Change Management from an Employer's Perspective

Transcription

1 Change Management from an Employer's Perspective Business Transformation October 2011

2 What is Change Management? Change Management covers everything to do with the people side of change Its all about getting people committed to "the change" and changing the way they operate in the workplace

3 Why do we need Change Management? Surveys show that the success rate for change in organisations is ~ 33%. The 2011 Prosci Change Management Benchmark report found: Expectation 88% of Executives believed the business changes they were implementing were right 92% thought the organisation was capable of achieving change Reality 29% succeeded on time and budget 53% were challenged being late, over budget and/or delivered less than expected 18% Failed and were cancelled or never delivered

4 What is Change Management? "Change starts with an ending and ends with a beginning" William Bridges There are always two sides to a change story: The visible: the rational part what will change and how you do it The invisible: the emotional part - how you feel about the change Plans and models tell people what they should know or what they should be doing But when it comes to the emotional part, how will we make people want to change?

5 Why do we need Change Management? "Change is EXCITING when done by us but can be THREATENING when done to us Rosabeth Moss Carter Resistance to change is a natural human response years ago it was possible to DICTATE change Today change has to be NEGOTIATED and COMMUNICATED effectively to ensure that all stakeholders (Business, Employees, Customers) engage in the change and reap the rewards

6 Making Change Happen Successful change is not governance. It is getting people within an organisation to adopt and use new tools, techniques and processes There are two change perspectives that have to be managed: Personal (invisible) Understanding how one person makes change successfully Decrease the uncertainty associated with how people are impacted Organisation (visible) Tools & Processes to make organisational change successful Improving the ROI of your projects

7 Increasing resistance Decreasing productivity Why managing the people side of change matters Increasing resistance Decreasing productivity With change, you can expect a decline in productivity and an increase in resistance. The degree of adverse impact will vary by group and will depend on the effectiveness of your change management work. 1 st communication or 1 st rumor 1 st communication or 1 st rumor Comfort / security Dept. A Worry / uncertainty Dept. C Dept. B Productivity loss Employee dissatisfaction Passive resistance Risk / flight Dept. D Turnover of valued employees Tangible customer impact Active resistance Opt-out of the change Time Time

8 Why managing the people side of change matters Increasing resistance Decreasing productivity The reality is that change creates instability and introduces risk to the organisation. Multiple changes within the organisation aggravate and compound this risk. 1 st communication or 1 st rumor Project 1 Project 3 Project 2 Time

9 How can we manage the people side of change? 10% Read 20% Hear 30% See 50% Hear & See 70% Discuss with Others 80% Do & Experience 90% Explain & Show It is very easy for us to think that all knowledge is in the head. Much of our knowledge exists in action: - action through participation - participation with the world - participation with the problem - participation with other people A lot of the knowing comes into being through the practices of the people and the environment you re working in. Brown, J.S. (2000) Growing up Digital, Change (march-april 2000)

10 The Benefits of Change Management For any given organisational change, there are three human factors that impact the amount of expected improvement from a solution: Factors Speed of adoption How quickly do people get on board? Expected Based on explicit or implicit assumptions Actual How quickly do people adopt the solution? Active and passive resistance experienced Utilisation How many people are on board? Usually assumed 100% participation How many people opt out of the new way Thorough effective communications throughout the change Proficiency How much improvement occurs Assumed ongoing improvement Determined by individual competence doing their job in a new way Can be reduced as a result of resistance

11 The Benefits of Change Management (2) Applying the Human Factors to ROI The height of the benefit post implementation is based on Ultimate Utilisation The slope is determined By Speed of Adoption + Net cash flow of project period 0 - Proficiency contributes to the "height" of each benefit and also the height of ONGOING benefits post implementation Time (periods) Courtesy of

12 Success Factors and Obstacles All Truth Passes through 3 stages First it is ridiculed Second it is violently Opposed Thirdly it is accepted as being self evident Key Success Factors Active and Visible Sponsorship Structured change management approach Frequent and Open Communications Dedicated change management resources Employee participation Greatest Obstacles Ineffective change sponsorship from senior leaders Resistance to change from employees Poor support and alignment of middle managers Lack of change management resources and planning

13 Conclusions McKinsey Quarterly survey (2006) 1536 executives surveyed their project mood and scale of the change, with either completely successful to unsuccessful Findings: Negative and positive moods reported in equal proportions Anxiety is the most common emotion, then confusion, frustration, fatigue and resistance. Among the positive moods, a sense of focus, enthusiasm, and feelings of momentum occur significantly unequal More of the top performers report positive moods, especially focus and enthusiasm. What we know will happen: People are confronted with anxiety and resistance, regardless of whether the change is positive or negative. You can channel these emotions to the benefit of your change in order to obtain more clarity and less confusion.

14 Creating a Compelling Case for Change Connect Change Management to Business Results Identify the need for change, Explain risks of not changing as well as the risks of changing Highlight impact of poorly managed change Articulate the benefits of the project and how it will realise its return on investment Develop a Detailed Communications Plan Customise key messages for the organisation Develop key messages that appeals to peoples values and are tailored to different stakeholder needs Use examples so people can see and feel what s happening

15 Grant Thornton Business Transformation Workforce Services If you have any questions and would like to contact Michelle Fenwick at Grant Thornton, she can be contacted on: Name: Michelle Fenwick, Associate Director Phone: Mobile: