All businesses face change at some point in their life cycle. This may be thrust upon them by outside factors such as competition, globalization, political changes or rapid technological progress. Or, the business may seek change proactively through a merger, improving business procedures or reforming the product offering. Whatever the reason, managing change is a multi-disciplinary process. There's no way to pull the various strands together without some clear tools and techniques in place to drive the change implementation forward.
What is Change Management?
Change management describes the planned management of change, taking the business from its current state to a target state. Its main task is to make order out of chaos. Good change management techniques lead the business through a potentially disruptive process in a planned, controlled and stabilized manner so the risks associated with change are ring-fenced and minimized.
There are multiple stages in the change management process, and those stages may differ from project to project and organization to organization. The common factor is structure. Whatever approach you take, change management models always involve the systematic application of tools to drive the business from where it is now (point A) to where it needs to be (point B). Breaking it down, change management is:
- Limited in time.
- Strictly targeted toward a very specific destination.
- Controlled "from above" by senior leaders (often consultants are called in).
- Proactively managed, such that with affected individuals are prepared from the beginning to deal with the negative consequences of change such as fear, anxiety and insecurity.
- Designed to result in long-term changes for the business.
Understanding the Change Management Process
What we have then is a holistic and at the same time very precise process for managing change. The process itself is guided by a strong framework so people can understand how the business is moving from point A to point B and what is expected of them. Change consultants often develop their own frameworks and sell their services based on the value of their proprietary process.
Virtually all frameworks lean heavily on the work of John P. Kotter, a leader in the field of change management. Kotter discovered that 70 percent of all change projects fail; most of them in the early stages. And it was not the process or the technology that represented the greatest obstacle to change, but people. Time and again, people resisted the change and fell back into old habits. So, the project failed.
Based on this insight, Kotter developed eight specific change management steps in 1996. The theory provides a framework for implementing change and gives leaders tips on how to drive change effectively. At the heart of the model is constant reinforcement of the change message, on the basis that it's the constant dripping of water that cuts the stone.
Change Management Techniques: Kotter's Eight-Phase Model
Here are Kotter's eight stages:
Step one: Create a sense of urgency
The first step is raising awareness of the urgency of the change, both among leaders and employees. For instance, change leaders might develop scenarios that could occur if the status quo was preserved to support the case for change. You can use a SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) to identify how your stakeholders will be affected by change (or the lack of it).
Step two: Build a guiding coalition
Build a team of advocates by attracting forward-thinking people to the change idea. Bring these early fans together under the banner of change. Make sure you have a good mix of employees from different departments and with different job functions and competencies.
Step three: Develop the vision and strategy
Create a strong vision and concrete strategies to help you reach your goal. Communicate these in a well-prepared and powerful speech.
Step four: Communicate the vision
Do not be afraid to communicate the vision over and over again to the executives and employees. This creates trust and strengthens motivation.
Step five: Clear obstacles
Are there structures in your company that slow down change? Take a close look at the status quo and clear out unfavorable organizational structures, workflows and routines.
Step six: Make short-term success visible
Avoid long-range and time-intensive goals in the early implementation stage. Instead, define quickly achievable goals. Go for the low-hanging fruit and secure some early wins – this will help people rally behind the process. Reward people who support change.
Step seven: Accelerate the change
After each milestone, analyze what went well and what could have gone better. Always develop new ideas and goals and bring new employees into your advocacy group.
Step eight: Anchor changes in the corporate culture
Drop the anchor! Only when goals are firmly anchored to the corporate culture can you regard the change process as successful.
Within each of these phases, there are a bunch of tools and techniques you can use to drive the project forward.
Flowcharts and Process Maps
Flowcharts and process maps are a simple way to visualize what exactly is changing. You start by mapping the organization's current workflows and people within them, and compare that to the "to-be" map which shows the new workflows once the change is implemented. This makes it easy for people to see what's changing and how it impacts them.
There's a universal language for process mapping which involves using symbols to represent a change – rectangles for a process activity that does not involve any major decision-making, diamond for an activity that does involve significant decision-making and so on. This "language" is designed to help you quickly identify process ownership, responsibilities, bottlenecks and repetition. When you see the problems that currently exist, it's easier to fix them.
Interviews, Surveys and Focus Groups
Interviews, surveys, questionnaires and focus groups are all ways to gather information about the change initiative. This involves taking your business case for change to the people who may be affected by it and gauging their perceptions of it. The business needs to carefully listen to what its people are saying about "how things are done around here" so they can design the new model of working.
Generally, interviews are conducted with managers, employees, customers, suppliers and anyone else you're interested in getting quality insights from. Each method has its pros and cons: with focus groups, for example, you can ask for specific examples of an issue that's raised to get a more nuanced understanding of the problem. On the downside, certain voices can dominate the room.
Stakeholder Analysis in Change Management
Change management models always include some type of stakeholder analysis. This is the process of identifying all the people who may be affected by the change and organizing them into groups. Classification or "stakeholder mapping" depends on the business – you might start with your core stakeholder groups like customers, suppliers, employees and regulators, then break these groups down further based on geography, occupation, seniority, how much influence they have and so on.
The idea is to find out who your stakeholders are (the group may be wider than you think) and what is important to them in the context of the change project. This is another process that you want to do at the beginning of the project, before any consultations begin. Take care not to miss anyone as these people are likely to be the most resistant to change.
You can now prioritize your stakeholders according to the level of involvement and "hand-holding" each group needs. For some groups, a loose working relationship may be all that's required. Others may require special initiatives to protect their interests during the change implementation.
Force Field Analysis
A force field analysis helps you identify the forces that are helping the business move forward with its plans and the forces that are holding it back. It's also known as a "barrier and aids analysis" – meaning things that act against change (barriers) and things that help (aid) the change project.
The purpose of this tool is to help identify:
- The strongest inhibitors to the project which could be things like costs, a drop in the work output or quality, policy restrictions or a "this is how we've always done it" mentality. Once identified, you should focus your efforts on resisting these inhibitors.
- The driving forces of change, which could be things like employee retention, training and key performance indicators. Focus on strengthening these drivers to push through the change project.
It's easy to wear the rose-tinted spectacles and only see the benefits of change, yet all change projects require someone to give up something. Force field analysis gives a more holistic view so you can start changing existing paradigms.
The Buy-In Index
The buy-in index is a short survey, or series of surveys, that track attitudes at specific intervals as the project is being implemented. It provides a snapshot of how much buy-in you're getting across the various stakeholder groups, compared to what people thought about the project during the pre-implementation phase. You're looking for an upward trajectory, meaning the degree of buy-in increases over time.
The survey itself is a rating scale (1-5, with 5 being the highest). Questions cover such things as, "I understand what I need to do to ensure the new system works effectively" and, "I believe that the new system will improve our performance."
The index also acts as a reinforcement tool, since respondents can see their own familiarity with the new model improving over time.
Risk Assessments and Contingency Planning
No project is free of risk, and your goal is not to eliminate risk entirely but to clarify what represents an acceptable level of risk for the organization and keep risks within those defined limits. A risk assessment is a tool you can use to compare the risks associated with a particular course of action. The assessments themselves come in all shapes and sizes, and you can design them to cover off specific risks you've identified in, for example, the stakeholder interviews or force field analysis.
The idea is to categorize risks from "insignificant" (who cares?) to "catastrophic" (puts the entire business in jeopardy) and all the gradations in between (minor, moderate and major risk). Ask yourself, what might trigger a risk? What are the signs to look out for which suggest the business is edging towards a risk situation? What cost-effective, proactive mitigation measures can you write into the transformation plan?
By having clear signals around what a risk is and its potential impact, you can quickly spot when a risk has occurred and kick straight into your workaround to recover the situation before any damage occurs. A good risk management/contingency plan is financially prudent and can save a project from almost certain failure when the worst occurs.