Change Management Is Risky Business

Crunch Fitness is on the market for around $200 million. Wow! Wow, not just because that’s a lot of dough but because of the company’s unique business model that they use and how it could be hit by change coming in from the outside.

As far as I know Crunch is in good shape so I assume there is no need to do some sort of elaborate gym-rescue. If Crunch is a successful company, they need to keep doing what they do best, which is to creatively mix and match classes and fitness trends to keep the interest of the members.

However, there’s naturally still going to be some pressure and stress when the buyers take the reins. Change comes up as an issue in business time and time again. As a business owner, you are likely to have to be facing it at some point in the near future if you are not doing so already. So, the question is: What does it take for a business to deal with a significant change?

Leadership Is The Business Of Change Management

Change is a risk in any business and gym ownership is no different. There’s one big differentiating factor and that’s people. More specifically, I mean the kind of people who have the right skills to work in gyms and help others become fit and healthy.

Hear me out on this; gym managers and owners are exactly the type of people that should be able to lead a business through the process of change because it’s what we do every day.

Business School Change Basics

It’s important to make the distinction between managing and leading. Once you have started to get a little success you are likely to start hiring and then delegating. However, bringing in more managers will tend to fix the course of your company and add complexity to your operation. The more people on your staff, the more expectations will become about conforming to whatever the norm is in their workplace.

When it comes time to make a change of direction it will be exponentially more difficult to implement the change in proportion to the size of the team. It will be up to you to lead the way.

Alienation Is What You Are Fighting

There could be a wide variety of situations that enforcing change will be appropriate, for example:

• For business reasons, you might decide to change the format of your gym from, say, a boxing club to a more versatile operation that trains MMA, Krav Maga and Brazilian Jiu Jitsu. Assuming your team has the right skill set, you still need to get them on board with the change. They may have concerns and fears, or be dependent on their boxing clients for income.
• It might be that you have decided that your management software systems need a radical update. It is possible to run a gym entirely form a tablet or other mobile device these days and run very insightful reports and analyses. However, your managers will have to actually use the software to get the benefits out of it. The one thing that will prevent good systems from leveraging your time and resources is if managers insist on adhering to the old boundaries "just because".
• If you were to decide that it would be more effective to switch from a salary-only payment scheme to one that encourages sales with incentives like commissions. In my experience trainers want to train and may not be too comfortable asking for sales. As endearing as that is, it still might mean the difference between profit and loss for you.
• The best possible reason, and the one that the Crunch Fitness announcement brought to mind, is that you might have discovered a super-effective business model and you need to expand by acquiring other local independent gyms to handle the demand. If you are bringing the established staff at the new locations into the fold, you will need to be very sensitive to how you change the way that they are used to doing business.

Mister Kotter’s Eight Steps For Leading Change

According to the seminal business school text on the subject by John Kotter of Harvard Business School, there are eight steps to leading change:

1. Establish urgency
2. Form a guiding coalition
3. Create a vision
4. Communicate the vision
5. Empower your people to act on the vision
6. Create short-term wins
7. Consolidate changes and keep the process going
8. Institutionalize the new approaches

Basically, you need to share your sense of urgency, find allies among your people and help everyone to see the new vision, and how important it is. Keep working on your vision statement until you can state it clearly and succinctly. The vision must create understanding and interest in your listeners. Until you have got that you need to keep working on it.

Based on what I know about people who own and manage gyms, leading change should be right up most gym owners’ street. It may be a daunting task but you are someone who had the courage to form a business in the first place, and you have gotten this far by selling, convincing, sharing and deciding what to do. Like endurance events or a plan to help a member get into shape, you have to follow through to get to the desired outcome.

Bibliography

Goldman, Stuart. Report: Crunch Sale Could Fetch More Than $200 Million. September 17, 2014. https://clubindustry.com/crunch/report-crunch-sale-could-fetch-more-200-million (accessed November 2, 2014).

Kotter, John. Leading Change. January 1, 2007. https://hbr.org/2007/01/leading-change-why-transformation-efforts-fail/ar/1.