In the fast-paced and ever-evolving world of technology, it can be challenging for century-old companies to keep up with the changing times. These organizations often find themselves grappling with the hurdles that can limit the speed or extent of digital transformation. Recently, Massaro partnered with a century-old New England company that saw huge growth during the pandemic. It was unexpected yet welcomed growth that showed they needed to take a large leap into modern business technology.
So while the executive team grabbed the bull by the horns to set up for the future, the project came up against some unsurprising hurdles, such as integrating new data systems with technologies made at the dawn of the internet, managing a legacy workforce with a strong sense of company pride and loyalty, and overcoming a fear of change that could set the company down the wrong path course.
A Rich History of Resilience and Adaptation
The company began its humble journey by producing small wooden products such as toothpicks and sticks for ice cream bars. Over time, the focus pivoted towards the medical industry and began making significant headway in the sector. Despite staying relatively small throughout the years, the company weathered various challenges and managed to survive by constantly adapting and innovating. But when the pandemic hit, the company saw unprecedented growth. .
Their main product, a device essential for testing kits, was suddenly one of the most sought-after items on the market. The government’s funding initiatives and the administration’s emphasis on domestic production led to an astonishing growth in sales and prompted the company to significantly scale its operations. From a small factory in Northern Maine, the company expanded to include three additional factories, one of which was a state-of-the-art facility outside Nashville valued at over 200 million dollars.
The Need for Digital Transformation
The executive team needed a business system to monitor manufacturing, sales, and shipments from all four facilities. Unfortunately, the original system, unchanged since the early 1970s and resembling a peculiar version of Pacman, just wasn’t going to cut it long-term. This company wasn’t a stranger to ERP implementations. More than once, the company tried to transition the 1970s system to a more modern ERP, but ultimately reverted back to using the original. Enter Massaro, a seasoned industry expert with the expertise and capabilities needed to spearheaded a transformation of this size.
While the vast majority of the company’s employees understood the need for this change, challenges still presented themselves along the way. In her book, 17 Reasons Why Businesses Fail, Pooja Agnihotri wrote, “Even though change is an important part of growth, we still face a hard time liking it.” If bringing this company’s technology forward 50 years wasn’t tricky enough, many employees had worked with the company for 40+ years and were very comfortable with how things worked. Massaro’s task became winning over a loyal, legacy workplace that understood technological changes meant bigger changes were on the horizon.
These challenges were not unique to this company nor this project. We often see a similar pattern when working with other older companies that are setting their sights on the future. It’s the great American entrepreneurial spirit that drives companies forward, allowing them to persevere through challenges and adversity. Today, we’ll examine each and provide ways to overcome them in your company.
Hurdle 1: Implementing the Wrong System
Initially, the company had attempted to implement an Enterprise Resource Planning (ERP) system a few years prior, and due to the substantial investment in licensing, they were hesitant to abandon it. So, we began evaluating how this ERP could be implemented in this company, while meeting industry regulations. However, it quickly became apparent this system was not suited for production in the medical industry and the level of traceability required for medical products. In addition, numerous limitations, bugs, and failures plagued the implementation, resulting in project delays and employees’ growing mistrust of the system.
Overcoming the Hurdle: Communication and Collaboration
To overcome this, our team adopted a strategy of open and honest communication with our partner. We educated the employees about the problems faced and why they were occurring. Involving the team in problem-solving created a sense of ownership and engagement among the ERP users. Customizations were provided as requested and needed, but the associated risks were clearly communicated to get in front of any frustrations and limit distrust in the system. Transparency and collaboration proved to be pivotal in rebuilding trust and navigating the path toward an effective system.
Hurdle 2: Legacy Workforce and Resistance to Change
A significant challenge faced by the company was its legacy workforce, comprised of employees who had dedicated their entire careers to the organization. Many of them, having served for over 40 years, were accustomed to a slower-paced lifestyle in the rural area where the company was based. The rural habits were engrained into the professional culture at the company as well. The long-standing employees struggled with the stress associated with change and learning modern technologies; this often led to missed deadlines that extended project timelines.
Overcoming the Hurdle: Inclusion and Positive Reinforcement
We recognized the importance of addressing the concerns and involving the legacy workforce in the transformation journey. By highlighting the need for change and involving the employees in significant decision-making processes, the employees felt valued and understood the importance of their role in the company’s success.
To tackle the resistance to increased workloads, we adapted an Agile methodology, breaking larger projects into manageable steps and ensuring that the employees did not feel overwhelmed. Maintaining a positive and supportive environment filled with appreciation and enjoyable work experiences helped to keep the legacy workforce engaged and committed to the transformation journey.
Hurdle 3: Fear of Change and Job Insecurity
The old system, though outdated, still worked for their current roles, making it challenging for employees to understand the need for change. However, the company was looking to the future and knew the current system would not sustain in modern industry. Change is inevitable, and so is the fear that comes alongside it. Fear of change can be a significant obstacle in digital transformation projects. Employees saw failed integrations in the past and were reluctant to implement a new system that could lead to more obstacles for them than fewer. Also, they understood that completing this ERP implementation meant even bigger changes would be coming for the company.
Overcoming the Hurdle: Understanding and Empowerment
To address the fear of change, it is crucial to understand the root causes and manage them effectively. Our team worked to educate teams in one-on-ones, explaining how the changes would benefit the employees and the company in the long run. We emphasized the importance of skill development for each employee and highlighted the opportunities that technological advancements would bring. In addition, it was essential to reinforce that employees were valued and their contributions recognized.
To create transparency, the leadership team acknowledged the limitations of the new system and outlined the steps being taken to address them (one of which was bringing in Massaro to navigate the implementation, knowing the obstacles). Regular updates and clear communication built trust and eased concerns among the workforce.
Lessons Learned: Navigating Change Successfully
Transforming a century-old company is undoubtedly a complex and challenging endeavor. However, by strategically navigating the hurdles, it is possible to achieve successful transformation and thrive in the modern business landscape.
The story of this remarkable company serves as a testament to the power of effective change management strategies, open communication, collaboration, and a deep understanding of the unique challenges old companies face. By embracing change, valuing employees’ contributions, and fostering a culture of continuous improvement, any organization, regardless of age, can overcome obstacles and embark on a transformative journey toward long-term success.
