theresa childress clark collins jason morgan. change management is defined as the practice of...
TRANSCRIPT
Change management is defined as the practice of managing the human elements associated with project implementation
Implementation examples in the Controller’s department◦ Implementation of a new financial system◦ New chart of accounts◦ New accounting related process
Change Management
Human elements are the largest reason for the failure of a project◦ Transition is uncomfortable to workers
Learning new routines Workers resistant to change
◦ The cost associated with training employees is high Production time can be cut to 25% of regular level
This illustrates the importance of quick implementation Also social gossip spreading through the company
causes a huge time constraint and often a negative effect on company-wide moral
Difficulties to Change Management
Review Implementation history before starting-Identify effective an ineffective facets of
implementation in previous projects Helps pinpoint past weaknesses to avoid Shows reasons for success that should be repeated
-Patterns to look for-How realistic were the implementation budgets?-What support was given to employees who had to do work differently
Remedies
First step in reviewing implementation history is to categorize these projects◦ Objectives were achieved on schedule and within
budget◦ Objectives were achieved, but somewhat off
schedule or over budget◦ Objectives achieved, but significantly off schedule
or over budget◦ Objectives were not achieved before installation
Remedies cont
After categorizing the projects, look for patterns to emerge in the way the implementation effort was managed◦ Patterns to look for include
How realistic were the budgets and schedules What support in addition to training was given Were employees given adequate time to learn new
activities while balancing regular responsibilities How much communication was there, and which
were the most effective How were people rewarded How were unexpected events handled
Remedies cont
Implementing an ERP system◦ Objective is to integrate key processes of an
organization such as order entry, manufacturing, and accounts payable so one system can serve all the company functions needs. Improves communication channels throughout the
company Supplies management with real-time information to
help with timely decisions to achieve competitive advantage.
Example of change Management
ERP systems change the way a company does business more so than changing the technology◦ People at first will be resistant to learn the new
system. Training can be costly Production will be less during implementation
◦ Must review past implementation history to see which approach to use
Risk to implementing an ERP system
Big-Bang◦ Switches from the legacy system to the new
system all at once. Quick start so lower cost
Reduced production will be brief More risk because if problems occur there is no
turning back Must look at previous history to judge how the
company culture will conform to the change Must have very good technical support staff to coach
employees through the process quickly
2 Approaches to implementing an ERP system
Phase in approach◦ This approach starts with one or two processes at
a time to gradually phase in the entire system Less risky than Big-Bang because if problems arise
the legacy system can still be used Best for companies that are not as diversified, or if
past history showed resistance to change Could cause loss in production to gradually be
reduced while the system is slowly put in
2 Approaches to implementing an ERP system
“One of the main problems in business today is that there are too many ideas, not too few.”
-George Tanewski, Monash University
Too much of a good thing….
1. Does the project support the company’s long term goals?
2. How well do projects relate or detract from each other?
Analyzing Potential Projects
1. Does the project support the company’s long term goals?
2. How well do projects relate or detract from each other?
3. Which personnel will be affected by the changes?
Analyzing Potential Projects
1. Does the project support the company’s long term goals?
2. How well do projects relate or detract from each other?
3. Which personnel will be affected by the changes?
4. Are there overlapping time frames that may need to be adjusted?
Analyzing Potential Projects
1. Does the project support the company’s long term
goals?
2. How well do projects relate or detract from each
other?
3. Which personnel will be affected by the changes?
4. Are there overlapping time frames that may need to
be adjusted?
5. Which employees will perceive themselves as winners
and losers due to the change?
Analyzing Potential Projects
Which projects have highest priority?
Which ones need to be delayed or scrapped?
What is a realistic time frame for each project?
How will overlapping be handled to reduce the
burden on personnel?
How to communicate the changes through the
organization?
Management Team Decisions
How much will the change affect he way
personnel performs their work?
Will personnel be able to understand the
changes and the effects of the changes?
Does the personnel affected need training?
How will their daily routines differ?
How have they embraced past changes?
Degree of Disruption
The Obvious◦ Wasted Time◦ Wasted Money◦ Wasted Effort
The Not-so-Obvious◦ Decreased Morale◦ Doubts about Leadership
Its important that all decision makers are on the same page when it comes to the cost of failure.
Cost of Failure
Measure risk from a change management perspective to help achieve project objectives◦ Adequacy of sponsorship◦ Adequacy of the motivation◦ Vision of clarity◦ Degree of resistance
Understand the factors Budget and increase chance of success
Risks
The project will need support throughout the organization
Single most important factor in change management
Must have effective sponsors
Adequacy of Sponsorship
Characteristics of Effective sponsors◦ Adequate time and attention to communications
about the projects, its importance, its objectives and its status
◦ Ensure adequate resources and maintain them ◦ Spend time with individuals to help them
understand the project People listen to what sponsors say, do not
say, and do Make sure these are consistent to achieve
the objectives of the project
Sponsorship Cont’d
Cascading Change management
Transforming target groups into sponsors Cascading sponsorship must be developed and maintained
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Change Management Learning Center. Prosci’s research data covers more than
1600 organizations from 59 countries, with 5 longitudinal studies in the past 9 years.
Over half of Fortune 100 companies are using Prosci's change management models and tools.
http://www.prosci.com/about-prosci.htm
Prosci
The bigger the transition the more motivation people need
Adequacy of Motivation
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Motivation is created by an understanding of problems that have to be addressed or opportunities that can be used advantageously
Problems can create motivation for change◦ People want to change existing problems
Focus on the reasons for making the change ◦ Make them feel uncomfortable with their current
situation◦ Belief System theory
Motivation Cont’d
Belief System theory ◦ Individuals value their beliefs and this influences
their attitudes◦ Look at change within the individual ◦ Focus on what the individual wants to achieve
Motivation Cont’d
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Must have a vision to arrive at the desired end
Vision must be clear and actionable Clarity requires time and sponsorship Repetition is key Stay clear of resistance because of fear of
disruption … Do not confuse it with the vision.
Vision Clarity
People do not resist change they resist disruption
Often means that people understand what they are being asked to do
Degree of Resistance
Causes of resistance ◦ Confusion about the projects vision◦ Inadequate motivation ◦ Unclear or inconsistent messages from sponsors
and other key individuals about the importance of the project
◦ Poor implementation history ◦ Lack of Adequate time to respond the and absorb
the changes ◦ Organization’s history of failing to deal
adequately with people who ignore project directives.
Degree of Resistance Cont’d
Allow resistance to be expressed openly Identify the source of resistance
◦ Lack of knowledge= educate◦ Just in time education allows the people to use
the skills soon after learning them Make specific measures to assess project
progress and individual achievement Allowing people to resist a project invites
failure.
Degree of Resistance Cont’d
http://www.prosci.com/about-prosci.htm Change Management Excellence: The Art of Excelling
in Change ManagementVolume 3 of Five pillars of organizational excellence, H. James Harrington
Creativity in Business, George Tanewski, Monash University. http://www.ceoonline.com/pages/2_29_533.aspx
Making sense of change management: a complete guide to the models, tools & techniques of organizational changeThe Change Series Authors Esther Cameron, Mike Green, 2004.
References