hcc demystifying change management presentation 9.27.11

Demystifying

Change Management

What HR needs to Know to Produce Organizational Change

Scott Leuchter

Partner

Camden Delta Consulting

Chicago Human Capital Club

September 27, 2011

Proprietary & Confidential


Agenda

• Introduction

• The Burning Platform

• Goals for Today

• The Psychology of Change

• Organizational Change vs. Change Management

• Change Reactions & Management Considerations

• How to Asses Change Readiness

2


Grounding Our Discussion

The human side of

change is the

“soft stuff”, and

the soft stuff is a

lot harder than

the “hard stuff”

3


Introduction

• A little about me

• A little about what I do

• A little about Camden Delta Consulting

4


Camden Delta Consulting

5

Strategic Workforce Planning

Integrated Talent Management

HR Strategy and Organizational Effectiveness

Leadership Development &

Coaching

Strategic Organizational

Change

Camden Delta is a management consulting firm that provides Strategic Change

Management & Human Capital solutions that support organizational transformation


The Burning Platform

• Organizational Change is omnipresent and inevitable feature of organizational life

• CEO’s rate speed, flexibility and adaptability to change as their top business challenge since 2004

• 31% of Board of Directors cite the failure to effectively manage change as the top reason for firing CEOs

6

The Burning Platform

• Strategic Imperative: 70% of all organizational change

initiatives FAIL


Type of Change Median Success Rate

Strategy Deployment 58%

Recruiting & Downsizing 46%

Technology Change 40%

Mixed Collection of Change Efforts 39%

TQM-Driven Change 37%

Mergers & Acquisitions 33%

Re-engineering and Process Design 30%

Software Development and Installation 26%

Business Expansion 20%

Culture Change 19%

ALL 33%

7


Goals for Today

• Understand the psychological factors and considerations that determine change

• Understand the difference between organizational change and change management

• Understand the different reactions to change

• Provide a framework to help you assess readiness and manage change in your organization

8

The Psychology of Change

Proprietary & Confidential 9

http://www.google.com/imgres?q=change+monster&um=1&hl=en&sa=N&rlz=1T4SNNT_en___US364&biw=1600&bih=692&tbm=isch&tbnid=KzD6v-F0oqeTXM:&imgrefurl=http://www.betterworldbooks.com/the-change-monster-id-0609808818.aspx&docid=2T6dHTCJCAJ9qM&w=258&h=400&ei=sZB8TtPzB8Tr0gG-3MjRDw&zoom=1

The Psychological Reality of Change

• People are not rational or linear

• People are loss averse

• People make decisions through peripheral processing

• Decisions to change are anchored on prior knowledge

• What people Think and Feel will determine how they will

Behave



Psychological Equations for Change

A + C = B

CG = (f) IB + GB

11

Case Study in Change

• Who

• Fortune 500 “Worlds Most Admired Companies”

• Global Financial and Professional Services Firm

• Human Resources Function

• What was the change?

• What was the rationale?

• What happened?

• What did they do?

• What happened after that?



Key Definitions

• Change • v. to make, become or behave DIFFERENTLY

• Organization • a TOOL used by PEOPLE to coordinate their ACTIONS to obtain

something they desire or value

• Organizational Change • The PROCESS by which organizations MOVE from their current state to

some desired future state to increase their effectiveness.

• Change Management • The PROCESS of planning, implementing, and evaluating change

within organizations or communities

13

Organizational Change vs. Change Management

Underlying Theory Role of Change

Agent

Intervention

Strategies

Organizational

Change

-Psychology -Facilitator

-Process Consultant

-Not traditionally linked

to strategy

-Focus on one

component/unit at a

time

-Change attitudes to

change behavior

Change

Management

-Psychology

-Sociology

-Economics

-Project

Management

-Content Expert

-Process Consultant

-Member of cross

functional team

-Part of project

organization

-Driven by strategy

-Simultaneous focus

on several areas

-Leverage models to

change actions


Change Management Models

Change Component Frequency Percentile Rank

Urgency and need to change 16 59% 1

Clear vision 16 59% 1

Assessing organizational readiness 15 56% 2

Planning the change 15 56% 2

Metrics, monitoring, controlling 15 56% 2

Change management structures/delivery 14 52% 3

Short-term wins 14 52% 3

Building Consensus 12 44% 4

Context for change 11 41% 5

Communication 11 41% 5

Consolidation 11 41% 5

Putting resources in place 9 33% 6

Clear empowerment and team authority 6 22% 7

Leadership 5 19% 8

Sponsorship 4 15% 9



Change Measurement

• What do you measure?

• Subjective

• Objective

• When do you measure it?

• Before

• During

• After

• Who do you measure?

• Employees

• Customers

16


Change Reactions

• Stress / insecurity / psychological adjustment

• Readiness / preparedness to change

• Performance / coping with change

• Receptivity to change

• Attitude toward change

• Openness to change

• Intentions to resist / willingness to cooperate

• Innovation / change adoption

• Commitment to change / status quo

• Adjustment to change

• Perceived benefits of change for learning

• Resistance to change

17

Change Resistance

• Lack of awareness of why the

change is happening

• Lack of involvement in the change

process

• The change is not aligned with their

operational objectives

• They anticipated negative impacts to

their day-to-day operations

• They fear loss of control or power


• Top reasons why management resists change and creates

obstacles

Change Resistance

• Lack of awareness of why the

change is happening

• Perceived negative impact on their

current role

• Past performance of the organization

with change


• Top reasons why employees resists change and creates

obstacles

Management Mistakes

• Most common mistakes made by managers and

supervisors

• Ineffective communication with employees

• Actively resist the change themselves

• Ignore the change


Management Roles

• Most critical roles for manager and supervisors in times

of change

• Communicate with direct reports about the change and why the

change is happening

• Demonstrate support for the change

• Coach employees through the change process

• Engage with and provide support to those driving the change

initiative

• Identify and manage resistance

• Assess change readiness


Change Readiness

Assess

Analyze

Act


Assessing Organizational Readiness

• Assess your organizations readiness for enterprise

implementation

• Assessment must be based on the Principal of Compatibility

• Before, During, After

• Alignment with business strategy

• How does the organization view change?

• What does success look like?

• What is the organizations history with change?

• How much change can we handle and when?

• What are the main barriers and challenges to this change?


Assessing Your Organization

• Assessment Methods

• Survey / Questionnaire

• Interviews / Focus Groups

• Observations

• Analyze

• Content / Statistical Analyses

• Identify and challenge assumptions

• Act

• Share analysis and results with senior leadership

• Make recommendations planning decision(s) based on the data

• Share the information and plan with employees Proprietary & Confidential 24

Conclusions

• Appreciate that change is a human psychological

phenomenon experienced by individuals and influenced

by groups

• Recognize that change management models neglect the

psychology of change and adjust accordingly

• Assess employee readiness prior, during and after a

change event

• “To change or not to change, that is REALLY the

question”



Goals for Today

• Understand the psychological factors and considerations that determine change

• Understand the difference between organizational change and change management

• Understand the different reactions to change

• Provide a framework to help you assess readiness and manage change in your organization

26

Thank You!

Scott Leuchter

scot t . leuchter@camdendel ta.com

www.camdendel ta.com

773.255.1632


mailto:[email protected]

http://www.camdendelta.com/

References

Slide 6: IBM. (2002, 2004, 2006, 2010). Global CEO Study;

Slide 7: Smith, M. E. (2002). Success Rates for Different Types of Organizational Change. Performance Improvement,

(41) 1, pg. 26-33

Slide 13: Jones, G. R. (2007). Organizational theory, design, and change. Pearson-Prentice Hall.

Slides 14: Martins, L. L. (2010). Organizational Change and Development. APA Handbook of Industrial and

Organizational Psychology, 3, pg. 691-727.

Slides 18-21: Prosci. (2009). Best Practices in Change Management Benchmarking Report
