Organisational Change

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Organisational Change
Change Management
MTL Course Topics
CHANGE MANAGEMENT

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Change Management
MTL Course Topics
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Change Management
MTL Course Topics
ARE YOU READY?
OK, LET’S START!

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Change Management
MTL Course Topics
INTRODUCTION
Just as individuals need to face up to a changing world and
adapt to it, through managing risk, paradox and learning, so
do organisations. For many organisations, adapting to new
needs and expectations involves a total cultural re-think,
one which many people with a stake in the old ways may be
unable to accept. The cultural changes that organisations
have to face affect not just the "hard" features of strategy,
structure and systems, but the "soft" aspects of staff, skills,
style and shared values as well.

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MTL Course Topics
THE OVENS WERE SMALL
In many organisations, life is a bit like the following story.
A mother was putting a roast in the oven. Her 6-year-old
daughter saw her cut off both ends of the roast and asked,
"Why do you do that?" The mother said, "I don't know. It's
what granny always did.“
So, the next time granny came to visit, the little girl asked
her to explain why the roast ends were always cut off. And
granny said, "I don't know. Let's ask great-granny.“
And when great-granny was asked the same question, she
replied, "In the old country, the ovens were very small.“
Moral of the story: Sometimes we do things out of habit
and for no reason at all.

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GONE TO THE WALL
The name Sanderson's was once synonymous in the UK with
the very best of high-quality wall furnishings. It owned an
archive of designs by leading Victorian artists such as
William Morris, Charles Voysey and Augustus Pugin. But, in
August 2003, its 100-plus staff were in tears as the business
folded, a victim of poor change management.
Sanderson's had been losing money for years and was
unable to adjust to new fashions in home design, despite
the market soaring thanks to TV makeover shows. In 2000,
they lost £2 million.
Unable to acknowledge the changing tastes of their
customers, the company fooled themselves into believing
their products were too good, too durable, and too high-
quality. They failed to see the need for change.

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MTL Course Topics
XEROXED
The photocopier organisation, Xerox, reached near
bankruptcy in the early 1990's as a result of fierce
competition from companies such as Ricoh, Toshiba and
Canon manufacturing in Japan. As a result they re-thought
their business from top to bottom.
They re-assessed their technology and moved from light
lens technology to digital; they changed their customer
orientation from making products to finding solutions; they
re-styled their management structure and created self-
managing business units; they reduced their supplier base
from 5000 to 400; and they reduced their raw material
stocks by 80%.
Now Xerox dominate the market for sophisticated office
machines and are set for a revenue figure of over $17 in
2008.

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MTL Course Topics
LEVELS OF CHANGE
According to anthropologist, Gregory Bateson, individuals
and organisations can experience three different kinds of
change.
1. Incremental Change, which is met one bit at a time and is
also known as step-by-step change. It is like a child growing
up and makes few if any demands on the organisation or
leaders (parents).
2. Reactive Or Transitional Change, which is change to meet
outside challenges and threats, but which doesn't affect the
nature and character of the enterprise.
3. Transformational Change, which requires changing the
culture of the organisation to respond to sudden, global
environmental change. This kind of change is deep and
pervasive and needs leaders to take people into unproven
territory.

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IT STARTS WITH STRATEGY
The starting point for any organisation undergoing change is
to identify what is driving the need for change. In other
words, why do we have to change, what happens if we
don't, and what is the desired end-result? This could be
driven by a need to respond to customers, a change in
processes, or to respond to changes in the market place.
The answers could mean...
• a change in the culture of how we do things
• a change to a process or system
• a change to the way people work together
• a re-structuring of the bits of the organisation
• new products and services and how they are made
• all of the above.
There should always be a strong business case for any kind
of change that outweighs the risks of doing nothing.

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A CHANGE-RESPONSIVE CULTURE
Your organisation's existing culture will tell you how easy it
is for you to change. Here are some ways to measure your
current culture:
1. Perspective. Is the culture top-down or bottom-up?
2. Design. Are the systems based on a rigid functionality or
on how well we deliver?
3. Measurement. Do we focus on measuring outputs,
targets and man-hours or our capabilities and successes?
4. Role of Management. Is management there to manage
budgets and people or improve the system?
5. Ethos. Is the work ethos about control or learning?
6. Motivation. Is motivation external or internal?
7. Change. Do we react to change or integrate it?
A top-down, hierarchical, command-and-control culture will
be less responsive to change than an outside-in, success-
focused, systems culture.

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IT'S ABOUT PEOPLE
In his book, ""Leading Change"", John Kotter says that
analysis, charts and thinking do not deliver change. People
do. They do it by seeing and feeling first, and then by doing
things differently.
Kotter suggests an 8-stage process to achieve this.
1. establish a sense of urgency
2. create a guiding coalition
3. develop a vision and strategy
4. communicate the change vision
5. empower broad-based action
6. generate short-term wins
7. consolidate gains and produce more change
8. anchor new approaches in the culture.
None of this is possible without a hefty dose of soft, people
skills and hard political skills. Which is why effective change
needs both good leadership and good management.

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MTL Course Topics
THE IDEAL MARRIAGE
Effective change requires a marriage between the best of
management and the best of leadership. Managers will
come from the organisational structure. Leaders can come
from anywhere within the organisation.
Good management requires:
1. defining the business case for change
2. assessing how ready the systems are for change
3. establishing a plan
4. setting expectations, milestones, and targets
5. managing the change as a project with timescales,
costs, and outputs
6. monitoring progress
7. fire-fighting and overcoming crises.
Good leadership requires:
1. winning hearts and minds
2. engaging and connecting with people
3. walking the talk.

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THE KUBLER-ROSS MODEL
The Kubler-Ross change model is a model of change named
after Elisabeth Kubler-Ross, a Swiss doctor who devoted her
life to studying people with terminal illnesses. She identified
five emotional states that people go through when they
learn that they are dying. Her model has become the basis
for the process that other people go through when they are
given bad news or are required in some way to make major
change.
The typical steps are:
0. The Status Quo: “Life's OK as it is"
1. Anger, Shock And Freeze: "I don't believe it"
2. Denial: "It's just not true"
3. Self-awareness: "I'm not really coping well with this"
4. Acceptance: "Well, it looks like it's going to happen"
5. Experiment: "Let's see if I can't do something to fit in"
6. Integration: "I think it could work out OK"

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THE DEAD CAR BATTERY
It's a cold, dark winter's morning. You're going to be late for
work so you rush out to your car, place the key in the
ignition and turn it on. You hear nothing; the battery is
dead. What happens next demonstrates some of the phases
of the Kubler-Ross change model:
1. Denial What's the first thing you do? You try to start it
again! And again and then...again.
2. Anger !$%&*@~$! car!, I should have junked you years
ago. You may hit the car with the nearest tree.
3. Bargaining (realizing that you're going to be late for
work)..., Oh please car, if you will just start one more
time I promise I'll look after you properly from now on.
4. Depression Oh God, what am I going to do. I'm going to
be late for work. My job is at risk. What's the use.
5. Acceptance OK. It's dead. Guess I had better call the
breakdown service or find another way to work. Time to
get on with things; I'll deal with this later.

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MTL Course Topics
THE STATUS QUO
In stable times, people in organisations often fight to
achieve a certain status that gives them what they want in
terms of power, position and prestige and then resist any
attempts to change. They like the status quo because they
do well out of it.
In uncertain times, however, such attitudes are a block to
change and explain why the following figures are often
found when people are first informed of a change:
1. 5% will accept the new concept or idea immediately
2. 25% will lean towards acceptance
3. 60% will wait and see
4. 10% will never accept.
In times of rapid and deep change, such resistance can spell
disaster. "If we want things to stay as they are, things will
have to change." (Giuseppe di Lampedusa 1896-1957)

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STEP 1: SHOCK, ANGER, FREEZE
In the Kubler-Ross change model, the first reaction to the
announcement of a sudden and unexpected change is often
a mixture of shock, anger, and freeze.
The immediate reaction to a sudden change may be felt at
an instinctive level, possibly in the stomach in a gut-
wrenching way. This is the reptilian brain kicking in and it
often means we freeze, as in the headlights of a car.
The next reaction may be felt in an emotional way such as
an overwhelming anger at those who are felt to be
destroying our present identity.
The third reaction may come a little later on when we seek
to justify our fears and feelings in a rational way.
"It's not so much that we're afraid of change or so in love
with the old ways, but it's that place in between that we
fear. It's like being between trapezes. It's Linus when his
blanket is in the wash. There's nothing to hold on to."
(Marilyn Ferguson)

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DON'T USE THE C WORD
The level of anger and fear at the prospect of change is
always linked to how much people are committed to the
status quo. This often links to how much people have
invested in where they are now and their feelings of security
and control.
Sometimes, people will react physically to the news of a
change. The colour will leave their skin, their breath will
become short, and they may need some kind of support as
their legs begin to buckle. It is almost as if the ground has
been taken away from them.
In the working situation, it is a good idea to avoid using the
word, "change" when announcing a change. Instead, focus
on the new behaviours that are needed and your confidence
that people will acquire them. This focuses people's
thoughts on their future identity and what they will gain
rather than on their past identity and what they are going to
lose.

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STEP 2: DENIAL
The next stage on the Change model, after the
announcement of change, is Denial. This is where some
people refuse to believe that a change has occurred or is
going to happen. They may simply put it out of their mind
and continue as before, or may seek alliances with others
who feel the same and who can reassure them that nothing
is going to change.
People who remain in the denial phase can become a
danger to themselves and others if they are not helped. If
they continue in denial, they eventually turn into dinosaurs
with no future except their own demise.
"It takes a lot of courage to release the familiar and
seemingly secure, to embrace the new. But there is no real
security in what is no longer meaningful. There is more
security in the adventurous and exciting, for in movement
there is life and in change there is power." (Alan Cohen)

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CONVERSATIONS
According to Mercer HR Consulting, the main reason why
organisations fail in their change programmes is because
they don't communicate from the start. Conversely, the
main reason why organisations succeed in their change
programmes is because they do.
Communicating change starts with a desire to really engage
people with what the change is all about. It means exciting
them with the vision and possibilities. It means listening to
their genuine fears and worries. It means keeping them up
to date with what is going on. And it means being honest
about bad news as well as good.
A communication plan for a major change will probably
mean formal presentations and newsletters. But one of the
most effective techniques is to engage in ongoing
conversations. That way, the change happens in people's
minds as they talk to each other and you.

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TEACHING AT FORD
When executives at Ford Motor Company were charged
with transforming their business in the late 1990's, they
decided that hiring consultants was not for them.
Instead, they decided to launch an unbelievably ambitious
one-year internal teaching programme that involved every
one of their 55,000 salaried staff in 200 far-flung countries.
Using a multi-faceted initiative of discussion groups, 360-
degree feedback, and community service, 200 Ford chiefs
taught 200 more who taught to all the staff. And they
achieved this all within a year.
As Chief Executive Officer, Jacques Nasser said, "There is
simply no better, faster way to distribute knowledge around
a company than through teaching. And the company has to
do this teaching using their own people."

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STEP 3: SELF-AWARENESS
The next step in the Kubler-Ross change cycle follows on
from Denial and is Self-Awareness. It is the realisation on
the part of those who have been resisting change that they
will not survive if they sit on their hands but have to accept
that they too have a responsibility to change. One way to
break through is to get people excited about how they will
be when things change.
"I'm looking for people who don't come in on time, sit
quietly at their desks, answer phones and respond to letters
before going home on time; but for people who might still
be here at two in the morning absorbed in an impossible
project, who make reading "War and Peace" an essential
management textbook, who will burst into "Oh what a
beautiful morning" when things go well, who will abandon
everything to help out a colleague who's stuck and who will
try things out for the sheer fun of it." (One MD on a new job
specification)

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FOCUS ON WHAT WORKS
Appreciative Enquiry is a way of developing change based
on what currently works, not on what doesn’t.
It was developed by Dr David Cooperrider and his colleagues
at Case Western University in Ohio. The approach is based
on the premise that "organisations change in the direction
in which they enquire." So an organisation which enquires
into problems will keep finding problems but an
organisation which attempts to appreciate what is best in
itself will discover more and more that is good. Change then
is no longer something to be feared but an opportunity to
build on what works. People discover when the organisation
is at its best. They dream as if the good times were the
norm. They design ways to make the dreams a reality. And
their destiny is to implement the changes.
"Management that wants to change an institution must first
show that it loves that institution." (John Tusa)

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STEP 4: ACCEPTANCE
Acceptance is the next step in Kubler-Ross's change cycle. It
is the realisation that there is more to be gained in
accepting change than in resisting it.
Whenever we face a change, there are always two
responses: fear and excitement. Our fears may be fear of
the unknown, fear of not being in control, fear of being
vulnerable, fear of being found out, and fear of looking
stupid. Excitement, on the other hand, may be felt when we
see the opportunities in change, the chance to do
something new, the possibility of learning new skills and
having new experiences, and the satisfaction that comes
from performing well at something we've not done before.
The second option is always more likely when people are
confident that they will acquire new skills relatively quickly
and easily and that there will be someone there to catch
them if they fall: the "hand across the chasm".

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OPPENHEIMER'S SECRET
When Robert Oppenheimer took over the Manhattan
Project to develop the A-bomb in 1942, he found that the
technicians responsible for the mathematical calculations
were making an enormous amount of basic errors. So much
so, that their work had to be double and triple-checked by
other teams.
Oppenheimer asked, "Why is this happening? Don't these
people know that their work could shorten the war by years
and save countless thousands of lives?". The Department of
Defence told him that, for reasons of security, the
mathematical team were not allowed to know the mission
that they were working on.
Oppenheimer, however, insisted that despite the security
implications, they should be told. When they were, the
error rate disappeared overnight, as the teams realised the
implications of their work.

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STEP 5: EXPERIMENT
The next step in Kubler-Ross's change model is Experiment.
It is that period when everyone in their own way is making
the necessary adjustments in skills, habits, routines, and
behaviours to come into line with the new change. Some
are playing one tune and some are playing another, but the
sound they make, though perhaps not totally harmonious,
does make sense.
This is why some people describe the Experiment period of
change as being like a jazz band. These are the similarities:
1. everyone shares the same sense of purpose though
they are working to their own pace and rhythm
2. there is a clear strategy around which everyone can
improvise as it suits them
3. people are at different stages of learning and mastering
new skills
4. the magic comes when people listen and adapt to each
other and do something different again.

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STEP 6: INTEGRATION
Integration is the final step on the Kubler-Ross change
model. It is the point when we integrate the change into the
normal way we do things and stop thinking of it as
something new and apart from us.
As a result of coming through change, there are many
lessons we can learn. These include the realisation that:
1. we can meet anything life throws at us
2. we can take care of ourselves
3. we don't have to control things to be successful
4. life works best when we embrace uncertainty
5. we can handle several things at once
6. life is fine even when it is messy
7. we are more resilient than we think.
"I haven't a clue as to how my story will end. But that's all
right. When you set out on a journey and night covers the
road, you don't conclude that the road has vanished. And
how else could we discover the stars?“ (Nancy Willard)

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MANAGING COMPLEX CHANGE
There are five ingredients in managing complex change.
These are: Vision, Skills, Incentive, Resources and Action
Plans. When any one of these is missing, change cannot
succeed without some form of stress.
1. (_______) Skills + Incentive + Resources + Action Plans =
Confusion
2. Vision + (_______) + Incentive + Resources + Action Plans
= Anxiety
3. Vision + Skills + (_______) + Resources + Action Plans =
Gradual Change
4. Vision + Skills + Incentive + (_______) + Action Plans =
Frustration
5. Vision + Skills + Incentive + Resources + (_______) = False
Starts
6. Vision + Skills + Incentive + Resources + Action Plans =
Successful Change

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MTL Course Topics
THAT’S
IT!
WELL DONE!

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MTL Course Topics
THANK YOU
This has been a Slide Topic from Manage Train Learn

Organisational Change

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