Report on Kotter's Change Model


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Report on Kotter's Change Management Model

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Report on Kotter's Change Model

  1. 1. European Masters in Project ManagementChange Management ModelsKotter’s 8 step change ModelAuthor: Ujjwal Kumar JoshiDate: May 20, 2013
  2. 2. Table of ContentsIntroduction to change management----------------------------------------------------------------------------------------------1Kotter’s 8 step Change Model -------------------------------------------------------------------------------------------------------2Create a Sense of Urgency --------------------------------------------------------------------------------------------------------4Form a Powerful guiding Coalition ----------------------------------------------------------------------------------------------4Create a Change Vision-------------------------------------------------------------------------------------------------------------5Communicate and share the vision ---------------------------------------------------------------------------------------------6Enable Action-------------------------------------------------------------------------------------------------------------------------6Create Short-term Wins------------------------------------------------------------------------------------------------------------7Do not Let up -------------------------------------------------------------------------------------------------------------------------8Make It Stick --------------------------------------------------------------------------------------------------------------------------9Benefits of Kotter’s model------------------------------------------------------------------------------------------------------------9Limitations of Kotter’s model------------------------------------------------------------------------------------------------------ 10Application of Kotter’s model------------------------------------------------------------------------------------------------------ 11Conclusion------------------------------------------------------------------------------------------------------------------------------ 12References------------------------------------------------------------------------------------------------------------------------------ 13
  3. 3. 1Introduction to change managementThe term “Change Management” is a way to describe the approach that the organization uses to applycontrol over the changes that are either planned or unplanned. Change occurs continually, whetherbeneficial or not so beneficial for the business organization, but the organization has to tackle with thosechanging situations. The way how the organization tackles with those changing situations determines thesuccess and failure of the organization. Moreover, in today’s competitive business world, all the business orstrategic processes of any organization requires changes in order to meet the growing customer’s demandso, change management is one of the major issue for the business organizations.Change Management in the organization is defined as “ongoing adjustment of the corporate strategies andstructures to cope up with the changing organizational objectives”. According to the Change ManagementLearning Center, a direct correlation exists between managing change and the success of the project or thebusiness. As stated in the above paragraph that the changes should be dealt properly, all the businesscompanies tackle the changes by using various change management models. But, among the lists of ChangeManagement Models, following are the most renowned models most of the companies rely upon:1. Lewin’s Change Management Model2. McKinsey 7-S Model3. Kotter’s 8 Step Change Model.Change Management plays an important role in any organization since the task of managing change is not aneasy one. Managing change refers to “making a change in a systematic and planned way“. Changes in theorganization or a project can be initiated from within the organization or externally. For example, if aproduct is popular among the customers may undergo a change in design based on the triggering factor likea competitive product from some other manufacturer. This is an example of external factor that triggers achange within the organization. Managing these changes come under change management.The change process could also be considered as a problem solving situation. The change that is taking placecould be the result of a problem that has occurred. Problem is a situation that requires some action to betaken positively to handle that situation. The change process could be considered as a problem solvingaction for a particular situation.Hence, change management plays an important role in an organization. In order to successfully react towindows of opportunity, regardless of the focus — innovation, growth, culture, cost structure, technology —a new methodology of change leadership is required.Organizational change occurs when a company makes a transition from its current state to some desiredfuture state. Managing organizational change is the process of planning and implementing change inorganizations in such a way as to minimize employee resistance and cost to the organization whilesimultaneously maximizing the effectiveness of the change effort.
  4. 4. 2In order to manage and accept the change, the situation must be handled properly by using various Changemanagement Models. Here, we are going to describe the Kotter’s 8 Step Change Model.Kotter’s 8 step Change ModelDuring the 1990’s, John Kotter, a professor at Harvard Business School and world-renowned change expert,studied the progress of over 100 companies who were trying to “remake” themselves. He found that therewere some general lessons that could be learned about managing change, and in particular how to avoid bigerrors. Kotter introduced his findings in his book “Leading Change” in 1995 in 8 steps for leading change.He investigated over 100 companies trying to make fundamental changes to cope up with a new andchallenging market environment including small and large organizations from Ford and British Airways toLandmark communication. Among these companies, some were successful and some failed. Dr. John Kotterdetermined that the change process involves series of phases that requires a considerable amount of time.Thirty years of research by leadership expert Dr. John Kotter have proven that 70% of all major changeefforts in organizations fail. He found out the reason for the failure of the organization to adapt the change.It is because the organizations often do not take the holistic approach required to see the change through.Thus, Kotter identified eight stages of changes that for managing the change from which a company can besuccessful and can achieve lasting sustainable change and business improvements. Hence, this model causeschange to become a campaign for the change management in the business companies. Apart from these 8steps, Kotter also identified corresponding possible pitfalls for each stage that can spoil the entire changeproject. The 8-steps for Kotter’s Change Model are as follows:1. Establish a sense of urgency2. Form a powerful guiding coalition3. Create a vision4. Communicate and share that vision5. Empower others to act on thevision6. Plan for and create short-term wins7. Consolidate improvements andkeep the momentum for changemoving8. Institutionalizing new practicesFig. Kotter’s 8 Steps Change ModelMake it stickDon’t Let-upCreate short-term winsEnable actionCommunication for buy-inCreate VisionBuild guiding teamsIncrease urgencyImplementing &Sustaining thechangeEngaging &enabling theorganizationCreating a climatefor change
  5. 5. 3Kotter asserts that all of these stages must be worked through in order and to completion. Skipping even asingle step or getting too far ahead during the process of managing changing situation without a solid basealmost always creates problems in the business organization. According to Kotter, “Skipping even a singlestep may lead to a huge disaster for a company”. Hence, in the table below, Dr. Kotter had given a relativesuggestion in according to the steps for the change management:Table 1. John Kotters 8 Change Step ProcessesJohn Kotters 8 Step ProcessSteps Transformation Suggestions1. Increase urgency  Examine market and competitive realities Identify and discuss crisis, potential crisis, or major opportunities Provide evidence from outside the organization that change isnecessary2. Build the Guiding Team  Assemble a group with enough power to lead the change effort Attract key change leaders by showing enthusiasm andcommitment Encourage the group to work together as a team3. Create Vision  Create a vision to help direct the change effort Develop strategies for achieving that vision4. Communicate for Buy-in  Build alignment and engagement through stories Use every vehicle possible to communicate the new vision andstrategies Keep communication simple and heartfelt Teach new behaviors by the example of the guiding coalition5. Empowering or enableAction Remove obstacles to the change Change systems and / or structures that work against the vision6. Create short term wins  Plan for and achieve visible performance improvements Recognize and reward those involved in bringing theimprovements to life7. Do Not Let Up  Plan for and create visible performance improvements Recognize and reward personnel involved in the improvements Reinforce the behaviors shown that led to the improvements8. Make Change Stick  Articulate the connections between the new behaviors andcorporate successSource:
  6. 6. 4Let us describe the eight steps involved in the Kotter’s 8 step change model briefly along with the possibletransformation suggestions and the strategies that could be adopted for the business success below:Create a Sense of UrgencyThe first step for the change process is to make a plan and take action in order to initiate for the requiredchanges. The proposal for the change process should be accepted by the employees and should agree tostep out of their comfort zones for the realization of change.Mostly, the task of creating an alert situation seems to be quite difficult because it should be motivating, andbooming the circumstances of the organization with an ultimate situation of maximum participation. It ismandatory to have 75% agreed support to start this progressive task with mutual understanding among theemployees.Leaders who understand the importance of a sense of urgency are good at taking the pulse of theircompany. It is important to determine the state of the organization in order to adapt the change procedurefor efficiency and effectiveness of the organization. Complacency –It is a state where people fail to react to signs that action must be taken False urgency -It is a state of doing unproductive actions leading towards unproductive results, andeventually, burnout. True urgency –It is a state of believing in the benefits of the change.After determining the state of the organization we can create a buzz for the change as per the expectationand requirement of the change user and developer.Strategies to create the alert are as follows: Explaining and Realizing the benefit of the change Creating and developing opportunities for the user Clear communication and information procedure Convincing the major supporting groups and motivating them. Value creating and inspiring proposal for the change.Form a Powerful guiding CoalitionChange is one of the most difficult tasks which are needed to be governed by the special force of committeewho can handle it smoothly within the right time and with the expected values. There are different activitiessuch as developing vision, communicating with required stakeholder, eliminating the key obstacles,generating short term wins, leading and managing dozens of change projects, and many more in anorganization. This activity is done with the equal participation of different experts who can manage it withhigh productivity as per their professionalism.
  7. 7. 5So, in order to get an effective outcome we should form a powerful coalition which must have the rightcomposition, a significant level of trust, and a shared objective.It is essential that the team develop a level of trust in one another. This is the reason that makes the teamfunction well. Constructing the right team and then combining a level of trust with a shared goal in which theteam believes can result in a guiding coalition that has the capacity to make needed change.Strategy in forming the Powerful Guiding coalition: The team as a whole should reflect enough Power so that those left out cannot block progress. All relevant viewpoints should be represented so that informed intelligent decisions can be madewith strong trust and commitment. The group should be seen and respected by those in the firm so that the group can enhance theircredibility. Recognize the opportunities and build the capacity of leading the change.Create a Change VisionA clearly stated vision gives an appropriate feel of understanding the reason for the entire change. Itsimplifies hundreds or thousands of more detailed decisions. This is done to empower the employees and tomotivate them to take action in the right direction. Vision helps to coordinate the actions of different peoplewith increased efficiency and productivity.Vision comprises of strategies, plans and budgets that are necessary to create a better future for all of theenterprise’s stakeholders. To be effective, a vision must take into account the current realities of theenterprise, but also set goals that are achievable. It is preferable to develop the precise goals with theconstraints of time and budget that can add the value for the organization.Leader should be conscious that the developed vision is capable enough provide real guidance. It must befocused, flexible and easy to communicate.Strategy to develop the change vision: They convey a clear picture of what the future will look like and should be imaginable Stakeholders should show interest with high desirability The goal should be realistic and attainable for the vision It should be focused and proper enough for providing guidelines for decision making process. Vision should be flexible with the space of expansion as per requirement. They should be easy to communicate and can be explained quickly.
  8. 8. 6Communicate and share the visionDeveloping vision is not enough to success the change process in the organization. It is necessary to followthe vision with enough communication among the required members. To be effective, the vision must becommunicated in hour-by-hour activities. The vision will be referred to in emails, in meetings, inpresentations – it will be communicated anywhere and everywhere.Frequently discussed vision creates positive attitude and clear understanding to choose the correct directionamong the team members .Executives will use every effective communication channel possible to broadcastthe vision.Strategy for effective communication of the vision: Communication should be done in simple and formal language which should be understandable andusable. It should be vivid using verbal pictures which is more worthy than a thousand words – use metaphor,analogy, and example. Ideas should be able to be spread by anyone to anyone because there are various parties to whom itshould be repeated again and again. Two-way communication is always more powerful than one-way communicationEnable ActionIn this step, the senior leadership and the guiding coalition, means a guiding team, turns their attention inthe mitigation of the obstacles that do not support the change vision. The senior leadership and the guidingcoalition need an accurate understanding of the organizational barriers that hinders the implementation forthe change process in the organization. The members of the guiding coalition must understand the pre-requisite required to implement the change. Thus, with the continuous communication between the otherstakeholders and the guiding coalition, the obstacle that hinders the change effort can be identified andthus, mitigated. Hence, the organizational processes and structures, procedures and reward system need tobe aligned with the change vision as such Incentives have a profound effect on the capability to achieve thechange vision.Empowering Action also involves the investment in the employee for their managerial training anddevelopment. It is natural that human beings resist change. Employee and managers can actively orpassively resist change but resistance to change is not predictable. These training and other developmentactivities not only develop the skills and abilities of the employees required for the change, but it alsoprovide assistance that the change is the best interest of the employees and the managers. Consequently,they can adjust the organizational training and other developmental activities and reward system of theorganization to align with the attitudes, skills, abilities and the behavior that are the crucial ingredients forthe change.
  9. 9. 7Strategies for empowering change action are given below: Hire change leaders to deliver results on the vision Gain consistent feedback, recognize and reward people for the implementation of change. Determine the compatibility of the change vision with the organizational structure, performance andother functionalities of the organization. Immediate action to remove obstacles that block the change.Despite these efforts, however, there will be some people, who resist change, even at the manageriallevel. These people must be informed to the senior managerial level. Then, the senior managerial leveltries to know the reasons for the resistance and if it is logical, the manager, senior managerial level andthe entire guiding coalition conducts a discussion and chooses the best alternative. Thus, the seniormanagerial level involves all the people involved in the change process within the organization.Create Short-term WinsA short-term win can be defined as an effective organizational improvement that can be achieved within 6 to18 months. A short-term win must meet following criteria: Its success must be unambiguous It should be visible throughout the organization It should be related with the change effort.Generally, the short-term wins are necessary to prevent the loss of momentum and to keep the organizationengaged in the change activities. In the practical world, implementing a major change takes a huge period oftime. Realizing these changes is a challenge. Hence, the senior managerial level and the guiding coalition usethe short-term wins so as to discourage the organizational discouragement with the slow pace to implementmajor change, means the short-term wins serves the employee and the managers to follow the vision andthe strategies of the organization.Similarly, the short-term wins have the ability to gain the support from the organization that shows thevalidity of the change vision. Finally, short-term wins have a way of building momentum that turns neutralpeople into supporters, and unenthusiastic supporters into active helpers.Strategies in order to create short-term wins are as follows: Implement only small changes whose result can be obtained quickly. Select cost effective targets that can be easily obtained. Analyze targets to avoid failure- use pros and cons to determine early target success. Recognize the people who help to meet the targets through the rewards.
  10. 10. 8Do not Let upUp to this stage, the organization develops many processes, internal connections and other several inter-departmental procedures or inter-dependencies as John Kotter states in his book. With the running time,however, some dependencies are no longer necessary. It requires patience to the stakeholders to know thatthe time for such inter-dependencies has passed. Moreover, it also requires involvement of seniorleadership. The senior leadership must keep the urgency level high to effect the change using theorganizational power and the lower level managers must work with the guiding coalition to identify andremove the unnecessary dependencies and bring the change project to the position as it is expected.The following quotes from Dr. John Kotter’s book, “Leading Change”, discuss the forms of the continuingresistances for the important change efforts:“Irrational and political resistance to change never fully dissipates. Even if you’re successful in theearly stages of a transformation, you often don’t win over the self centered manager who isappalled when reorganization encroaches on his turf, or the narrowly focused engineer who can’tfathom why you want to spend so much time worrying about customers, or the stone-heartedfinance executive who thinks empowering employees is ridiculous.”This quote reflects that in reality it is really difficult for the organizational change. The resistance for thechange may go underground because of the continuous involvement of the senior leadership, but normally itnever disappears completely. Nevertheless, the senior leadership should promote and develop the existingemployees and hire other employees whenever required. The changes process moves forward as it gets theopportunity. That is why, the short-wins achieved and implementing more changes are the powerful strategyto encounter these Irrational and political resistance.According to the John Kotter, following are the outcomes by this step in a successful major change initiative: More projects being added Additional people being brought in to help with the changes Senior leadership focused on giving clarity to an aligned vision and shared purpose Employees empowered at all levels to lead projects Reduced interdependencies between areas Constant effort to keep urgency high Consistent show of proof that the new way is workingStrategies to build the change in the organization are as follows: After successful implementation of the change in the organization, analyze what worked and whatdid not. Develop new goals to maintain and continue the change growth in the organization.
  11. 11. 9Make It StickThe 8thstep outlined by the Dr. Kotter is a critical activity to make sure that the new changes that theorganization has achieved are still continuing. This step anchors the change in the entire organizationalculture. The senior leadership must anchor the change by analyzing the superiority of the new changes andtheir benefits to the organization. Senior leadership must work with the guiding coalition and other manageron the following: Identifying the norms and values that support the changes. Ensuring selection, promotion and succession processes according to the new norms and valuesof the organization. Modify the reward system aligned with the new norms and values of organization. Provide trainings and development activities to fulfill the skills and competencies associated withthe changes. Modify and eliminate organizational processes and procedure that does not support thechanges.Strategies to stick the changes to the organizational daily processes and activities are as follows: Conduct a discussion program with the employees about the progress timely. Explain the importance of change ideals and values when hiring the people and conducting thetrainings. Develop new policies and processes that reinforce the value of change.Benefits of Kotter’s modelAccording to the Kotter’s Change Model, companies have to convince the employees to tackle with thechanges in order to survive in the market. Various team building methods must be conducted and all theprocesses that undergoes, must be aligned with the proper communication modes between the entities ofthe organization. Furthermore, the change vision must be developed and shared with the employees of theorganization. Similarly, the skill developing techniques must be conducted to ensure that the employees areable to deal with the change activities. An entire change process must be divided into smaller parts tomaintain the dedication of the employees to that change. Finally, these changes must be made permanentby fitting the change activities into the company’s culture and practices.Following are the benefits of the Kotter’s 8 step change model: It is a step by step model, which is easy to follow. It does not focus on the change itself, but rather the acceptance and preparedness for the change,which makes the changes easier for the transition in the organizational culture.
  12. 12. 10 It acts as an Organizational development tool by providing three-dimensional linkage betweenindividual employee, team and the organization It provides a platform to reveal the importance of the stakeholder, leadership, employees in theorganizational level. Kotter’s model helps to deal with cultural changes, thus helping large and small organization toperform well in new environment. (Step 8)Thus, Kotter’s 8 step change model helps organization to be prepared for the changing situations. Accordingto this model, people are the major asset for any business organization because it describes the importanceof the stakeholders, leadership and employees for the organization. Moreover, Kotter’s model develops thechanging situations into a success by acting as a three-dimensional linkage tool for organizationaldevelopment.Limitations of Kotter’s modelKotter’s 8 step model was fully elaborated to address “fundamental changes in how the business isconducted in order to cope with a new and challenging market environment”. This statement implicitlystates a framework in which the model is applicable; therefore, it is not expected to be applicable to all typesof change. Following are the conditions where the model might fail without the modifications: A rigid approachKotter argues that the steps in the model should be followed in sequence. If any of the steps is missed, theimplementation of the change is not worth and if the process has started, it is difficult to change thedirection of the project. But, in real life, the steps may be combined or somehow reviewed for the fluentchange management. Some steps are not relevant in some contextsThe linearity of the model can lead to the wrong assumptions. There might be some transformations in theorganization that does not require nor are able to go through certain steps. For example, if there is a changewith need for a great deal of secrecy. Steps 1 and 4 will be completely discarded. Dealing with difficulties during the change managementOrganization may undergo through several difficulties while implementing change. The planning of changesaccording to the Kotter’s Model should limit the obstacles. The model is not detailed enough to provideinformation in all scenarios. For example, Resistance to change and commitment to change are majoraspects of change management and complementary components outside Kotter’s model.
  13. 13. 11Application of Kotter’s modelJohn P. Kotter is internationally celebrated researcher and has authored eighteen books, whereby twelve ofthem are bestsellers. His theory about the change management as a model was accepted in differentorganization in an easy way because of the clear distinction of different steps.Along with clear steps, Kotter’s model has managed to distinguish between the role of manager and leaderand their related function to adopt change in their organization. In his theory, he divided the functions intogroups for managers and leaders respectively in the context of an organization.It is necessary for the project managers to get an understanding of which factors are most relevant todevelop for creating a successful project. There is large number of researches made in the field of managersand leaders in organizations and what functions are important to create a successful and profitableorganization. Projects comprises of various function like motivating, budgeting, planning and so on. Thesefunctions are important qualities to be a successful leader of the project organization.There are some basic ideas suggested by Kotter to differentiate between managers and leaders with theirrespective functions for the change procedure are as follows:Managers Set objectives (communicating these to people within the organization) Organize (staffing, divide tasks and activities among the subordinates) Motivate (give incentives and reward by using the promotion policy of the organization) Make measurements (measure both individuals and the organization) Develop people (encourage and educate)Leaders Motivating and inspiring: The leader is always promising to motivate their employees to generatethe effective result with high productivity. Recognition and rewards always encourage employeesand gives a transparent result to the organization. Leader should manage to keep moving their co-workers towards success. Aligning people: The leader communicates the direction to those who is needed to alignment, sothey understand the vision and later on wants to achieve the vision. Establish a direction: The leader establishes vision, mission and strategies in order to show the trackto his co-workers to achieve their desired objectives within the required time-frame.
  14. 14. 12ConclusionThe John Kotters teachings are now accepted by many organizations: the CEO must lead the change; theentire organization must be involved; and the organizational culture must be taken into account before anymajor change. On the basis of these teachings, he has developed 8 step change model, which is presented inaction points arranged in a practical sequence. The model is sensitive and relatively easy to accept since it isbased upon the practical experiences of John Kotter and so, is well presented with the appropriateexamples.According to Kotter, successful change leaders find a problem or a solution to a problem and then engagethe people and compel them to change the behavior according to situation. They recommend a people-driven approach that helps people to see the reason for change.Furthermore, Kotter has deeply analyzed the functions of the managers and leaders in an organization thatacts as a guide in today’s business to achieve the business success. In today’s changing world, everyorganization needs to enhance strategies to meet the globally changing demands. The organizations havetrained their managers in change process models to offer effective assistance in providing information todesign synchronized development intercession for leadership, employees and organization stakeholders.Hence, the above mentioned 8-Steps processes outlined by Dr. Kotter shows that the organizations canavoid failure and adapt to the change from the employees. Changes will not be successful it the employeesare reluctant to the change. Thus, by arising the willingness for the change and improving their ability tochange, organizations can increase their chances of success, both today and in the coming future. Withoutthis ability to adapt the continuous change, organizations cannot boom or succeed.
  15. 15. 13References, J. (2007). Leading change: Why transformation efforts fail. Harvard Business Review, 1-10. Retrieved