Change Management StrategiesThe Nature of Planned change

SyllabusModule 1: Introduction to Organizational Change:

Module 2: The Nature of Planned Change

Module 3: The Process of Organizational Development: Diagnosing organizations

Module 4: Designing Interventions

Module 5: Leading and Managing change

Module 6: Strategic Change Interventions

Module 7: Transformational change

Module 8: Continuous change

Module 9: Trans organizational Change

Why is Executing Change so Challenging?• People will resist change. Why? “Uninformed Optimism is always followed by

“Informed Pessimism” and humans will choose the comfort of familiarity over the anxiety that comes with the unknown.

• We live in an era of perpetual change/unrest. We have only just crossed the threshold of perpetual unrest. We need to expect more change.

• We’ve run out of the resources required to deal with change. Absorbing change requires physical, emotional, and intellectual energy.

• We incorrectly focus an inordinate amount of energy into trying to make people feel comfortable during a major change. Reality is they won’t – it is necessary that they make adjustments that will help them succeed in the new environment.

• We focus on getting the change “installed” (e.g. # people trained, spent, computers on desks) and miss “realizing” the return on investment expected from the change (i.e. the fundamental purpose for the change, the outcomes that were promised). People need to be readied to absorb the disruption and adapt to the change.

• Source: Adapted from a presentation by Daryl Conner – Organizational Change: Installation vs. Realization)

Organization Strategies for Successfully Realizing the Results in Change:

• Look for ways to decrease unnecessary demands on existing resources. • To consider the aggregate effect of incremental changes.

• Change projects need to be driven by whether or not they are an organizational imperative.

• Change projects should generate “such value that the cost for failing to implement them would be prohibitively high”.

• Increase the organization’s capacity and resilience for dealing with the disruption of change.

• People need to be able to absorb change if organizations are going to be effective.

• We can increase capacity by carefully and diligently managing the human side of change (i.e. the transition).

• We can increase resilience by seeking out and enhancing personal resilience.

• Follow a process for managing change and transition.• What is changing and the impact of that change on the people.

Managing Change vs. Managing Transition• Change is the shift in the external situation; the thing that has changed. It

can happen fast.

• Transition is the reorientation people need to make in response to the change. This can take time.

• To be successful in both the implementation and in helping people we need to manage both the change and the transition.

• A transition management plan is a necessary component of a changemanagement plan and presumes that the underlying change is being well managed.

• Source: Bridges, William. (1991). Managing Transition: Making the Most of Change.

A well-managed change ensures that:

• There is an identified Executive Sponsor for the change

• Leaders understand the shifting roles of Sponsors, Implementers Agents and Advocates during change

• Change teams are set up as needed (e.g. implementation, transition, communication, etc.)

• The need for the change has been effectively established and communicated to everyone – more than once using a variety of medium.

• The impacts of the planned change - indirect, as well as direct - have been identified and communicated.

• Those who will be impacted by the change have been involved in the planning, or at the very least, will be involved in its implementation.

• The details of the implementation are generally understood as they emerge and are modified to fit changing circumstances

Detail of Steps for Managing Change:

1. Identify/Accept the Need for Change:List the issues, indicators or symptoms

Ask stakeholders to confirm the issues, indicators or symptoms

Decide whether change is necessary

Set up change team(s)/support mechanisms (implementation, transition, communication etc.)

Clarify Roles (Sponsor, Implementer, Agent, Advocate)

Detail of Steps for Managing Change

2. Assess and Define the Change Required:

Identify the preferred future state

Assess the current state

Identify the gap or difference

Clearly define what must be changed

Establish measures of success

Detail of Steps for Managing Change

3. Analyze the Impact of Alternatives and Select the Best:List reasonable alternatives (including making no change)

Assess the cost/benefits, pros/cons, outcomes/risks and potential side effects

Choose the best alternative

Identify restraining and supporting forces (i.e. people, events, rules and policies)

Detail of Steps for Managing Change:

4. Develop the Plan and Strategies:Explain the change and rationale

Describe the current situation vs. the desired future

Explain the options considered and decision

Describe objectives, action plans, and measures of success

Develop strategies: Operational (Physical/Plant Legal, Financial, and Service Issues)

Training and Learning

Human Resource (HR/LR, Staff Transfer, Selection)

Communication

Transition

Team Development

Budget Implications

Detail of Steps for Managing Change

5. Implement the Plan and Strategies:

Enlist others

Determine readiness for change

Prepare and educate those implementing the change

Follow the timetable and sequence of events for communication, training, team development etc.)

Detail of Steps for Managing Change

6. Manage the Transition:

Monitor transition issues and people’s response to the change

Implement strategies to help people with the transition

Recognize results

7. Evaluate the Change:

Monitor progress and debrief

Design and conduct evaluation based on the measure of success

Document and report on the outcome

Adjust or alter based on evaluation

Model for Managing Transition

This model for Managing Transition is influenced by the separate work of Elisabeth Kubler-Ross, Cynthia Scott and William Bridges

Key factors in achieving change

Key factors in achieving change

Scale of change

• Hammer and Champy (1993) defined BPR as

the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed.

• Fundamental rethinking – re-engineering usually refers to changing of significant business processes such as customer service, sales order processing or manufacturing.

• Radical redesign – re-engineering is not involved with minor, incremental change or automation of existing ways of working. It involves a complete rethinking about the way business processes operate.

• Dramatic improvements – the aim of BPR is to achieve improvements measured in tens or hundreds of percent. With automation of existing processes only single figure improvements may be possible.

• Critical contemporary measures of performance – this point refers to the importance of measuring how well the processes operate in terms of the four important measures of cost, quality, service and speed.

Different scales of change

Term Involves Intention Risk of failure

Business

process re-

engineering

Fundamental redesign

of all main company

processes

Large gains in

performance

(>100%?)

Highest

Business

process

improvement

Targets key processes

in sequence for

redesign

(<50%) Medium

Business

process

automation

Automating existing

process

(<20%) Lowest

Project management activities• Estimation – identifying the activities involved in the

project, sometimes referred to as a work breakdown structure (WBS).

• Resource allocation – after the initial WBS, appropriate resources can be allocated to the tasks.

• Schedule/plan – after resource allocation, the amount of time for each task can be determined according to the availability and skills of the people assigned to the tasks.

• Monitoring and control – monitoring involves ensuring the project is working to plan once it has started. Control is taking corrective action if the project deviates from the plan. In particular the project manager will want to hit milestones

Stages in developing an e-business solution

Stages in developing an e-business solution

An example web site development schedule for the B2C Company

Figure 10.3 An example web site development schedule for The B2C Company

Automating the employee development process

Figure 10.4 Automating the employee development process

Source: Confirmit Copyright © 2003 FIRM

Organisational structures for e-business and e-commerce

Organizational structure Circumstances Advantages Disadvantages

(a) No formal structure

for e-commerce

Initial response to e-commerce

or poor leadership with no

identification of need for

change.

Can achieve rapid response to

e-commerce service

responses (e-mail, phone).

Priorities not decided logically.

Insufficient resources

Poor quality site in terms of

content quality and

customer

(b) A separate

committee or

department manages

and coordinates e-

commerce

Identification of problem and

response in (a)

Coordination and budgeting

and resource allocation

possible.

May be difficult to get

different departments to

deliver their input due to

other commitments

(c) A separate business

unit with independent

budgets

Internet contribution (Chapter

6) is sizeable (>20%)

As for (b), but can set own

targets and not be constrained

by resources. Lower risk

option than (d)

Has to respond to

corporate strategy. Conflict

of interests between

department and traditional

business

(d) A separate operating

company

Major revenue potential or

flotation. Need to differentiate

from parent

As for (c), but can set strategy

independently. Can maximize

market potential

High risk if market potential

is overestimated due to

start-up costs

Summary of alternative organizational structures for e-commerce suggested in Parsons et al.

Figure 10.5 Summary of alternative organizational structures for e-commerce

suggested in Parsons et al. (1996)

Transition curve indicating the reaction of staff through time from when change is first suggested

Transition curve indicating the reaction of staff through time from when change is first suggested

Source: Bocij et al. (2003)

Key staff in systems acceptance• System sponsors

•

• System owners•

• System users•

• Stakeholders•

• Legitimizer•

• Opinion leaders•

The role of organisational culture• Survival (outward-looking, flexible) – the external environment plays a

significant role (an open system) in governing company strategy. The company will likely be driven by customer demands and will be an innovator. It may have a relatively flat structure.

• Productivity (outward-looking, ordered) – interfaces with the external environment are well structured and the company is typically sales-driven and is likely to have a hierarchical structure.

• Human relations (inward-looking, flexible) – this is the organization as family, with interpersonal relations more important than reporting channels, a flatter structure and staff development and empowerment is thought of as important by managers.

• Stability (inward-looking, ordered) – the environment is essentially ignored with managers concentrating on internal efficiency and again managed through a hierarchical structure.