Mastering the Art of Managing Organizational Change in the Cannabis Industry

Are you ready to transform your cannabis venture? To take it to the next level, you'll need to master the art of change management - a systematic approach to dealing with the transition or transformation of your company's goals, processes, or technologies. In this thrilling conversation, we dissect the top 10 triggers for change management, from technological advancements to market dynamics, and present the eight-step process created by Dr. John P. Kotter for managing change effectively. Properly implemented, this process can lead to significant improvements in your business.

But remember, change isn't just about new processes or tech. The human element is crucial for successful change management. It's about ensuring everyone involved understands the mission and feels equipped and empowered to contribute to it. We close the episode by sharing our own expertise and insights on how to leverage change for your business's success. Let us guide you on your journey to making change your competitive advantage in the cannabis industry. Get ready to turn change into a game changer. Let's ride the wave of change together, only at Cann Strategy.

Thank you for tuning in to 'Cann Strategy: Elevating Your Cannabis Business Venture'. Our mission is to empower cannabis investors, business owners, and entrepreneurs with rarely shared insider knowledge to navigate the fast-growth cannabis industry.

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Also, don't forget to check out our website at www.cannstrategy.com for even more resources and insights into the cannabis business world. We offer a range of consulting services to help you navigate the complex cannabis industry and turn your cannabis business dream into a reality, no matter what stage of the game you're in.

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Episode Transcript

Speaker 1 (00:00):
Hey there, innovators and change makers, welcome to
Can Strategy elevating yourcannabis business venture the
go-to podcast for cannabisentrepreneurs looking to level
up their business game.
Today we're diving into thetopic of change management,
which could be the game changeryour business is looking for,
because it is critical for allbusinesses, but is especially

(00:22):
pertinent for cannabis companies.
Change management refers to asystematic approach to dealing
with the transition ortransformation of a company's
goals, processes or technologies.
The objective is to effectivelyimplement new methods and
systems in an ongoing business.
Change management is one of themost underappreciated business
strategies.
Michael Porter, a leadingauthority on company strategy

(00:45):
and competition, said strategyis about making choices,
trade-offs.
It's about deliberatelychoosing to be different.
The same can be said aboutchange management.
It's about choosing to embracechange instead of resisting it,
deciding to lead your teamproactively through the
transition and choosing to standout in the cannabis industry as
a company that's agile andresponsive to change.

(01:06):
Let's delve deeper into theapplication of change management
tactics.
Whether you're scaling up,adopting new tech, altering
policies and procedures orpivoting in your cannabis
venture, understanding when andhow to apply change management
principles can be the differencebetween seamless transition and
organizational chaos.
It's essential that we, asbusiness leaders, understand

(01:28):
what events trigger the need fora structured change management
approach.
Let's unpack that, shall we?
Here are the top 10 events thattrigger the need for change
management.
Trigger number one istechnological advancements.
The rapid evolution oftechnology often necessitates
changes in the way organizationsoperate.
Adopting new systems orsoftware or upgrading existing

(01:49):
ones requires a structuredapproach to ensure a smooth
transition.
Trigger number two is mergersand acquisitions, when two or
more companies come together orwhen one company acquires
another, integrating differentcultures, systems and processes
often demand structured changemanagement.
According to Harvard BusinessReview, most studies conclude
that between 70 and 90 percentof mergers and acquisitions fail

(02:12):
.
Most explanations for thisdepressing number emphasize
problems with integrating thetwo parties involved, indicating
egregious failures in changemanagement implementation.
Trigger number three isorganizational restructuring.
This could be due to scaling up, downsizing or simply changing
the way teams and departmentsare organized.
Such restructuring can havesignificant impacts on roles and

(02:34):
responsibilities.
Trigger number four is shiftsin strategy.
If an organization decides topivot its business model or
strategy, it will likely need torealign its processes, goals
and perhaps even its workforce.
Trigger number five isregulatory changes, especially
relevant to industries likecannabis.
Changes in regulations orcompliance standards can

(02:56):
necessitate adjustments inbusiness operations.
Trigger number six is culturaltransformation.
If an organization seeks tochange its internal culture,
perhaps to be more innovative orcustomer-centric, a structured
change approach will benecessary to guide behaviors and
mindsets.
Trigger number seven is marketdynamics.
Rapid changes in the market,such as new competitors,

(03:17):
changing customer preferences orglobal events, can force
businesses to adapt quickly.
Trigger number eight is processimprovements.
Implementing new methodologiesor practices like Six Sigma or
Agile, requires training,adaptation and often a shift in
mindset.
Trigger number nine is crisissituations.
Unexpected crises, like theCOVID-19 pandemic, can compel

(03:40):
organizations to rapidly altertheir way of operating.
Finally, trigger number 10 isstakeholder expectations.
Sometimes stakeholders whetherthey're shareholders, customers
or employees, demand changesthat require a methodical
approach to manage.
In the cannabis sector, whereregulations can shift overnight,
where technologicaladvancements are pushing the

(04:02):
boundaries every day, and wheremarket dynamics can be as
unpredictable as New Englandweather, having a change
management strategy isn't justgood business practice.
It's essential for survival.
And yet many organizations inthis space falter, not because
they aren't aware of the needfor change, but because they
underestimate the nuancesinvolved in executing it.

(04:23):
Change is not just aboutswitching from point A to point
B.
It's a journey, and like alljourneys, the path to successful
change is filled withchallenges that need to be
foreseen, understood and managed.
This is where many cannabiscompanies face their Achilles
heel.
But here's the silver liningWhile challenges abound, so do
solutions such as themethodologies of Dr John P

(04:45):
Cotter, a beacon in the realm ofleadership and change
management With decades ofinsight into the intricacies of
organizational shifts, cotterhas laid down a meticulous
eight-step process that hastransformed how the most
successful businesses approachchange.
Step one is to create a sense ofurgency, help others see the

(05:07):
need for the change and theimportance of acting immediately
.
Step two is to build a guidingcoalition, assemble a group with
enough power to lead the changeeffort and encourage them to
work as a team.
Step three is to form astrategic vision and initiatives
, create a vision to guide thechange effort and develop
strategies for achieving thatvision.
Step four is to enlist avolunteer army, get a

(05:29):
significant portion of peopleinvolved, engaged and committed
to the change.
Step five is to enable actionby removing barriers, remove
obstacles, change systems orstructures that undermine the
vision.
Step six is to generateshort-term wins plan for and
create short-term wins orimprovements to motivate and
persuade skeptics within theorganization.

(05:51):
Step seven is to sustainacceleration.
Use increased credibility fromearly wins to change systems,
structures and policies thatdon't fit the vision.
Finally, step eight is toinstitute change.
Reinforce the value ofsuccessful new behaviors to
ensure that the change becomespart of the core of the
organization.
While Dr John Cotter'seight-step process has proven

(06:13):
its efficacy time and againacross various industries, it's
crucial to understand that itssuccess doesn't solely rest on
its structured approach.
Execution is key.
Implementing these stepsrequires deliberate intention,
attention to detail and, aboveall, consistency.
It's one thing to comprehendand appreciate the wisdom in
each of these steps, but it'sanother entirely to apply them

(06:34):
diligently and consistentlyacross an organization.
As with any robust framework,the power of Cotter's
methodology truly shines whenthere's a deep commitment to
seeing each step through,ensuring that every stage is
given the time, resources andfocus it deserves.
When properly implemented, johnCotter's eight-step approach to
change management can lead tosome serious improvements in

(06:56):
your business.
Imagine higher employeeengagement, effortless
transitions during shifts,nimble responses to industry
trends and crafting a fortressof resilience around your
business.
Sounds pretty good, right?
Let's ground this conversationin some hard facts.
The data truly speaks foritself, and I've got some juicy
stats about the outcomes of goodchange management that I think
you'll find fascinating.

(07:16):
Croshe, which is aresearch-based change management
methodology and solutionsprovider that offers tools,
training and consulting to helporganizations manage the human
side of change, reports thatbusinesses acing their change
management game are a whoppingsix times more likely to crush
their objectives than theircounterparts that are still
fumbling with change.

(07:37):
If that wasn't enough, willisTowers Watson chimes in stating
businesses leading in changemanagement and communication are
three and a half times morelikely to leave their
competitors in the dust.
Now hold on to your hats forthis one.
Gartner, a global research andadvisory firm, points out that
spot on change management canslash employee resistance in

(08:00):
half.
That's a smoother ride withfewer bumps, fewer drop-offs in
productivity and less of thatdreaded turnover and the dollars
.
Ibm has a say here.
Teams that have the changemanagement formula dialed in hit
their budget goals 80% of thetime.
Compare that to the mere 40%for the others still trying to

(08:21):
figure things out.
And to top it off with top-tierchange management practices,
prashe says you could reachproject proficiency a whole 28%
faster, optimizing that returnon investment and keeping your
investor smiling.
These stats indicate that goodchange management practices can
dramatically enhance the successof projects, employee
engagement and satisfaction,operational efficiency and the

(08:43):
financial performance of acompany.
Despite the compelling evidencesupporting the benefits of
change management, we still seea significant number of
businesses, including those inthe cannabis industry,
struggling with it.
You see, change is hard.
It's even harder when we'retalking about shifting the
dynamics within a group ofpeople, each with their own
habits, values and understandingof how things work.

(09:06):
How can we, as an industry, dobetter, and what are some things
that cannabis business leaderscan do to improve their chances
of success once they startimplementing change management
initiative?
When sustainable change isimplemented, it is done by the
people, for the people.
Therefore, it's crucial toinvolve employees in the change
process right from the start.
If you can inspire eachindividual to get on board with

(09:28):
change, then you're winning thegame.
Prashe developed the ADKARmodel, standing for awareness,
desire, knowledge, ability andreinforcement.
The model emphasizes the humanside of change management and
can be used in conjunction withCotter's eight-step system.
By breaking down the changeprocess into these five key
stages, organizations canaddress and support individual

(09:50):
transitions more effectively,which in turn, cumulatively
result in successfulorganizational change.
Step one is awareness, meaningrecognizing the need for change.
Before any change can takeplace, individuals must first
understand why it's needed.
This understanding might arisefrom recognizing inefficiencies
in current processes, externalmarket pressures or the

(10:13):
potential benefits of a proposedchange.
For businesses, this involvesclear communication about
upcoming changes, explaining thereasons behind the decision and
highlighting its potentialbenefits.
Step two is desire, meaning theinternal commitment or decision
to engage and participate inthe change.
Simply being aware of the needfor change doesn't guarantee

(10:35):
acceptance.
Desire ensures that there isintrinsic motivation to adapt to
and embrace the change.
Organizations can foster thisdesire within their workforce by
involving employees in thechange process, highlighting
individual benefits andaddressing concerns or
reservations they may have.
Step three is knowledge, definedas understanding how to change.

(10:56):
It's the information, skillsand training required to move
forward.
Without knowledge, even themost motivated individual may
struggle.
Equipping people with the rightskills and understanding allows
them to confidently navigatethe change process.
This can involve providingtraining sessions, workshops or
knowledge sharing platforms toensure everyone knows what's

(11:19):
expected and how to achieve it.
Step four is ability, referringto the tangible capability to
implement the change on aday-to-day basis.
It involves translatingintention and knowledge into
action.
Knowledge without applicationis ineffectual.
The ability phase ensures thatindividuals can practically
integrate the change into theirdaily routines and

(11:40):
responsibilities.
This stage often involveshands-on training, mentorship,
practice and real-time feedbackenabling employees to
effectively use their new skillsor tools.
Finally, step five isreinforcement, with the goal of
ensuring that the change sticksand becomes a part of the
regular routine of each affectedteam member in the system.

(12:01):
It involves feedback,recognition and any other
actions that consolidate thechange.
Changes can easily revert toold habits without reinforcement
.
This stage ensures thelongevity and permanence of the
change by embedding it into theorganization's culture and daily
operations.
Measures such as feedbackmechanisms, continuous training,

(12:21):
updates and recognizing andrewarding adherence to the new
change can be effective toolsduring the space.
Alright, while understandingmodels like Cotter's Eight Steps
and Prashi's ADKAR methodologygives us the blueprint to
effectively navigate theintricacies of change, it's just
as crucial to measure ourfootsteps, to truly assess the

(12:42):
trail we've blazed, because whatgood is any strategy or
approach if we don't take amoment to reflect on its
tangible impact as we shiftgears to our final segment.
Today, we're diving deep intothe heart of assessment, which
is to measure the results ofchange.
It's not just aboutunderstanding if our change
management approach hit the mark, but also evaluating the change

(13:03):
itself.
Was it truly necessary?
Did it bring about theforecasted outcomes?
Was the voyage worth the effort?
So tighten your seatbelts as weexplore the tangible metrics
and indicators that reveal thestory behind every change
journey.
Here are our top 10 favoritemethods.
Measurement 1, engagement herewe ask how many stakeholders

(13:25):
actively participated in thechange process and how much
feedback was received of duringthe process.
The second measurement istraining and adoption.
Consider how many of your teammembers attended training
sessions.
Did they pick up new skills,and how many are now using the
new tools or methods that wereintroduced.
Measurement number 3 iscommunication.

(13:46):
Did our messages reach everyone?
Which methods, like emails ormeetings, worked best in sharing
information about the change?
The fourth measurement isperformance.
After the change, did you seeimprovements in operations?
How about key areas like salesor customer satisfaction?
Fifth is resilience to change.

(14:07):
How much resistance did we faceand how quickly did we resolve
these issues?
Measurement 6 is benefitrealization.
What was the financial returnafter implementing the change?
Did the actual benefits matchour predictions?
The seventh measurement isculture and behavior.
Did your team's morale stayhigh during the change?
How well did the change fitwith our company's values?

(14:29):
Next measurement number 8, isfeedback and improvement.
What lessons did we learn andare we using this feedback to
make further improvements?
Following that, measurementnumber 9 is risk and issues how
many risks that were anticipatedactually happened and how
efficiently tackled were theproblems that cropped up?
And finally, measurement number10, long-term impact Is the

(14:50):
change sticking and showinglong-term benefits, or are some
areas slipping back to how theywere before?
While the journey of change iscrucial, it's the reflections at
the end, embodied bymeasurements and evaluations,
that determine its true successand value.
Just as a sailor adjusts salesbased on the wind's feedback,
businesses must adjust theirchange management strategies

(15:12):
based on the feedback from theirevaluations Over time.
This not only improves theorganization's approach to
change, but also strengthens itsresilience, adaptability and
overall competitiveness.
In the cannabis industry,concluding this extensive
exploration into changemanagement, particularly in the
dynamic world of the cannabisindustry, it's clear that, while

(15:33):
change is inevitable, ourapproach to it is what
determines our success.
Change management is more thanjust a corporate buzzword.
It's a nuanced dance betweeninnovation and adaptation.
It's a roadmap for navigatingthe unknown and unpredictable
waters of the business landscape.
Michael Porter aptlyencapsulated the essence of
strategic choices and, in therealm of change management.

(15:55):
Our strategic choice should beto embrace, lead and become
masters of change, rather thanbeing mere spectators.
For cannabis entrepreneurs,this isn't just about staying
relevant.
It's about thriving in a worldwhere the only constant is
change itself.
The methodologies of Dr JohnCotter and the AD CAR model from
Prashe provide strategicframeworks to address the human

(16:17):
and operational sides of change.
By adopting these models,cannabis businesses can position
themselves not just to survive,but to lead the charge in an
evolving industry.
To all the innovators and changemakers tuning in, remember that
implementing change isn't justabout adopting a new process or
introducing a new technology.
It's about people.

(16:37):
It's about ensuring thateveryone aboard the ship not
only understands the destination, but is also equipped and
empowered to sail towards it.
As we draw the curtains ontoday's episode, I urge you to
think of change management asyour compass and your team as
the crew in your venture'sjourney.
With the right tools,strategies and mindset, the

(16:58):
horizon is not just a limit buta beginning.
If today's discussion hasresonated with you, if you're
eager to leverage change as astepping stone rather than a
stumbling block, then we're hereto support you.
At CAN Strategy, we guidecannabis companies like yours
through the complexities oforganizational change.
Our expertise, combined withindustry-specific insights, can

(17:18):
be your beacon as you navigatethe tumultuous waters of
business transformation.
So if you're ready to take yourcannabis venture to the next
level, if you're ready toembrace change, innovate and set
your business on a trajectorytowards formidable success,
let's chat, connect with us atCAN Strategy and let's make
change your competitiveadvantage.
Stay tuned, stay informed and,most importantly, stay open to

(17:41):
change.
Until next time, keep elevatingyour cannabis business game.