Organisations must be prepared to abandon traditional ways of managing people if they are to prosper in the new business age, according to Terry Leahy, chief executive of Tesco. "The nature of modern society and modern competition as industries move into global competition, means there will be an increasing need for change in all businesses," he told the Marketing Society's retail forum. "The challenge is that you have to address a facet of human nature, which is that none of us like change, whatever we say. In the basic psyche you want security; you want to understand your surroundings. "All businesses have, very positively, to try to create a culture and a climate whereby change is normal rather than seen as unusual." But Leahy said that was a real problem for managers ­ "because the basis of bureaucratic organisation does not want to allow that". He added: "Bureaucracy wants to preserve the status quo, the relationship between people and organisations, so in a way traditional methods of organisation are completely inappropriate to handling modern demands for change. "We have tried to solve these problems by developing management skills around change. "A lot of what we try to do is develop processes which deal effectively with change, and as part of that, communication matters, empowerment matters, putting teams together who can deal with change, all those things matter. "In a wider sense I think it is important to show your understanding of the problems which inevitably come up around change. People do need to know why there is a need for change; they have to buy into it. They also have to have a very clear picture of what you are trying to create. "There will be lots of mistakes along the way and I think you have to try to have an organisation that can live with mistakes. If you punish mistakes people will say, Oh well, the last time I tried I got my head chopped off, so I'm not doing that again'." {{PEOPLE MOVES }}