Managing Cuts And New Growth
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Managing Cuts And New Growth

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A proven approach to managing strategic change, requiring hard cuts + new growth.

A proven approach to managing strategic change, requiring hard cuts + new growth.

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  • Scope:Narrow ↔BroadAmplitude: High↔Low Timing: Periodic↔ConstantSpeed: High ↔LowContent Focus: Hard Cuts↔New GrowthSocial: Top Down↔Bottom Up
  • Together with our clients we have achievedstrategic renewal and repositioning initiativeslocal implementation of global strategygenerating and launching new growth strategieslarge scale post merger & acquisition integrationrestructuring of business unitslarge scale turnaroundscompanywide cultural shiftslaunch of innovation initiativesmajor functional changes in marketing, HR, finance, IT, communications,......

Managing Cuts And New Growth Managing Cuts And New Growth Presentation Transcript

  • Managing Cuts + New Growth Un:balanced Transformation
  • AGENDA What is change? © Doujak Corporate Development
  • What is change? I have to move my We’re restructuring desk!  our complete organization!  © Doujak Corporate Development
  • What is change? New operations New way of working Merger Turnaround New organisational New strategy structures Reengineering Downsizing New processes New IT system New management tools New culture © Doujak Corporate Development
  • AGENDA Why change? Adapt to changing conditions. Become competitive. Stay competitive. © Doujak Corporate Development
  • AGENDA How to lead change? = the BIG question we‘re trying to answer! © Doujak Corporate Development
  • Narrow ↔ Broad Discontinuous ↔ Continuous Periodic ↔ Constant Fast ↔ Slow Top Down ↔ Bottom Up Hard Cuts ↔ New Growth © Doujak Corporate Development
  • What am I supposed to do? I need some orientation… © Doujak Corporate Development
  • © Doujak Corporate Development
  • OK…let’s start by analyzing the overall situation! © Doujak Corporate Development
  • The Change Map What‘s your situation? High Securing survival Crisis management - restructuring Current Necessity for Change Radical repositioning Strategic turnaround - organizational redesign Renewal Growth Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map Different challenges require different appraoches. High • Turnaround projects Securing survival Crisis management - • Goal: focus on survival + decrease the restructuring current need for change Current Necessity for Change Radical repositioning Strategic turnaround - organizational redesign Renewal Growth Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map What‘s your situation? High Securing survival Crisis management - restructuring Current Necessity for Change Radical repositioning Strategic turnaround - organizational redesign Renewal Growth • Goal: increase the capabilities and willingness for change of individuals, groups, and organisations. Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map What‘s your situation? • Proactive turnaround, anticipating a crisis + strategic High redesign Securing survival Crisis management - • Goal: move into a more stable environment and restructuring increase the change capacity of the organisation Current Necessity for Change Radical repositioning Strategic turnaround - organizational redesign Renewal Growth Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map What‘s your situation? High Securing survival Crisis management - restructuring • Goal: find, test and imlement innovative Current Necessity for Change Radicalpotentials for new growth and success. repositioning • The identity Strategic turnaround - of company is being organizational redesign and renewed. transformed Renewal Growth Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map What‘s your situation? High Securing survival Crisis management - restructuring Current Necessity for Change Radical repositioning Strategic turnaround - organizational redesign Renewal • Change is day to day business for the learning Growth organisation (emergent change). • Continuous development and innovation • Decentral self-organisation, fostered by the market, reward systems and the organisation‘s culture. Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map In which direction to move? High Securing survival Crisis management - restructuring Current Necessity for Change Radical repositioning Strategic turnaround - organizational redesign Renewal Growth Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map Un:balanced Transformation High Securing survival Crisis management - restructuring Current Necessity for Change Radical repositioning Strategic turnaround - organizational redesign Renewal Growth Mobilizing Adapting and developmental Learning organization capacity Market responsiveness Low Low High Change Capability © Doujak Corporate Development
  • The Change Map What to think about... What‘s influencing What‘s influencing the capabilities and the need? the readiness? • Financial pressure • Has the organization some experiences • Competitive pressure with change? • Market pressure • Do people have the skills for change? (Change Mgmt know how) • The organization‘s ability to perform (compared to peers) • How is the need for change perceived? • Level of coordination • Is it a radical change? • Level of target achievement • Are systems and support structures in place to facilitate the change? • Level of customer satisfaction • How high is the trust in the ability to • Internal systems change? • Structure and processes • How high is the personal readiness for • Organizational culture change? • Leadership, values, „climate“ • Does the change match people‘s values? • ... • ... © Doujak Corporate Development
  • Un:Balanced Transformation Anchoring hard cuts and new growth simulaneously Hard cuts New growth Focus on short-term performance, efficiency and economic Focus on long-term success, future growth potential and Goals capital intellectual capital Top-down – close, clear, directive, linear, by program – Bottom-up involvement: self-organization, collaboration and Steering “planned change” networking, open. Emergent change. Decrease resources/costs – focus on processes, structure, Contents systems, downsizing Involvement, participation, innovative culture HR a cost factor capital, a resource, “entrepreneurs” longer coping processes (worries, distrust, aggression, focus, community (teams are important) and a basic feeling of joy, Logic of feelings disappointment, leave-taking – gradual new commitment) challenge and confidence Reality Buoyant optimism, a combination of discipline and spirit of Feelings of loss and defeat influence perception construction adventure influence perception (pioneers, winners of the future) Support autonomous initiatives and structures and short-term Core team steers the process of hard cuts – intense Architecture involvement of HR and line managers for implementation experiments – conducted on the sidelines of day-to-day operation (“incubation” until matured) Pull towards the past and to the inside – a need for Pull towards the future and to the outside – desire to “ignore” or Orientation stabilization and renewal of the employee – company overcome existing conditions contract Producers, ambassadors and bringers of “bad news” – the Architects, enablers and promoters of innovation – the situation situation calls for their presence in the roles of Executives “implementers”, coaches, communicators and calls for letting go and strengthening autonomy, encouraging “revolutionaries” crisis/transition experts (security, orientation) Motivator for Security and risk minimization, finding one’s own position, Involvement, challenge and free play, commitment. Performance people maintaining stability in new, demanding areas © Doujak Corporate Development
  • Approaches to Change Old and new images of transformations Old Images New Images Maintaining a balance between fields of tension and Change management as management of Unbalance and contradictions accelerates change. Balance. Conflicts must be deescalated. Transformation needs conflict. Feelings are a side-effect in transformation processes; we Feelings are the motor for all phases of change. have to accept them. The combination of top-down decisions and bottom-up Transformation decisions require a broad consensus. involvement is crucial. Transformation is change planned top-down; management Transformations are a squaring of the circle - “planned accounting and controls are a success factor (“planned quantum leap” (planned change) and at the same time self- change”). generated change “emergent change”. From step one, concept development must be interlinked with A good concept makes up 90% of success. implementation work. For all those involved, transformation also means (more or Now the others need to change. After all, we initiated it. less extensive) personal change. Clear-cut and step-by-step integration according to phases and It is important to always involve everyone. stakeholders. Before we can step outside, we need to have solved Integration of relevant environments from the very beginning. everything on the inside. © Doujak Corporate Development
  • • Get your team (management, change, ...) together. • Plan 3-4 hours. • Put the change map on the floor. • Ask everybody to postion him/herself. • Spend the next 3 hours on deciding on a common view of your situation. • Agree on how to evaluate the need. • Agree on how to evaluate the capacity. © Doujak Corporate Development
  • Next we need a road map & outline who does what when. © Doujak Corporate Development
  • The perform ability to perceived organizations Breaking through routine – 1 we must change Creating visions of the future How to Change 2 The Five Phases Model - develop architecture and roadmap Courageous decisions 3 - jumping into the cold water Consistent implementation © Doujak Corporate Development 4 - connecting the desire for innovation with broad involvement Mastering the difficulties on 5 the highland planes – anchoring successes Time
  • How to Change The Five Phases Model Breaking through routine: We must change! Creating visions of the future: Develop architecture and roadmap Courageous decisions: Jump into the cold water Consistent implementation: Connect the desire for innovation with broad involvement Mastering the difficulties on the highland planes: Anchor successes © Doujak Corporate Development
  • Phase One Breaking through routine – we must change 1 2 3 4 5 Key strategies: Creating visions of the future - - jumping into the cold water Mastering the difficulties on • Disrupting routine: Consistent implementation Breaking through routine – - connecting the desire for develop architecture and – anchoring successes Courageous decisions “Change starts with me” the highland planes broad involvement • Evaluating the need for action: we must change innovation with “From outside to inside” • Assessment of the willingness and roadmap ability to change: “Let’s test ourselves!” Typical situation and dynamics Time • Communicating by shaking up: • Diversity of perspectives and views concerning “Opening up – taking a position – situation and future developments sending signals” • Energy for change varied • Identifying the key players: • Contradictory signals from stakeholders “Finding the best people” • Doubts about information quality • Ambivalent collective mood: routine vs. increasing interest in renewal vs. fear/blockades © Doujak Corporate Development
  • Phase Two Creating visions of the future – develop a roadmap 1 2 3 4 5 Key strategies: Creating visions of the future - - jumping into the cold water Mastering the difficulties on • Work on the vision: “We are creating Consistent implementation Breaking through routine – - connecting the desire for develop architecture and – anchoring successes Courageous decisions a (fitting) future.” the highland planes broad involvement • Develop strategy and master plan : we must change innovation with “Big picture of drastic cuts and new growth” roadmap • Decide architecture and teams: “Containment due to process stability Time and trust” Typical situation and dynamics • Communicate seriously and • First concepts and ideas about possible future transparently: “That’s there we want • Concepts too vague to get implemented on a 1:1 to go and how we get going” basis • Unclear: who will be concerned, degree of • Deepen and broaden change commitment, details of implementation management know-how: “About the • Only key people are involved art of change” • Perceived performance increases, potential threats are felt less • Collective emotional level: interest is predominant, those who are directly involved feel spirit of a new era © Doujak Corporate Development
  • Phase Three Courageous decisions – jumping into the cold water 1 2 3 4 5 Key strategies: Creating visions of the future - - jumping into the cold water Mastering the difficulties on Consistent implementation Breaking through routine – • Plan and implement pilots and quick - connecting the desire for develop architecture and – anchoring successes Courageous decisions wins: “Taking advantage of the the highland planes broad involvement trampoline” we must change innovation with • Cost-cutting and decisions roadmap about people “Challenging the unpleasant aspects first – with support measures” Typical situation and dynamics Time • Promote growth and innovation: • First implementation steps: try out big things “en “Incentives and scope for freedom” miniature” • Deal with resistance: “Work with the • Initial euphoria resistance – not against it!” • Subsequent disillusionment: • Use evaluation as a motor: “Broad, “misunderstandings”, “misinterpretations” stimulating – with consequences” • Resistance: reactions out of fear, sometimes aggressive • Collective emotional level: “Defending the former identity” vs. “Conquering new territories” © Doujak Corporate Development
  • Phase Four Consistent implementation – connecting the desire for innovation with broad involvement 1 2 3 4 5 Key strategies: Creating visions of the future - - jumping into the cold water Mastering the difficulties on • Speed up implementation activities Consistent implementation Breaking through routine – - connecting the desire for develop architecture and – anchoring successes Courageous decisions and projects consistently: “Pulling the highland planes broad involvement yourself out of the swamp.” we must change innovation with • Adapt architecture continuously: “Nothing is forever” roadmap • Winning over undecided and skeptical individuals: “From the team to the Time organization” Typical situation and dynamics • Adapt systems step by step: “Good • Initial euphoria has worn off by now – the systems save energy” setbacks have hit home • Continue to learn and build up skills • “Should we stop or continue” for transformation: “Looking behind • Middle-management are at the centre of change the backdrop and creating skills” as mentors and multipliers responsible for implementation • Change process becomes broader, more and more projects are completed • Top-management impatient, middle- management overloaded with work, many people who will be affected are not yet involved © Doujak Corporate Development
  • Phase Five Mastering the difficulties on the highland – anchoring successes 1 2 3 4 5 Key strategies: Creating visions of the future - - jumping into the cold water Mastering the difficulties on • Harmonizing leadership systems: Consistent implementation Breaking through routine – - connecting the desire for develop architecture and – anchoring successes “Integration at all levels.” Courageous decisions the highland planes • Cultural change: integrate behavior, broad involvement we must change innovation with norms, values into day2day-business: “Awareness creates new possibilities” roadmap • Continue training on a broad basis: “Practice, practice, practice!” Time • Increase outward orientation: Typical situation and dynamics “Happiness lies on the back of a • Longest and most decisive phase – albeit not the horse” most exiting one • Bring leadership into the focus of • Clear project orientation and broad implementation, attention and finish the • Systems integration and in-depth anchoring: transformation: slowly but surely – all systems, all staff members “With enthusiasm towards new • Transformation is becoming second nature to efficiency” people © Doujak Corporate Development
  • • Well it depends very much on the phase you‘re in! • The team (change, management,...) should be aware of these phases! • The question is „In which phase is the organization?“ versus „In which phase is the change/mgmt team?“ • Think of how the people must feel • Get some feedback from the organisation • Establish a sounding board • Establish regular feedback loops • How does your team feel? © Doujak Corporate Development
  • See the book starting on page 235 for specific actions in each phase. Let me know how they worked! © Doujak Corporate Development
  • How to I get people to come along? © Doujak Corporate Development
  • I´m going to be I hope they‘ll be confronted with able to keep it I‘m afraid. Will horrible emotions... under control... I loose my job? I couldn’t care Cool! Finally less… some change! © Doujak Corporate Development
  • The Logic of Emotions Every emotion has a function daily routine curiosity fear interest uncertainty joy daily routine courage anger aggression disappointment sadness © Doujak Corporate Development
  • The Logic of Emotions Emotions are the drivers of change processes Thinking and feeling cannot Implications for be seperated. leadership. • Emotions are drivers and • Emotional and affective tune is just as barriers to our thinking. important as the cognitive understanding. • Communication doesn‘t work without a • Emotions bias our focus and minimum of emotional conformity (being attention. on the same page). • Emotions impact learning and • As a result affective accomodation, remembering. responding to people, picking them up • Emotions attract certain where they are is important. thoughts and reject others. • Affective moods, verbal and non-verbal, are highly infective. They spread at lightning speed and impact following situations and messages. © Doujak Corporate Development
  • The Logic of Emotions Emotions are the drivers of change processes Emotional Consternation Emotional Leadership Fear, insecurity: denial of the need for Stabilization: address fears, crossover change, mental block, unable to act model, strategies for crisis management, positive: focus enable a solution orientated mood Anger, aggression: borders are being Tension regulation: “fighting arena”, offer defined, defence through devaluation support to prevent burnout, expectation positive: things worth keeping are management defended Disappointment, resignation, sadness: Continuous: reliable communication, structures, dissolve, holding points are ongoing rhythms and rituals, consistent lost, doubt about own competencies and staffing, celebrate (small) quick wins problem solving capacity, slowdown, cling appreciate the past, farewell rituals to the past, depressive mood positive: open mind for new things © Doujak Corporate Development
  • The Logic of Emotions How people act Discrimination dynamics Projections on outside world Increasing fear scapegoats, mobbing, groups, customers, other insecurity, time pressure, in-group/out-group- departments, leadership, burnout, stress dynamics, intrigues idealization and devaluation Position fights, power games Psychological illness Betrayal, cynicism, mistrust “dog-eat-dog”-mentality depression, anxiety disorder, (social Darwinism) addiction Psychosomatic illness Decreasing loyalty back problems, Resistance, avoidance internal dismissal, decreasing cardiovascular diseases, commitment, quitting stomach problems © Doujak Corporate Development
  • Expecting resistance Where is it coming from? • Is the urgency for change considered low? • Are there any ambiguous expectations? • Are there doubts about successful project closure? • Are the results uncertain? • Are negative results to be expected? • Are the results unalterable? • Are the results associated with few advantages but with high costs? • Is the change profound? • Are those affected insufficiently involved? • Does the change imply poor performance up until now? The more often you answer „Yes“ to these questions, the higher the expected resistance. © Doujak Corporate Development
  • The Logic of Emotions How to deal with Hard Cuts • Decide wisely – layoffs as the last resort • Communicate as clear and concise as possible – open – interactive – with content and emotional messages • Plan hard cuts comprehensively based on a stakeholder analysis • Communicate plausibly what the hard cuts will bring and why they are necessary • Implement as announced including support • Monitor and evaluate results continuously © Doujak Corporate Development
  • The Logic of Emotions Leadership needed • Clear language and information: vision, objectives, tasks, feedback Assuring one‘s own ability • Open communication: speak and to work through Assuring employees‘ listen honestly willingness and capability ability to work through • Build transparency: motives and to self-reflection, self- containment, and security foreseeable consequences, culture of criticism, self-honesty. information • Social perception • Ability to deal with conflicts, provide structure (“containment”) • Appreciative, accepting and respectful attitude with resistance Enabler of processes: Development of and fears. Practice listening! impulses, facilitation, individuals, groups and • Employee participation: views, coaching the organisation experiences, competences, in an appropriate manner © Doujak Corporate Development
  • More on Managing Cuts and Hard Cuts... www.doujak.eu/thinking © Doujak Corporate Development
  • Thanks for your attention!
  • Marc Sniukas Doujak Corporate Development Lainzer Strasse 80 A-1130 Vienna Mobile: +43 699 122 333 marc.sniukas@doujak.eu Follow Marc at www.twitter.com/sniukas Blogging for Manchester Business School at http://sniukas.tm.mbs.ac.uk © Doujak Corporate Development
  • Doujak Corporate Development What we do Doujak Corporate Development is a consulting company partnering with CEOs and their executive teams to resolve the global strategic and organizational challenges they face. We help them to shape strategy and develop the capabilities and organizational culture, structure, processes and systems needed for global execution and transforming their businesses. Strategy Change Management Professional Development • Purpose & Culture • Un:balanced Transformation • Top Executive Coaching • Strategic Innovation • Hard Cuts + New Growth • Top Executive Teambuilding • Strategy Development • Restructuring • Inhouse Programs • Strategy Implementation • High Impact IT • Open Programs © Doujak Corporate Development
  • Corporate Development Developing.... Purpose Stakeholder Culture Relationships Leadership Strategy Organization © Doujak Corporate Development 47
  • Our Focus Dimensions of our work Content Process What? Why? Who? How? © Doujak Corporate Development 48
  • Lainzer Strasse 80 A-1130 Vienna Austria Tel: +43.1.306 33 66 Fax: +43.1.306 33 66 9 office@doujak.eu www.doujak.eu