Change Mangt

R Srinivasan: Business Process ReengineeringR Srinivasan: Business Process ReengineeringCopyright © 2011 Tata McGraw-Hill EducationCopyright © 2011 Tata McGraw-Hill Education

BUSINESS

PROCESS

REENGINEERING


Chapter 16Chapter 16Change ManagementChange Management


IntroductionIntroduction Change Management is a set of processes that is Change Management is a set of processes that is

incorporated to ensure that significant changes are incorporated to ensure that significant changes are implemented in a systematic and controlled way to implemented in a systematic and controlled way to effect organizational change. effect organizational change.

The main goal of the change management is to reduce The main goal of the change management is to reduce the risk associated with the implementation of change in the risk associated with the implementation of change in the business environment. the business environment.

The other fundamental goal of the change management The other fundamental goal of the change management is rapid recovery of change-related problems when is rapid recovery of change-related problems when changes are implemented.changes are implemented.

Effective change management achieves these goals Effective change management achieves these goals without compromising the values of business.without compromising the values of business.


Importance ofImportance ofChange ManagementChange Management

Identification of changes in the organization or a Identification of changes in the organization or a project can be initiated from within the project can be initiated from within the organization or externally. How the organization organization or externally. How the organization responds to these changes is what that is more responds to these changes is what that is more important.important.

When organizations have more than one process When organizations have more than one process running in parallel or series fashion, there are running in parallel or series fashion, there are changes of changes made in one process to reflect changes of changes made in one process to reflect in another. To implement changes in these in another. To implement changes in these environments is not an easy task. environments is not an easy task.

So a systematic and structured approach is So a systematic and structured approach is necessary in change management.necessary in change management.


Broad skill set like political, analytical, business Broad skill set like political, analytical, business etc are required while managing the changes in etc are required while managing the changes in an organization.an organization.

Operations and systems in the organization Operations and systems in the organization should be reconfigured in such a manner that should be reconfigured in such a manner that organizations get the desired financial impact.organizations get the desired financial impact.

Change management considers all aspects of the Change management considers all aspects of the organization before implementing the change. So organization before implementing the change. So it plays a vital role in the success of any business. it plays a vital role in the success of any business.

Importance ofImportance ofChange Management (Change Management (Contd…)Contd…)


Action Plan forAction Plan forChange ManagementChange Management

There is increasing emphasis on the need to tailor There is increasing emphasis on the need to tailor change management strategies to the business change management strategies to the business entities of the organization and its environment entities of the organization and its environment and to address all aspects of the organization and to address all aspects of the organization during implementation of change. during implementation of change.

Effective change management requires not only Effective change management requires not only skilled management but also effective leadership skilled management but also effective leadership and broad employee engagement and and broad employee engagement and participation.participation.

Process and values which are the key factors of Process and values which are the key factors of any business can become the restrictive factor any business can become the restrictive factor while implementing the changes.while implementing the changes.


So when an organization needs new processes and So when an organization needs new processes and values, it must create a new organizational space values, it must create a new organizational space where those capabilities can be developed in several where those capabilities can be developed in several ways. They are:ways. They are:

– Creating new organizational structures within the Creating new organizational structures within the corporate boundaries where new processes can be corporate boundaries where new processes can be developeddeveloped

– Spinning out an independent organization from the Spinning out an independent organization from the existing organizationexisting organization

– Acquiring a different organization whose processes Acquiring a different organization whose processes and values closely match the requirements of the and values closely match the requirements of the new tasknew task

Action Plan forAction Plan forChange Management (Change Management (Contd…)Contd…)


Prosci’s Change Management Prosci’s Change Management ApproachApproach

Prosci is the recognized leader in change Prosci is the recognized leader in change management research.management research.

It has developed a change management model It has developed a change management model which it claims to be research based and which it claims to be research based and holistic in approach.holistic in approach.

For addressing issues related to change For addressing issues related to change management, Prosci makes use of ADKAR management, Prosci makes use of ADKAR (Awareness, Desire, Knowledge, Ability, (Awareness, Desire, Knowledge, Ability, Reinforcement) model which allows Reinforcement) model which allows organizations to focus their activities on specific organizations to focus their activities on specific business results. business results.

For more information, readers can visit Prosci’s For more information, readers can visit Prosci’s website, www.prosci.com.website, www.prosci.com.


Prosci’s Change Management ApproachProsci’s Change Management Approach


Level 1 – Ad hoc or AbsentLevel 1 – Ad hoc or Absent Project leadership is focused only on the Project leadership is focused only on the “concrete” or “concrete” or

tangible aspectstangible aspects of the project including funding, schedule of the project including funding, schedule & issue tracking& issue tracking

Communications from the project are on a Communications from the project are on a ‘need to know’ ‘need to know’ basis basis only and typically infrequent.only and typically infrequent.

Employees find out about the change first Employees find out about the change first through rumors through rumors and gossipand gossip rather than structured presentations. rather than structured presentations.

Executive support is in the background as evident through Executive support is in the background as evident through funding authorization and resource allocation, but funding authorization and resource allocation, but active and active and visible sponsorship is not presentvisible sponsorship is not present..

Supervisors and managers have little or no information Supervisors and managers have little or no information about the changeabout the change, and have no change management skills , and have no change management skills to coach their employees through the change process.to coach their employees through the change process.

Employees react to change with surpriseEmployees react to change with surprise; resistance can ; resistance can be widespread.be widespread.

Productivity slows and turnover increasesProductivity slows and turnover increases as the change as the change nears full implementation.nears full implementation.


When is change management used on When is change management used on a project at this level?a project at this level?

Change management is applied on a project at this Change management is applied on a project at this level only as a level only as a last resort last resort when employee resistance when employee resistance jeopardizes the success of the project.jeopardizes the success of the project.


Level 2 – Isolated ProjectsLevel 2 – Isolated Projects

A A large variation of change management practices exists large variation of change management practices exists between projects with many different change management between projects with many different change management approaches applied sporadically throughout the organizationapproaches applied sporadically throughout the organization

Elements of communication planning are evidentElements of communication planning are evident, but , but there is little sponsorship or coaching as part of change there is little sponsorship or coaching as part of change management.management.

Managers and supervisors have Managers and supervisors have no formal change no formal change management trainingmanagement training to coach their employees through the to coach their employees through the change process.change process.

Change management is typically Change management is typically used in response to a used in response to a negative eventnegative event..

Little interaction occurs between the isolated project Little interaction occurs between the isolated project teams teams using change management; each new project “re-using change management; each new project “re-learns” the basic change management skills.learns” the basic change management skills.


When is change management used on a project?When is change management used on a project?

Change management is applied on a project when Change management is applied on a project when resistance emerges or when the project nears resistance emerges or when the project nears implementation with only isolated projects using implementation with only isolated projects using change management at the beginning of their project. change management at the beginning of their project.


Level 3 – Multiple ProjectsLevel 3 – Multiple Projects Structured change management processes Structured change management processes are being are being

used across multiple projects; used across multiple projects; multiple approaches and methodologiesmultiple approaches and methodologies are being are being

utilized.utilized. Some elements of knowledge sharing emerge Some elements of knowledge sharing emerge between between

teams in the organization; experiences are shared between teams in the organization; experiences are shared between teams in some departments or divisions.teams in some departments or divisions.

While change management is applied more frequently, While change management is applied more frequently, no no organizational standards or requirements existorganizational standards or requirements exist; pockets ; pockets of excellence in change management co-exist with projects of excellence in change management co-exist with projects that use no change management.that use no change management.

Senior leadership takes on a more active role, but Senior leadership takes on a more active role, but no formal no formal company-wide program existscompany-wide program exists to train project leaders, to train project leaders, managers or coaches on change management.managers or coaches on change management.

Training and tools become available Training and tools become available to project leaders to project leaders and team members; managers are provided with training and and team members; managers are provided with training and tools to coach front-line employees in future changes.tools to coach front-line employees in future changes.


When is change management used on a project?When is change management used on a project? Change management is initiated at the start of some Change management is initiated at the start of some

projects, with a large fraction still applying change projects, with a large fraction still applying change management as a reaction to employee resistance management as a reaction to employee resistance during implementation.during implementation.


Level 4 – Organizational StandardsLevel 4 – Organizational Standards There is an There is an enterprise-wide acknowledgement enterprise-wide acknowledgement of what of what

change management is and why it is important to project change management is and why it is important to project success.success.

A A common change management methodology common change management methodology has been has been selected and plans are developed for introducing the selected and plans are developed for introducing the methodology into the organization.methodology into the organization.

Training and tools are availableTraining and tools are available for executives, project for executives, project teams, change leaders, managers and supervisors. teams, change leaders, managers and supervisors.

Executives assume the role of change sponsors Executives assume the role of change sponsors on every on every new project and are active and visible sponsors of change.new project and are active and visible sponsors of change.

Resistance and non-compliance is expected in Resistance and non-compliance is expected in isolated isolated instancesinstances. .

Adoption is not yet at 100% Adoption is not yet at 100% and the organization is in the and the organization is in the process of building change management skills throughout the process of building change management skills throughout the organization.organization.


When is change management used on a project?When is change management used on a project? At Level 4 teams regularly use a change management At Level 4 teams regularly use a change management

approach from the beginning of their project. approach from the beginning of their project. Change management work begins at the planning Change management work begins at the planning

phase of the project.phase of the project.


Level 5 – Organizational CompetencyLevel 5 – Organizational Competency Effectively managing change Effectively managing change is an explicitly stated is an explicitly stated

strategic goal, and executives have made this a priority. strategic goal, and executives have made this a priority. Employees across the enterprise Employees across the enterprise understand change understand change

managementmanagement, why it is important to project success and how , why it is important to project success and how they play a role in making change successful. they play a role in making change successful.

Change management is second nature Change management is second nature – it is so – it is so commonplace that it is nearly inseparable from the initiatives. commonplace that it is nearly inseparable from the initiatives.

Managers and supervisors routinely use change management Managers and supervisors routinely use change management techniques to help support a broad range of initiatives from techniques to help support a broad range of initiatives from strategy changes to individual employee improvement. strategy changes to individual employee improvement.

Extensive training exists Extensive training exists at all levels of the organization. at all levels of the organization. Higher ROI, lower productivity loss and less employee Higher ROI, lower productivity loss and less employee resistance are evident across the organization. resistance are evident across the organization.


When and how is change When and how is change management used on a project?management used on a project?

Change management begins before projects begin.Change management begins before projects begin.


McKinsey's 7 S ModelMcKinsey's 7 S Model The model is based on the theory that, for The model is based on the theory that, for

organizations to perform well, seven elements – organizations to perform well, seven elements – structure, systems, style, staff, skill, strategy and share structure, systems, style, staff, skill, strategy and share values - need to be values - need to be alignedaligned and and mutually mutually reinforcingreinforcing..

So, the model can be used to help identify what So, the model can be used to help identify what changes need to be implemented so as to improve changes need to be implemented so as to improve performance of the organization.performance of the organization.

For more information, readers can refer to book For more information, readers can refer to book ‘Strategic Management’ by Prof R Srinivasan, Volume 3, ‘Strategic Management’ by Prof R Srinivasan, Volume 3, 2009.2009.


Practices inPractices inChange ManagementChange Management

Change management contains four stages. They Change management contains four stages. They are:are:– Proposing a changeProposing a change– Summary of impactSummary of impact– DecisionDecision– Implementing a changeImplementing a change

In order to continuously improve and monitor the In order to continuously improve and monitor the change process, a process improvement program change process, a process improvement program (PIP) must be implemented. (PIP) must be implemented.


SummarySummary Change management is one of the most important Change management is one of the most important

processes in the organization. In any organization, it will processes in the organization. In any organization, it will experience a large volume of changes in its process, experience a large volume of changes in its process, strategies while identifying and implementing the strategies while identifying and implementing the changes.changes.

As business experiences a continuous change, it is As business experiences a continuous change, it is essential for any organization to bring a change in their essential for any organization to bring a change in their strategy towards success of business. strategy towards success of business.

After identifying the changes, it is of utmost importance After identifying the changes, it is of utmost importance to maintain these changes and to monitor these changes to maintain these changes and to monitor these changes as it will have direct impact on the other entities of as it will have direct impact on the other entities of business. business.

It is always advised to follow a structured and systematic It is always advised to follow a structured and systematic approach towards the change management.approach towards the change management.

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Change Mangt