You are on page 1of 9

e x e C u t i v e

f o r u m

beat tHe CHanGe manaGement trap:


yoUr orGanization is more ready to CHanGe tHan yoU tHinK
Wes Siegal and Jonathan Stearn

eraclitus told us in the sixth century bCe that the only constant is change. never before has this phrase rung more true for leaders of organizations in all sectors. in fact, most leaders dont need to be convinced of the need to changethey simply need to figure out how to help their organizations do it. almost without exception, they begin organizational change initiatives with internally focused preparatory steps to get ready for a big transformation. but as we will show in this article, this is the last place they should start. this approach almost always leads to what we call the change management trap: resources, time, and energy are spent preparing for change rather than achieving its desired outcomes.

to avoid the change management trap, leaders must demonstrate some boldness and new ways of thinking and acting. they must demand that desired outcomes are achieved quicklynot in the months or years after the organization is finally ready. When leaders focus on desired outcomes and make explicit requests for rapid advancement, two things happen. First, the organization responds by achieving some initial success, improving performance, and building confidence. second, these initial successes demonstrate what actually worksmaking longer-term changes in systems, structures, and processes more targeted and effective.

winter 2010

37

Leaders must demonstrate some boldness and new ways of thinking and acting.

management of this program became an activity in itself, with internal metrics assessing the number of chapters reached, and those chapters progress as measured by the change readiness survey. but two years in, most of the participating chapters could not yet point to any remarkable new impacts on local conditions. 2. a major insurer wanted to standardize processes across its multiple business units. a corporate change group analyzed processes and performance, and business managers were asked to use this information to improve profitability and strategic alignment. but many months later, little progress had been made. Frustrated by this, a few senior executives asked three business units to demonstrate measurable profitability improvements within 100 days. these business heads quickly launched a dozen small projects that challenged employees to improve sales, streamline underwriting, and/or adjust prices. three months later, they had achieved hundreds of thousands of dollars in new premiums, and improved internal efficiencies.

in this article, we will discuss the reasons why so many leaders fall into the change management trap, the consequences of the trap, and how they can avoid it.

A Tale of Two Change Initiatives


in our experience, a hallmark of successful change efforts is the extent to which they include specific welldefined improvements. Consider the following two examples: 1. a distributed national community services organization wanted its chapters to become active players in their respective communities, helping to prioritize local needs, then shaping and sponsoring specifically tailored programs. the national office introduced an intensive change program to help chapters with this transformation. internal consultants conducted diagnostic surveys and interviews to help chapter officers understand their readiness for the change, then introduced activities to help the chapters align their structures and processes with the desired way of working. Communication materials and workshops were also developed for chapter employees, volunteers, and other stakeholders.

Corporate officers were enthusiastic about the idea of locally responsive offices but failed to ask for the achievements that they expected.

38

leader to leader

in the first example, corporate officers were enthusiastic about the idea of a network of locally responsive offices but failed to ask for the achievements that they expected from this new model, such as targeted fundraising, improved partnerships with government and agency programs, and especially greater impact on their communities highest-priority issues. instead, they focused on the long-term work of transforming the organization, so it would eventually be prepared to deliver these results. they fell into the change management trapfocusing on preparing for change, rather than changing. the executives in the second example recognized this trap early and took action. they challenged their business leaders to deliver the needed improvements quicklyand introduced a change program specifically designed to respond to that expectation.

strategy, methodically update the organizations foundation, and only then begin execution. in short, leaders often believe it would be foolish and irresponsible to try to make some improvements before all the underlying, fundamental issues are addressed. the newly popular phrase, positioning the organization for success, is a telling reinforcement of this mind-set. thus, leaders launch a number of streams of work focused on preparing the organization to improve. the streams of work that are typically included in activity-focused change management programs are illustrated in Figure 1. this activity-focused approach to change is also reinforced by virtually every consulting company, the perceived experts in organizational change. these consultancies almost universally assert that companies should focus on building the foundation of the organization before expecting to achieve meaningful business results. another reason that leaders embrace a change management approach focused on preparatory steps is because it is more psychologically comfortable for them. they can delay the unpleasant work of demanding results. Leaders often have difficulty making demands to staff that they themselves do not feel confident in achieving. When they contemplate asking employees to achieve something for which there is no clear path of execution or solution, they worry about being perceived as unfair or heartless. in this context, it is much easier and safer to avoid the socially unpopular stance of driving for results and instead focus on enabling activities. to make matters worse, once leaders publicly admit that there are shortcomings in the current fundamental organizational components, it becomes even more difficult to make short-term, results-based demands on staffit can feel almost hypocritical. many leaders thus give subordinates a pass on results and let them focus instead on building the foundation for the future. so with logic and psychological comfort on their side, and the support of organizational change experts, leaders are confident that preparing before achieving is the only way to go about changing their organizations.

Why Leaders Fall Into the Change Management Trap


there are two main reasons that so many leaders invest in preparatory steps before going for the performance improvements they want. First, the logic of the approach seems sound. in many cases, the fundamental components of the organization are misaligned or outdated. For instance, the organizational structure, roles and responsibilities, and processes were likely developed years ago, before the needs for efficiency and quality were as sharp as they are now. information systems might be outmoded and unable to appropriately support the business in the face of new challenges. the skills that staff need have changed over time, but these newly required capabilities may not have been developed. or the organizations culture might be seen as out of step with the required performance levels. Given the challenges of all these misaligned organizational components, leaders logically come to the conclusion that there is no way the organization can succeed unless these areas are fixed first. and this perspective is reinforced by leaders genuine convictions that they must take a long-term view of the business. it is prudent, they believe, to develop a clear vision and

winter 2010

39

Figure 1. tYpical components oF activitY-FocuseD cHanGe manaGement proGrams

Pitfalls of the Change Management Trap


activity-focused change management devotes resources to preparatory activities without ensuring that these investments will pay off. Figure 1 also includes the outcomes of an activity-focused change programs work streams. as work proceeds on each of these streams, activity is misconstrued as progress. Leadership can trumpet all kinds of achievements, like the number of processes reviewed, the system implementation milestones reached, and the number of people trained, all of which provide the appearance of progress. Lots of work has happened, and people are dedicated to the program and putting in significant effort to see it through. However, often after months of activity the organization is not yet seeing the cost reductions, revenue increases, cycle-time reductions, or customer service improvements that were the reasons for launching the change initiative. activity-focused change management also misses opportunities to engage or excite employees. However inspiring the original vision of a change program might be, the work streams listed in Figure 1 are al-

most always tangential to peoples jobs. Without a line of sight into how these extra assignments will positively impact the organization and their jobs in the near term, employees can perceive them as frustrating and wasteful. this is not meant to suggest that these kinds of work streams are not worthwhile or helpful to many organizations. on the contrary, they are sometimes critical.

The activity-focused approach to change is reinforced by virtually every consulting company.

40

leader to leader

Organizational change and improvement requires thousands of individual behavior changes.


the problem is that when they supplant results-focused tasks, they become the end instead of the means, and everyone focuses on executing the reorganization or implementing the new system instead of growing revenue or serving customers better. executing preparatory activities without some tangible achievement of desired outcomes drains resources from the organization and energy from employees. the change management trap has another unpleasant consequence: it fails to cultivate the many changes in individual behavior needed for successful performance and results. imagine an organization that is trying to improve its customer service track record. perhaps the organizational structure should change so all customer-facing units are brought together. but what also must change is the way employees collaborate, so customers receive a better end-to-end experience. activity-focused change management is much better suited to support the former outcome than the latter. the reality is that numerous people must make many changes in how they work in order to bring about the vision of improved customer experience. individuals must know each other and what role they play within the organization and with respect to serving customers. they must come to agreement on the right way to serve customers, taking into account different customer profiles and needs. they must execute their service model effectively and make changes as necessary.

and they must do this in a mutually beneficial way so all parties are satisfied with their roles, responsibilities, and rewards. put simply, organizational change and improvement requires thousands of individual behavior changes, which must be discovered through the experience of pursuing results together. activity-focused change management that is defined by organizationwide initiatives often fails to address this difficult yet critical need.

The Alternative: Prioritize Improvement While Changing


Leaders who want to push beyond the change management trap need to focus on what the organization really needs: improvement, not just change. We call this approach results-driven change management, which applies the maxim that nothing succeeds like success. this approach makes performance results, not changeenabling activities, the central element of any change effort. a few simple guidelines can ensure that any change program is results-driven. First, identify the change efforts primary purposes. examples might include maintaining position in a market where technology has revolutionized the current value chain, growing accounts in an emerging segment, or revolutionizing cycle times for product development and distribution. these focus areas should represent the desired performance results, not preparatory steps like alignment of structures or installation of systems. next, commission a portfolio (anywhere from a few to several dozen, depending on the scope and pace of change needed) of small, temporary rapid results teams to drive these strategic issues into the daily priorities of people on the front lines. Challenge these rapid results teams to deliver results quicklyin 100 days or less. point the teams toward a specific desired outcome within a focus areafor example, winning back one customer while restoring profit-

winter 2010

41

ability, taking share in one representative region, or bringing a product to market several months ahead of schedule. but beyond that, give them latitude to design and discover their methods for securing these outcomes. third, extract the learning from these rapid results experiences. because the teams methods for getting results are not fully dictated, they experiment with new ways of working, and thus drive organizational learning. the cross-functional and cross-divisional members of rapid results teams learn through direct experience the new behaviors that will deliver results. these teams enhance thinking about the changes in behavior at all levels, as well as the processes and systems that will sustain progress in the focus area. share this learning across the organization in the form of success stories about what was achieved and how it was done. even people who do not directly participate in rapid results teams can benefit from this learning when these new ways of working are shared as best practices. success stories from rapid results efforts also create an organizationwide sense of efficacy (we believe we can do it)generating excitement about, rather than resistance to, change efforts. a culture that fits with the new, transformed organization begins to develop organically, rather than being dictated by senior leadership. Fourth, apply the learning to the longer-term work streams of traditional change management. two types of enhancements should be leveraged: technical and qualitative. technical enhancements include improvements to specific reports, processes, management practices, communication, and other mechanisms that have proven effective. Qualitative enhancements include things the teams learned about engaging stakeholders, improving processes, enhancing collaboration, and managing change. For example, a rapid results team focused on product rationalization might develop an innovative way of cataloging product features from the customer perspective. and the team might have found effective ways of aligning the efforts of product engineers,

sales representatives, and account managers. both types of learning can be infused into the broader change program initiatives to make them more targeted and effective. Figure 2 shows how the results-driven approach does not replace the long-term activities of change management, but enhances them, providing rich data about how to make them more effective. at the insurance organization described at the beginning of this article, the scales were finally tipped by launching a concentrated program of rapid-cycle, cross-functional efforts to actually increase profitability. each team focused on a well-defined opportunity: adjusting prices for a specific market segment, improving speed and accuracy of underwriting for a particular type of policy, or gathering better data from customers with a certain profile. and the employees from sales, underwriting, and production on these teams all had to find new ways of workingwith one another, and with others from their own functions. in addition to delivering results, the teams created new tools to improve the accuracy of information in customer applications, and adjusted processes to make underwriting and policy generation more efficient.

Less than two years later, over 100 rapid results projects had been completed.

42

leader to leader

Figure 2. results-Driven cHanGe manaGement: a continuous cYcle oF GettinG results anD usinG tHose outcomes to propel successive staGes oF tHe cHanGe eFFort

marketing learned how to incorporate customer needs into its programs. and business managers developed metrics that supported profitable operations. the corporate change group paid close attention and incorporated these lessons into its recommendations for other businesses to follow. immediately after the pilot round of projects, new projects were commissioned to extend the initial gains and replicate them in similar opportunity areas. several other business units adopted the approach, and less than two years later, over 100 rapid results projects had been completedyielding bottom-line improvements worth hundreds of millions of dollars, and dramatically increasing engagement with the corporate process standardization initiative. this prepared the company to weather todays business downturn, and it remains a significantand soundplayer in the industry today.

Control the Risk


managers who are leading change efforts often play a high-risk game: they invest in preparatory activities that run for months and even years, mistakenly believing that these must be completed before results will come. but far too often, the pot of gold they find at the end of the rainbow is too small to justify the investments they have made. Leaders can control this risk by demanding that immediate, measurable improvements become a critical component of change management. they can help their organizations reap a payoff from change initiatives earlier, and ensure that longer-term change activities remain focused and effective. in the process, they can unlock a new level of excitement and commitment to their change initiatives, making successful change part of the fabric of daily organizational life, rather than an added activity with questionable benefit.

winter 2010

43

Wes Siegal is an organizational psychologist and a senior consultant at Robert H. Schaffer & Associates (www.rhsa.com). By emphasizing the experience of change leadership as a developmental crucible for leaders, Wes has helped dozens of toptier organizations transcend the organizational dynamics that so often frustrate critical strategic goals, achieving breakthrough results in areas as diverse as sales growth, manufacturing efficiency, certification of renewable energy sources, and HIV mitigation in developing countries.

Jonathan Stearn is a consultant with Robert H. Schaffer & Associates. He has helped numerous organizations in the financial and pharmaceutical sectors address the technical, management, and behavior changes related to large-scale information systems implementations. He has also facilitated the transformation of government agencies and partners by helping them drive accountability for extraordinary efficiency gains to the front lines.

44

leader to leader

Copyright of Leader to Leader is the property of John Wiley & Sons, Inc. / Business and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.