Empathy is a critical leadership skill when implementing a digital transformation.

Change doesn’t happen without people. While organizations may design transformation strategies and set goals, the employees drive change. That’s why the human element of transformation projects is so important — and without considering how to lead with empathy through change, projects risk failing, and organizations may lose key employees during the transition.

When MetLife was undergoing a monumental digital transformation project, Cindy Pace, then Assistant Vice President of Diversity and Inclusion at MetLife, spoke about the criticality of creating a purpose-driven culture that positively impacts people, communities, and society. As a people leader, she explained her role in helping others through the change curve, saying: “To truly lead transformational change, you have to craft your narrative and find your purpose.”

This focus on leading with purpose and empathy has been consistently reflected in the various transformation initiatives undertaken by the insurance industry in recent years. Some studies have found empathy to be a top driver of both change and business performance, with 82% of employees saying they would consider leaving their jobs for a more empathetic organization and 78% would work longer hours for a more empathetic company.

The role of empathy in the insurance industry is well-understood. Policyholders who suffer a loss often need more than the indemnity coverage their policy affords. They need empathy and patience from their claims adjuster, which is baked into many large insurers' process. “Empathy is the cornerstone of exceptional claim service,” Kevin Rampe, head of North America claims for Chubb, recently said in an interview

Leaders of modernization and transformation projects can learn to lead with empathy once they understand the human element of change.

How the Human Element Impacts Transformations

People often have some type of emotional response to change. Ranging from excitement to curiosity to apprehension, these responses are natural — and they need to be managed. With the talent gap at an all-time high in the insurance industry, insurers can’t afford to lose employees because of a perceived lack of empathy. Since these emotional responses also significantly affect the outcome of a transformation project, leaders have to manage them with empathy.

Because each individual’s response to change varies, leaders need to adapt their style and tailor their support to meet these different needs. That could mean scheduling more 1:1 meetings, following up individually with team members, or implement department meetings where open discussions are encouraged.

Here are some additional ways to understand and manage the spectrum of emotions employees may feel:

Use communication as a tool for empathy

Effective communication should be an open, collaborative dialogue where both employers and employees can speak freely and listen actively. This is not a one-way method for management to simply convey information. Employers must make an effort to listen to employee concerns, solicit feedback, acknowledge problems, and problem-solve together. Only through this mutual exchange can organizations foster a culture of trust and engagement.

Build trust by being consistent

Consistent verbal and actionable messaging can help build confidence and trust during challenging transition periods. It’s crucial for leaders to ensure their behaviors and decisions match the beliefs that they convey, by doing so, leaders can effectively cultivate trust among employees navigating periods of stress and uncertainty.

Support employees with transparency

Offering support to employees through transformations can help turn detractors into supporters as they understand and accept the change. Being transparent about the benefits and challenges of the transition can help employees move past their emotional responses. 

 

Understanding Emotional Responses With the Change Curve

Leaders can apply the change curve to help them understand emotional responses and better manage them. Used by many organizations, the curve follows the progression of change and corresponding emotions through four stages:

Challenge the Status Quo

The first stage is challenging the status quo. People may feel shock and denial as the norm is disrupted.

Disrupt Everything

Next, when the reality of the change sinks in, people are often angry and fearful. This is called the “disruption” part of the curve because the organization usually experiences disruption due to spiraling emotions.

Trying New Things

The third stage is acceptance, where people let go of the past way of working and start trying out the new change.

Reap The Benefits & Celebrate

Finally, people move to commitment, where they have accepted the new norm and embrace it. This is when the organization can feel the benefits of the transformation.  

Leaders who understand where their employees fall on the change curve can help them reach the next level. These are some ways to lead employees with empathy as they manage their emotional responses to transformation:

  • Communicate clearly and transparently
  • Listen to employees and observe their reactions
  • Provide training and learning opportunities
  • Celebrate successes

Create a Winning Environment for Transformation

Knowing employees react to change in different, emotional ways, means leaders have to do everything they can to set the stage for success. They should focus on creating a supportive and inclusive environment where people can take risks — and fail — without fear!  Change doesn’t happen overnight, and an idea's first test or iteration rarely turns out to be the right one.

Employees who don’t feel safe making mistakes may never get through these early failures to land on the winning solution. Leading with empathy, celebrating failures, and encouraging people to try again are the hallmarks of a good transformational leader.

A recent EY survey found that 87% of respondents agreed empathetic leadership inspired positive change in the workplace. But people know when empathy is forced or, worse, faked. The same survey showed more than half (52%) of employees felt their company’s empathy efforts were dishonest.

Andy Cohen, President at Snapsheet, spoke more about the importance of honesty and empathy, saying: “At Snapsheet, one of our core values is ‘Do the right thing’ and to us, this means integrity is at the foundation of everything we do. We act with transparency and honesty, and we do the right thing, even when no one is watching. This core value translates into a place where our employees can try new things and innovate to help the customer. Developing this continuous improvement environment is critical when undergoing a digital transformation.”

Leading With Empathy for Successful Transformations

As digital transformations continue to shape the future of insurance, insurers who understand the human element of change and lead with empathy will see greater results. Understanding and actively managing the array of emotions accompanying transformations is a strategic imperative that drives organizational success. Empathy has become a cornerstone of effective leadership in this dynamic digital world.

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