Change Management Forum

Cultural Change without Top Support

2006-11-15T09:52:00.000+01:00

Hello

Does anyone have any comments or experience about how it is possible to change the culture within a department without support from the top. In fact the very top may actually be part, in no way all of, the cultural problem.

To explain further:

Cultural issues have been identified such as fear of top, lack of innovation, mistrust, low motivation, negativity

Managers and sample of staff are happy to try to work on this

Senior management who will sanction any action are seen to be part of the problem

The question is whether it is possible to effect any form of cultural change without support from the top?

If anyone has any comments to start this discussion I would be very grateful.

Change Management Books

2006-04-02T21:13:00.000+02:00

I asked the members of an OD list to name their favorite change management books. You can find the list at http://home.att.net/~nickols/change_biblio.pdf

Kofi Annan takes steps to reform UN management

2005-11-06T10:11:00.000+01:00

Pressing his campaign to improve United Nations management, Secretary-General Kofi Annan today named Rajat Kumar Gupta, Senior Partner Worldwide and former Managing Director of the global consulting firm McKinsey & Company as his special adviser. Mr. Gupta "will help to ensure that the overall management reform programme is in line with best global practice and provide focused, specialist assistance on key issues of concern," the spokesman said.

His senior management chief laid out an immediate two-track policy of whistle-blower protection and financial disclosure, including the establishment of an ethics office. Under the new system, the worth of gifts that UN officials will be required to disclose will drop from $10,000 to $250, and financial disclosure forms will be required from a far broader spectrum than the current range of assistant secretary-general and up.

These reforms, long in the making, have gained added momentum in light of the independent inquiry into charges of mismanagement and corruption in the UN-administered Iraq Oil-for-Food Programme.
Under the new system, the worth of gifts that UN officials will be required to disclose will drop from $10,000 to $250, and financial disclosure forms will be required from a far broader spectrum than the current range of assistant secretary-general and up.

The UN is seeking out a wide spectrum of views on the issue from the staff council, the global accounting and consulting firm Deloitte Consulting LLP, and the World Bank, which has gone through an even more lengthy process and review than the UN Secretariat, Christopher Burnham said. "I think it is very important that we share what they have learned and what best practices they have identified," he said. "The United Nations does not presently have a functioning whistle-blower protection system. We have an organizational culture whereby staff members do not come forward to report wrongdoing owing to fears that their careers will be on the line or some other retaliation." More

Change Management Cooking Class

2005-10-28T14:24:00.000+02:00

95% of the population worries about change. The remaining 5% are managers who wish to implement change. Imagine your relief if there was such a thing as a recipe for successful change management. No more doubts, everyone would be motivated and production wouldn’t be at risk. The cooking class in this article may not guarantee you a Michelin star, but if applied properly, you will save yourself a lot of time and worries.

Click here to download the article (pdf format)

Thanks in advance for your feedback!

The Cost Cutting Ritual

2005-06-02T10:28:00.000+02:00

Does anyone recognise this????

The Cost Cutting Ritual (non-crisis)
=========================
(NB In a crisis this ritual can be bypassed and usually is)

Having been through this (painful) experience a few times it is apparent that there is a 3 step ritual that must be completed in sequence if one is to achieve real significant costs savings.

I describe the three steps as
1. Count the paper clips
2. Point the finger
3. Face reality

In "Count the paper clips" management attempts to save money by making what are essentially petty and ultimately ineffective gestures. Examples are move to recycled paper, use cheaper pens, cut out business class travel, stop company phones, etc.. These are picked because they are seen as easy, painless(?) changes, that do not threaten any significant power base.
These are ineffective for a number of reasons. The first is that when you look at the overall cost base they represent only a small percentage of total costs and even if major inroads can be made to them (and this is rarely the case) it will have only a small effect on the bottom line. Short term there may appear to be gains but these are usually quickly eroded. For example cutting out business class travel may well result in more overnight stays or higher costs for changing travel arrangements.

The second reason they are ineffective is because they alienate the core of the company, its staff. They see small things being taken from them and as a result often withdraw their goodwill, with a negative cost impact.

So having "Counted the paperclips" and not achieved the objective the stakes get raised and we move to "Pointing the finger". This phase is usually looking at what are seen as overheads and cross charges. In essence management looks to someone else to make the saving and thus charge the business less. Examples are looking at the cost of a Finance Department and deciding that something like expense processing is too high. So the central team is cut to a minimum and the work, that still needs doing, is distributed to team secretaries. This may mean some staff cuts but usually among junior, relatively inexpensive staff. The cost of Finance drops as to the allocated charges, but a business unit overtime will need more secretarial support, control of expenses is likely to be slacker and probably staff unhappier with the process.
There is often a stage where the basis of allocation is examined closely and changed, but in the end the same total cost has to be allocated across the set of business units, just maybe allocated differently.

There are many possible examples, but they all have they all have similar impact, a reduction in central costs and this allocated charges with a compensating increase in "local" costs. Net impact over the medium term is usually minimal and less than desired.

Finally we get to the crux of the matter and "Face reality". In this, having tried the easy(?) options and failed the business faces up to cutting the drivers of significant costs which constitute the key power bases of the company. In business like financial services with high human capital this means cutting big jobs, front office jobs, the roles that require support. Having worked in such environments there is often a multiplier effect and that is that the total cost of a business is some near-constant multiplier of front office salaries, albeit the multiplier is specific to that company. For example with a 2.5 multiplier cutting a £100k job will lead to £250k saving.

Other businesses will have other key drivers for example plant and property and it is these that need to be tackled at this stage.

These are not easy savings but are possible and sustainable and management only reaches this point by having tackled the previous two steps. in anything other than a crisis, when drastic steps are required, trying to jump straight to "Facing reality" is extremely hard as the other ineffective savings will be offered as a smoke screen in order to protect key power bases.

In summary

Count the Paper Clips
===============

Typified by: Use of cheaper supplies/services

Results: Minimal saving after initial impact
Loss of goodwill and thus increased costs

Point the Finger
===========

Typified by: Some reduction in central functions
Some reduction in allocated cost

Results : More local resource needed
Compensating local cost
Reduced service(?)

Face Reality
=========

Typified by: Cuts in key drivers

Results: Reduction in local and associated costs
Attacks key power bases
Is sustainable

Change Management Survey

2005-04-06T13:21:00.000+02:00

Different concepts of Change Management have been around for the last twenty years, and depending on background, practitioners, such as consultants and managers have applied different tools and methodologies to facilitate change in organizations, teams and individuals.

To find out what is the state of the art, in 2004 the Change Management Toolbook run a survey on the future and practice of Change Management.The survey which ran from August until September 2004, queried participants’ views on the application of Change Management, the competitive advantage of its different methodologies, its drawbacks and its prospects. In total there were 562 respondents, covering private business, public services, development agencies, NGOs, universities and consultants. Further, 45% of the survey’s responses come from outside North America and Europe, indicating that Change Management has no borders and is relevant throughout the world.

The central target of this survey was to get an idea on whether Change Management will still be talked about in 10 years and whether the concepts will become mainstream. There is good news! The Change Management sector will grow. The respondents believe in the validity of Change Management approaches; the results are striking. 99% of all respondents agree that in the future Change Management skills will be in higher demand than today. This is confirmed by 94% of all respondents who consequently disagree with the idea that Change Management is a fashion which will not survive for much longer.

Another outcome of this survey, came as a surprise to us because of its clarity. 89% of all respondents consider Change Management as a universal concept. Deep rooted in concepts of democracy at the workplace and the stakeholder participation, with large parts of the concept having been developed in the US and in Western Europe, it is not perceived as a Western paradigm. To our surprise, there isn’t a significant variation over geographical background, position or length of experience with Change Management approaches. Interesting though, that people from “Western cultures” (Europe, Australia, North America) are slightly, but not significantly, more critical of the universal applicability of Change Management concepts than respondents from “Eastern” or “Southern” cultures.

The report is available from http://www.change-management-toolbook.com/res/Reports.html

Nobody needs Continuity Champions

2005-02-15T19:39:00.000+01:00

Thomas A. Stewart, the editor of Harvard Business Review, signals a new trend on the horizon: continuity champions. Although change is sexy, challenging and a job for heroes, it has also a way of swalowing a company's attention and resources. Still, it's more glamorous to be Napoleon (who gained and lost an empire in little more than a decade) than Hadrian (who gave the Roman empire a stability that endured for generations). Therefore, according to Stewart, continuity needs and deserves champions, too. They should:

Protect the image of core business,
Identify the forces of continuity,
Keep legacy business sound,
Maintain communication between new and legacy business, and
Define what lies outside the reach of change.

I would argue the standard vested interests supported by mankind's reluctance to change, particularly when not involved in the change, are strong enough to prevent change from occurring too fast.

Can you remember reading about a company adapting too fast to change?

Bestselling Books on Organizational Change

2004-12-29T14:33:00.000+01:00

Values-Based CM

2004-12-07T13:20:00.000+01:00

I've been thinking where I should create a review of the interview with IBM CEO Samuel J. Palmisano in the HBR of December 2004. I believe what Palmisano says is primarily his organizational CM vision so I've put it here. However the interview is equaly important for people having an interest in leadership, value based M., corporate responsibility and human capital M.

In the interview Palmisano describes how he dealt with the situation that he needed to change IBM in a period that business was (finally) doing well after the period in which Lou Gerstner brought the company back from the brink in the 80s.

It was necessary to get different parts of the organization working together so IBM could offer customers integrated solutions (hardware, software, services ands financing) at a single price on a global scale. Also Palmisano wanted to enable decision-making as deep as possible into Big Blue IBM and last but not least to revitalize the perception of IBM's workforce that working for IBM makes a difference.

Palmisano decided to put values in the center of his CM approach, which led to what he calls a Values-Based M. system. A crucial role in the entire process was played by a three-day discussion forum on IBM's intranet, which was called "ValuesJam", in which an estimated 50.000 of IBM's employees posted nearly 10.000 comments about the proposed draft values for IBM.

By thus empowering IBM's own workforce, Palmisano succesfully gained momentum and support for the changes he wanted to implement, ensuring people make the right decisions in the right way. An by 'right' he's not only talking about ethics and legal compliance, but also about strategy, brand and culture. Looking back, Palmisano thinks values inject balance in the company culture and M. system: balance between the short-term transaction and the long-term relationship, balance between the interest of shareholders, employees and clients.

6 reasons why organizational change fails

2004-11-24T10:42:00.000+01:00

Bill McCarthy of Penna consultants addresses six common reasons why organizational C. fails and suggests an approach that focuses on people within a “before, during and after” timeframe.
McCarthy's 6 reasons why organizational C. fails are:

People planning comes last (Organizations plan the financials, the operations, the marketing and selling, but few plan the people dimension).
The role of managers is disregarded (while they are pivotal for winning hearts and minds)
Communication fails to win hearts and minds (too mechanical; leaders' passion and the vision for the future not communicated)
Individual agendas are ignored (failing to address the “what’s in it for me?” agenda)
Engagement isn’t measured (You’re then unclear about the support they need until it’s too late and productivity and profitability already suffer)
Lack of a project manager (Inadequate project M.)

In order to deal with these frequently made mistakes, McCarthy suggests an organizational C. approach with a focus on people within a “before, during and after” timeframe in three layers (levels) of activity: the organization as an entity, the managers; and the individuals.

The rest of McCarthy's (bill.mccarthy@e-penna.com) article can be found in Strategic HR Review (Volume 4 Issue 1 November/December 2004).

Organizational Development

2004-11-17T10:55:00.000+01:00

An article by Diane Moody and Andy Smith on organizational development in a magazine called Personnel Today contains some useful clues on how the CM and the Human Resources function are related and should work together.

While its execution is often complex, the principles of organizational Development (OD) are fairly straight-forward: it is a planned, organization-wide approach to improving organizational effectiveness. There are, however, some important assumptions that underpin the concept.

History of organizational development

OD is informed by a set of humanistic values and beliefs about the potential of people and organizations to develop and grow. It involves C. through people and improvements to build future capability. It is concerned with the health and well-being of people at work and is rooted in a sound theoretical and research base, starting with people such as Lewin, Trist and Banforth and the Hawthorne experiments.

The term 'organization development' was actually coined in the 1950s, by McGregor and Beckhard, who introduced new team structures promoting higher levels of upward decision-making.

More recently, new approaches such as Real-Time Strategic C. (Jacobs) and Appreciative Inquiry (Cooperider) have come to the fore. These put an emphasis on finding new ways of engaging more people in dealing with the changes faced by their organization through dialogue and conversation.

Where does organizational development belong?

Many OD practitioners have a Human Resources background. However, there is a trend towards moving OD practice out of HR and bringing it alongside functions such as strategy or business development. Professional OD programmes are increasingly attracting practitioners from a range of backgrounds. Sometimes participants bring business process or quality M. experience, after realizing they need to balance their technical knowledge with a deeper awareness of the human responses to C. and transformation.

Sometimes the OD team is drawn from within the business, with people selected for their operational rather than OD skills and their commitment to improving the organization. Increasingly, organizations are using large-scale C. processes, where the whole organization gets together, and all staff are involved in creating and agreeing C. decisions. These latest develop-ments reflect values central to OD practice engagement, participation and democracy.

The article reminded me I need to schedule a meeting with the guys from HR to discuss how they can support us. Who has experiences to share on working with HR on C. efforts? Did it work for you?

Power of holding hands

2004-11-07T05:35:00.000+01:00

I was sitting on a beach one summer day , watching two children , a boy and a girl,
playing in the sand.

They were hard at work building an elaborate sandcastle by the water's edge,with gates and towers and moats and internal passages.

Just when they had nearly finished their project, a big wave came along and knocked it down, reducing it to a heap of wet sand.

I expected the children to burst into tears, devastated by what had happened to all their hard
work. But they surprised me. Instead, they ran up the shore away from the water, laughing
and holding hands, and sat down to build another castle.

I realised that they had taught me an important lesson.

All the things in our lives , all the complicated structures we spent so much time and energy
creating , are built on sand. Only our relationships to other people endure.

Sooner or later , the wave will come along and knock down what we have worked so hard to build up.

When that happens , only the person who has somebody's hand to hold will be able to laugh….

Measuring Culture C.

2004-09-08T10:25:00.000+02:00

Yesterday I was creating a description of The Eight Considerations towards Changing Organizational Cultures. These best practices from Harrison Trice and Janice Beyer certainly are highly recommended reading if you have to walk the slippery road of organizational culture C.

While working on these considerations, that made me think it would be useful to have a methodology to measuring culture C. in order to determine if the culture C. process is actually making progress and how much progress it is making.

Measuring this kind of processes is far from easy, even if you can quantify certain things you still have to value the results (what I mean is you can measure the temperature increasing from 21 to 24 degrees, but whether that's cold or hot or even welcome or to be avoided remains a challenge).

Does any of you have a best practice method to share and recommend to measure organizational culture C.?

HP: The adaptive enterprise that can't adapt

2004-08-14T10:37:00.000+02:00

For quite some time now, HP has been trumpeting its Adaptive Enterprise idea to anyone that would listen. The basic concept being that companies need to use technology as a tool for making quick, fluid changes in their businesses. But after HP blamed a disastrous SAP roll-out for its third quarter failings, you have to wonder exactly how adaptive HP's own enterprise really is.

HP seemed to place more blame for the weak third quarter on an SAP implementation. The company struggled to get new SAP supply-chain software up and running with the process taking six weeks instead of the predicted three. HP's ordering system became chaotic. HP had to tap the channel to make sure deliveries were met and even missed some sales. "The migration was more disruptive than we'd anticipated," Fiorina said. All told, HP's hardware and software failings cost it $400m in revenue and $275m in operating profit in Q3.

On one hand, you have to believe the SAP problem did have a material impact. HP and SAP work together on numerous large revenue deals. One would think this relationship would prevent HP from outing SAP publicly as a culprit unless it really had no where else to turn.

On the other hand, starting at HP's third quarter in 2002 the hardware units' results are as follows: a $422m loss, a $152m loss, a $83m loss, a $7m loss, a $70m loss, a $106m profit, a $108m profit, a $120m profit and yesterday's $208m loss. These results don't compare terribly well with Dell's consistently massive revenue gains over the same period or IBM's solid gains. This isn't one quarter of poor execution; it's a tradition of poor execution with blips of success.

If HP is an Adaptive Enterprise, it's one heading toward extinction in its current form. Fiorina cannot afford to keep fingering others for HP's failings much longer. Read on...

Swinging radical C.

2004-08-05T09:37:00.000+02:00

Have you ever tried to teach an old dog a new trick? It’s not an easy task. As Management Consultant Rich DiGeorgio describes, its not just old dogs that are resistant to C. !
DiGeorgio documents the business struggles of a company attempting to put a new swing on Golf, in his article The Strategic Challenges of Bringing a Radical Idea to the Market Place. DiGeorgio uses the struggles of the Natural Golf, Inc., and its attempts to C. a traditional sport as a metaphor for business C. He starts with his new Natural Golf swing’s encounter with Tiger Woods, an encounter that humorously highlighted many questions about the challenges Natural Golf faces. “Research and common sense suggest that people prefer the status quo to C,” writes DiGeorgio. “Only about 30% of people embrace C. If you are embarking on a mission to change the way the world swings a golf club, you need to understand, at a very deep level, that golf is very traditional.”DiGeorgio connected with the Natural Golf Company and became interested in the massive challenges it has been facing to gain credibility in the market place. Many business leaders and managers will find the article’s message enlightening and interesting. How will Natural Golf gain credibility in the market place when none of the top pros uses it? What market niche is this very different golf swing going to appeal to first, to allow Natural Golf to get a foothold and survive financially? What is the best way to reach this market niche? I recommend this interesting and humorous article. Perhaps a new 'swing' is just what your own organization needs...

10 Principles for the "soft side" of Managing Strategic C.

2004-07-09T22:02:00.000+02:00

John Jones, DeAnne Aguirre and Matthew Calderone argue long-term structural transformation has four characteristics:
1. Scale (the C. affects all or most of the organization)
2. Magnitude (it involves significant alterations of the status quo)
3. Duration (it last for several months t least)
4. Strategic Importance.
For these circumstances, they provide 10 principles to managing the "soft side" of strategic C. (Strategy + Business, Summer 2004, Issue 35):
1. Address the human side systematically
2. Start at the top
3. Involve every layer
4. Make the formal case (articulate case for C. and create a written vision statement)
5. Create ownership (by leaders to make the C. happen, not just buy-in))
6. Communicate the message
7. Assess the cultural landscape (core values, beliefs, behaviors, perceptions)
8. Address culture explicitly (define an end-state culture)
9. Prepare for the unexpected
10. Speak to the individual
Do you have additional builds on these 10 C. principles?

Communication in major C. situations

2004-06-30T14:01:00.000+02:00

Businesses are in a constant state of flux and the speed of modern communication means that as soon as an announcement is made in one location, everyone will know.
Helen Coley-Smith and Jacqui Hitt therefore advise to prepare your organization on future major changes in an article in Strategic Communication M. (Feb/Mar2004, Vol. 8 Issue 2). They argue that communicating in “high concern” situations (such as a Merger or an Acquisition, Redundancy, Relocation, Outsourcing, Leadership crisis, Introduction of shared service models) is crucial, and recommend to develop a core set of C.-communication competencies. These competencies will place practitioners in a powerful position to give valuable support to executives, managers and employees when the next wave of C. comes around. Although their advise certainly seems to make sense, unfortunately the authors do not provide concrete best practices in their article. The fact they both run a consultancy business might play a role in that :)
Does any of you has practical experience in setting up a preventive C. communication competency that you want to share?

What is CM really?

2004-06-24T19:46:00.000+02:00

On his interesting CM page, Fred Nichols suggests 3 valid definitions:
1. The task of managing C.
1A. Proactive: the making of changes in a planned and managed or systematic fashion, or
1B. Reactively:the response to changes over which the organization exercises little or no control
2. An area of professional practice (with considerable variation in competency and skill levels among practitioners)
3. A body of knowledge or subject area (consisting of models, methods, techniques, and other tools)
I am wondering if these 3 definitions taken together cover the whole spectrum of CM?