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Change Management

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21st Apr 2005
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“Businesses turn people the wrong way around so they operate with their face towards the boss and their ‘ass’ towards the customer,” is a picturesque line from Kjell Nordstrom’s Funky Business. Little wonder then that so many companies struggle to twizzle people back towards a ‘relentless focus on the customer’. How can current techniques of change management and internal marketing help?

Triggering Change

Cultural change is easiest when a disruptive event hits the organisation i.e. a new strategy, new CEO or market threat/opportunity. For this is when people seek leadership and are more receptive to changing working practices. If no change is at hand then either one is engineered, or more ‘savvy’ work is needed to reach a ‘tipping point’ – a build up of actions that suddenly catapults the change into the ‘big time’. (See recommended reading The Tipping Point)

So those struggling with internal brand alignment should find a disruptive event (maybe a CRM project!) to gain attention and draw staff into co-creating a more compelling culture. Those in the luckier position of having a disruptive change already, should press ahead with change management plans - yet few do. Not only do they lose out on an opportunity to align culture they jeopardise the success of their work. The failure of BPR and process led IT projects is the failure to take account of social and organisational transformation. (See recommended reading The Social Life of Information)

Principals of a Change Plan

  • Crucially cultural change doesn’t mean chucking out the old culture, thereby making people feel their behaviour is wrong and their skills obsolete. A company often needs to rediscover its heritage and the passions of the past that built it. When Carly Fiorini took over at HP she resurrected the founder’s vision of innovation, rather than starting anew.
  • Change is a process, like a butterfly you have to pass through all stages. So the plan needs phasing with respect to the psychological patterns of change for individuals, teams and organisations It can take at least two years for new behaviour to replace old ways of working. (See recommended reading Making Sense of Change Management)

  • Staff need to understand what’s in the change for them and, more importantly, contribute to new ways of working - then they will own it. It is highly likely that you will be starting from a position where staff feel like disposable assets, and have devised informal ways of looking after their own welfare. (see Creating Sustained Performance Improvement - Peter Hunter)

  • It should be done IN CONJUNCTION with the strategy. (see The Must Have Customer Strategy)

  • The plan is iterative not linear, constantly review it and research the effect of different techniques, pay great attention to detail.

  • A change plan eventually melts into ‘business as usual’ internal marketing. Both align promised and delivered brand values. Neither is ‘just’ a communication plan, but a recipe for building knowledge, leading to collaboration, leading to co-creation. Marketing = change management. (see Inside out: how employees build value - Nicholas Ind, Equilibrium Consulting)

    Planning for Change

    Phase 1: Uncovering Context

    Whilst change needs leadership, leadership needs convincing. Phase 1 therefore, examines the current customer and staff experiences against promises. What is happening and in what context – people act according to their environment, a brutalising environment will brutalise the gentlest of characters.

    Some Techniques:

    • Use story techniques with staff and customers to get behind what is really happening on the front line. Where are the gaps and why? (see Story - David Firth & Jennifer Kirkby)
    • Examine staff satisfaction questionnaires and any feedback system in place
    • Examine staff relationships if you have the budget. If not do this at later stage. (see Actions for Enterprise Collaboration - Innovation Assessment by Allan Engelhardt and Bruce Lewin)

    Phase 2: Executive Leadership

    Leadership is a ‘must have’ but leadership with little knowledge can be worse than none (see New Learning in Implementing CRM Successfully). Phase 2 is about getting executive backing for a customer strategy, an understanding of the current cultural and agreement (if not passion) for that required.

    Some Techniques

    • Politically map senior managers -who are the influencers, advocates and detractors
    • Conduct a personalised ‘lobbying’ campaign with each one – and their influencers
    • Bring customers themselves, and customer/staff knowledge to the boardroom. Link it to the objectives or operational pain points that senior managers care about i.e. shareholder opinion call centre inefficiencies
    • Create with senior managers a story or picture of where the company wants to be. Use storyboard format so that emotions as well as practicalities can be expressed.

    Phase 3: Preparing the Ground

    Now, with luck, there is budget, a team and positive intentions. However, change programmes are often victims of cynicism and derision. So the ground needs ploughing to remove the stones of resistance. Establish the degree of collaboration and inhibitors in the organisation. Finish any work not done in Phase 1. Decide who needs to do what and put in measures to monitor progress.

    Some Techniques

      Create a staff impact and adoption map. Who will be affected, to what degree – what is the expected reaction?
    • Relationship mapping if not done before. Where are the informal and formal teams/groups in the organisation? Who are the acknowledged experts, persuaders and networkers? (see Actions for Enterprise Collaboration, Allan Engelhardt & Bruce Lewin)
    • Look to balanced scorecard measures to establish the links between culture and customer objectives

    Phase 4: Collective Change Management

    In Phase 4 the programme must hit hard and energise staff. The main task is bringing the vision to life so people identify with it and quickly get through the psychological barriers. Staff will be catapulted out of their comfort zone and have to think harder about what they do. Involve them fully in the work harness their ideas and ambitions. Sow the seeds of change but reap quick wins to act as exemplars. This phase succeeds when momentum comes from top down encouragement and bottom up enthusiasm; it fails if it stays roots in the boardroom

    Some Techniques

    • Create ‘voice of the customer’ workshops , surgeries and communities of practice to keep all staff up-to-date with customer knowledge, but more importantly encourage the use of customer information in decision making
    • Establish staff feedback – ranging from suggestion to regular reviews between brand managers and call centre staff. Ensure senior mangers ‘walk the floor’
    • Build a model offices for cross functional teams to experiment with new methods of working
    • In training and education use staff to put over new ideas in their own words e.g. video or even customer advertising as the Halifax Bank have successfully done
    • Material should anchor learning, be useful and entertaining. Packaging is all -encourage ‘stickiness’ with creative writing, quality and the use of all the senses
    • Synchronise customer and staff messages - don’t promote top class customer service whilst telling staff cutting cost has primacy. Link both to corporate social responsibility initiatives. (see The Next Hot Topic in CRM)

    Phase 5: Internal Marketing

    The momentum for change can now be siphoned off into business as usual, as supporting capabilities (organisational structures, rewards, systems, and skills) are built. Constant training, surveys and away days get in the way of work and become tiring. Whilst phase 4 kick starts the change and overcomes conflict, Phase 5 weaves internal marketing of brand values into the fabric of the organisation.

    Some Techniques

    • Turn training into brand coaching, people learn better when customer knowledge relates to experience and is immediately useful
    • Encourage team working with the right support eg virtual team rooms, communities of practice, (see Marketing Produce the Product Brochures - Jennifer Kirkby)
    • Every department and project plan should say how brand values will be brought to life; it should be as natural as the cost/benefit analysis
    • Nike employ a corporate ‘storyteller’ to compile a ‘compendium’ of ‘how things have got done around here’

    Phase 6: Stakeholder Marketing

    Cultural change should now be well underway so the emphasis can turn from staff to external stakeholders e.g. partners and suppliers. Whilst these groups should be involved in the previous phases this phase is specifically aimed at them.

    Some Techniques

    • Choose suppliers who have similar or complimentary brand values (see Collaborate or Perish)
    • Set up supplier feedback, relationships are two way.

    As always please add your comments to this story by clicking on the 'Add your own comment' link below.

    Jennifer Kirkby
    Strategy & Business Analyst, CMC

    [email protected]

    Find out more about Jennifer Kirkby

    Recommended Reading - Online

  • Creating Sustained Performance Improvement - Peter Hunter

  • The Must Have Customer Strategy

  • Actions for Enterprise Collaboration - Innovation Assessment - Allan Engelhardt and Bruce Lewin

  • Inside out: how employees build value - Nicholas Ind, Equilibrium Consulting

  • Story - David Firth & Jennifer Kirkby

  • The Next Hot Topic in CRM

  • Marketing Produce the Product Brochures - Jennifer Kirkby

  • Collaborate or Perish

    Recommended Reading - Books

  • Making Sense of Change Management, Ester Cameron & Mike Green (Kogan Page) – excellent overview of both the theory and practice, very readable (Buy from Amazon)

  • The Tipping Point, Malcolm Gladwell ( Abacus) – the number one best seller that reminds marketers what real marketing is, excellent storytelling (Buy from Amazon)

  • The Psychology of Personal Power, C Johnstone (self published, www.chrisjohnstone.info) – how to make change happen against the odds from the Doctor who led the campaign to reduce doctors hours, packed full of tips and very readable

  • The Social Life of Information, John Seely Brown & Paul Duguid (Harvard Business School Press) – you’ll never forget the human side of BPR and technology implementation again ! Excellent storytelling (Buy from Amazon)

  • Replies (3)

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    avatar
    By AnonymousUser
    21st Apr 2005 13:51

    Jennifer

    An interesting article bringing together a pretty good synopsis of different models of change.

    What I particularly like is the emphasis you place on change reaching an organisational 'tipping point'. There is plenty of evidence which show that the diffusion of a product, change or idea really does take on different characteristics once 40-50% of the total population has been reached.

    Indeed, until this tipping point has been reached, most significant organisational change programmes have 'loss-leader' characteristics, often costing more in time, effort and money than the business benefits they generate. Only once the tipping point has been reached and the change starts to take hold across the broader population do the benefits start to outweigh the costs.

    What your articles doesn't bring out so well is the fact that change is primarily an 'individual within the group' activity, rather than an individual or a group activity. It occurs when your average employee starts to see the benefits of the change for themselves, sees their work colleagues benefiting from it too and sees that their direct managers, are supporting the change in spirit, word and deed. Real change that sticks occurs largely in the workplace. It doesn't occur in the boardroom, although the board must create 'space' for change to happen.

    What this means is that although board-level support is very important, it is not anywhere near sufficient to actually drive change. The real change leaders are the middle and lower-level managers; who make sense of the often half thought through change programmes from above, who help individuals to make the often difficult personal changes that the change programme demands, who drive collaboration between groups, and critically, who stick with the change for the 18-24 months typically required for the changes to become the new daily business.

    This real-world emphasis on change driven by middle and lower-level managers adapting change programmes to the real-world is in stark contrast to, for example, the top-down approach promoted by Kaplan & Norton in their Strategy-focussed Organisation books.

    Think about it, you know it makes sense.

    Graham Hill
    Independent Management Consultant

    PS. Take a look at John Kotter's book 'The Heart of Change' for a widely used change framework. At Jon Katzenbach's book 'Real Change Leaders' for more on managers as change agents. At Peter Senge's book 'The Dance of Change' for more on managing the blockers of change. And at Larkin & Larkin's paper on communicating big change in small steps (available for free at http://www.larkin.biz/publications.htm ) for a very practical guide to communicating change.

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    avatar
    By AnonymousUser
    26th Apr 2005 09:14

    Harold

    I agree with your suggestion that organisations adopting change programmes need to be mindful of what worked and what didn't in the past. Many organisations seem to go through endless rounds of change programmes driven by whatever is in vogue at that moment in time. In these organisations, the 'shadow system' of personal relationships and experiences that drives how work is really done is often not really changed and the organisation is full of 'change survivors' who play the change game but never really change.

    As is now widely recognised, change is primarily an emotional, not a logical process. Faced with a new change programme, staff assess what the change is likely to mean for them, their work and their relationships at work. As neurobiologists like Damassio and LeDoux have clearly shown, this assessment is primaily driven by non-conscious emotional processes rather than conscious thought processes. That doesn't mean that rational thought (and argumentation) about the change is a waste of time, just that if staff feel that the change will be bad for them individually, then that is likely to overwhelm any rational thoughts about how it might be good for them or the organisation.

    The implications of this is that change programmes need to work closely with the staff who must change if the change is to be effective. Just being told to change or else, will not be effective in the long run. And as people are social animals, the change programme needs to work with these individual staff within their normal or new organisational work groups if the change is to reach a natural tipping point. It will always be easier to resist change within a group than to support change as an individual.

    I would be very careful about being overly-mechanistic with tools like a 'state management plan'. It all looks nice on paper - with the Kubler-Ross change cycle mapped out with state changing interventions and all that - but without a detailed understanding of what really drives the individuals and group behaviours in the organisation, it can so easily create additional problems if staff believe management are attempting to manipulate them.

    At the end of the day, change needs the active support of staff if it is to be effective. And change is a very emotional thing at the best of times.

    Graham Hill
    Independent Management Consultant

    PS. Take a look at the psychology of change pages at the changingminds.org website for a good introduction to this complex topic - http://changingminds.org

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    avatar
    By Harold Russell
    21st Apr 2005 14:38

    I enjoyed reading your paper and I agree with what you write. Based on experiences to date it sparked the following thoughts:-

    In looking at change management processes organisations need to be mindful of what works / doesn't work. Too many repeat past change strategies, albeit 'with a bit more noise'. If people feel senior management are doing more of the same to them, then the company will get the same results (e.g. lip service, half-hearted enthusiasm etc). So if it didn't work before, companies need to stop and do something different, or follow a different process, in order to get a different reaction.

    The case for change (i.e. CRM) needs to be very compelling if people are to be engaged intellectually. The emotional engagement will come from people being willing and able to relate to a vision of what CRM is intended to achieve for the business. Too often this is expressed as a simple objective (e.g. 'be first choice for our customers'). A clearly defined CRM vision is key for helping everyone relate to what they will se/hear/feel. At this stage it's worthwhile undertaking a 'state management plan' . This is for mapping out people's current emotional state (e.g. cynical), the desired state (e.g. fully engaged), the intermediary states (e.g. curious - receptive etc), and the trigger actions required to move people through each state phase. To change people's thinking and feelings you need to be clear about how they need to evolve.

    Senior management needs to be aware of the signals they emit by what they evidently pay attention to, and what they are seen to be recognising and acknowledging. Openly praising examples of CRM successes can be very powerful in developing mindsets.

    As you say at phase 4. People need to engage at early stage; so visions and plans are meaningless until they can relate to them and translate them in to what they mean in practical terms. Internalising intellectually is a helpful precursor to engaging emotionally in doing whatever is needed of them.

    Kind regards

    Harold

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