A Lean Approach

to Change Management
Framework for a successful transformation

Difficult economic times demand a new way of conducting

business. The pressure is intense, both for small companies forced
to downsize and for larger ones that still have plenty of resources
but lack the expertise to streamline their operations. Planning
can be a challenge, but even greater challenges lie ahead when
it is time to implement a transformative plan. This is when the
effective use of resources is most neededand where lean change
management proves most beneficial.

Change can be problematic in any

corporate scenario. Companies that
downsize during a recession, for example, may be cautious about hiring as
the economy begins to improve. Thus,
when they need to initiate transformation programs, they lack sufficient
human resourcesboth in terms of
quantity and skillsjust when that
talent is needed to manage a successful
transformation. In the end, mistakes
are made, momentum is lost and true
change is hindered.
On the other hand, some larger
firms may have retained the resources
they need to manage change but
cannot sustain the momentum. They
put too much early effort into planning for change, and once they reach
execution, the project team is tired of
change and reluctant to devote resources
to change-related activities. In short,
managing change at the wrong time
often leads to little if any change at all.
When it comes to large-scale
change management, several questions

may be keeping you up at night:

How do we manage and measure this
transformation? Who is empowered
to make this change happen? What
should we measure and how? How
do we structure change management
to deliver the right activities at the
right time?
Answering these questions best
requires rethinking traditional change
management models.

A Leaner Model
For years, companies have applied lean
management techniques to manufacturing and operations, with the goal of
improving quality and efficiency by
reducing waste, whether in human
assets or physical materials (see sidebar:
Applying Lean Principles to Change
Management). Why not apply these
same techniques to managing change?
Just as waste and poor workforce
management can cause business setbacks, inefficient change management
can result in a failed transformation.

Applying lean
management
techniques to
managing change
can reduce waste,
increase efficiency
and ensure that
momentum is
maintained
toward successful
transformation.

The Playbook:
Implementation and Benefits

Applying Lean Principles to Change Management

Lean principles can reduce waste in change management, including unnecessary meetings, travel, tasks, operations and idle time. The following highlights some popular
lean principles and how they apply to change management.

Just-in-time. All tasks are divided into work streams and stages to ensure the
right work is done at the right time.

Ongoing maintenance. Scorecards are used to evaluate risks and identify issues
early on.

Continuous improvement. Work stream tasks are continually updated to reflect
new learning; redundant work is eliminated.

Quality at the source. The next stage does not begin until the previous one is
completed.

All stakeholders treated as partners. All core and non-core teams are involved
in execution and reporting so have an incentive to deliver their best.

Small lot production. Tasks are divided into work streams and stages to reduce
the amount of upfront work and reduce lead times between different jobs.

Employee empowerment and growth. Responsibilities for work streams are
shared among team members to create a more flexible workforce.

How can lean principles apply to

change management? First, it helps
identify the necessary changeswhat
decisions must be made and what
management milestones must be
created. Second, these milestones are
divided into stages to reduce the
number of marginally useful activities
performed at the wrong time.
Planning should start in a topdown fashion and focus on key milestones, particularly at the executive
level. Too often, minutely detailed
transformation plans are created at
headquarters and immediately sent
out to leaders in remote locations,
causing remote managers to lose sight
of the overarching goals. Similar to an
efficient manufacturing process where
parts arrive at the factory just before
they are installed, just-in-time change
management ensures that the right
things are done at the right time.
With this in mind, our lean
change management model addresses
the challenges of corporate transformation. Think of it as a coachs play-

book: key strategiesplays, if you

willthat help manage change with
minimal waste and maximum efficiency and ensure that momentum
is maintained toward successful transformation. The playbook translates
the program vision for change into a
management framework that clearly
defines key work streams, resources
and time frames.

To implement the playbook, begin by

establishing governance bodies with
oversight assigned to program sponsors and, more directly, to a change
management leadership team. These
groups succeed with clearly defined
roles and responsibilities, and regular
meetings. We have found that the ideal
model consists of a central team and
business-unit teams that work directly
with the central change management
leadership group (see figure 1).
A playbook checklist outlines key
milestones, decisions and stages. It
serves as the basis for monitoring
progress and discussions about when
milestones will be met. Similar to the
pulling the cord principle in lean
manufacturing, when a milestone is
not met teams do not begin the next
task until the present one has been
completed, to resolve issues more
quickly and prevent rework. Applying
lean manufacturing strategies, change
leaders can monitor activities to ensure
they are executed at the right time and
at the right level of detail.

FIGURE 1: Playbook team structure

= Set of plays

Business
unit D

Carry out change for

their respective areas

Change
leadership

Evaluate progress
Review key decisions made
Provide direction for the central
and business unit change teams

Central
change
team
(at HQ)
Develop and distribute plays
(key change management milestones, decisions and timing)
for local change teams

Business
unit B

Carry out change for

their respective areas
Source: A.T. Kearney analysis

 There are five main benefits to

using the lean change management
playbook:

Better use of resources. By coordinating with a central team, local teams
can execute preset strategies with less
overlap. Thus the transformation can
involve lean teams in planning, with
the potential to ramp up later.

Right-time execution. Teams are
better equipped to do the right tasks at
the right time at the right level of
detail, even when the project scope or
team resources change.

More objectivity in defining plans.
Though traditional models help define
the vision and value of successful
change, they lack detailed execution
plans. This leaves change managers,
bearing the responsibility of reaching
milestones that are, at best, vaguely
defined. The playbook eliminates that
frustration by defining change milestones up front.

More transparency in measuring
progress. Change programs often fail
because there is no structured approach
to measuring change teams progress.
The playbook solves this problem by
highlighting, work stream to work

stream, the greatest threats to staying

on track. Thus, change teams have
clear direction on what plays they
must call to counter the threats and
drive progress.

Consistent change readiness. As
the plays are defined centrally and
refined locally, all business units execute the similar set of activities. This
results in consistency among all units
and ensures coordination during global
strategy deployment. The playbook
provides consistent interpretation of
readiness so that all parties know each
others status.

The Playbook in Practice

We recently executed a supply-chain
transformation for a large global
retailer with various degrees of available resources and at different stages of
change readiness. Achieving costsavings goals depended on how efficiently the plan could be deployed.
Given the projects complexity, the
central team had to engage numerous
stakeholders while providing the right
level of detail to facilitate decision
makingwithin tight time and
resource constraints.

FIGURE 2: The lean change management playbook stages

Execution
Deployment
preparation
Detailed
planning
Strategy
definition
Program
initiation
Establish executive
sponsorship
Identify change
leaders

Define direction
and guiding principles for deployment
across people and
process

Establish core
team and develop
detailed plans to
manage and execute
change readiness

Execute transition
from current-state to
future-state process

Complete detailed
tasks across central
and distributed teams
Monitor performance
and outputs with
centralized governance

Source: A.T. Kearney analysis

The following playbook ensured

risks were identified appropriately and
decisions were made early (see figure 2).
Program initiation. Change management leaders were designated along
with a governance model to manage
the scale and complexity of the global
deployment. Central team leaders
assigned to each work stream provided
a point of contact to exchange information, drive communication and
resolve issues. Representatives from
each location served as in-country program managers in charge of voicing
local concerns and updating the central team. One international leader
oversaw global deployment and served
as a liaison between central and incountry teams.

Strategy definition. The team
defined the direction and guiding
principles of deployment and identified the core components and work
streams. We defined the transformation roadmap, functional plans and the
stakeholder transition plan, and identified change management resources,
program communications and training, and implementation support. The
main decisions and milestones for each
work stream were defined at an appropriate level of detail for each stage.
Current metrics and key performance
indicators (KPIs) were documented.
The team also revisited the original
business case for change to ensure
the right measurements were in place.

Detailed planning. The team developed detailed plans to manage and execute the plan. We prioritized potential
KPIs linked directly to the transformation, classified and shared them with
all stakeholders. A business readiness
scorecard was prepared to showcase
deployment status across all locations
(see figure 3 on the following page).

FIGURE 3: The business readiness scorecard

6 months

5 months

Illustrative
4 months

3 months

2 months

1 month

Go
live

Program
definition
Strategy
definition
Detailed
planning
Deployment
preparation
Execution

Plan at risk

Behind schedule

On track

Deployment preparation. Central

and unit-level teams completed

detailed tasks and central leadership
implemented performance monitors
and outputs. The teams confirmed
KPIs with stakeholders, prepared
dashboards and reports, and developed pre-implementation baselines.
Managers attended weekly meetings where they examined each units
progress and ensured that all were
focusing on the most pressing milestones. The reviews were updated in
a central checklist repository so the

Source: A.T. Kearney analysis

units could track each others real-time

progress and communicate problems
to the central team. The checklist
reviews occurred over a series of
meetings and during calls with the
main parties.

Execution. Following months of
preparation using lean principles, the
actual deployment began. Project teams
handed off report maintenance to
operations teams, and all stakeholders
received summarized results through
automated dashboards and reports.
Although the company had minimal

resources, the lean change management all but guaranteed a successful

transformation.

The Right Environment

A successful transformation starts by
forging an environment conducive to
change. As a result, the value of a
dynamic, cost-effective plan for implementing change cannot be overstated.
Using the same lean principles that
have streamlined manufacturing so
well, todays business leaders can find
the playbook for successful change.

Authors
Christian Hagen is a partner in the Chicago office and can be reached at christian.hagen@atkearney.com.
Mike Sansone is a principal in the Chicago office and can be reached at mike.sansone@atkearney.com.
Pushkin Pant is a principal in the Chicago office and can be reached at pushkin.pant@atkearney.com.
Kevin Cheung is a consultant in the Washington, D.C., office and can be reached at kevin.cheung@atkearney.com.
Sunita Dudeja is a consultant in the Chicago office and can be reached at sunita.dudeja@atkearney.com.

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