The document summarizes John Kotter's eight steps for leading change: 1) establishing a sense of urgency, 2) creating a guiding coalition, 3) developing a vision and strategy, 4) communicating the change vision, 5) empowering broad-based action, 6) generating short-term wins, 7) consolidating gains and producing more change, and 8) anchoring new approaches in the culture. It provides details on why change efforts fail and how to successfully lead organizational change through establishing a vision, communicating effectively, empowering others, and institutionalizing changes.

1. John P. Kotter
LEADING CHANGE
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

2. Why firms fail…common errors
# 1: allowing too much complacency
# 2: failing to create a sufficiently powerful
guiding coalition
# 3: underestimating the power of vision
# 4: under communicating the vision
# 5: permitting obstacles to block the new vision
# 6: failing to create shot term wins
# 7: declaring victory too soon
# 8: neglecting to anchor changes firmly in the
corporate culture
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

3. Consequences
 New strategies aren’t implemented well
 Acquisitions don’t achieve expected
synergies
 Reengineering takes too long and costs too
much
 Downsizing doesn’t get costs under control
 Quality programs don’t deliver hoped-for
results
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

4. Economic and social forces
driving change
 Technological
 International economic integration
 Maturation of markets in developed countries
 Fall of communist and socialist regimes
 Globalization of markets and competition
 More competition and increased speed with
Bigger markets and fewer barriers
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

5. More large scale change in
organizations
 Reengineering
 Restructuring
 Quality programs
 Mergers and acquisitions
 Strategic change
 Cultural change
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

6. THE EIGHT-STAGE PROCESS OF
CREATING MAJOR CHANGE
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

7. 1. Establishing a sense of
urgency
 Examining the market and competitive
realities
 Identifying and discussing crises, potential
crises or major opportunities
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

8. 2. Creating the guiding
coalition
 Putting together a group with enough power
to lead the change
 Getting the group work together like a team
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

9. 3. Developing a vision and
strategy
 Creating a vision to help direct the change
effort
 Developing strategies for achieving that
vision
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

10. 4. Communicating the change
vision
 Using every vehicle possible to constantly
communicate the new vision and strategies
 Having the guiding coalition role model the
behavior expected of employees
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

11. 5. Empowering broad based
action
 Getting rid of obstacles
 Changing systems or structures that
undermine the change vision
 Encouraging risk taking and nontraditional
ideas, activities, and actions
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

12. 6. Generating short term
wins
 Planning for visible improvements in
performance or wins
 Creating those wins
 Visibly recognizing and rewarding people
who made the wins possible
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

13. 7. Consolidating gains and
producing more change
 Using increased credibility to change all
systems structures and policies that don’t fit
together and don’t fit the transformation
vision
 Hiring promoting and developing people who
can implement the change vision
 Reinvigorating the process with new projects
themes, and change agents
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

14. 8. Anchoring new approaches
in the culture
 Creating better performance through
customer and productivity oriented behavior
more and better leadership and more
effective management
 Articulating the connections between new
behaviors and organizational success
 Developing means to ensure leadership
development and succession
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

15. Leadership
 Establishing direction
 Aligning people
 Motivating and inspiring
 Producing change
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

16. Complacency
 The absence of major and visible crisis
 Too many visible resources
 Low overall performance standards
 Narrow functional goals
 Wrong performance indexes
 Insufficient feedback
 Kill the messenger of bad news, low candor, low
confrontation culture
 Denial
 Too much happy talk from senior management
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

17. Effective guiding coalition
 Position power
 Expertise
 Credibility
 Leadership
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

18. Building a coalition that
make change happen
 Find the right people
 Create trust
 Develop common goal
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

19. Relationship between V-S-P-B
vision
LEADERSHIP
strategies
plans
MANAGEMENT
budgets
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

20. Characteristics of an
effective vision
 Imaginable
 Desirable
 Feasible
 Focused
 Flexible
 Communicable
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

21. Creating an effective vision
 First draft
 Role of the guiding coalition
 Importance of teamwork
 Role of the head and the heart
 Messiness of the process
 Time frame
 End product
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

22. Key elements of the effective
communication of vision
 Simplicity
 Metaphor
 Analogy and example
 Multiple forms
 Repetition
 Leadership by example
 Explanation of seeming inconsistencies
 Give and take
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

23. Barriers to empowerment
 Formal structures
 Lack of needed skills to action
 Obstructing personnel and information
systems
 Bosses discourage actions for the new vision
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

24. Empowering people to effect
change
 Communicate a sensible vision to employees
 Make structures compatible with the vision
 Provide the training employees need
 Align information and personnel systems to
the vision
 Confront supervisors who undercut needed
change
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

25. Role of short term wins
 Provide evidence that sacrifices are worth it
 Reward change agents with a pat on the back
 Help fine tune vision and strategies
 Undermine cynics and self serving resisters
 Keep bosses on board
 Build momentum
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

26. Why culture is powerful
1. Because individuals are selected and
indoctrinated so well
2. Because the culture exerts itself through the
actions of hundreds or thousands of people
3. Because all of this happen without much
conscious intent and thus is difficult to
challenge or even discuss
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

27. Anchoring change in culture
 Comes last, not first
 Depends on results
 Requires lot of talk
 May involve turnover
 Makes decisions on succession crucial
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

28. Twenty first century
organization
Structure:
i. Non bureaucratic
ii. Limited to fewer levels
iii. Management leads and employees manage
iv. Policies and procedures with minimal
internal interdependence needed to serve
customers
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

29. Systems:
i. Many performance information systems
ii. Distribute performance data widely
iii. Offer management training and support
systems to many people
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

30. Culture:
i. Externally oriented
ii. Empowering
iii. Quick to make decisions
iv. Open and candid
v. More risk tolerant
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

31. The relationship of lifelong learning, leadership
skills and the capacity to succeed in future
Personal history
 Inborn capabilities
 Childhood experiences
 Job and educational experiences
Competitive drive
 Level of standards
 Desire to do well
 Self confidence in competitive situations
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

32. Life long learning
 Willingness to seek new challenges
 Willingness to reflect honestly on successes
and failures
Skills and abilities
 Knowledge
 Leadership skills
 Other skills
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

33. Competitive capacity
 Capability of dealing with an increasingly
competitive and fast moving economic
environment
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

34. Mental habits that support life
long learning
 Risk taking- willingness to push oneself out of
comfort zones
 Humble self reflection- honest assessment of
successes and failures especially the latter
 Solicitation of opinions- aggressive collection
of information and ideas from others
 Careful listening- propensity to listen to
others
 Openness to new ideas- willingness to view
life with an open mind
Dr. V. R. Kesava Ram (P.T.) August 8, 2012

35. Dr. V. R. Kesava Ram (P.T.) August 8, 2012