Strategy Formulation, Implementation &

Performance Management
Sponsored by- Nib International Bank S.C.
Facilitated by- Leadership & Career Development School, EAA, ETG
May 2018

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 Agenda of the workshop
– Key concepts in strategy
• Why do we plan strategically?
• How do we plan?
• Strategic Planning Process
– Strategy formulation
• Mission analysis
• Values analysis
• Objectives
• Industry analysis
• Environment analysis
– Strategy implementation
– Performance management
 Why should we plan strategically? It…
– Keeps organization competitive in a dynamic, unpredictable environment
– Promotes a clearly defined direction , helps in changing direction
– Promotes buy-in, ownership, engagement of employees and commitment
– Sets priorities for resource allocation
– Leads to positive action and change
– Can accelerate growth
– Promotes innovation and creativity
– Promotes communication & teambuilding
– Expands data and intuition
– Brings external factors to light
 How do we develop the strategic plan?
To perform the planning task:

1. Establish where an organization is at the present time

2. Determine its desired future state

3. Decide how to move it forward to reach that future state

The Strategic Management Process
 The Strategy Process Model
lysis
Environmental ana Culture & managing of
change

e s & s trategic Analyzing

rc
Resou abilities
c ap
ation
z
er Implementation rgani ture
ol d O truc
s i n g s t ak eh
As s e s
at i on
S
ex p ec t
Choosing
Management pro
c es s
tions
Identifying op

Selecting a strategy
ns
optio
al uating
Ev
– Strategy formulation and implementation
interact continuously
– Hence, Strategic formulation process is not
linear rather circular
 Strategy process
• Deliberate strategies are those that are realized
(implemented) as intended
Intended strategy Realized strategy
Deliberate strategy

Unrealized strategy Emergent strategy

• Emergent strategies are those that are realized

despite the existence of intended strategy or in the
absence of any managerial or organizational intention
 1.2. Strategy Formulation
• Strategic question for strategy formulation:

– What is our business mission?

– Who are our customers?

– What do our customers consider value?

– What have been our results?

– What is our plan?

 Strategy Formulation- creating the strategy

• Strategy formulation- The process of creating strategy

– Involves assessing existing strategies, organization, and
environment to develop new strategies and strategic plans
capable of delivering future competitive advantage
– Identify & analyze current
• Mission
• Objectives
• Strategies
– Analyze internal & External environment
• Organizational resources & capabilities (strength & weakness)
• Industry & External environment (opportunities & threats)
 Strategy Formulation…
– Strategy — a comprehensive action plan that identifies long-term
direction for an organization and guides resource utilization to
accomplish organizational goals with sustainable competitive advantage.
– Strategic intent — focusing all organizational energies on a unifying
and compelling goal
– Competitive advantage — operating with an attribute or set of

attributes that allows an organization to outperform its rivals.

– Sustainable competitive advantage — one that is difficult for

competitors to imitate
• Opportunities for achieving sustainable competitive
advantage:
– Cost and quality
– Knowledge and speed
– Barriers to entry
– Financial resources
 Strategy formulation…
• Analysis of mission:
– The reason for an organization’s existence.
– Good mission statements identify:
• Customers
• Products and/or services
• Location
• Underlying philosophy
– An important test of the mission is how well it
serves the organization’s stakeholders
 Strategy formulation…
• Analysis of values:
– Values are broad beliefs about what is or is not appropriate.
– Strong core values for an organization help build institutional
identity, gives character to an organization, and it backs
up the mission statement.
– Organizational culture reflects the dominant value system of
the organization as a whole
 Strategy formulation…
• Analysis of objectives:
– Operating objectives direct activities toward key and specific
performance results
– Typical operating objectives:
• Profitability
• Market share
• Human talent
• Cost efficiency
• Product quality
• Innovation
• Social responsibility
Analysis of industry and environment:
– Assessment of macro environment:
• Technology
• Politics
• Legal & Government
• Social structures and population demographics.
• Economy.
• Natural environment.
– Analysis of industry environment:
• Resource suppliers.
• Competitors.
• Customers
Environmental Analysis
Macro Environment

Task Environment
• Demand, Market,
competition, technology,
Government,…

Internal Environment-
• Organizational
Resources & capabilities

• PESTEL
 Analysis of the Environment
The Internal Environment
What are our Strengths? What are our Weaknesses?
– Operational efficiency? – Outdated facilities?
– Skilled workforce? – Inadequate research
– Good market share? and development?
– Strong financing? – Obsolete technologies?
– Superior reputation? – Weak management?
– Past planning failures?
 Analysis of the Environment
The Internal Environment
• Analysis of organizational resources and capabilities:
– Important goal of assessing core competencies.
– Potential core competencies:
• Special knowledge or expertise.
• Superior technology.
• Efficient operational approaches.
• Unique product/ service distribution systems
 Analysis of the Environment
The External Environment
What are our Opportunities? What are our Threats?
– Possible new markets? – New competitors?
– Strong economy? – Shortage of resources?
– Weak market rivals? – Changing market
– Emerging technologies? tastes?
– Growth of existing – New regulations?
market? – Substitute products?
 SWOT Analysis

STRENGTH Convert WEAKNESS

Internal resources that are available or
things that an organization does well
How can organization use its strengths to
take advantage of the available
opportunities?
M
Resources that an organization lacks or
activities that it does not do well
How can organization use its strengths to
overcome the weaknesses identified?

SWOT
a
t
c
h
Convert THREAT
OPPORTUNITY
Negative external environmental factors
Positive external environmental How does an organization reduce threats
factors using available opportunities or strengths?
SWOT Analysis
Opportunities Strengths Weaknesses
SO OW

External Factors
Attack Beware
‘go for it’ ‘don’t do it’

ST TW
Explore Protect
Threats

‘if have time’ ‘watch yourself’

Internal Factors 22
 The Five Forces
• Strategic forces to be
examined in
conducting an industry
analysis:
– Industry competitors
– Potential entrants
– Suppliers
– Buyers
– Substitutes
 The Five Forces
• Competitive forces
– Level of competition- increased competition results in lower
profits
– Potential for entry- easy entry leads to lower prices and
profits
– Power of suppliers- only few suppliers of important items,
supply cost rises
– Power of customers- only few large buyers, they can bargain
down prices
– Substitutes- more available substitutes tend to drive down
prices and profits
Different Strategies
M. Porter’s Generic Strategies
Broad Cost Leadership
• Porter’s generic Differentiation
Strategy Strategy

Market Scope
strategies for gaining
competitive advantage:
– Differentiation strategy
Focused Low Focused
– Cost leadership strategy
Narrow
Cost Strategy differentiation
– Focused differentiation Strategy
strategy
Low Source of Unique
– Focused cost leadership Price Competitive Advantage Product

strategy
 Different strategies…
• Low-Cost Strategy
– Driving the organization’s total costs down below the
total costs of rivals.
• Manufacturing at lower costs, reducing waste.
• Lower costs than competition means that the low cost
producer can sell for less and still be profitable.
 Different strategies…
• Differentiation
– Distinguishing the organization’s products from those
of competitors on one or more important dimensions.
• Differentiation must be valued by the customer in order for
a producer to charge more for a product.
 Different strategies…
• “Mixed” strategy
– Attempting to simultaneously pursue both a low cost
strategy and a differentiation strategy.
– Difficult to achieve low cost with the added costs of
differentiation.
 Different strategies…
• Focused Low-Cost
– Serving only one market segment and being the
lowest-cost organization serving that segment
• Focused Differentiation
– Serving only one market segment as the most
differentiated organization serving that segment
 Different strategies…

Question Mark
• BCG matrix Stars
High • Poor position,
growing industry • Dominant
– Ties strategy formulation to • Growth & position, growing

Market Growth
retrenchment industry
analysis of business strategy • Growth strategy

opportunities according to …
• Industry or market growth Dogs Cash Cows
• Poor position, • Dominant
rate Low growth position, Low
Low industry growth industry
– Low versus high
• Retrenchment • Stable or
• Market share strategy modest growth
strategy
– Low versus high Low Market Share High
 Different strategies…
• Cash Cows
– Products or divisions that are the current high earners for the
organization
– They are relatively short term
– The organization should seek to adopt measures to increase profit
and extend their lifetime e.g. use of IS.
– These are well established products in mature markets
• Stars
– Products or divisions providing significant revenue now & expected
to do so in future
– The organization should seek to adopt measures to increase profit
and extend their lifetime
– These are market leader products in growth markets
 Different strategies…

• Dog
– Products or divisions providing little or no contribution
currently and not expected to change in the future
– They should be divested or reduce associated costs or make
cash cows.
• Question mark
– Products or segments providing little or no contribution
currently but expected to change in the future
– The organization should ensure that they quickly mature into
profitable stars
Different strategies…
(Ansoff’s growth matrix 1987)

Product
Present New
Market
Product
Market Penetration
Development
Present (Existing market &
(New Product)
product)

Market Diversification
Development (Organic = SBUs)
New
(New Market) (Inorganic =
Merg.&Aqsn.)
Different strategies…

• Diversification - strategy of expanding a company’s

operations into a new industry in order to produce new
kinds of valuable goods or services
– Related Diversification - strategy of entering a new
industry and establishing a new business division that is
linked to a company’s existing divisions because they share
resources that will improve the competitive position
• Synergy- Obtained when the value created by two divisions
cooperating is greater than the value that would be created if the
two divisions operated separately and independently
 Different strategies…

• Diversification
– Unrelated Diversification- Firms establish divisions
or buy companies in new industries that are not linked
to their current business or industry
• Portfolio strategy- Allocating resources among divisions
to increase returns or spread risks
 1.3. Strategy Implementation
Strategy implementation
– The process of allocating resources and putting strategies into
action.
– All organizational and management systems must be mobilized
to support and reinforce the accomplishment of strategies
– Implement the strategy
• Management systems & practices
• Strategic leadership
– Evaluate results
• Strategic control
• Renew the strategic management process
 A Framework for Executing Strategy

• Entails converting the organization’s strategic plan

into action and results.

• Job for the whole management team.

• Affects every part of the firm.

• Each manager must answer, ‘what has to be done in my area

to implement our part of the strategic plan, and what must
I do to get these things accomplished?’
• All managers become strategic implementers in their areas
and all employees are participants.
 A Framework for Executing Strategy

– Strategy implementation
• Least charted and most open-ended area.
• Based on individual company situations-Some
strategies cannot be executed by some companies!
• Implementation should be addressed initially
when the pros and cons of strategic alternatives
are analyzed.
 Strategic Implementation
• Most know what it is: few know how to get things done.
• Three keys to keep in mind:
• Execution is a discipline, and integral to strategy.
• Execution is the major job of the business leader.
• Execution must be a core element of an organization’s
culture.
 Strategic Implementation
• Among other things, implementation has to do with;
– Rigorously discussing ‘hows’ and ‘whats’, questioning, persistently following through
– Ensuring accountability
– Making assumptions about the business environment
– Assessing the organization’s capabilities
– Linking strategy to operations and the people who are going to implement
– Linking rewards to outcomes
– Changing assumptions as the environment changes
– Upgrading the company’s capabilities to meet the challenges of an ambitious
strategy.
 Strategic Implementation
• Among other things, implementation has to do with;
– Communicate the strategic plan -Maintain a constant two-way information exchange
– Influence achievement of changes as quickly as possible; “quick wins”
– Keep strategic priorities up front
– Build & maintain a sense of high urgency
– Show your enthusiasm for the plan
– Sell the benefits
– Praise significant accomplishments and those responsible for them
– Own up to your failures, focusing on lessons learned
– Allocate implementation responsibility to the appropriate individuals or
groups and hold them accountable
– Draft detailed action plans for implementation.
– Establish a timetable for implementation
– Allocate appropriate resources
Implementation is Different!

– Operation-driven rather than market-driven

– Action-oriented, make-things-happen tasks
– Formulation requires few; execution requires
everyone
 Implementation is Tougher
• What makes it tougher?
• More time consuming challenge- took more time than planned
• Wide array of managerial challenges
• Many options to proceed
• Demanding people-management skills
• Persistence to get initiatives moving
• Number of unexpected issues- Unanticipated major problems
• Resistance to change, misunderstandings
• Difficulties of integrating efforts across groups- Ineffective coordination
• Loss of focus on implementation
• Employees incapable, inadequately trained
• Environmental factors
• Inadequate leadership
• Tasks poorly defined
• Inadequate monitoring & control
 Implementation failure

• Lack of participation
• Lack of communication
• Poorly thought-out strategy
• Failure to hold people accountable
• Picking the wrong people for the tasks
 II. Performance Management

• Performance management
– a systematic process for improving organizational
performance by developing the performance of
individuals and teams.
– a means of getting better results from the organization,
teams and individuals by understanding and managing
performance within an agreed framework of planned
goals, standards and competence requirements

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2.1. What is Performance Management?
Performance Management System (PMS):
• Process by which Managers and employees work together to plan,
monitor and review an employee’s work objectives and overall
contribution to the Organization.
• Continuous process of setting objectives, assessing progress and
providing on-going coaching and feedback to ensure that
employees are meeting their objectives and career goals.
• Performance Management (PM) is a “ continuous process of
identifying, measuring, and developing the performance of
individuals and teams and aligning performance with the strategic
goals of the Organization ” (Aguinis, 2009 , p. 3).
 2.2. Pointer questions on effectiveness of
Performance Management
• Is our performance management system aligned with our
organization’s strategic direction and culture ?
• Is there executive sponsorship and is it visible?
• Do executives continually sell the vision of effective
performance evaluation system?
• Do we provide the resources required?
• Do we follow up continuously and provide interventions as
required?
• Are we following on the change management aspect ?
 Pointer questions on effectiveness of
Performance Management…
• Do we Provide an accurate picture of each employee’s
performance?
• Do we review performance based on two-way
communication between the employee and manager ?
• Do we give both positive feedback for a job well done and
constructive feedback when improvement is needed?
• Do we Provide training and development opportunities for
improving performance?
• Do we ensure that employee work plans support the
strategic direction of the organization?
 Pointer questions on effectiveness of
Performance Management…
• Do we establish clear communication between managers and
employees about what they are expected to accomplish?
• Do we Provide constructive and continuous feedback on
performance?
• Do we objectively Identify and recognize employee
accomplishments?
• Do we identify areas of poor performance and establish plans
for improving?
• Do we support staff in achieving their work and career goals
by identifying training needs and development opportunities?
 2.3. Importance of PMS
• Alignment of effort to Organizational goals;
• Translation of strategic objectives to operational KPIs
• Helps to promote and improve employee productivity &
effectiveness;
• Enables to identify areas of poor performance;
• Provides Training and development opportunities;
• Serves as a Communication tool;
• Support s administrative decision-making about promotions,
transfers, compensation and rewards and even separations.
The translation of the Strategy to operational measurement
forms the basis for a good measuring system

VISION

Re
MISSION

por
ti n
g
STRATEGY

MEASURING THE OPERATION

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2.4. Performance Management Process

Rewarding
Planning

Rating Monitoring

Developing 52
 To Effectively manage performance
– Clarity of goals
– Interpretation of goals at each level of the structure down to
the last employee into activities
– Ensuring all understand and act in accordance with the goals
– Measuring
– Verify goals against achievements

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Implications of not Managing Performance
– Lack of discipline
– Disengagement
– Potentially higher staff turnover
– Poorer standards
– Negative impact on customer service or client
perceptions of the company
– Low productivity
 Setting Target
• JD relevance + Vertical alignment+ Cross functional alignment
Target
 Key Drivers of Target Setting
 Organizational or Divisional Strategy Cascading
 Current Business Requirements
 Baseline Performance
 Benchmarking
 Existing & Planned Resources - HR, Facility & System Resources
 Continuous Improvement plans for improvements in Efficiency,
Productivity, Competitiveness, Quality.

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 Planning
• Setting performance expectations and goals for groups and
individuals.
• Participate employees

– Understand the goals of the organization,

– What needs to be done,
– Why it needs to be done,
– How well it should be done

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 Your Objectives
• Specific: what is to be done, when it is to be done, who is to accomplish
it and how much is to be accomplished.
• Measurable: How much? How many? How will I know when it is
accomplished? Multiple measures should be used if possible, for example,
quantity, quality, time frame and cost.
• Attainable: Assure there is reasonable path to achievement and feasible
odds that you will get there.
• Realistic: The objective needs should match the level of complexity with
the employee's experience and capability and no insurmountable forces
outside the control of the employee should hinder its accomplishment.
• Time-bound: Be clear about the time frame in which performance
objectives are to be achieved. In most cases, objectives are to be
completed by the end of the performance review period
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Performance Measures (KPI)
• Where we are with regards to the intended strategic objective, and set our
targets
• To monitor our performance and make necessary decisions to ensure that
we meet our targets.
• To help us know when we meet our goals.
Typical Performance Measures
 Quantity of Work
 Timeliness (Speed)
 Quality of Work
 Completeness
 Effectiveness
 Efficiency
 Satisfaction
 Compliance 58
Measures :
 Meaningful and relevant to the unit.
 Must have strong relationship to strategic objectives and
outcomes.
 Must give vital information to achieve objective.
 Must be measureable with reasonable effort.
 Must be collectable or accessible from a data source with
reasonable ease.
 Must be something that the Measure Owner can control,
influence or improve.
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 Monitoring Performance
– Consistently measure performance and provide ongoing
feedback.
– Progress reviews with employees on performance VS goals
– Opportunity to check how well employees are meeting
predetermined standards
– Make changes to unrealistic or problematic standards.
– Identify unacceptable performance.
– Provide assistance to address performance deficiencies.

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 Monitoring…
• No feedback= No performance evaluation
• If we don’t monitor performance, we cannot :
• Give feedback,
• Improve performance,
• Develop our staff,
• Identify potential,
• Rate effectively, the whole process is defunct

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 Developing Employees
• Increasing the capacity to perform
• Address deficiencies through Development /different
intervention
– Through training,
– Giving assignments that introduce new skills or higher
levels of responsibility,
– Improving work processes,

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 Employees’ Development
 Focus on the process, not the recording of the ratings
 Monitor people’s engagement level to ensure high and sustained level
of productivity
 Requirement for continued performance evaluation
 Create simple system for monthly inputting of performance
assessments
 Managers shall indicate number and performance category of
staff each month
 Avail Summary data whenever required
 No surprises, interventions at the right time
 Continuously assess opportunities for improvement
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 Rating
– Evaluating employee performance against the set goals.
– Organizations need to know who their best performers
are
– It is based on work performed during an entire appraisal
period

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 Rewarding
– Recognizing employees, individually and as
members of groups, for their performance and
acknowledging their contributions.
– Recognition is an ongoing, natural part of day-to-
day experience
"Thank you" — doesn’t require a specific regulatory
authority

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 2.5. Common Errors in Performance
Appraisal
• Halo/Horn effect – A halo effect may occur when an
employee is extremely competent in one area and is
therefore rated high in all categories. Conversely, the horn
effect may occur when one weakness results in an overall
low rating
 Errors …
• Recency error – occurs when an appraiser gives more
weight to recent occurrences and discounts the
employee’s earlier performance during the appraisal
period.
• Primacy error – occurs when an appraiser gives more
weight to the employee’s earlier performance and
discounts recent occurrences.
 Errors …

• Bias – when an appraiser’s values , beliefs, or prejudices

distort ratings ( either consciously or unconsciously).
Age, religion, gender, appearance or other non job
related factors may influence the rater to distort
appraisal information.
 Errors continued…
• Strictness – Reluctance to give high ratings. These are
appraisers believe that standards are too low
• Hence, although employees may be performing better
than employees in other departments, their ratings may
be lower
 Errors continued…
• Leniency errors –appraisers who don’t want to give low
scores, all employees are given high scores.
• Central tendency errors –appraiser rates all employees
within a narrow range, regardless of differences in actual
performance.
 Errors continued…
• Contrast error –occurs when an employee’s rating is
based on how his or her performance compares to that of
another employee instead of on objective performance
standards.
 Objective of training
• Overall objective: Build change competency
through Understanding the concept of change
within organizations and how to manage
change for maximum benefit
• At the end of the day you will :
• Have an understanding of the concept and
process of change and how to be an effective
change leader
 Content
• What is change management?
• Why do we have to know and deal with
change management?
• What is the process of change
management?
• What are the steps in change management?
• ADKAR model in managing change
 1. What is change?
• Going through transformation.
• From one state to another
 Where is change?
• If there is any constant in life, it is
change
• Change is our current reality
 Change drivers
• Internal environment
• External environment
 What happens if we don’t
change?
It is not the strongest of species that
survive, nor the most intelligent, it is
the one most adaptable to change”.
 ከማያውቁት መልአክ
የሚያውቁት ሰይጣን ይሻላል፡፡
One year after our
resolution
 ?????????????? Change
• Change is not easy
• We are creatures of habit
• We are comfortable in maintaining the status quo
• Change is a process, it takes time and effort

• HABITS ARE HARD TO CHANGE, even individual

change needs to be managed!
• And yet change is inevitable
 Success factors
• Pick only one resolution/keep it simple
• Make it tangible/make it an action
• Take baby steps, change tiny habits, break it down to
the simplest tasks
• Hold yourself accountable, write it down, tell others,
make it visible
• Keep believing you can do it/ acknowledge setbacks
• Focus on the carrot, not the stick
 What is Change Management

• What is change management?

- It is the people side of change. It is
bringing the attitude, psychology, behavior
and culture of individuals, teams and the
organization as a whole from a current
state to another desired state.
 Assumptions on Organizational Change

• Higher Management usually assumes that :

• - staff have endorsed changes
• - changes are in everyone’s best interest

• The reality is often very different!

• It can be very difficult to introduce change to an
organization
Reflections by business leader on
Change?
“I should have communicated better”
“If I had just been more public in my support”
“Next time I will involve more people”
“I was undermined by managers who felt
threatened by this change”
 Each represents a failure to manage the people
side of change!
 Why Manage Change?
• Organizations are complex systems
• People are complex
Because the issues of front-line employees,
and even supervisors & managers are very
different.
Employees, the project team and executives
have different priorities, different knowledge
sets, different motivations.
Why is it important to focus on the
people side?

• Change brings these different priorities in a potentially

volatile mix.
• Business enters a period in which productivity loss,
customer dissatisfaction and employee turnover
increases dramatically.
• It is at this critical juncture that Change Management
plays a crucial role for business to succeed.
 Why is it important to
focus on the people side?
• Ultimately:

• To be able to prevent and manage resistance to

change
• To increase the probability that the intended
business results of a change initiative/project are
achieved
 Levels of Change
• Organizational
• Group
• Individual
 Selecting a change
•
strategy
The above approach will result in effective management of change.
• However, the change strategy is usually employed vis a vis the
specific situation.

• Directive strategy – imposition of change

• Negotiating strategy – concessions
• Normative strategy – change in values
• Analytical strategy – Data based, use of experts
• Action centered – General problem to trying out solutions
 Factors affecting choice of
strategy
• Pace of change
• Amount an kind of resistance anticipated
• Power base of initiator
• Amount of information required
• Stakes involved
 Change Management Process
• Is the process we go through over a period
of time in moving from A to B.
• Process can vary greatly depending on what
is changing, type of change etc.
• However, there are considerations that need
focus
 Change Management Process
The most effective change management
process consists of three phases:

• Preparing for change

• Managing change
• Reinforcing change
Phase 1: Preparation Stage
• Assess the scope of the change
• Assess the readiness of the organization impacted
by the change
• Acquire project resources and assess the strengths
of the change management team
• Assess the change sponsors and take first step to
enable them to effectively lead the change process.
 Phase 2: Managing Change
• Developing change management plans and
• Taking action and implementing the plans
• Communication Plans
• Coaching Plans
• Training Plans
• Resistance management plans
Phase 3: Reinforcing Change
• Assessing the results of the change
management activities and implementing
corrective actions.
• Celebrating early successes
• Transferring ownership of the change from
change management to the organization
• Conducting “after-action” reviews
 Steps in process for leading
change
• 1. Establishing a sense of urgency
• 2. Creating a guiding coalition
• 3. Developing a change vision
• 4. Communicating the vision for buy in
• 5. Empowering broad based action
• 6. Generating short term wins
• 7. Never letting up
• 8. Incorporating change into the culture
Roles in Change Management
• Change Management : Focus on individual transitions
• Executives/seniors : lead change through direction,
guidance, commitment
• Middle manager : Directly support impacted
employees
• Project teams : Design solution determining what to
adopt, to use means
• Support functions : HR , OD staff, training staff.
 Managers role:
• Close to the action as people must change
how they do their jobs
• Managers need to support his/her people
which will show in their attitudes
• Managers must support both with top down
initiatives as well as through responses to
daily demands
 Role of manager
• Communicator – message about the change
• Advocate – support for the change
• Coach – helping through coaching
• Resistance manager – mitigate resistance
• Liaison – interacting with project teams,
taking directions/providing feedback
 Success

Post-implementation/
Maintenance

Implementation

Analysis and Design

Need/Problem

Awareness Desire Knowledge Ability Reinforcement

People dimension of change
• Effective management of people dimension of change
requires five key goals:
• Awareness of the need for change
• Desire to participate and support change
• Knowledge of how to change ( what change looks like)
• Ability to implement the change on day to day basis
• Reinforcement to keep the change in place
Five stages of Grief model
• Denial
• Anger
• Bargaining
• Depression
• Acceptance
 Resistance to Change

• How prevalent is Resistance to Change?

– It is generally acknowledged that in an average
organization, when the intention for change is announced:

• 15% of the workforce is eager to accept it

• 15% of the workforce is dead set against it
• 70% is sitting on the fence, waiting to see what
happens
 Why people resist change
• Self interest
• Misunderstanding
• Different assessments of the situation
• Low tolerance for change
 Overcoming resistance
• Education and communication
• Participation and involvement
• Providing support
• Negotiation and agreement
Resistance Management Plan
• Resistance is normal
• Persistent resistance is dangerous
• Use Individual Change Management
techniques to identify, understand
and manage resistance.
 ADKAR model provides focus
for conversations about
change
• Clarify communications to center on the most relevant
topic
• Helps business leaders avoid sending the wrong message
or spending time on the wrong topics
• Help identify when objections to change are actually not
objections to the design or solution but resistance to
change.
 Applying ADKAR:
Not everyone moves through change
at the same pace
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person… A
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A
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Adapted from Prosci 2008
R
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 ADKAR

A – Awareness of the need to change

D – Desire to participate and support the
change
K – Knowledge about how to change
A – Ability to implement new skills & behaviors
R – Reinforcement to keep the change in place
 Developing corrective actions with
ADKAR
If the gap is: Corrective actions:

Awareness Management communicates about the

business reasons for change (why, risk of not
changing, drivers of change); Face-to-face
communications with immediate Managers
about how the change impacts you directly is
what should occur

Desire Look for pockets of resistance and identify the

root cause; discuss your desire for resisting
the change

Adapted from Prosci 2008

 Developing corrective actions with
ADKAR
If the gap is: Corrective actions:
Knowledge Training on how to change and the skills
needed after the change

Ability On-the-job training and job aides to support

the new behaviors; Coaching by Managers;
Troubleshooting

Reinforcement Messages by senior leaders and Managers

that the change is here to stay; Individual
coaching sessions to identity gaps

Adapted from Prosci 2008

 How? By asking questions like:
• Around Awareness: “Do you understand and agree
with the business reasons for making this change?”

• Around desire: “Do you want this change to

happen or would you prefer to keep things the way
they are? What would cause you to want this
change to happen?”
• Around knowledge: “Do you know about the change
and the required skills to support the change?”

• Around Ability: “Are you capable of performing

these new skills?”

• Around Reinforcement: “Are you receiving the

necessary support and reinforcement to sustain this
change?”
Tips for managing resistance
• Expect resistance
• Create opportunities to vent
• Listen
• Look for trends
• Be specific
• Be honest
• Bend but don’t break
• Silence is not golden
 Responding to reactions
• Ask for questions and concerns
• Ask for opinions
• Resist becoming defensive, encourage
communication
• Be visible and involved
• Provide information
• Be patient
 Ask?
• How will the change impact the employees?
• What kind of communication should I target to
reduce resistance?
• How will roles change?
• What kind of tools do the managers need to get
employees on board?
• What kind of skills do the employees need to
succeed in the new environment?
 Exercise

• Taking into consideration the

morning session on Performance
management, how would you
apply the ADCAR model ?
 • Change is the norm!
• Lets make it our competitive
advantage!
• Thank you!
Thank you !

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