THE HIDDEN FACTORYin change management

Brainstorm New-York, November 4th 2009

Tiran Dagan, Director, Strategic Initiatives & AnalysisGE/NBC Universal

Tiran.Dagan@nbc.comwww.TiranDagan.com

BPMInstitute.org

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Strategic Initiatives & Analysis

Change Management

NOT SO EASY

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What is change?

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What is change?

EXTERNAL ENVIRONMENT/CIRCUMSTANCES

INTERNAL

TIME-BOUND

ORGANIC/PLANNED

IMPOSED/CHOSEN

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BPM & Change Management

BUSINESS RULES

PROCESS AUTOMATION

MODELING & SIMULATION

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Change is difficult

SUCCESS RATE <40%*

EMPLOYEE ATTITUDES & MANAGEMENT BEHAVIOR

SUCCESSFUL CHANGE: TACTICS• Leadership• Transformation structure• Sustainable momentum• Wide-spread involvement & support

*“Organizing for successful change management: A McKinsey Global Survey,” July 2006

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From Denial to Commitment

COMMITMENT

PAST

Productivity

FUTURE

FOCUS ON SELF

FOCUS ON ENVIRONMENTDENIAL

RESISTANCE EXPLORATION

Source: “The Transition Grid”, Flora/Elkin Assoc & HeartWorld, Inc.

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Resistance to Change: The Weavers

“They said Ned Ludd was an idiot boy

That all he could do was wreck and destroy, and

He turned to his workmates and said: Death to Machines

They tread on our future and they stamp on our dreams.”

“Ned Ludd”, from the album FreqRobert Newton Calvert, 1985

Tools & Methods

TIPS & STRUCTURE

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Change Management as a Process4. MOBILIZE COMITTMENT

• STAKEHOLDERS AFFECTED & THEIR LIKELY RESPONSE

• ANTICIPATED RESISTENCE • SUPPORT NEEDED FOR FUTURE STATE TO

MATERIALIZE• STRATEGIES TO MOBILIZE SUPPORTERS & WIN

RESISTERS5. IDENTIFY SYSTEMS & LEVERS FOR ALIGNMENT

• SYSTEMS, STRUCTURES & PROCESSES BLOCKING SUCCESS

• LEVERS WE NEED TO LEVERAGE• WHERE (WHICH LEVERS) DO WE HAVE

INFLUENCE OVER• INFLUENCE CHANGE TO ALIGN WITH CHANGE• COMMUNICATIONS

6. TRACK PROGRESS• HOW WILL YOU KNOW YOU SUCCEEDED

(METRICS) • WHO WILL BE INFORMED OF SUCCESS?• COMPARE SCORECARD TO BASELINE• WILL MEASUREMENT ACTIVITY AFFECT

OUTCOME?• OTHER BENEFITS AS “BY-PRODUCTS”?

1. LEAD THE CHANGE• SPONSORSHIP• CHANGE AGENT• WHO WILL IMPLEMENT?• IMPACT ON PARTICIPANTS• OTHER LEADERSHIP SUPPORT• COMMITMENT: SAY & DO

2. FRAME THE SHARED NEED• IDENTIFY KEY STAKEHOLDERS• BURNING PLATFORM• NEED FOR CHANGE > RESISTANCE?• SUPPORTED IN DATA

3. SHAPE THE VISION• VISION FOR FUTURE STATE/DESIRED

OUTCOME• DETERMINE BENEFITS TO ORGANIZATION,

STAKEHOLDERS, INDIVIDUALS• ID STAKEHOLDER CONCERNS/FEARS• DESIRED BEHAVIOR CHANGES NEEDED

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ShortTerm

LongTerm

Threat (if we don’t make this change)

Opportunity(if we do make this change)

Threat/Opportunity Matrix:

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ShortTerm

LongTerm

Threat (if we don’t make this change)

Opportunity(if we do make this change)

Threat/Opportunity Matrix: Improve Call Center Ops

• Lose competitive edge• Long term damage to reputation

• Lose competitive edge• Long term damage to reputation

• Negative impact on bottom line• Rapid customer abandonment

• Negative impact on bottom line• Rapid customer abandonment

• Visibility to customer purchasing habit• Early detection of product defects

• Visibility to customer purchasing habit• Early detection of product defects

• Cross sell opportunities• Energize workforce

• Cross sell opportunities• Energize workforce

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Stakeholder Analysis:

Name

Continuum of Support

Explanation

Strongly Against

Moderately A

gainst

Neutral

Moderate Support

Strong Support

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Stakeholder Analysis: SAP Rollout

Name

Continuum of Support

Explanation

“Excitable neutralist”

“Good to go friend”

“Later bloomer”

“Dangerous Antagonist”

“Important Supporter”

Strongly Against

Moderately A

gainst

Neutral

Moderate Support

Strong Support

Warning: Keep this tool internal to your change management team

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Communicating Change: Strategy

TIMELY

REPEAT

EXPECTATIONS

LISTEN, REACT & ADJUST

FEEDBACK

CHANNELS

ALIGNMENT

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Communicating Change: Key Message Elements

• EXPLAIN THE REASON AND BENEFITS OF THE CHANGE

• DEMONSTRATE LEADERSHIP SUPPORT (CHAMPIONSHIP)

• ASK FOR RECIPIENT’S HELP IN MAKING THE CHANGE MORE EFFECTIVE

• EXPLAIN HOW MESSAGE WILL AFFECT THE RECIPIENTAND THEIR DEPARTMENT IN THE SHORT/LONG TERM

• EXPLAIN HOW THE CHANGE WILL BENEFIT THE RECIPIENT

• BE REALISTIC BOTH ON THE UPSIDE AND DOWNSIDE OF CHANGE

• DEMONSTRATE EMPATHY (EMOTIONS ASSOCIATED WITH THE CHANGE)

• PROVIDE UPDATE ON PROGRESSSource: Corporate Leadership Council research.

Change with Lean (Toyota Production System)

GIVING OWNERSHIP

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Walking the Process

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Establish A Shared Vision

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Process MappingProcess Mapping

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Metrics, VA & Pain Points

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Participants Report To Management

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Jan Feb

Jan 1

Mar Apr

Apr 15

USA, Sci-Fi, Oxygen (TBC)

AE Training for Deal Header requirements

Sales Asst. Training

Communication of Client Upgrades

Stewardship cycle time

Streamlined process for oversell

Convert time standard in Gabriel

Convert “Hold” deals to “Order”

~p

M

~S

M

Ms

M

~

Status: Team still working on this project

Status: Effort to implement outweighed benefits

Status: Effort to implement outweighed benefits

Status: System Limitation

Act

ion

Plan

s +

Mon

itor

ing

Wor

kout

Web

site

–D

aily

Upd

ates

Deliverables

Roun

d-Ro

bin

Prio

riti

zati

on o

f Sol

utio

ns

Informal Communication Networks

THE ORG WITHIN

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Informal Network

Person

PersonPerson

Bond/Connection

Mutual Trust

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ONA Tools

TOOLS• Org.Net InFlow (Commercial)• NetDraw (Free)• UCINET (Commercial)• Pajek (free)• NetMiner• Sentinel

…and:• Facebook• LinkedIn

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Case Study: Western Electric

WESTERN ELECTRIC:• HAWTHORE PLANT,

BANK WIRING• WORKER INTERACTIONS

Reference: Roethlisberger F. and Dickson W. (1939). Management and the worker. Cambridge: Cambridge University Press.

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Western Electric: Hawthorne Plant Bank Wiring

Wiring Assembler

Solderer

Inspector

I1

I3

W1

W2

W3

W4

W5

W6

W7W8

W9

S1

S2

S4

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Western Electric: Hawthorne Plant Bank Wiring

FriendshipDislike

Wiring Assembler

Solderer

Inspector

I1

I3

W1

W2

W3

W4

W5

W6

W7W8

W9

S1

S2

S4

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Western Electric: Hawthorne Plant Bank Wiring

FriendshipDislike

Wiring Assembler

Solderer

Inspector

Work Product

I1

I3

W1

W2

W3

W4

W5

W6

W7W8

W9

S1

S2

S4

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I.N. CHARACTERISTICS

CLOSED

INDIVIDUALS

TACIT KNOWLEDGE

INFLUENCERS

NO CENTRALIZED CONTROL

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Informal Network Structures

Joseph

Dan

Susan

David

EddieRuth

JimMary

Anne

Erin

Central Individual

“Broker”/”Hub”

Stan

Isolated Individual

Workgroup

Informal Networks

IDENTIFYING & TRACKING

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Audit Methods

1. SURVEYS

Question Purpose

Who do you seek advice from before making an important decision?

Experts

With whom are you most likely to discuss a new idea?

Innovation Groups

Indicate individuals whose expertise you are aware of but see no opportunity to collaborate

Wasted opportunities

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I.N. Audit Methods

1. SURVEYS

2. DATA MINING EMAIL

“contribution index”*:

[messages sent] – [messages received][messages sent] + [messages received]

Email flow in a large project team, © Valdis Krebs, www.orgnet.com, reproduced with permission

1-” Visualizing Time in Social Networks with TeCFlow”,Peter A Gloor, Center for Coordination Science, MIT, Cambridge MA2- Contribution Index (Gloor et al, 2003, Gloor 2004)

>1

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I.N. Audit Methods

1. SURVEYS

2. DATA MINING EMAIL502 Messages

615 Actors

800 Days

Innovation Tagging(new product name)

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I.N. Audit Methods

1. SURVEYS

2. DATA MINING EMAIL502 Messages

615 Actors

800 Days

Innovation Tagging(new product name)

Visualizing Time in Social Networks with TeCFlow”,Peter A Gloor, Center for Coordination Science, MIT, Cambridge MA

http://www.ickn.org/JoSS_subm/TeCFlow4JoSS.htm

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I.N. Audit Methods

1. SURVEYS

2. DATA MINING EMAIL

3. OBSERVATION (HAWTHORNE EFFECT?)

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Leveraging IN: Quantify Interaction Benefits

• How many of the ideas you discuss with X become products?

• How much time did working with X save you?• How many sales deals over $x did you work on with X?

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Leveraging IN: Formalize the Informal Network5

SVP

VP Sales VP Marketing VP Operations

Emp7

Emp8Emp4

Emp3

Emp10

Emp9

Emp5

Emp6

Emp2

Emp1

SVP

VP Sales VP Marketing VP Operations

Emp7

Emp8Emp4

Emp3

Emp10

Emp9

Emp5

Emp6

Emp2

Emp1

XX Leader

Local managers

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Leveraging IN: Knowledge Management

• CAPTURE INNOVATION FROM I.N.• SPONTANEOUS & FOCUSED SESSIONS• OUTCOMES (SELECTED/REJECTED)

• NO REPEAT• MONETIZE

• TRACK PROGRESS (IDEATION -> DEVELOPMENT)

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"As our business grows, it becomes increasingly necessary todelegate responsibility and to encourage men and women to exercise theirinitiative. This requires considerable tolerance. Those men and women, to whomwe delegate authority and responsibility, if they are good people, are going towant to do their jobs in their own way. Mistakes will be made. But if a personis essentially right, the mistakes he or she makes are not as serious in thelong run as the mistakes management will make if it undertakes to tell those inauthority exactly how they must do their jobs. Management that is destructivelycritical when mistakes are made kills initiative. And it's essential that wehave many people with initiative if we are to continue to grow."

William McKnight, 3M, Chairman, 1948

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Appendix

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Models in Change Management: The Big Four

Six steps for changeMichael Beer (1990)

Ten commandments for change Kanter et al (1992)

8 stage process for successful organizational transformationKotter (1996)

7 steps for change Lueck (2003)

Mobilize commitment Analyze org & need for change Establish sense of urgency Mobilize commitment

Develop a shared vision Create a vision Create guiding coalition Develop shared vision

Foster consensus Separate from the past Develop a vision & strategy Identify leadership

Spread revitalization to all departments without pushing it from the top.

Create a sense of urgency Empower broad-based action Focus on results, not activities

Institutionalize revitalization through formal policies, systems and structures.

Support a strong leader role Communicate the change vision Start change at the periphery and let it spread

Monitor and adjust strategies Line up political sponsorship Generate short-term wins Institutionalize success

Craft an implementation plan Consolidate gains and produce more change

Monitor and adjust strategies

Develop enabling structures Anchor new approaches in the culture

Communicate, involve people & be honest

Reinforce & institutionalize change

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50 Ways to Say “Very Good”

1. Good work2. Well done3. You did a lot of work today4. It’s a pleasure to work with you5. Great job6. That’s right7. Nice going8. That’s coming along really well9. That’s great10. Let’s implement11. Excellent12. Good job13. Exactly right14. You’re on target15. Good thinking16. Wonderful17. That’s good18. You’ve worked hard on this19. That’s it20. Let’s share this with others21. Good for you22. You’re learning fast23. You did well today24. Keep up the good work25. I’m glad your approach is working

Derived from the work of Roger L. FiresteinCenter for Studies in Creativity (1992)

26. Good solution27. That’s better than ever28. You’ve figured it all out29. You’ve got it30. Very resourceful31. Good progress32. I like that33. I couldn’t do it better myself34. Now that is what I call a great job35. You did that very well36. Outstanding37. Keep up the great work38. That’s wonderful39. You mastered that in no time40. Congratulations41. You make our work fun42. I’m glad I assigned you to this43. You showed great leadership44. I knew I could count on you45. You made a difference46. You have my complete support47. Clever idea48. I’m glad you are on our team49. Thank you50. Very Good

Encourage your team, affected employees and stakeholders with compliments. I have found this table useful in the day to day:

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Additional Reading

• 1. Borgatti, S.P., Everett, M.G. and Freeman, L.C. 2002. Ucinet for Windows: Software for Social Network Analysis. Harvard, MA: Analytic Technologies.

• 2. Robert L Cross et al, McKinsey Quarterly, 2006 Number 3, “Mapping the value of employee collaboration”

• 3. Vladis Krebs, IGRIM Journal, Volume XII, No. 5, 2008, “Social Capital: the key to success for the 21st century organization”

• 4. Scott Keller & Carolyn Aiken, McKinsey, “The Inconvenient Truth About Change Management: Why it isn’t working and what to do about it”

• 5. Lowell L. Bryan et al., McKinsey Quarterly, 2007, No. 4, “Harnessing the power of employee networks”

• 6. Fearless Change – Patterns for introducing new ideas, Mary Lynn Manns, Ph.D. & Linda Rising, Ph.D., Pearson Education