7 the eight stage process

8/14/2019 7 the Eight Stage Process

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Session 7

The eight stage process: successful

change and the force that drives it



The globalization of markets andcompetition People of older generation did not grow up in an era when

transformation was common.

With less global competition and a slower-moving businessenvironment, the norm back then was stability and contentment with“things around them.”

The challenge we now face are different. A globalized economy iscreating both hazards and more opportunities for everyone, forcingfirms to make dramatic improvement, not only to compete andprosper but also to merely survive.

Globalization, in turn, is being driven by a broad and powerful set of forces associated with:

technological change international economic integration domestic market maturation within more developed countries The collapse of worldwide communism.



The globalization of markets andcompetition No one is immune to these forces.

Even companies that sell only in small geographic

regions can feel the impact of globalization.

The influence route is sometimes indirect:

Toyota beats GM

GM lays off employees School systems, hospitals, charities and government

agencies are being force to try to improve



The globalization of markets andcompetition Given the track record of many companies over the past

two decades, some people have concluded that

organizations are simply unable to change much andthat we must learn to accept that fact. But this assessment cannot account for any of the

dramatic transformation success stories from therecent past.

Some organizations have discovered how to make newstrategies, acquisitions, reengineering, quality programs and so forth, work wonderfully well for them.

They have minimized the change errors. In the process, they have been saved from

bankruptcy or gone from middle players to industryleaders or pulled farther out in front of their closestrivals.



The globalization of markets andcompetition An examination of these success stories reveals

two important patterns:

Useful change tends to be associated with a multi-

step process that creates power and motivation sufficient to overwhelm all the source of inertia.

This process is never employed effectively unless it

is driven by high-quality leadership, not just excellent management – an important distinction.



The eight-stage change process The methods used in successful transformation are all based on

one fundamental insight:

That major change will not happen easily for a long list of reasons:

Even if an objective observer can clearly see that the costs are

too high or products are not good enough or shifting customer requirements are not being adequately

addressed

needed change still stall because of inwardly focused cultures, paralyzing bureaucracy, politics, a low level of trust, lack of teamwork, arrogant attitudes, a lack of leadership in middle management and the general human fear of the unknown.



The eight-stage change process To be effective, a method designed to alter

strategies, reengineering processes, or improve quality must address these barriersand address them well.

The eight-stage process of creating major change is the one methods to make changesmore effective.

It is the transforming of the eight errors wementioned earlier.



The eight-stage process of creating

major change The steps are:

3. Establishing a sense of urgency

4. Creating the guiding coalition

5. Developing a vision and strategy 6. Communicating the change vision

7. Empowering broad-based action

8. Generating short-term wins

9. Consolidating gains and producing more change

10. Anchoring new approaches in the culture



1. Establishing a sense of urgency

Examine the market and competitive realities

Identifying and discussing crises, potential crisesor major opportunities

Reduced or eliminate sources of complacencyand raise and push up the urgency level

Sources of complacency such as:



Establishing sense of urgency The absence of a major and visible crises (not losing money, no

threats) Too many visible resources (nice company cars etc)

Low overall performance standards (managers measured themselves were far from high)

Organizational structures that focus employees on narrow functional goals (instead of broad business performance, no one feel responsible)

Internal measurement systems that focus on the wrong performance

indexes (not specific enough) A lack of sufficiently feedback from external sources (eg

stakeholders rarely went to anyone. never heard an unhappy stakeholers, so life is ok)

A kill-the –messenger-of -bad-news (messenger who collect datatreated like lepers)

Human nature, with its capacity for denial, especially if people arealready busy or stressed (deny what we do not want to hear. life ismore pleasurable without problems)

Too much happy talk from senior management (false sense of security by senior management happy talk)



2. Creating the guiding coalition

Putting together a group with enough power

to lead the change

Getting the group to work together like a

team

Four characteristics essential to effective

guiding coalition:



Creating a guiding coalition

Position power : key players on board, especially the

main line managers so that those left out cannot blockprogress.

Expertise: people with various point of view in term of discipline, work experience, nationality etc, relevant tothe task at hand adequately represented so thatinformed, intelligent decisions will be made.

Credibility: people with good reputation in the firm that

pronouncement will be taken by other employees

Leadership: proven leadership to be able to drive ti thechange process.



Why vision is essential

Vision refers to a picture of the future with some implicit or

explicit commentary on why people should strive to create thatfuture.

In a change process, a good vision serves three importantpurposes:

5. By clarifying the general direction for change

7. It motivates people to take action in the right direction, even if the steps are personally painful.

9. It helps coordinates the actions of different people, eventhousands of individuals, in a remarkably fast and efficient way.



Clarifying the general direction for

change Clarifying the direction for change is important because more

often than not, people disagree on direction or are confused or wonder whether significant change is really necessary.

An effective vision and back-up strategies help resolve theseissues. (they say: this is how our world is changing and here are

compelling reasons why we should set these goals and pursuethese new products or acquisition or quality program toaccomplish the goals).

With clarity of direction, the inability to make decisions candisappear.

In line with the vision can help eliminate hours, days or evenmonths of torturous discussion.



Clarify the general direction for

change A second essential function vision serves isto facilitate major changes by motivating action that is not necessarily in people’sshort-term self-interest.

Third, vision helps align individuals, thuscoordinating the actions of motivated peoplein a remarkably way. With clarity of vision, managers and employees

can figure out for themselves what to do withoutconstantly checking with a boss or their peers.



Characteristic of an effective vision for

change Imaginable: conveys a picture of what the future will look like.

Desirable: appeals to the long-term interest of employees,customers, stockholders and others who have a stake in theenterprise.

Feasible: comprises realistic, attainable goals

Focused : is clear enough to provide guidance in decision making

Flexible: is general enough to allow individual initiatives andalternative responses in light of changing conditions

Communicable: is easy to communicate; can be successfullyexplained with five minutes



4.Communicating the change vision

Using every vehicle possible to constantly

communicate the new vision and strategies

Having the guiding coalition role model the

behavior expected of employees



Key elements in the effectivecommunication of vision Simplicity : all jargon and technobabble must be eliminated

Metaphor, analogy and example: a verbal picture is worth a thousandwords

Multiple forums: big meeting and small, memos and newspaper, formaland informal interaction – all are effective for spreading the word

Repetition: ideas sink deeply only after they have been heard manytimes

Leadership by example: behavior from important people thatinconsistent with the vision overwhelms other forms of communication

Explanation of seemingly inconsistencies: unaddressed inconsistenciesundermine the credibility of all communication

Give-and-take: two-way communication is always more powerful thanone-way communcation.



5. Empowering broad-based action

Getting rid of obstacles

Changing systems or structures that

undermine the change vision

Encouraging risk taking and non-traditional

ideas, activities and actions



Empowering people to effect change Communicate a sensible vision to employees: if

employees have a shared sense of purpose, it will beeasier to initiate action to achieve that purpose

Make structures compatible with the vision: unalignedstructures block needed action

Provide the training employees need : without the rightskills and attitudes, people feel disempowered

Align information and personnel systems to the vision:unaligned systems also block needed action

Confront supervisors who undercut needed change:

nothing disempowers people the way a bad boss can.



6. Generating short-term wins

Planning for visible improvements in

performance or “wins”

Creating those wins

Visibly recognizing and rewarding people

who made the wins possible



The role of short-term wins

Provide evidence that sacrifices are worth it: wins greatly help justifythe short-term costs involved.

Reward change agents with a pat on the back: after a lot of hardwork, positive feedback builds morale and motivation.

Help fine-tune vision and strategies: short-term wins give the

guiding coalition concrete date on the viability of their ideas.

Undermine cynics and self-serving resisters: clear improvements inperformance make it difficult for people to block needed change.

Keep bosses on board: provides those higher in the hierarchy with

evidence that the transformation is on track.

Build momentum: turns neutrals into supporters, reluctantsupporters into active helpers, etc.



7. Consolidating gains and producing

more change Using increased credibility to change all

systems, structures and policies that don’t fittogether and don’t fit the transformationvision.

Hiring, promoting and developing people whocan implement the change vision

Reinvigorating the process with new projects,themes and change agents



What stage 7 looks like in a successful, majorchange effort More change, not less: the guiding coalition uses the credibility

afforded by short-term wins to tackle additional and bigger change

projects.

More help: additional people are brought in, promoted anddeveloped to help with all the changes.

Leadership from senior management : senior people focus on

maintaining clarity of shared purpose for all the overall effort andkeeping urgency levels up.

Project management and leadership from below : lower ranks in thehierarchy both provide leadership for specific projects and managethose projects.

Reduction of unnecessary interdependencies: to make changeeasier in both the short and long term, managers identifyunnecessary interdependencies and eliminate them



8. Anchoring new approaches in theculture Creating better performance through

customer-and productivity-oriented behavior,

more and better leadership and more

effective management.

Articulating the connections between new

behaviors and organizational success.

Developing means to ensure leadership

development and succession.



Anchoring change in culture

Comes last, not first : most alterations in norms and shared

values come at the end of the transformation process.

Depends on results: new approaches usually sink into a cultureonly after it’s very clear that they work and are superior to oldmethods.

Requires a lot of talk: without verbal instruction and support,people are often reluctant to admit the validity of new practices.

May involve turnover : sometimes the only way to change aculture is to change key people.

Makes decisions on succession crucial : if promotion processesare not changed to be compatible with the new practices, the oldculture will reassert itself.



Management Planning and budgeting

Establishing detailed steps and time tables for achieving needed results, then allocating the resources necessary to make it happen.

Organizing and staffing

Establishing some structure for accomplishing plan requirements,staffing that structure with individuals, delegating responsibility and authority for carrying out the plan, providing policies and

procedures to help guide people, and creating methods or systems to monitor implementation.

Controlling and problem solving

Monitoring results, identifying deviations from plan, then planning and organizing to solved these problems.



Management

Produces a degree of predictability and

order and has the potential to consistently

produce the short-term results expected

by various stakeholders (e.g. for customers, always being on time; for

stockholders, being on budget)



Leadership

Establishing direction

Developing a vision of the future – often the distant future – and strategies for producing the changed needed to achieve that vision.

Aligning people

Communicating direction in words and deeds to all those whosecooperation many be needed so as to influence the creation of teams and coalitions that understand the vision and strategiesand that accept their validity.

Motivating and inspiring

Energizing people to overcome major political, bureaucratic, and resource barriers to change by satisfying basic but oftenunfulfilled, human needs.



Leadership

Produces change, often to a dramatic

degree, and has the potential to produce

extremely useful change (e.g. new products

that customer want, new approaches to labor relations that help male a firm more

competitive)



The future

The change problem inside the organizations would

become less worrisome if the business environmentwould soon stabilize or at least slow down.

But most credible evidence suggests the opposite:

the rate of environment movement will increase andthat the pressure on organizations to transformthemselves will grow over the next few decades.

If that the case, the only rational solution is to learn more about what creates successful change and topass that knowledge on to increasingly larger groups of people.

7 the eight stage process

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