Archive for the “Change Management” Category

Last week was a busy week. We began work with a new client and I was battling a mini-depression over an assessment that my profession might add no value to society.

My battle started with an article I read about Wall Street wizards, hedge funds and derivatives. The author, an Andy Rooney-type, claimed if a person couldn’t explain what they did for a living in two sentences, they weren’t adding value to society. Farmers, doctors, plumbers and janitors were all on the good list. “Liquidity tranche default analysts” were definitely on the bad list.

So if I can’t define “organizational change management consultant” in two sentences, does this mean I am not adding value to society? Does my mother-in-law have any idea what I do when I say I:

“Help clients’ managers lead their people quickly through organizational changes. I help by being a project manager, strategist, writer, teacher, coach, scorecard keeper, presenter, analyst, tactician, assessor, trainer, and graphic artist.”

The answer is no. Those two sentences, although accurate, really don’t get the meaning across. I’m afraid I have failed the author’s test. I need more than two sentences.

If unbound by the two sentence definition constraint, I frame a conversation about the work to be done with questions about an organization’s relative potential for success:

1. Does it have the right goals and plans? Are the right goals established for the situation? Will the plans enable the organization to reach the goals?
2. Do people understand what they are to do? Great plans that aren’t understood have no value. How does the leader ensure people understand the plan? Are they organized to succeed and have all the enablers necessary to achieve the goals.
3. How engaged are people to achieve the goals and work the plans? The right plans, even if well understood, will not be successful if people don’t want to make the necessary effort.

Depending on the answers, the organizational change management consultant’s job changes greatly. At the most general, the consultant’s job is to help the organization answer yes to all these questions. The specific work changes based on the nature of the challenge, the scope of services being retained, and the tactics required.

Regardless of the author’s perspective on whether certain jobs add value to society, there is value to an organization in moving past change and returning to its mission. The faster the move, the more value is created. If a consultant can speed that move, the consultant helps create value.

As an aside, I decided on Sunday the author was wrong – which just happened to be Father’s Day. Sometimes more than two sentences are needed. To prove the point – try defining “father” in two sentences. Or – obviously – “mother.”  

Stefan Stern has written a great piece in Financial Times on transformational change and uses two examples to buttress his claims. The success story is the opening of a new terminal for the cross-Channel Eurostar train service. The failure story is the opening of the new British Airways terminal at Heathrow airport. The highlights of the Heathrow story are provided below:

“consider the horrors of the launch of Heathrow’s T5 in March. Sure, as far as the construction of the site was concerned, it was a triumph, a £4.3bn project completed on budget, on time and in full. But in spite of BA running a three-year change programme, called “Fit for 5″, we all know what happened come opening day.

Baggage handlers tried to warn their bosses about the problems they could foresee. The site is huge. Employees, who had not had enough training, simply did not know where they were supposed to go. More time had to be allowed to get staff from their locker rooms to the arrival and departure gates. And, as for the lockers – the new ones were not big enough to hold all the baggage-handlers’ clothing and belongings, including bulky wet-weather gear. Parking space, also far from the terminal building, was inadequate.

Managers were told about all these things. And BA chief executive Willie Walsh did not appear to know how grave the problems were. (He later told MPs that he had taken a “calculated risk” pressing ahead with the launch date.) But the clock ticking down to the March 27 opening had kept ticking, and apparently it could on no account be stopped.

Managers sometimes complain that their people “hate change”. That is just not true. People hate stupid change, change that they have no influence over, change that is simply imposed on them.
To err is human. We all do it, even – you will just have to believe me here – journalists. But looking back at the T5 fiasco, it seems clear that a bit of honest, straight talk (and action) at the right time could have helped avoid much of the subsequent aggro.

How hard is it really for managers to recognise these basic truths: that staff (including managers) need to be trained properly to do their jobs well, that employees on the ground may have useful things to tell you about the reality of the work they are doing, and that large-scale, difficult changes need to be prepared for thoroughly?

So much in the world of management seems ultimately to be a matter of common sense, of basic human decency, in fact. You could almost believe that most management foul-ups would be avoided if only people did a bit of serious thinking first. Employees could then get on with their work calmly and productively. Life would go serenely on. And, in this blissful world of efficiency and success, there would certainly be no need for management columnists.”

There would be a whole lot less need for management consultants as well!

The social scientist, Kurt Lewin, once stated, “If you want to truly understand something, try to change it.”

There are many reasons for and against every decision. Knowing what those reasons are and how to properly weigh them to make the right decision can be more art than science. However, Lewin’s concept of force field analysis is a technique change leaders can use for evaluating the variables present in their change management program before making the decision to go ahead.

Within the idea of force field analysis there are driving forces – those things helping you achieve change – and restraining forces – those that would prevent change from occurring. By listing those forces, as shown below, force field analysis offers you a clearer picture of the strategies needed for successful change. Specifically, force field analysis helps you:

• Decide if you have the right support for the change initiative
• Identify what obstacles are standing in your way
• Find ways to reduce or marginalize those obstacles

Change leaders who take the time to weigh the pros and cons in this way will have the information they need to weaken the negative forces and strengthen and leverage the positive ones. For the pictoral learner, placing concepts into a picture yields an immediate grasp of what to minimize, and what to augment.  Even for those who aren’t pictoral by nature can gain the understanding and engagement of those who are by depicting the situation as simply as is done below.

In an earlier posting, I briefly mentioned Elizabeth Kübler-Ross’s grief cycle. Her cycle defines the rollercoaster we all ride during times of loss, and includes the five stages:

• Denial (this isn’t happening )
• Anger (why me?)
• Bargaining (I’ll … if …)
• Depression (I no longer care)
• Acceptance (it is what it is)

This cycle is often what employees experience during times of change. The instability from the unknown future state causes employees to feel they’ve lost their power or control over the work lives. The instability causes undue fear and doubt in themselves and their futures, causing them to get stuck somewhere between immobilization and depression.

Helping employees to move through these stages toward acceptance can be difficult, but not impossible, especially if we employ the strategies of awareness, understanding and participation to help them through it.

By creating awareness of the change to come, we help employees move through the denial phase and make the change a reality for them. Likewise, helping employees move to an understanding of the need for change helps them to deal with the anger they feel. Finally, using participatory methods helps employees to move through the depression and past just simple acceptance to a level of engagement in the change.

One place to look for a different take on creating awareness, understanding and participation is Weight Watchers. Weight Watchers helps individuals seeking weight loss through their Four Pillars. The Four Pillars are behavior, exercise, food and support that make up a comprehensive program of support, education, and encouragement.

These pillars take members through an awareness of their weight issues – why they are overweight – to understanding the best ways to address their issues -the right food choices and exercise – to engagement through participating in meetings or an online community.

Alcoholics Anonymous is another good example of personal change programs that address the need for awareness, understanding and participation. Through fellowship meetings and their 12-step program, members are encouraged to participate in their own healing. This is done by helping members acknowledge their situation and then finding ways to live with it.

Perhaps with a little effort, companies can work to apply these participatory and supportive means to their change efforts. 

Change is a scary process in and of itself. But add the word “transformational” in front of change and the idea has people running for the exits. Since transformational change is such a widely used term in change management, why does it elicit such a reaction?

Well, first, transformational change encompasses more than reorganizing a single department or changing a simple business process. Transformational change affects the entire business, from the front-line employee to senior management. It affects the organization’s structure, processes and culture. It creates significant disruption across the organization; it changes the patterns and assumptions found within the organization. For instance, it requires employees to work in new ways; ways that might change their ingrained, comfortable identities.

Even more important than the change associated with transformation is the implications associated with the word. Transformation means out with old and in with new. It means caterpillars are bad – we want butterflies. The only problem is that you are a caterpillar, and you’ve always been a caterpillar. And you like being a caterpillar.

Because the word transformation can start the conversation on a negative tone, the idea of transformational change needs to be carefully approached even in organizations in great need of change. Leaders looking to implement transformational change need to start with an appealing, positive vision and work backwards to the negatives of today. “I envision a world where we will be beautiful, fly with the winds and see the world… As an added benefit, we will have less risk of being stepped on.”

Best practice says business process and organization design are linked. This reorganization team’s charter was to focus on organization design and filling jobs. Senior management viewed business process as something that would “figure itself out pretty quickly.” Because business process and organization design weren’t linked, the organization was designed without understanding how it would work.

As the new organization was rolled out, business process did not “figure itself out.” Here is an example: Mary used to perform roles A and B. After the reorganization, she performed roles A and B, plus an additional role, C – but only for business unit #1. She had no idea who to give A and B work to for business units #2 and #3 – and this work fell apart for those units. Mary also was struggling with the new work in role C. She could not get help from her new boss because her new boss was relocating from the home city of unit #2 to the city of unit #1. To make matters worse, the person who used to perform role C was let go in the reorganization. Mary’s productivity was in a perfect storm, and her storm was just one of hundreds.

The team’s recommendation: “We strenuously recommend respecting the critical link between business process and organization design throughout the change effort.”

During the course of the reorganization, the president, HR head and Finance head conducted a number of “alignment” sessions with the organization’s top two levels. These sessions were meant to explain the rationale for the change and define the roles of those executives in moving the reorganization forward. Nonetheless, mixed messages were common when those executives spoke to their functions. Just as bad, employees told us repeatedly that senior managers were absent or silent during the most stressful periods of change.

Obvious shortcomings in the vision were, no doubt, a primary driver of the mixed messages. Unfortunately, poor leadership, political maneuvering and an unwillingness to confront unproductive behaviors created far more turmoil in the workforce than was necessary.

In the end, the team knew they had few options in addressing unhelpful behaviors from such senior executives. All the same tactics (those alignment sessions) would need to be employed, with one important addition. At the project’s initiation, the team would measure senior executive support by surveying their functions. Scores would be publicly provided to senior management “in the spirit of transparency.” Of course, transparency was only part of the rationale. Creating a sense of competition and peer pressure would become the safety net to ensure appropriate performance.

There is a continuum along which organizational changes can be planned. On one end are top-down approaches with planning done by small groups behind closed doors. The organization implements what it is told to implement. At the other end is including as many employees as possible in designing pieces of the new organization, and then tasking those same people with implementing the changes they designed. The former is exclusive, the latter is inclusive.

This company took a more inclusive route as it mirrored their culture. Directors and senior managers designed their organizations, level by level, and were then responsible for implementing the design. This choice was intended to take advantage of line managers’ more intimate knowledge of their areas and people, while at the same time building their buy-in to the change process.

The approach’s down side was employees feeling it was taking too long. Impatience led to paralysis.

The team had underestimated and under-communicated the impacts. At the same time management was dealing with business issues (their day jobs) and counseling their teams through the unsettling period of change (which encroached on their daily job performance), they had an additional burden of intensive reorganizational work upon them (a night job).

In short, the team miscalculated the burden on line management. By being inclusive, they passed a burden on to people ill-prepared to accept the challenge.

On the flip side, a more exclusive approach would have taken just as long, and perhaps longer. (All the kinks associated with any reorganization still needed to get worked out.) But, since employees would have had less visibility to the process and less day-to-day involvement with the work, it may have felt shorter.

In the end, the team concluded, “in the future we must carefully weigh the pros and cons of a range of approaches, choose the one that suits us best, build a fully fleshed-out plan, and then aggressively and continually communicate the methodology and its benefits to all employees.”

In other words, there is no correct answer – but whatever choice you make, set people’s expectations accordingly.

Recently, we worked on a reorganization of a business with several thousand employees. The company was splitting itself into smaller organizational units. Our team didn’t set the business strategy or the change plan. But we were the arms and legs to help the project team get the work done.

At the end of the project, the team documented their learnings and some will be shared over the next couple posts. We share them for a simple reason – it is highly likely that other reorganization teams will face similar challenges. The challenges themselves aren’t “secrets;” what created the challenges, where the challenges occurred and how they were addressed are. In any case, here are some real live challenges to plan for as you work on a reorganization.

#1 – Crystallize the Vision and Case for Change

While there were several important themes supporting the reorganization (like “accountability” and “customer focus”), these themes didn’t effectively crystallize into a clear and compelling picture of the envisioned future. Because the vision wasn’t clear, the team struggled throughout the project with several issues:

• Decision making became more complex since there were no clear “stakes in the ground” on which to base priorities. Everything was an ad hoc decision. Nothing was principle based.
• The team was left in a reactive and responsive mode vs. being proactive with a clearly defined strategic goal.
• The team was unable to effectively communicate an appropriate understanding of management’s vision of the future. (The team wasn’t quite sure themselves). When the team did communicate, there were conflicting messages:
  • “This is not a cost-driven exercise,” and “Design an organization that reflects some level of reduction,” or,
  • “Business process management and execution is critical to our long-term success,” and “We can design our processes after we set the organization;” or,
  • “Do it right,” vs. “Do it fast.”

The team’s #1 lesson: “When considering large-scale change, nothing should be more important than crafting an iron-clad and understandable case for change and an engaging vision for the outcome of the change. This includes creating specific examples of how employees would experience the change as enhancing their work lives. Use focus groups to test the vision for how understandable and engaging it is.”

A recent comment on this blog regarding resistance to change led me to try to prove an intuition about the subject. (Meyers Briggs’ intuitives can look like geniuses frequently, but can also look like idiots when those intuitions are wrong!)

According to SHRM’s 2007 study on Change Management, about 70% of major organizational changes encounter employee resistance. The comment stated that typical levels of employee resistance run around 15%. Is there a way to reconcile the two? In short yes. They aren’t mutually exclusive. 70% of reorganizations can encounter resistance – but the resistance can come from only a small number of people.

A 2005 benchmarking study of 411 companies by Prosci identified where resistance to change was most commonly cited. Middle management won the prize by a long shot.

Their study provides common sense insight on why managers resist change:

1. Loss of power and control
2. Overloaded with current responsibilities
3. Lacked awareness of the need for change
4. Lacked the required skills
5. Fear, uncertainty and doubt

The managers’ reasons are far different from the reasons why front line employees resist change:

1. Not aware of the business need for change
2. Layoffs were announced or feared
3. Unsure if they had necessary skills for success
4. Comfort with the current state
5. Believed they were being asked to do more with less, or more for the same pay

Thinking back over the many initiatives I have been involved with, the front-line employee concerns were more easily handled. Provide information in a professional and compassionate way as it is available and you will earn trust, respect and engagement in the change process. The middle manager, however, has always been more difficult to address. Frequently their concerns are well-founded. They are going to lose power or they are going to become more overloaded.

As you work with them to gain their participation in the change, however, it is best to remember the leverage they represent. Getting one middle manager on your side means a whole lot of their people will follow him or her. It is a whole lot harder to convince the employees of a middle manager to not follow their leader’s resistance than it is to get the leader on your side.