Managing Strategic Change

John Marti discusses how senior managers can facilitate and drive significant corporate change.

‘Managing change is easy, most of us do it most of the time’.

This is not the commonly held perception of change, but it is true, or at least, it can be true.  Although we may not recognise the fact, most of us are changing constantly.  Generally, this change is something we initiate or we regard as favourable to our interests, so we accept it. What we don’t like is someone else’s change, especially when it is imposed upon us.  Typically, our reaction is to resist in some overt or covert way or to go along reluctantly with the intention of reverting when the opportunity arises.  I know of many meetings to explain change over the years where no-one argues, but they leave muttering “over my dead body”.  Why?  Because it is not their change, they don’t own it and whilst they might understand the logic, they don’t really believe that it is necessary or they don’t buy-in emotionally.  Of course, it may be that they do believe, but “nobody asked me so I’m not going to do it”.

The lesson here is quite obvious.  If we can find ways of involving people in deciding the change which affects them, they are much more likely to accept it and make it work.  In particular, we need to let them question the ‘what’ and decide the ‘how’.  Don’t plan everything for them, but do create a favourable climate.  We have to give people a reason to change, beyond “do it because I say so”.  Creating the climate is a ‘hearts and minds’ process which involves two important elements:-

1          Generating dissatisfaction with the status quo.  In some cases, this is very easy where the performance of the organisation is obviously poor:  the business is losing money, there are large numbers of customer complaints or workplace morale is very low.  In other cases, dissatisfaction is not so obvious.  This is especially true when a company has performed well historically and although the signs of decline are becoming evident, it has not yet reached the edge of the cliff.  The ‘boiled frog syndrome’ is much in evidence.  If you place a frog in cold water and heat it slowly the frog dies, but place it in boiling water and it jumps out.  Without unavoidable signs of crises, many managers prefer to ignore the evidence of their eyes on the simple basis of “if I can’t see it, it’s not there”.  Many of us will know about the near disasters of Philips, IBM and Xerox.  Huge companies worldwide, all with a very successful past, but very nearly no future.  All could have avoided their crises.  Managers in each one knew of the problems besetting them, but it took a new leader to galvanise them into action – almost too late.

Corporate memory is important and useful, but “the way we do things around here” can easily turn into corporate sclerosis.  As I have said before, nothing gets in the way of future success as much as past success.  Quite often, managers need to be shocked into believing that change is essential to survival, let alone future success.  Ideally, we need evidence that appeals to both logic and emotion and clearly shows that all is not well.  This can come from many sources, external and internal:  customer surveys, competitor reviews, operational reviews, staff surveys.  A way then needs to be found to ensure that the responsible management team can accept the validity of the information provided and debate and agree the likely consequences of failure to change and improve.  One way which I have found to be effective is to prepare the factual evidence in considerable detail covering all important aspects of business performance.  This information is analysed and presented to the management team without conclusions.  It then becomes the first task of the team to debate the information and agree its conclusions and the implications for their business.  In this way, the managers generate and take ownership of the problems confronting the business.  Also, the debate centres upon facts and problem resolution rather than opinions.

The important needs to be separated from the critical: too often I find managers attempting to tackle an impossibly wide range of issues, all of which could be classified as important and many as urgent.  Few, however, have the power to fundamentally affect the long-term success of the business.  These are the handful of critical things which must be done to ensure survival and success.  These issues have to become the primary focus of attention.

2          Understanding that something better is possible.  Making sure that people are dissatisfied with the status quo is essential, but it is not sufficient.  Unsettling and destabilising people may be necessary, but if we leave them like that, we will be worse off than before.  People in organisations need to know that someone can see a way through the problems and can articulate a brighter future in a way that they can understand and relate to.  That future must not seem to be the product of idle day dreams:  it has to be relevant, it has to be possible and it has to be inspiring.  As I have said in a previous issue of ‘Talking Points’, this vision of the future has to be part of a clear, coherent strategic framework which everyone can understand.  This facilitates the sorting of issues into the important and critical categories.  In terms of strategic change, this is an essential step as it removes much of the deadwood from the path of progress.  Suddenly, we know what we are not going to do because it is not critical.

So who generates dissatisfaction with the status quo and who provides this vision of a better future?  The specific answer depends upon the particular circumstances of the organisation, but in general every major change effort has to be led.  Strategic change needs a leader who galvanises people, provides them with a compelling picture of a more desirable future, breaks down barriers and creates a climate for change.  As I said in a previous ‘Talking Points’, “…. the vision is achieved by aligning people ….. gaining their trust and creating coalitions”.  The key here is trust.  Leaders need to have many qualities, but if they cannot inspire trust then people will not follow them and without followers there is no leader.

The role of the leader in the strategic change process is vital.  Leaders articulate the vision and they also grant permission for the process – they act as the process sponsor.  With a clear vision and good sponsorship, the change may succeed: without it, it will certainly fail.  But in order to lead effectively, the leader has to engage in the process: it has to get to the top of their agenda.  What leaders can’t do if they want the change to work is to indulge in baton passing.  Saying, “I have a vision of a better future and I empower you to go off and create it.  Let me know how you get on”,

doesn’t work.  Strategic change is not a relay race.  It is more like a marathon where we all run together, but we are pretty sure that some won’t last the distance.

When we think about change, we tend to consider the outcome rather than the process.  Having a vision of an inspiring and idyllic future is one thing – making it happen is another.  There is a very natural tendency to look out across the valley to the green fields on the other side and imagine ourselves there.  What we often ignore is the difficult climb down from where we are and the arduous climb up the other side. And what about the river at the bottom – very deep and fast flowing?  Also, when we look across the valley, the distance is foreshortened.  What is in reality a considerable journey looks quite short and we find it hard to imagine that it can possibly take very long.  But unless we are prepared to think about the detail of the journey we expect to face, we will certainly underestimate the length of time it will take and the difficulties we are likely to encounter.  We need to consider potential hazards, plan to overcome them and accept that we will face as yet unknown problems.  Without good implementation, an inspiring vision remains just that, an inspiring vision which eventually fades and dies.

Strategic change programmes usually involve several functions and are often implemented via multi-functional project teams.  If project teams are used, it is vital that the rules of engagement are clearly defined.  Firstly, each individual project must be clearly specified so that no-one is in any doubt about the intended outcome.  Secondly, the project client or sponsor and the project manager must be identified – individuals not committees.  These individuals must have clear, distinct, single-point accountability for delivery of their respective roles:  simplicity, clarity and accountability are essential to success.

Implementing strategic change in this way reflects the holistic nature of the change.  Whole system change with its built-in interdependencies, means that one part of the system cannot be changed without affecting other parts.  Many ‘Business Process Re-engineering’ (BPR) projects, for example, have foundered on the rocks of unanticipated consequences.

It is essential that implementation is planned and monitored.  Clear goals need to be set with a timetable for achievement and well defined accountability.  Short-term milestones must be identified during the detailed planning stage and then used to monitor performance.  This helps to ensure that the implementation remains on track and provides the basis of a feedback process which allows all involved to assess their progress.

One of the most vital elements of implementation is communications.  Everyone who is affected by the proposed change or who will need to take some action as a result, needs to know what it is and what it means for them in their job.  This may seem to be a daunting task, but failure to communicate will only serve to feed the rumour mill.

Below is a summary of the more important elements of the change process:-

i           Information: use all the relevant information you can to create a desire for change and to reinforce commitment.  Provide a strategic framework; a context for the change which allows people to see something other than operational difficulties.  Remember that most strategic change occurs in response to external pressure.

ii          Behaviour:  out with the old and in with the new.  New ways have to be demonstrated – symbols are important.  Reinforce and praise new behaviour; make a fuss.  Ignore or let go minor mistakes, they will be made.  Work to get obdurate people on-side, but punish persistent intransigence or sabotage.

 

iii         Leadership:  without the people at the top being seen to be leading the change, it simply won’t happen.  Overall leadership can’t be delegated, but you can have and indeed you need, leaders at all levels managing the change process throughout the organisation.

iv         Communication:  you can’t do too much!  It needs to be simple, regular, repetitive and honest.  Not too taxing one might imagine, until you’ve explained something for the fortieth time to the same group and they still don’t (won’t?) believe you or give every appearance of not having heard or understood something which to you is blindingly obvious.

v          Control:  you have to be prepared to let go of the reins.  Apparently, your control diminishes, but you have to have faith in your vision and your educative and persuasive powers – there is no other way.  You cannot control every detail, so don’t try.

vi         Influence the Influencers:  in most change programmes you need helpers: disciples who help to spread the word.  But they must understand and commit to the new vision and be able to communicate it clearly and simply: you want and need evangelists.

vii        Politics:  they’re there whether you like them or not.  They have to be managed; if not, they may derail the process.  Identify key groups and get them on-side: if you can’t, isolate them.

viii       Parallel working:  don’t be tempted to do everything in sequence.  Many things will need to be done at the same time.  This puts a premium on the ability to manage disorder – you need jugglers, not just a safe pair of hands.

ix         Constants:  some things need not and will not change.  Identify them and create sanctuaries, ‘safe areas’ where people can rest from the pressures of change.

x          Results:  as with R & D, your lemons tend to ripen before your plums, so be patient.  Everything will take longer than you want.  In large, complex organisations strategic change often takes five to seven years before you see real results.

xi         Review and revise:  monitor what is going on; check against the plan, review regularly and revise if necessary.

xii        Constancy:  you will certainly need to make minor adjustments to your course, but that does not mean you alter course completely.  With your vision in mind, don’t waver: just keep going until you get there.

One final warning:  things will go wrong, so hold your nerve.  There will always be people who tell you that what you are attempting is impossible, or stupid, or both.  They may have a point, but if your team believes in the change, then go for it.