Organizational Change Management

Ganesh Botcha, Ajoy Chatterjee

21 Sep ’15, Monday

Agenda – Organizational Change Management

# Topic Speaker

Minutes

1 Basic Reasons for Org Changes Ganesh B

2

2 Typical Org Changes Ganesh B 3

3 What happens during an Org Change Ganesh B

2

4 Kotter’s 8 Steps Model for OCM Ganesh B 5

5 Steps 1 thru 6 Ganesh B 10

6 Steps 7 thru 8 Ajoy C 5

7 Benefits of OCM Ajoy C 5

8 Change Fatigue Ajoy C 15

9 Reframing OCM Ajoy C 3

10 References

11 Q&A Ajoy C, Ganesh B 10

Change is the key

The rate at which our world is changing is increasing but our ability to keep up with it is not ..

Dr. John Kotter

Basic Needs/Reasons for an Organizational ChangeReduce Operational Costs Increase Revenues and

Profits

Improve Efficiency and Effectiveness

Increase Speed of Delivery

Typical Changes in an Organization ..

Many Other Changes - New Business Strategies, etc.,

Mainframes

Client Server

Web-Desktop

Mobile Wireless

Technology Changes

Business Globalization Change

Org Structure Changes

Current State

Future State

Process Changes

Regulatory Changes

What happens during an Org Change?

Performance Dip

Lengthy Duration for Change Adoption

Why Performance Dips?

ActiveResistan

ce

PassiveResistan

ce

Neutral Enthusiastic

Support

Acceptance

Organizational Change Management in a Nutshell

Courtesy: Gavin Wedell

Solution - Kotter’s 8 Steps for OCM/Transformation

3 Form a Strategic Vision and Initiatives

2 Build a Guiding Coalition

1 Create a Sense of Urgency

7 Sustain Acceleration

6 Generate Short-Term Wins

5 Enable Action by Removing Barriers

4 Enlist a Volunteer Army

8 Institute Change

Phase - ICreate a

Climate for Change

Phase – IIEngage and Enable the

Organization

Phase – IIIImplement and

Sustain the Change

BIG

OPP

ORT

UN

ITY

Organizational change management (OCM) is a solution framework for managing the effect on people due to implementing a new business process, technology or org structure in an enterprise. It addresses the people side of change management.

Step 1 - Create a Sense of Urgency

• Leadership must describe the opportunity (What are the stakes if we succeed, Consequences if we do not act up on it quickly, etc., ) such that it will appeal to the employees’ heads and hearts and they sign up for the change instantly ..

• 71% workforce is actively disengaged. This costs USA annually 300 Billion.

• If you see even glimmer of a Big Opportunity, it's important to engage and mobilize around it as quickly as possible to be ahead of competitors.

• Companies with engaged employees have 5 times more Shareholder Returns.

(Phase I : Create a Climate for Change)

Step 2 - Build a Guiding Coalition

Establish a guiding coalition with group of Leaders, Managers, SMEs that bring expertise, energy, and perspective to institute the change and most importantly to sustain that change.Avoid resisters from this coalition.

Real collaboration is about steppingoutside of traditional institutionalstructures to focus on results. In fact,there is an 81% correlation betweencollaboration and innovation.

81%

(Phase I : Create a Climate for Change)

Step 3 - Form a Strategic Vision and Initiatives

Shape a vision to help steer the change effort and develop strategic initiatives to achieve that vision.

Business Week attributes 30% higher return on several keymeasures for the companies withwell-crafted mission statementsdescribing why the business existsand its optimal desired future state.

(Phase I : Create a Climate for Change)

Step 4 - Enlist a Volunteer Army

Large-scale changes can occur only when significant number of employees work for a common opportunity and driven in the same direction.

Raise a large force of volunteers from various levels of organization who are ready and willing to drive the change.

Organizations with a high number of actively engaged employees have an average of 147% higher EarningsPer Share (EPS) than the norm.

(Phase II : Engage and Enable the Organization)

Step 5 - Enable Action by Removing Barriers

Remove barriers of hierarchies, processes that pose threat to achievement of vision and provide necessary freedom to employees to work across boundaries and create real impact.

“Innovation is less about generating brand-new ideas and more about knocking down barriers to making those ideas a reality.”

- John Kotter

44% of leaders agree that their own management strategies are too bureaucratic and are a nuisance.

(Phase II : Engage and Enable the Organization)

Step 6 - Generate Short-Term Wins

Consistently produce, track, evaluate and celebrate volumes of small and large accomplishments – and correlate them to results.

Wins are the molecules of results. They must be collected, categorized,and communicated — early and often — to track progress and energizeyour volunteers to drive change.

(Phase II : Engage and Enable the Organization)

Step 7 - Sustain Acceleration

• Identify and resolve issues with org structure, culture that may impede upon the change execution.

• Ensure that policies, procedures and systems align with the change vision.

• Hire, promote, develop and reward employees to implement change vision.

• Reinvigorate the process with new projects, themes and volunteers.

Change leaders must adapt quickly in order to maintain their speed. Whether it's a new way of finding talent or removing misaligned processes, they must determine what can be done — every day — to stay the course towards the vision.

Agile firms see a 37% increase in revenue when they employ leaders who strategically adapt to any situation.

(Phase III : Implement and Sustain the Change)

Step 8 - Institute Change

Big Opportunity

Volunteer Army

Results

To ensure new behaviors are repeated over the long-term, it is important that you define and communicate the connections between these behaviors and the organization's success.

(Phase III : Implement and Sustain the Change)

Organizational Change Fatigue• A passive resistance from the organization toward change• Can be individual or team in nature• Studies show, 70% of organizational changes fail in their purpose due to change fatigue• Changes executed in a wrong way, or too many changes at the same time lead to fatigue• Exhausts the employees• Employees don’t see a value for themselves

How to overcome fatigue:

• Reiterate again and again, what not changing would impact to the future of the organization

• Device ways to show them the value of changing• Make people love the change as people will embrace it only if they love it

Reframing Organizational Change

Benefits of implementing OCM

Successful implementation of OCM will decrease the Performance Dip and shortens the duration of Change Adoption.

References The 8-Step Process for Leading Change

http://www.kotterinternational.com/the-8-step-process-for-leading-change/ Transition Process

http://www.businessballs.com/ Forbes Study - Why Change Management Fails - And How To (Perhaps) Succeed

http://www.forbes.com/sites#/sites/victorlipman/2013/09/04/new-study-explores-why-change-management-fails-and-how-to-perhaps-succeed/

Perspective on Leading Strategic Change http://orgreadiness.com/

Kotter, J. P., & Schlesinger, L.A. (1979). Choosing strategies for change. Harvard Business Review 106-114. Bridges, W. (1991). Managing transitions: making the most of change. Reading, MA: Wesley Publishing Company.

Dent, E. & Goldberg, S. (1999, March). Challenging "resistance to change." Journal of Applied Behavioral Science 25-41.

Kegan, R. & Lahey, L. (200 1, Nov). The real reason people won't change. Harvard Business Review 85-92.

Questions?