And they must take into account the enthusiasm—or often, lack thereof—of the people who must deal with the new systems, processes, or ways of working C2. Top-level commitment is vital to engendering commitment from those at the coal face. No amount of top-level support is too much.
In , when we were working with the CEO of a consumer products company, he told us that he was doing much more than necessary to display his support for a nettlesome project. When we talked to line managers, they said that the CEO had extended very little backing for the project. They felt that if he wanted the project to succeed, he would have to support it more visibly!
A rule of thumb: When you feel that you are talking up a change initiative at least three times more than you need to, your managers will feel that you are backing the transformation. Sometimes, senior executives are reluctant to back initiatives. Senior executives found it gut-wrenching to talk about layoffs in an organization that had prided itself on being a place where good people could find lifetime employment. However, the CEO realized that he needed to tackle the thorny issues around the layoffs to get the project implemented on schedule.
He tapped a senior company veteran to organize a series of speeches and meetings in order to provide consistent explanations for the layoffs, the timing, the consequences for job security, and so on.
He also appointed a well-respected general manager to lead the change program. Those actions reassured employees that the organization would tackle the layoffs in a professional and humane fashion. Companies often underestimate the role that managers and staff play in transformation efforts. By communicating with them too late or inconsistently, senior executives end up alienating the people who are most affected by the changes.
That usually happens when senior executives articulate subtly different versions of critical messages. For instance, in one company that applied the DICE framework, scores for a project showed a low degree of staff commitment. Organizations also underestimate their ability to build staff support. A simple effort to reach out to employees can turn them into champions of new ideas. For example, in the s, a major American energy producer was unable to get the support of mid-level managers, supervisors, and workers for a productivity improvement program.
Partly because of the straight talk, the initiative gained some momentum. This allowed a project team to demonstrate a series of quick wins, which gave the initiative a new lease on life. According to staffing tables, people in many businesses work plus-hour weeks. If, on top of existing responsibilities, line managers and staff have to deal with changes to their work or to the systems they use, they will resist. Project teams must calculate how much work employees will have to do beyond their existing responsibilities to change over to new processes.
Go beyond that, and the initiative will probably run into trouble. Resources will become overstretched and compromise either the change program or normal operations. Employee morale will fall, and conflict may arise between teams and line staff. To minimize the dangers, project managers should use a simple metric like the percentage increase in effort the employees who must cope with the new ways feel they must contribute. They should also check if the additional effort they have demanded comes on top of heavy workloads and if employees are likely to resist the project because it will demand more of their scarce time.
Companies must decide whether to take away some of the regular work of employees who will play key roles in the transformation project.
Companies can start by ridding these employees of discretionary or nonessential responsibilities. In addition, firms should review all the other projects in the operating plan and assess which ones are critical for the change effort.
At one company, the project steering committee delayed or restructured out of subprojects so that some line managers could focus on top-priority projects. Another way to relieve pressure is for the company to bring in temporary workers, like retired managers, to carry out routine activities or to outsource current processes until the changeover is complete. Handing off routine work or delaying projects is costly and time-consuming, so companies need to think through such issues before kicking off transformation efforts.
As we came to understand the four factors better, we created a framework that would help executives evaluate their transformation initiatives and shine a spotlight on interventions that would improve their chances of success. We developed a scoring system based on the variables that affect each factor. Executives can assign scores to the DICE factors and combine them to arrive at a project score.
Companies can determine if their change programs will succeed by asking executives to calculate scores for each of the four factors of the DICE framework—duration, integrity, commitment, and effort.
They must grade each factor on a scale from 1 to 4 using fractions, if necessary ; the lower the score, the better. We find that the following questions and scoring guidelines allow executives to rate transformation initiatives effectively:. Do formal project reviews occur regularly? If the project will take more than two months to complete, what is the average time between reviews? If the time between project reviews is less than two months, you should give the project 1 point.
If the time is between two and four months, you should award the project 2 points; between four and eight months, 3 points; and if reviews are more than eight months apart, give the project 4 points. Is the team leader capable? Do they have sufficient time to spend on the change initiative?
If the team is lacking on all those dimensions, you should award the project 4 points. Do senior executives regularly communicate the reason for the change and the importance of its success? Is the message convincing? Is the message consistent, both across the top management team and over time? Has top management devoted enough resources to the change program? If senior management has, through actions and words, clearly communicated the need for change, you must give the project 1 point. If senior executives appear to be neutral, it gets 2 or 3 points.
If managers perceive senior executives to be reluctant to support the change, award the project 4 points. Are they enthusiastic and supportive or worried and obstructive? If employees are eager to take on the change initiative, you can give the project 1 point, and if they are just willing, 2 points. What is the percentage of increased effort that employees must make to implement the change effort?
Does the incremental effort come on top of a heavy workload? Have people strongly resisted the increased demands on them? Executives can combine the four elements into a project score. When we conducted a regression analysis of our database of change efforts, we found that the combination that correlates most closely with actual outcomes doubles the weight given to team performance I and senior management commitment C 1.
That translates into the following formula:. In the 1-to-4 scoring system, the formula generates overall scores that range from 7 to Our data show a clear distribution of scores:. This is the Worry Zone. The project is extremely risky. If a project scores over 17 and under 19 points, the risks to success are very high. Beyond 19, the project is unlikely to succeed. We have changed the boundaries of the zones over time. For instance, the Worry Zone was between 14 and 21 points at first, and the Woe Zone from 21 to 28 points.
But we found that companies prefer to be alerted to trouble as soon as outcomes become unpredictable 17 to 20 points. We therefore compressed the Worry Zone and expanded the Woe Zone. Although the assessments are subjective, the system gives companies an objective framework for making those decisions.
Moreover, the scoring mechanism ensures that executives are evaluating projects and making trade-offs more consistently across projects. A company can compare its DICE score on the day it kicks off a project with the scores of previous projects, as well as their outcomes, to check if the initiative has been set up for success. When we calculated the scores of the change projects in our database and compared them with the outcomes, the analysis was compelling.
When we plotted the DICE scores of change management initiatives on the horizontal axis, and the outcomes of those projects on the vertical axis, we found three sets of correlations. Projects with DICE scores between 7 and 14 were usually successful; those with scores over 14 and under 17 were unpredictable; and projects with scores over 17 were usually unsuccessful.
We named the three zones Win, Worry, and Woe, respectively. Each number plotted on the graph represents the number of projects, out of the projects, having a particular DICE score. The four factors offer a litmus test that executives can use to assess the probability of success for a given project or set of projects.
Consider the case of a large Australian bank that in wanted to restructure its back-office operations. Senior executives agreed on the rationale for the change but differed on whether the bank could achieve its objectives, since the transformation required major changes in processes and organizational structures.
Bringing the team and the senior executives together long enough to sort out their differences proved impossible; people were just too busy. Doing so condensed what could have been a free-flowing two-day debate into a sharp two-hour discussion. For instance, managers learned that the restructuring would take eight months to implement but that it had poorly defined milestones and reviews. Although the project team was capable and senior management showed reasonable commitment to the effort, there was room for improvement in both areas.
However, the assessment also led managers to take steps to increase the possibility of success before they started the project. The bank decided to split the project time line into two—one short-term and one long-term. To improve staff commitment, the bank decided to devote more time to explaining why the change was necessary and how the institution would support the staff during the implementation. See Conducting Effective Business Negotiations. Significant organizational changes can create ongoing conflict between two locations in the same country.
But conflict is more likely to occur, and is harder to address, when differences in language, time zones, institutions and business practices exist. According to research conducted by the Economist Intelligence Unit, companies will continue to become larger and more global, handling operations in more countries than they do today. Culturally based assumptions about customer needs, infrastructure, competitive threats and other factors make it more difficult to find common ground during a cross-cultural change initiative.
What differentiates an organization's products or services in one country may not be the same elsewhere, and the strengths that it has in its home market may not be easily replicated in other countries. Leaders of global change initiatives should consider these potential problems and plan to address them in advance.
They will be far more likely to avoid change-related pitfalls; achieve their objectives; and build business partnerships characterized by mutual learning and superior business results. Change Management. Only one-quarter of employers are sustaining gains from change management initiatives, Towers Watson survey finds.
Accelerate: Building strategic agility for a faster-moving world. Global firms in The next decade of change for organisations and workers. You may be trying to access this site from a secured browser on the server. Please enable scripts and reload this page. Reuse Permissions. Page Content. Overview Change management is the systematic approach and application of knowledge, tools and resources to deal with change.
Four categories of important obstacles are: Formal structures that make it difficult for employees to act. A lack of needed skills. Personnel or information systems. Supervisors who discourage actions toward implementing the new vision. Another model for organizational change includes a four-phase change management process: Define —Align expectations regarding the scope of the change as well as timing and business impact.
Plan —Understand how the change will impact stakeholders and design a strategy to help them navigate it. Implement —Engage with leaders and associates to execute the change. Sustain —Work with leaders and employees to track adoption and drive lasting change. Overcoming Common Obstacles Encountered in Implementing Change Organizations can have a clear vision for changes and a technically and structurally sound foundation for making changes, but the initiatives can still flounder due to obstacles that arise.
Employee resistance Successful change starts with individuals, and failure often occurs because of human nature and reluctance to change. Some actions to build employee change readiness include: Developing and cascading strong senior sponsorship for people-focused work. In the absence of visible sponsorship, leaders should build alliances, meet business needs and promote wins. Developing tools and information for front-line supervisors and managers.
Organizations should involve them early—train them, prepare them and communicate regularly. Coaching employees to help them adapt and thrive during change. Rewarding desired behaviors and outcomes with both tangible and intangible rewards. Relying on insights from both those in the field and subject-matter experts.
Communication breakdown Sometimes decisions about major organizational changes are made at the top management level and then trickle down to employees. To avoid communication breakdowns, change leaders and HR professionals should be aware of five change communication methodologies—from those that provide the greatest amount of information to those that provide the least: "Spray and pray.
The theory is that more information equates to better communication and decision-making. Employees are passive receivers, and feedback is not necessary. Managers listen for potential misunderstandings and obstacles. This strategy is generally the most effective.
This strategy emphasizes listening to employees; they set the agenda, while executives respond to rumors and innuendoes. Secrecy and control are implicit. The assumption is that employees are not sophisticated enough to grasp the big picture.
Some of the specific communication pitfalls and possible remedies for them are the following: The wrong messengers are used. Studies have found that employees tend to trust information from managers. Understanding the organization's culture will dictate who is the best messenger for change—the manager, the senior executive team or HR.
The change is too sudden. Leaders and managers need to prepare employees for change, allow time for the message to sink in and give them an opportunity to provide feedback before a change is initiated. Communication is not aligned with business realities. Messages should be honest and include the reasons behind the change and the projected outcomes. Communication is too narrow.
If the communication focuses too much on detail and technicalities and does not link change to the organization's goals, it will not resonate with employees. Other obstacles Employee resistance and communication breakdowns are not the only barriers that stand in the way of successful change efforts. Other common obstacles include: Insufficient time devoted to training about the change. Staff turnover during the transition. Excessive change costs.
An unrealistic change implementation timeline. Insufficient employee participation in voluntary training. Downturn in the market or the economy. Change management experts have suggested that unsuccessful change initiatives are often characterized by the following: Being too top-down.
Executives relate their vision of what the end result of the change initiative should be, but do not give direction or communication on how the managers should make the change happen. Being too "big picture. Being too linear. Managers work the project plan from start to finish without making even necessary adjustments. Being too insular. Most organizations do not seek outside help with change initiatives, but businesses may need objective external input or assistance to accomplish major changes.
Mergers and acquisitions A merger is generally defined as the joining of two or more organizations under one common ownership and management structure. Devising ways to meld the two organizations most effectively, efficiently and humanely for the various stakeholders. This process entails coordinating separation and severance pay issues between the combining organizations. Addressing the ethical dilemmas involved, such as when an HR professional may be required to eliminate his or her own position or that of a co-worker or an HR counterpart in the combined organization.
Downsizing Successfully implementing a layoff or reduction in force RIF is one of the more difficult change initiatives an HR professional may face.
Tasks HR professionals will need to undertake include: Planning thoroughly. Each step in the process requires careful planning, considering alternatives, selecting employees to be laid off, communicating the layoff decision, handling layoff documentation and dealing with post-layoff considerations. Applying diversity concepts. HR should form a diverse team to define layoff criteria and make layoff selections. Addressing the needs of the laid-off.
This step involves reviewing severance policies, outplacement benefits, unemployment eligibility and reference policies. Dealing with the emotional impact. HR professionals should understand and prepare for the emotional impact of layoffs on the downsized employees and their families, on the managers making layoff decisions, on other HR professionals involved, and on remaining employees and managers working with the post-layoff workforce.
In some situations, an HR professional may even be responsible for implementing his or her own layoff, a case calling for the utmost in professional behavior. Managing the post-layoff workforce. See Managing Downsizing by Means of Layoffs and Drive Team Performance Using Organizational Transformation Bankruptcy Filing for a business bankruptcy and successfully emerging from the process is generally a complex and difficult time for all parties.
Closing a business operation Businesses make the difficult decision to close all or part of their operations for many reasons, including economic recession, market decline, bankruptcy, sale, a realignment of operations, downsizing, reorganization, outsourcing or loss of contracts. Some of HR's major responsibilities during this type of organizational change are listed below: Following facility-closing notification laws.
HR must determine whether and to what extent the business must comply with notification requirements under federal or state laws for mass layoff and facility closings. HR will also lead the announcement process and participate in all aspects of employee communications, which may include all-employee meetings, written announcements and media interviews.
Announcing the closure news. HR has an important role to play in anticipating and responding to workforce reactions by having as much information and resources on hand as possible. To avoid hostilities or other destructive behavior, HR should consider using an employee assistance program or an outplacement firm.
Providing employee benefits information. After the shock of the announcement subsides, the most frequently asked questions involve benefits, including unemployment compensation, health care continuation, pension plan issues, and retirement plan distributions and rollovers. Coordinating outplacement services. Offering outplacement services for departing employees may enable business owners and managers to provide much-needed support and protect the organization's reputation.
If financially feasible, the organization may offer departing employees outplacement services from a private outplacement consulting firm or, in some states, a state agency. Negotiating with unions. In unionized facilities, employers have a duty to bargain about the effects of a business closure decision.
A much better way to solve the problem is to invest in operational improvements, such as process design and training, to instill new practical approaches and give people the knowledge and cultural support they need. The third major obstacle is that transformation efforts are typically decided upon, planned, and implemented in the C-suite, with little input from those at lower levels. This filters out information that could be helpful in designing the initiative while also limiting opportunities to get frontline ownership of the change.
The following list of 10 guiding principles for change can help executives navigate the treacherous shoals of transformation in a systematic way. Lead with the culture. Yet change leaders often fail to address culture—in terms of either overcoming cultural resistance or making the most of cultural support.
Among respondents whose companies were unable to sustain change over time, a startling 76 percent reported that executives failed to take account of the existing culture when designing the transformation effort. Or they get so focused on structural details—reporting lines, decision rights, and formal processes—that they forget that human beings with strong emotional connections to the culture will be enacting these changes.
Instead of trying to change the culture itself, they draw emotional energy from it. They tap into the way people already think, behave, work, and feel to provide a boost to the change initiative. To use this emotional energy, leaders must look for the elements of the culture that are aligned to the change, bring them to the foreground, and attract the attention of the people who will be affected by the change. In two healthcare companies undergoing a merger, culture led the post-deal integration.
It quickly became clear that where one company had a culture attuned to bottom-line results, the other tended to focus on process. Optimally, the new company would need to skillfully use processes to deliver clear results. Start at the top.
Rather, work must be done in advance to ensure that everyone agrees about the case for the change and the particulars for implementing it. A clinical research firm was committed to tripling its size over the next decade to achieve a more competitive position. Because the company was still pretty much operating as a startup after 25 years, this required a far-reaching organizational redesign. Before starting the design phase, finance leaders gathered at an off-site meeting to begin a rigorous exercise in alignment.
Instead, they mostly operated as lone rangers, in characteristic startup style. Each of the executives in the group made a thoughtful individual presentation about the case for change. Most of them agreed on the general direction the company needed to take to achieve rapid growth.
But their descriptions of how to move in that direction—for example, what the first concrete steps should be—were all over the map. They were then tasked to work together to develop a case for change that every one of them could support. To hammer out these agreements, these top executives had to listen closely to their colleagues and weigh conflicting points of view.
The exercise was demanding, but they began to coalesce around a coherent vision for what the company should look like in 10 years. Most importantly, the experience of working together so intensely led the executives, for once, to act as a collaborative and committed team.
By the end of the off-site meeting, they found that they were all using the same language to describe what the company needed to do. As one participant noted, the experience had transformed him , which in turn gave him confidence that together they could cascade the plan to other groups at other levels of the hierarchy.
Involve every layer. Strategic planners often fail to take into account the extent to which midlevel and frontline people can make or break a change initiative. The path of rolling out change is immeasurably smoother if these people are tapped early for input on issues that will affect their jobs. Frontline people tend to be rich repositories of knowledge about where potential glitches may occur, what technical and logistical issues need to be addressed, and how customers may react to changes.
In addition, their full-hearted engagement can smooth the way for complex change initiatives, whereas their resistance will make implementation an ongoing challenge. Planners who resist early engagement at multiple levels of the hierarchy often do so because they believe that the process will be more efficient if fewer people are involved in planning.
But although it may take longer in the beginning, ensuring broad involvement saves untold headaches later on. IBM recognized the need for such an approach in , when rolling out a new initiative on culture. The leadership team had met intensively to develop clear definitions of the cultural traits the organization would require going forward. Make the rational and emotional case together. Hewlett-Packard CEO Meg Whitman and her senior executive team appear to be following this principle in their transformation efforts.
In any organization facing a challenging environment, the emotional connection fostered by moves like these is likely to make a major difference. Act your way into new thinking. Many change initiatives seem to assume that people will begin to shift their behaviors once formal elements like directives and incentives have been put in place.
People who work together on cross-functional teams will start collaborating because the lines on the chart show they are supposed to do so.
0コメント