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This newsletter describes the beginning of the change management industry in the early 1990s.

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Cm consultant-news

  1. 1. r{,(€APTURING ABy Sco?t WhelehqnWhat is chonge rncn-ogernenf, exoctly? WhoIeods the lield & whqldoes a leading practiceIook like? In the first ofo 2-port series, CN-od-dresses fhe first gues-fion. ilexf month, weprotile s selection o!Ieoding /irms in fhetieldChonge monogemenl, con!... 2-3Here & There ...................... 4-5Morkeling ideos ..................... 6On morketing & delivery .........7Feedbock ....,,...8U7. KEH}EDYftN puslrcArrolsIttOVl NG IARGET: GHAHGE fiANAGEII,IENT"Chqnge monogement" is everywhere, qnd finding its woy into ogrowing number of consulting engogements of qll kinds. Iis receivedporticulor ottention qS.the key "soft-side" of business process reengi-neering- or whots been missing in foiled BPR work, Cleorly, os mqnyservices become commoditized, including technicol qspects ol BPR,mostery ol humon ond orgqnizotionol dynomics of chonge will provecriticoi to monogement consultings futureMore thqn semonticsToken literolly, "chonge monogement" oppeors to deline consulting,Symmetrix chqirmon George Bennett is not olone in describing oll olhis firms work qs chonge monogement. But lets be more specific: its qholistic opproqch to implementing lorge-scole chonge thot integroteson orgqnizotions strotegy ond processes with its people ond cultureHow this tokes shope in on engqgement hos qs mony voriqtions osthere ore consuliing lirms. Deltq Consulting Groups Dovid Nodler ob-serves thqt "most compqnies hove developed chqnge mqnogement qson implementqtion qrm of their core content proctice," ond it lollowsthqt chqnge mqnqgement qt o strotegy firm meons something verydilferent from chonge mqnogement of o systems firmThe chonge mqnqgement process con.begin os broodly qs strotegicvisioning ond communicqtion. It might qddress resisionce points, bothculturql ond individuql, explore methods to generote commiiment ondelicit desired behqviors, qnd qlign plonned chqnge to theorgonizotions structure ond HR systems such os opproisol ond rewqrd.Bennett feels chqnge mqnogement "hqs lots to do with mqnqging thepsychology of qn orgonizotion,qnd hence the terms qssociqiion withbehqviorol sciences. Mercer Monogement Consultings Borry Spikernotes thot "whqt is colloquiolly known qs chonge mqnqgement hos itsroots in OD (Orgqnizc.tion Development) ond sociotechnicol sysiems,wNch suggests equci qtiention to both sociql ond technicql elementsof on orgonizqtionThe morket cqllsWhy the mounting demond for chonge mqnogement consulting? Withchqnge qs q constqnt todoy, shell-shocked employees hqve under-stondobly lost their qppetite lor monogement initiqtives. Though tNsmokes implementotion of the next chonge- or the -cleonupof on oldone- more chollenging, mony CEOs qre whqt Doryl Conner of ODRcqlls -scqrredond scqred themselves from fqiled chonge, ond thusreody to listen to orgonizqtionql qnd behoviorol issues neglected in thepost. Adds OD pioneer Wqrner Burke: "Clients now use the term culturebefore I do"Conlinued on poge 2
  2. 2. r FEBRUARY I995tZ- CONSULTANTS NEWSe.}IOW CONSILTANTS ARE ADDRESSING GHANGE iTAHAGEftIEF{TContinued from poge I Consultonts onswerin on effort io sell qnd deliver more losting, systemic chonge, consult-ing firms qre responding with chonge mqnogement services thotNqdler suggests cqn be dilferentiqted olong 4 dimensions: Content ol the chonge (lT, strqiegy, etc) Client level within orgonizotionr Mognitude of chonge (incrementol vs. discontinuous)r Stqffing model (i.e., will front-line chonge ogents be from consultingor client firm?)in delivering chonge monogement services, consulting films hove or-gonized themselves in two bosic wqys:. Estsblishment of o distinct functionol proctice or skill groupDevelopment ol o smoll core ol "thought leodership" used to build Cchonge mqnqgement skills qmong multidisciplined consultontsIn qddition, we find q number of niche ployers- either smoller firmsor very smqll proctices within lorge firmsIts importont to note thot the internol orgonizqtionol model does notnecessorily represent how the firm goes to mqrket, ond moy even beinvisible to clients. (Next month, CN profiles q selected group of leod-ing chonge mqnogement consultoncies in eqch of these cotegories)Chollenges to growthPotentiol for growth in chonge monogement is cleqr ond significont,but the ideol monner in which to opprooch the mqrket is not obvious.The Deltq model of PhDs-turned-sirqtegists indicqtes q morkedly differ-ent skill set thqn thqt of the typicol MBA (ond, subsequently, the typi-col mqncgement consultqnt), Most leoding B-schools now stress "OB"courses ond reloted skills, but the overoge MBA still feels rnore com-fortoble in q closs on corporqte finonce thqn in one on corporqte cul-tureThis stqffing dilemmo is compounded by the foct thqt systemic chongeneeds to stqrt qt the top, ond credibility with CEOs, occording io Ernst& Youngs Gory Von Glinow, requires some groy hoirsThe need for experienced consultqnts with this unique skill set shouldcontinue to keep seorch lirms busy, ond niche ployers populor ocquisi- tJtion torgetsFor more on chcngemqnogement, see CNSpeciol Report/ Apr9 3:HR Aspects Criticql toSuccess in BusinessReengineering, byDcrvid Clinkenbeqrd
  3. 3. 1995 -iaN EWS ). . . AND HOW THEY IIUS? CHAilOE TO ADAPT TO ITS FUTUREThe future of chongeAndersens Terry Neill notes thqt "there is o lorge body of knowledgeobout humqn beings qnd their behqvior, but it hos tended to be in theheods ond the librories of onthropologists, sociblogists qnd psycholo-gists." Consultonts hqve now trqnsloted this knowledge into the imple-mentotion of orgonizotionol chonge, but so for hqve been generollylimited to single engogementsThe future moy lie in multiple engqgements ihot expond the scole oichonge mqnogement. Rqndy Mortin of KPMG Peqt Morwick cites oneclient currently undelgoing 35 chonge initioiives speorheoded by mul-tiple consulting firms. True systemic chonge would require some or-chestrotion of these efforts, ond Peot Morwick, Ernst & Young qnd oth-ers ospire to provide this by octing os o clientsportfolio monoger" ofchongeThe increqsed poce ond lrequency of chonge is keeping consultontsbusy, bui mony engsgements remqin reoctive in noiure. In fqct, MoryRobout of EDS feels thot the term chonge mqnqgement corries reoctiveconnototions ond prefers insteqd the notion of chonge creqtion." Theinherent odvontoge of a compqny thot could onticipote chonge ondodopt in q reol-time foshion hqs inspired firms such qs CSC Index toexplore o service thqt would creqte client c<imponies thqt were per-petuolly qmenqble to chongb -= in essence, qllow Kurt Lewinsre-freezeto creote o kinetic, or qmoebic stqteThe next buzzword?Individuql ond orgonizotionol issues qssocioted with chonge mqnqge-ment qre- in themselves- nothing new, but iheir growth in impor-tonce to manogement consulting is noteworthyNodler cqlls the trend heolthy for our economyqnd believes thqtmore effective orgonizotions hqve been the direct result, Its qlso truethot while the octuql work of reengineering to stoy, thebuzzword moy be neoring the peok of its product lifecycle. As the twoterms do shqre underpinnings of lorge-scole system chonge, perhopschonge mqnqgementis the heir oppqrentMercers Borry Spiker estimotes thqt chqnge monogement olreody oc-counts for up to 30o/o of the reengineering morket (qnd growing), ondthe news for consultonts is good: Theres so muchchongein the mor-ketploce, thqt theres room for everyoneAboui the quthor: Scott Whelehon is c groduote studeniot Columbiq University ondthis spring will receive both qn MBA qnd o Mqsters in Orgonizotionol Psychology. Heis erploring q cqreer in chonge mqnqgement. For more informqtion on his reseqrchfor this report, Scott con be reoched at212-724-6079fF.B.R.u.4By.CONSULTANTScf"r&Attention to cu]ture ondthe power oI humsnresistqnce cqn mean sIIthe ditference in creat-ing susfoin oble chonge.Lock o! o symbol for"chonge" in ChineserIlusfrirfes on importanlporodox in DarylConners book, Monog-ing ot the Speed olChonge. Coming closeslconceplually to chongeis fhe nofjon of "crisis,represenled by the coa-.binofion of two sym-bols: "dongef (dbove)sndhidden opporlu-nity(below)Watch nexl rnonfb forPgrrt Il in fhis series(L
  4. 4. MARCH I995b b Ns ir iraH ri r.i ewil=.*;ffaa*i?aE+!!ra:€-r.=:,-.:j..i:Last month CN exqrn-ined fhe booming mar-ket tor Change Manage-ment services. In thenexl 3 issues, we.lipresenl a serles ol pro-tiles ol leading playersdnd how theyre orgq-nlzedSays an Andersen com-pelitor: "They preltyrnuch own the muketIn many, mo,ny wdys-they really own it."Other tlrms mlght arguefhal fhis ls comparingtheir apples to.AndersenS entfue lruitbasketLEADIHG PI.AYERS IN CHANGE II,IANAGEII,IENTb,y Scott Whelehon signed to qddress this need, but Neillconcedes thot boloncing strength ofscole qnd flexibility is "whot mqnqg-ing portners in this orgonizotion getpoid lorErnst & YoungE&Y recently combined Orgonizo-tionol Chonge Monogement qndOrgonizotionol Alignment groups toform Business Chonge Imp)ementc-tion group of 70 core "speciolists- inU.S. & supporting cost ol up to 500consultonts. Orgcnizotioncl Align-ment brings competencies in chongeenoblers such os performonce mon-cgement & reword. E&Ys Center forBuSiness Innovotion in Boston doesreseorch oround issues such oschange monqgement, ond though itdoesnt coll itsell think tqnk, its qnintellectuol tesource ior E&Ys consult-qnts & clients€oopers & LybrondCoopers hos Chonge MonogementServices proctice of ol-out 35 procti-tioners bosed in Woshington DC ondcurrently present of 30-40% of en-gogementsIn addition, in93, Coopers purchosedBoston-bqsed Horbrid.qe House (65pros, including 50 doitrg chongework), now port oI C&Ls Humon Re-source Advisory grot- p. HorbridgeHouse- with reputqtjcn lor imple-mentotion, troining qnd executivedevelopment - hqd in post offeredchonge mcnqgement qs q distinctservice, but Monaging Principsl ErnieGlickmon now lqbels itthe umbrellothot links everything we do,Since HRAdvisory proctice is seporote fromC&L Consulting, discussions ore ongo-ing to build synergies ond ovoid over-lop with C&L Consultings chongeprocticeWe Iind 2 bosic models for chongemonogement proctices omong lorgeconsulting firms: firms with distinctfunctionql proctices or skill groups,and firms with o smoll core ol"thought leodership used to buildchonge skills qmong multidisciplinedconsultonts. In oddition, we lindmony niche ployers- smqller iirmsor smoll proctices within lorge firms(Note: Internol structure does notnecessorily represent how lirms go tomorket, ond moy even be invisibleto clients)This month, we describe lirms in thelirst_cotegory: lorge-lirm procticeswithilistinCt tijncti6noi groripi:(weltlook of the two other cotegories inApril & Moy)Andersen ConsultingWith neqrly 2,000 chonge mqnoge-ment consultqnts worldwide, onnuqlgrowth of 3O%-plus.:ond presence qt30-40% of firms mojor engagements,Andersens chonge monogementproctice is mqrkets 8OO-pound go-rillo (one exomple: Current $60M jobcontoins 25% chonge moncgement).Andersens Chonge MonogementServices (CMS)- unlike most com-petitor groups- hos historicollybeen qssocioted with lorge numbersol junior consultqnts engaged in sys-tems troining. But Andersen is olsobuilding competencies to monogebroqder orgonizotionql issues of se-nior executive level, To reflect thisdirection,Services designotion hosbeen dropped from groups nqmeWorld prcctice leqder Terry Neilllikens morket potentiol of chongemqncgement to thot of systems in70s, qnd feels thqt despite goodideqs, mqnqgers qre olten over-whelmed by scole of chcnge..Andersens stoffing model is de-t/a-l
  5. 5. MARCH r995 Etbilsir rrnNrsr.iews J,n(=,Price WoterhouseAccording to PW, chonge moncge-ment describes its entire Chcnge In-tegrotion (Ci) prcctice. which qlso hoso speciiic organizotion chonge & eI-fectiveness component to accompqnystrotegy ond process redesign. ColinPrice hos grown U.S. orgonizotionchonge group to 84 consultonts (therecre severol hundred worldwide) sinceorrivol from PWs London proctice oyeqr ogo. Within CI, orgonizctionchongei grg.qp gqqresses orgonizotionaesigri,cr.4ljriiechonge & technologyossimilotionlCI Drqctice ond method-orogifjd:;11iti"o itt book entitled Bet-ter Cbonge.;:.gppqgrs well-rggorded"o"11:+9,Y:tryColin_Bric-eligirols PWs oggressivestqnce _Dy scying morket lor orgcnizc-tion chqnqe :is there to be token:.--;ri:+ii.j_::r:. _: .._ .-KPMG Pddt Morwicktnoughbhtinge monogement is nowdesigmoted. acore skill setIor qllKPMG consultonts, qctuol chongework is done by U.S. teqm of qbout 15with behqviorql bockgrounds (thereore 100 worldwide), Group hqs devel-oped globolly consistent fromeworkthqt focuses on people snd orgcnizo-tion bsrriers, Soys prcctice mqncgerRondy Mqrtin, KPMG seeksto moin-toin o core of highly speciolized,highly volue-qdded people qimed otentering client orgonizotion of highestlevelCSC lndexBorn cs bridge between humqns &mochines, CSC Index has olwoys od-dressed humon dimension, but not qsseporote service. Index reengineeringteoms lreguently contqin chongemqnqgementspeciolist, qnd skill setis one of 4 oround which consultqntsore grouped (others ore strotegy,technology, operations). Index envi-sions cutting-edge chonge monoge-ment service os one thot creotesodoptobility rother thon odoptoiion-not shilting geors, but putting in otronsmission, exploins CSCs AlonCohen. CSC recently ocquiredDiBionco-Berkman (20-30 consuit-qnts) to explore deePer issues olchonge leodership & trqnsformotionGemini ConsultingGemini describes chonge monoge-ment os so pervosive in its culturethqt relevqnt concepts oreembed-dedin every engogement. EllenHqrt qlso heods up distinct discipline- Orgonization ond MonogementDevelopment (OMD)- chorged withkeeping on eye on the horizon olthis evolving field ond diggingdeeper into behoviorol issuesEDSHeoded by recent Gemini olum MorYRqbout, EDS Monogement ConsultingServices (MCS) hos built chongeproctice of obout 40 core proctitio-ners. In oddition, relevont supportIrom elsewhere in EDS is ovoilqble inIorm of systems troiners, etc., thoughMCS mointoins its own P&LSymmetrixGeor(re Bennett believes thot osmucir ss 50% ol effort monoging onengogement should be in moPPingclients psychologicol londscoPe,likening plcnning process to militorystrotegy. Phqses of Symmetrix en-gogement- qim, discover, dePloY- oreencqsed in this psychologicolplon. Firms 130 consultonts qreevenly grouped into four skill boses:strotegy, operotions, systems ondorganizotionql effectiveness, Lqtterboosts OD qnd humon resource-reloted copcbilities, qnd oll 4 qrerepresented on engogement teqmAbout the quthor: ScottWhelehan is o graduatestudent qt Columbiq Uni-versity ond this spring wilireceive both on MBA qndc Mqsters in Orgcnizo-tionol Psychology. He isexploring q coreer inchonge monogement. Formore informqtion on hisreseqrch for this report,Scott cqn be reoched ot2t2-724-607 9