Shaking the Box: Creating Indelible Organizational Change

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How do you drive organizational change when massive cultural change is needed? This presentation includes examples of techniques and approaches based on an 8 step model created by J.P. Kotter. This model is very useful for best practices implementations like ITIL or CMMI, process process improvement, quality programs, performance management, reducing costs, and improving competitiveness.

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Shaking the Box: Creating Indelible Organizational Change

  1. 1. Shaking the Box: Creating Indelible Organizational ChangeKirk HolmesPresident, Holmes and Associates, Inc.kirk@holmesinc.nethttp://www.holmesinc.net © Holmes and Associates, Inc. All Rights Reserved 1
  2. 2. IT Organizations are Challenged • Declining budgets • Increasing customer demands • Competition and outsourcing • Fast technology change© Holmes and Associates, Inc. All Rights Reserved 2
  3. 3. Best Practice Programs Can Be Hard to Sell IT If you aren’t already following the Best Staff Practices available with the money you already have, then what kind of service “Flavor of the day” are you giving me now?“Process crap” “I’m special” Customer“Bureaucracy” The Culture Challenge: How do you transform your organizational culture to embrace best practices without major new funding?© Holmes and Associates, Inc. All Rights Reserved 3
  4. 4. YOU Are Changing Places • 3 organizational change scenarios • Which one of the following three leaders would you rather change places with (inheriting their situation and adopting their plan/approach)?© Holmes and Associates, Inc. All Rights Reserved 4
  5. 5. Scenario 1: Executive Push to Fully Implement ITILDeputy CIO for infrastructure (data centers, network, operations) embracesITIL wholeheartedly and has carte blanche for ITIL from the soon-to-retire CIO•Executive plan is to move quickly and aggressively: • Put entire Ops leadership team and employees through ITIL training • Require contractors to train their employees through contract requirements • Perform Gap Analysis (internal only) against ITIL and defines roadmap • Target Incident, Service Desk, Change, Config, Release Management • Lock down the desktops and freeze the baseline as they implement virtualization • Take back control from rogue business unit operations that cause major disruptions through unplanned and invisible changes • Not formally engage customers executives in Phase 1 in order to ensure that the Ops team has positive results to show before they engage (credibility) • Use proof of reductions in cost, improvements in stability, and improvements in operational response© Holmes and Associates, Inc. All Rights Reserved 5
  6. 6. Scenario 2: Mid-Level ManagerFocuses on Narrow Slice of ITIL Mid-level data center manager in an investment bank owns servers running major trading applications • Bootstrapped knowledge of ITIL • No success in getting any funding, executive support, or peer support for “process crap” • The manager’s plan is to: • Engage with the most important IT Customer • Make component availability visible to everyone through proofs of concept and vendor demonstrations • Trace availability to the component level and tie to services • No money for training, tools, or process reengineering© Holmes and Associates, Inc. All Rights Reserved 6
  7. 7. Scenario 3: Voluntary Process & Technical Transformation Senior VP of Operations for a national service provider • Predecessor’s best practices program had just FAILED • History of strong financial success (“what problem?”) • Little control over key operations functions • History of non-cooperation between functional silo’s • Data centers spread all over the country serving business Divisions • Executive plan is to enlist his entire management team in voluntary process transformation • Use ITIL, PMBOK, etc but not explicitly refer to them • No formal ITIL training or assessment is planned or funded • Use limited consulting budget to coach, but depend on management team to buy-in and become the leaders • Focus on business objectives© Holmes and Associates, Inc. All Rights Reserved 7
  8. 8. GROUP ASSIGNMENT • Pick one of the three leaders you would rather change places with (inheriting their situation and adopting their plan/approach) • Gather with others who made the same choice • Take 10 minutes to brainstorm: • Biggest reasons you chose this scenario • Biggest risks and concerns© Holmes and Associates, Inc. All Rights Reserved 8
  9. 9. A Change Model You Can Use:8 Steps to Cultural Change 8. Enshrined Culture 7. Consolidation 6. Quick Wins 5. Empowerment 4. Communication 3. Vision and strategy 2. Coalitions 1. Urgency From J.P. Kotter’s “Eight Steps to transforming your organization”, as depicted in “Information Technology Infrastructure Library®, Service Transition.” TSO. 2007© Holmes and Associates, Inc. All Rights Reserved 9
  10. 10. STEP 1: Establish a Sense of Urgency • Storm on the horizon • Metrics • “OH NO” moment • Inspire desire to create a positive outcome (altruistic motivation)© Holmes and Associates, Inc. All Rights Reserved 10
  11. 11. Kirk’s Favorite Change Tool #1 Baldrige National Quality Award Criteria A tool for understanding and managing components of culture http://www.quality.nist.gov/ Organizational Profile: Environment, Relationships, and Challenges 2 5 Strategic Workforce Planning Focus 1 7 Leadership Results 3 6 Customer and Process Market Focus Management 4 Measurement, Analysis, and Knowledge Management© Holmes and Associates, Inc. All Rights Reserved 11
  12. 12. Try The Baldrige Framework Example of Using a Self-Assessment Workshop • Brief 1 day self- Self-Assessment Categories: assessment or LEADERSHIP • The reward and recognition system is long term program aligned with our business and quality • Discussion goals and accomplishments are publicized and shared • Commitment • Our vision is shared and • Collaboration communicated such that everyone knows where we are going and how we plan to get there (e.g., products and services, quality, customer service, business success)© Holmes and Associates, Inc. All Rights Reserved 12
  13. 13. Using “the Spread” to Understand the Culture • People learn LEADERSHIP from each WORL D other CLASS 100 81-100 81-100 • Strengths are Optimistic 80 61-80 61-80 affirmed and Self- 60 built upon Assessment 40 41-60 41-60 • Weaknesses Ratings 20 21-40 21-40 are 0-20 Pessimistic0-20 challenged • Honesty 0 0% 100% 0% 20% 40% 60% 80% 100 0% 50% 100% % % of Responses usually Falling into each Rating Band prevails© Holmes and Associates, Inc. All Rights Reserved 13
  14. 14. SCENARIO 3: The First Self-Assessment WORLD 100 CLASS 81-100 81-100 81-100 81-100 81-100 81-100 81-100 81-100 81-100 81-100 80 61-80 61-80 61-80 61-80 61-80 61-80 61-80 61-80 61-80 61-80 Management 60 41-60 41-60 41-60 Summit 41-60 41-60 41-60 41-60 41-60 41-60 41-60 40 Self- 21-40 21-40 21-40 21-40 21-40 21-40 21-40 21-40 21-40 Assessment 21-40 20 Ratings 0-20 0-20 0-20 0-20 0-20 0-20 0-20 0-20 0-20 0-20 0 0% 40% 60% 80% 100 0% 0%100%100 0% 40%100%50% 0% 100% 0% 100% 50% 0% 50% 100% 0% 20% 100% 50% 0% 20% 40% 60% 80% 100% 20% 0% 80% 100 0% 50% 100% 0% 0% 60% 100% 100% 0% 0%50% 100% 0%0% 100% 50% 100% % % % % of Responses Falling into each Rating Band© Holmes and Associates, Inc. All Rights Reserved 14
  15. 15. Step 2: Guiding Coalition • Heroic missions • Personal • Something bigger • Shared commitment • Geographic dispersion and lack of cohesion can be a huge challenge© Holmes and Associates, Inc. All Rights Reserved 15
  16. 16. Step 3: Vision and Strategy Where do you start? • Conduct assessments, Gap Analysis (ITIL and/or other frameworks) • Focus on Points of Pain, clear Customer impact, and ROI© Holmes and Associates, Inc. All Rights Reserved 16
  17. 17. SCENARIO: Phasing Led to Initiatives© Holmes and Associates, Inc. All Rights Reserved 17
  18. 18. Step 4: Communicate MULTI-MODAL MESSAGE© Holmes and Associates, Inc. All Rights Reserved 18
  19. 19. SCENARIO 3 Communication Keys • Public affirmation • Clear communication of expectations • Opportunity for feedback and discussion • Focus on the personal stakes (WIIFM) • Shuttle diplomacy • Cool names are cool© Holmes and Associates, Inc. All Rights Reserved 19
  20. 20. Step 5: Empower Action • Go beyond talk to action • Individuals, Teams, Executives • Train, Train, Train • Accountability • Big promotions/bonuses • Demotions/termination of roadblocks© Holmes and Associates, Inc. All Rights Reserved 20
  21. 21. Step 6: Quick Wins • Not too big and not too small • Noticeable and important • Don’t forget all of the dimensions© Holmes and Associates, Inc. All Rights Reserved 21
  22. 22. Step 7: Consolidate Gains • Continue executing the plan • Expand Raising the Stakes • Scope • Participation Inserting the Wedge • Process integration • More training • Investments© Holmes and Associates, Inc. All Rights Reserved 22
  23. 23. Step 8: Enshrine the New Culture • Embed the new way of doing business • Language • Processes • Documentation • Tools • New hires • Celebrate • Focus on future • Continual Service Improvement (CSI)© Holmes and Associates, Inc. All Rights Reserved 23
  24. 24. Cultural Guiding Principles • Focus on the things that we can control • Align all efforts and activities around the business objectives • Align new transformation tasking with interests, passion, expertise, and existing tasks of employees and managers • Hit dates • One team with one common goal; Collaborate • Leverage existing operational framework • Prioritize • Zero tolerance of defects • Make incremental, tangible progress but understand long- term goal • Involve all employees: All Hands On Deck! • Celebrate progress!© Holmes and Associates, Inc. All Rights Reserved 24
  25. 25. What Happened in Real Life? • Scenario 1: Senior Executive Push to Fully Implement ITIL • Scenario 2: Mid-Level Manager Focuses on Narrow Slice of ITIL • Scenario 3: Enterprise-wide Voluntary Process & Technical Transformation© Holmes and Associates, Inc. All Rights Reserved 25
  26. 26. Scenario 3: How Fast Did Things Start? Within 60 days: • Support from Subsidiary President • Personal initiative leadership by 100% of senior management team • Committed participation from >30% of field employees • Strong support and collaborative process development with other functional disciplines© Holmes and Associates, Inc. All Rights Reserved 26
  27. 27. Key Cultural Differences BEFORE AFTER Each data center says Data centers lead the way their way represents best in ITIL implementation practice “We need our uniqueness “We need more audits and because we know our zero tolerance for non- customers best” compliance.” SVP and Consultant do SVP and Consultant do most of the talking at virtually no talking Summit© Holmes and Associates, Inc. All Rights Reserved 27
  28. 28. SCENARIO 3 Business Results • Reduced capital expense by over $25 Million • Increased Business Unit satisfaction • Decreased MTTR • Market leadership • Consolidation and streamlining • New rewards and recognition • New leadership core • Harmony© Holmes and Associates, Inc. All Rights Reserved 28
  29. 29. SCENARIO 3: Avoided $25Million Project OLD TRANSFORMATION  Lingering instability  69% reduction in # of  High customer service events costs  73% reduction in MTTR  New fixes never fixed it ITIL  Almost defect-free  Getting worse! Implementation Total Durations Per Month 13 data centers # Events Start Pilot # Events Total Durations Per Month and hdqts Per Month Per Month Dev & Deploy Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct© Holmes and Associates, Inc. All Rights Reserved 29
  30. 30. Thank You!Change the cultureand you can World Classchange your world Technology Kirk Holmes Process Holmes and Associates, Inc. (301) 998-6108 People kirk@holmesinc.net http://www.holmesinc.net© Holmes and Associates, Inc. All Rights Reserved 31

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