive systems; implement initiatives to exchange knowledge in new conditions; identify changes in the target customer base.

2. Lack of coherence of actions in the organization. It is difficult for management to make changes and involve employees in the work in the absence of confidence in the success of these transformations, which is manifested in the incoherence of the employees actions due to the lack of clearly defined tasks at the management level.

3. Problems in determining the resources necessary for the successful implementation of changes in the enterprise. The process of change begins with the identification of all types of resources (financial, personnel, information, material, etc.), which are resources that ensure the process of change management. In modern business conditions, it becomes difficult to determine the budget and necessary resources before the start of the change process due to the large increase in uncertainty factors [9].

4. Lack of a clear plan for the implementation of the change program. For each change management process, a clear plan should be developed, with deadlines and stages of change.

5. Ineffective communication in the workplace. Violation of the communication process between employees of the enterprise leads to a violation of change management processes and deviation from the terms of the change program implementation. All changes must be documented in a timely manner and given to employees for review. With the large-scale spread of digital technologies, the process of information exchange within the enterprise is also accelerating, which requires a greater concentration of personnel on the assigned tasks. Therefore, there is a need to create such an information environment that allows more mobile contact with all employees, regardless of their location.

6. Untimeliness. Changes happen constantly. The competitiveness of products and the enterprise as a whole largely depends on their orientation, timeliness, and efficiency. Concern for the timeliness of changes prompts top management to intervene in the course of events. Therefore, today "changes" are also administrative programs of reorganization, restructuring, etc. Since change programs are usually initiated "from above", many employees perceive this as coercion, feel that they are being manipulated. Timely assessment of changes, informing about options for responding to them, as well as implementing solutions allow you to attract more supporters of change, manage their participation and get the necessary support.

Thus, the life cycle of enterprise development involves changes in the organization, which must be managed in such a way as to avoid staff opposition and obtain the desired planned result. Crisis phenomena of the external and internal environment also affect changes in the organization and require effective management actions. And in this case, it is necessary to implement strategic management itself, that is, to develop a change management strategy, which will ultimately allow to obtain positive results of the changes implementation in the enterprise.

Taking into account the above, a system of change management strategies was proposed (Table 1), which contains a description of organizational measures for their implementation, as well as measures for motivating staff in order to reduce resistance from employees. This system is characterized by a detailed elaboration of organizational measures set, measures to motivate personnel in order to reduce resistance to change. The choice of a specific change management strategy is proposed to be carried out based on the following criteria: the radicality degree of the planned changes; the terms of changes implementation; the resources allocated to the implementation of the change program, while special attention should be paid to the assessment of the intellectual potential of employees involved in the process of implementation of changes.

Within the framework of the given system of strategies, recommendations are offered for the implementation of the change project at enterprises:

- involvement of personnel (identify key people participating in the process of changes; inclusion of structural units heads in the process, etc.);

- formation of a change program (distribution of administrative management tasks among company employees; the area of responsibility of all participants should be clearly traced in the program, the change goals should be divided into short-term and long-term; the possibility of adjusting the program in accordance with the changing conditions of the company's operation);

- support of the change program (adaptation, incentive system, personnel recruitment, etc.);

- coordination and organization of effective communications (effective communication and coordination; clarification of measures regarding the change program at each stage of implementation, timely identification of deviations from planned results caused by a lack of information about the benefits of the change implementation process).

Table 1. A system of change management strategies at the enterprise