3 elements for management of organizational change

joshuabrusse.jpgBy Joshua Brusse, Chief Architect, Asia Pacific and Japan, HP Software Professional Services

 

 

(Joshua Brusse has more than 20 years experience in all aspects of running IT as a business. He consults with HP enterprise customers regarding strategy, governance, service lifecycle management, and organizational design and transformation.)

 

One thing I see consistently as I meet with CIOs or talk to industry experts is that the importance of managing change is often overlooked. This insight is often gained in hindsight. I’ve heard CIOs say that they were surprised at how difficult it was to manage cultural change in their organizations. In surveys and in person, I see again and again that top leaders vow to start managing change earlier in the process – next time.

 

Why is managing change so difficult, and how can leaders do it successfully? In my practice at HP I’ve worked with many CIOs and organizations to go through this process. Management of organizational change (MOC) has become an interest of mine due to the tremendous benefits it brings. In my experience, MOC can not only make change go more smoothly, it can also save your organization a great deal of money.

 

Avoiding the productivity dip

Change inevitably affects productivity. People worry about what the change will mean for them and their jobs, they speculate and get distracted. This behavior results in a productivity dip, and the greater the change, the greater the dip.

 

From a C-level perspective, the most important thing is to manage this dip so that productivity returns to normal as soon as possible. If you don’t, the dip will be too big and will jeopardize the chance of a successful change. It might take months for people to return to normal productivity. They might lose three to four hours a day in distraction. Simply calculate the cost of four hours of lost employee hours over six months of transition and you’ll see that in a large organization the effect can add up to millions of dollars.

 

But if you manage change effectively, the dip might be only a few weeks instead of months, and people might lose only one to one-and-a-half hours a day instead of three or four. An MOC program can greatly help lessen the productivity dip.

 

Three fundamental elements for managing change

In the past few years of working with customers I’ve refined a list of fundamental elements you need to build into an MOC program. I’ll be writing more about these later in subsequent blog posts.

 

  • The first is leadership: The most important part is you need to lead by example. If you want the change to happen, you need to show that you want it to happen. You must not just talk about it but also walk the talk.

 

  • The second is communication and engagement: Effective communication has two objectives. The first is that people are aware of what is happening. The second is that people understand what is happening. Leaders often don’t realize these are two different things. But MOC does not equal communication alone: leaders must also engage on many levels.

 

  • The third is internalization: The final stage is for people to internalize the change. Because only when the change is internalized are benefits realized and the change becomes sustainable.. When you have internalized change you are convinced that the new practices are better than the old practices. Before that the change hasn’t really happened. It’s only on paper.

 

The benefits of managed change

Aside from lessening the productivity dip, MOC can also ultimately impact revenue and growth. How? This goes back to the idea of the service profit chain (see “Putting the Service-Profit Chain to Work” from the Harvard Business Review). If employees don’t understand what a change entails or how it will affect them, or if they don’t have the tools or training to be successful with the change, their productivity, loyalty and satisfaction will drop–and they will not be successful with customers and this will negatively impact the bottom-line. An effective MOC program will go a long way in keeping employee productivity high during a change transition. Greater productivity will improve employee value creation, and ultimately this will drive new growth and increase customer satisfaction.

 

The better you manage organizational change, the better you manage employee satisfaction, effectiveness and loyalty and the greater the improvement that will be seen in their productivity. The higher the productivity of employees, the more value is added, and ultimately that results in customer satisfaction.  

 

 

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Labels: IT leadership
Comments
sajeeve(anon) | ‎01-03-2012 06:50 PM

Totally agree with the points here and the approach.

The C-levels that get it will buy into the cost saving and also the opportunity loss if not done well.

The challenge is the C-Levels that either do not buy in or their CEOs do not buy in and hence they by implication do not buy in.

Honored Contributor ‎01-03-2012 10:17 PM - edited ‎01-03-2012 10:31 PM

Well said Joshua. Interesting, organizations spend millions of dollars in making the paradigm shift, be it technology, process, tools but hardly make investment around the Management of Change Program

 

In my opinion the single factor of disaster for any organization embarking on a Change is not taking the time to communicate and engage the Employees/Task force from the beginning. This makes them feel dejected/isolated and left over with uncertainties.

 

At the end of the day,  getting the people in confidence is utmost essential to make the Change a reality.  So Organizations should not  rush , but make it a gradual accepted change to make it sustaining...

 

graham huzzey-morgan(anon) | ‎01-04-2012 03:56 AM

What you are aiming for is to establish a new norm.  In effect, to embed a new way of working where individuals understand the value that they contribute to their own, their teams and their corporations goals.

 

It is worth bearing in mind that these cultural changes will often take place at the same time as changes to tools and processes so there is huge upheaval within the organisation.  Joshua describes the key steps taken to ensure that this journey happens as smoothly as possible.  Only by ensuring the individual has adopted and made the change real for them (internalised) will the organisation reach its goals. 

Tony Price(anon) | ‎01-04-2012 07:07 AM

As a fellow advocate of MOC its great to see words of wisdom like this Joshua.  

PaulMuller | ‎01-05-2012 09:12 AM

Thanks for the post Jos, your thoughts on MOC have always been great reading, but for some reason it's often under appreciated in terms of funding and priorities for IT leaders.

 

What are your thoughts on the measures that leaders should be putting in place that might indicate that their MOC efforts are insufficient or need greater focus?

Johnny Itoh(anon) | ‎01-05-2012 10:06 PM

Hi Joshua,

I totally agree to the importance and benefits of MOC that you described.

I too feel that people are fundamentally afraid of changes to be happened which also can sometime be a critical risk in an organisation and for trying transformation in a company.

 

I would believe the leadership could be translated to the action to indicate the goal and the steps of change to reach the goal with the approach of MOC that can remove the worry/dread to the changes with making people exactly understood the expected changes and those changes will realise better situation for the people.

Guest Blogger (HPSW-Guest) | ‎01-06-2012 10:00 AM

Hi Paul, thanks for your question. My answer to this is:

 

Many metrics can be put in place, grouped in 3 categories:

 

1) Speed of Adoption: how quickly employees begin adopting the "new normal"; adopt their new roles and demonstrate the new skills and behaviors required by a change; adopt new process, system, technology or tools your change introduces.

 

2) Institutionalization: how many employees do know how to use the new process, system, technology or tools your change introduces effectively after they have adopted it. Do they know how to use it and is the "new normal" fully understood

 

3) Internalization: how many employees are convinced that the "new normal" is the way "we do things over here"...so not only adopted the "new normal" and able to academically utilize the "new normal..but - more important - whole hearted convinced that the "new normal" is the best for everyone...

 

If one of the above categories score much lower than expected a greater focus on MOC is necessary or the current MOC methods are not effective enough.

 

- Joshua

Alexandra Zammit(anon) | ‎01-06-2012 11:08 AM

Joshua,

 

As always accurate and insightful, its good to see the message spreading wider. Your comments around communication and engagement are especially key. During a period of upheaval as experienced during an IT transformation, it is important to ensure the messages communicated are targeted at the specific stakeholders. To avoid confusion and future resistance it is critical for the stakeholders to understand the impact to themselves and the benefits. Only with end user buy in and understanding will the future business benefits be achieved in full. Thank you for highlighting the importance of managing the people change.

Nadhan | ‎01-06-2012 02:26 PM

Joshua, When I was writing the post on whether Applications Transformation is a journey or a destination, I identified five suggestions to simplify the overall experience.  If I had to pick a sixth one, it would have been Management of Change.  Thanks for a very well written post.

PrasannaA(anon) | ‎03-20-2012 11:30 PM

Hi Joshua,

 

Thanks for the post. I was getting lost in highlighting the importance of MOC and risk of not running the MOC program, ending up painting a complex MOC problem. Thus it becomes so important to keep the solution to MOC to simple - and three elements that you highlight is my take away :).

 

Where there is association between all three elements, I particularly see one critical association between "Leadership" and "Internalization". If leaders are clear on change roadmap, future state after change, and the benefits the future state brings, many people just follow their leaders.

 

Totally agree on the productivity dip. Unfortunately, the intangible benefits that MOC brings like reducing the productivity dip is often taken for granted or go without notice. Productivity as a problem during change, gets visibility and manifests only if MOC program is weak or does not exist.

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