Financial Consulting for SMEs
CoFit Consulting GmbH

Why stability and change are not a contradiction – but a leadership task

The conflict between “Never change a winning team” and “What got us here won’t get us there” is one of the biggest dilemmas in business management. There are many examples in which change has worsened the situation, e.g. Lopez effect (quality problems due to excessive savings) at Opel with lasting damage to the brand reputation.

 Is “Never change a winning team” therefore the solution?  What if this very attitude is jeopardizing your company in the long run? How can you tell if your “winning team” is actually on the verge of falling behind? When is the right time for change, and what kind of change makes sense?

 

1. Never  change a winning team!

Stability is the foundation of every successful organization. Well-established teams work very efficiently and reliably. Processes run smoothly and are optimized.

Stability is only beneficial as long as it meets current requirements. Especially in successful organizations, this also leads to high risks such as:

• Arrogance: Teams bask in their success, miss out on innovations, and underestimate their competitors.
• Blindness to external changes: Markets, technologies and customer needs continue to evolve – those who don’t keep up get left behind.

A good example of this is Nokia: As the market leader in the mobile communications sector, they overlooked the impact of the smartphone on their business model.

However, yesterday’s success is no guarantee of tomorrow’s success. That’s precisely why stability alone is not enough.

Always ask yourself this question:

“Is my organization still a good fit, or what changes are necessary to maintain or improve my position?” 

 

2. What brought us here won’t get us there!

Change is not a passing fad, nor is it an self-serving purpose. It becomes necessary because a company’s environment is constantly changing.

Many organizations fail not because they are bad, but because they cling for too long to a successful model that originated under different circumstances.

Reasons for change:

• Changing customer requirements: What convinces today may already be standard tomorrow.
• Technological progress: Digitization and AI are changing business models and competition rules.
• Company growth: Structures that work with 50 employees often reach their limits with 500 employees.
• New competitors: New market entrants are often faster and more flexible than established companies.
• Regulatory changes: New laws, sustainability requirements, or geopolitical developments increase the pressure to adapt.

The actual risk is therefore often not the change itself, but the assumption that the environment will not change.

Example: Amazon has reinvented itself again and again – from an online bookstore to a technology and cloud company.

The developments mentioned often make adjustments unavoidable. However, not every change automatically leads to better results.

Many companies correctly recognize the need for change, but fail to implement it. The desire for improvement alone does not guarantee success. Change can involve significant risks and jeopardize existing strengths.

Risks of change:

• Temporary drop in performance: Roles are unclear, processes do not run smoothly, decision-making processes need to be re-established.
• Uncertainty and loss of motivation: Employees lose their orientation, fear loss of power or job change, and “informal structures” are disrupted.
• Loss of know-how: Key people leave or withdraw, implicit knowledge is lost.
• Loss of focus in day-to-day business: Reorganization ties up management capacity, while operational issues suffer (customers, quality, cash flow and market position).
• Organizational design without strategy: Structure is changed, but strategy is unclear.
• Overcomplexity: A new structure is supposed to solve everything. The risk lies in too many levels, new interfaces, and more coordination instead of less. Processes become more complex and decisions take longer.
• High costs: High external and internal costs. Internal implementation costs, in particular, are often massively underestimated.
• Cultural shift: Established teams and processes are broken up. Trust is lost.

Example: At Volkswagen Group, the pooling of software expertise led to more complexity instead of clarity. 

 

3. The optimal timing – the real leadership task

The central question is not whether you should change – but when and to what extent. Most companies change either too late or too much. Successful companies change early and in a targeted manner.

The optimal timing is not a matter of intuition, but rather a comparison of strategy, organization, and initial operational signals. Successful companies:

• • •  don’t wait for crises
    • do not react hastily
    • but adapt early and gradually

 The following should be noted:

• • • Change too soon: Unrest and inefficiency without a real need for action
    • Change too late: the market has already shifted. One can only react instead of shaping the future.

 

The right time for change is not when problems become obvious, but when the first early indicators become apparent:

Operational signals

• • • Decisions take longer
    • Alignment is increasing
    • Too many (ad-hoc) meetings, too little output
    • Unclear responsibilities regarding new topics

Financial signals

• • • Revenue is growing, but profitability is stagnating/decreasing.
    • Rising overhead costs
    • Declining operating cash flows

Strategic signals

• • • New initiatives are not progressing.
    • Time-to-market is slowing down.
    • Competitors are acting faster and more efficiently
    • Targets are systematically missed.

 

Ask yourself the following key questions:

• • Are we still in line with our long-term strategy?
  • Does our organization still fit the company and/or market environment?
  • Do we have the right skills and structures for the future?
  • Are we adapting faster or slower than our competitors?

 

4. How much change is right – evolution instead of revolution!

The extent of the change is just as important as the timing. It is important to maintain the “success DNA” but ensure long-term success. Successful companies therefore avoid extremes.

They:

• keep functioning structures stable
• adapt specifically where necessary
• continuously develop their organization further

Change happens in an integrated way – not in isolation.

That means:

• no radical breaks unless absolutely necessary.
• no change for the sake of change
• but rather a logical consequence of the strategy

 

Consequence:

• “Winning teams” need evolution, not revolution.
• Change is understood as development – ​​not as correction.
• Organizations remain flexible and adaptable. 

 

5. Organizational development  as an integrated part of the strategy process

Organizational developments should always be part of an integrated strategy process and follow a clear logic (see also article on how to develop a successful strategy: https://cofitconsult.com/strategieentwicklung-in-5-schritten-praxisbeispiel-fur-kmus/):

1. Success factors define what is relevant in the long term. 
2. Strategy translates these into concrete goals 
3. The organization must enable this strategy  
4. Efficiency is the result of continuous optimization. 

 

1.  Starting point: Understanding success factors

Question: How  do we earn money today – and how will we earn it tomorrow?

Typical changes:

• Market is shifting
• Competition is getting faster / new competitors
• Margins are under pressure

 

2.  Derive a strategy

What does this mean specifically for:

• Growth
• Efficiency
• Speed
• Customer requirements

 

3. Reflect the requirements in the target organizational setup

Now comes the crucial step: Does our organization still fit the strategy – and what needs to be adapted?

 

4. Efficiency improvement

New structures and processes must be continuously optimized.

 

 

Conclusion:

Organizational development is not an end in itself. It is the consequence of changing success factors and strategic requirements.

Even successful strategies must be regularly reviewed and adapted to new circumstances. Stability and change are therefore not opposites – they are two sides of the same coin.

• Stability ensures today’s performance      
• Change enables the future

The challenge lies in balancing both.

This balance does not arise by chance, but through a clear logic:

  Success factors → Strategy → Organization → Efficiency

Changes derived from this logic will occur neither too early nor too late – and not more drastically than necessary.

If this doesn’t happen, the pressure to adapt will sooner or later come from the market, from customers, or from the competition. Companies lose the ability to shape the future and can only react.

Successful companies don’t change because they have to. They change while they still have a choice.

The task of managers is therefore not only to secure today’s success, but also to recognize the next challenges and opportunities early on.

  Winning teams need evolution, not revolution. Those who don’t evolve will eventually be forced to do so by the market.