Client Login
Tuesday, 27 January 2015 17:54

There's Work Here for My Grandchildren

No matter how many years I work in change management one thing never ceases to amaze me.  How the simplest and easiest things to avoid are not, and they are the things that trip us up.

I’m a member of an association that is an international group with a corporate/chapter structure.  This association has gone to standard processes in one area of the organization.  In addition, two of the core values of the corporate entity are flexibility and collaboration with their chapters.  Both are great core values.  Unfortunately the way they have manifested themselves in the endeavor to standardize a process is this:  The ‘standards’ aren’t written down, the head of the group just talks about them. (Often in the abstract, which is in and of itself a problem but I won’t go into that here.)  And when someone does something not to the standard instead of reiterating the standard dispassionately, they want to enter into a conversation to re-convince the individual of the need for standards.  And maybe the standards stay the same, but it is hard to tell because there isn’t anything written that anyone can refer to.  To some individuals working with the standards they seem to change, which is confusing.

You can see where this is going.

There are so many things wrong with their approach; it is hard to know where to begin.  So I’ll just say this:  Clarity, Clarity, Clarity.

As we know, when making a change it is important to be crystal clear about the change and what it is, and what it’s not.  People do better when they know the rules.  And if the rules or standards appear to be changing pretty regularly, it is hard to abide by them.  That’s why when you change procedures or processes it is important to put them in writing in a way that anyone can pick them up and understand them.  We know this, but it still isn’t being done. (Now you know why I say there is work here for my grandchildren.)

One of the frustrations of this corporate group is that they don’t know why they have to have the same conversation over and over again.  To this I say, to you it is the same conversation, but to others it may not be.  And if, in fact, you are having the same conversation over and over again, maybe it is because the other person isn’t clear about the rules.

When I mentioned to this corporate entity that the standards need to be clear, they told me it wasn’t ‘black and white’.  Problem number 2: If you are going to have standardization, the rules that govern it need to be black and white.  This is the rule, this is what the rule covers, this is what the rule doesn’t cover.  Otherwise it isn’t a standard.  This seemed to go against their core values of collaboration and flexibility but it really doesn’t.

Standards are by their very nature not flexible, but they are often surrounded by ways to be flexible.  You can have a standard that says ‘you must do a, b and c’ but then when it comes to ‘d’ there are options.  It is still a standard.  And these standards were created in collaboration with representatives from many of the chapters, so there is collaboration.  But once they are set, if you really want to standardize, you can’t continue to act as if there is flexibility and collaboration regarding the standards – or you will just confuse people, which is exactly what is happening.

I could go on, but I think you get the picture.  The lesson I want to share with you from what I describe is this:  when you are leading change it is important that you have clarity on several levels.

Clarity Level 1:  Make sure you, yourself are clear about the change – what is changing and what isn’t.  Make sure you understand the change from the perspective of the changee – the person doing the changing.  If you are the change agent, it is incumbent upon you to understand other perspectives.

Clarity Level 2:  Have repeatable explanations of the change that ensure it is clear to everyone.  By repeatable I mean written.  If there are standards or new rules, make sure the rules are written in a way that everyone can understand.  Do a test – ask people not involved in any way to read the standards and tell you what it means to them.

Clarity Level 3:  Invite and welcome questions about things that aren’t clear – no matter when they occur  - in a month, in two months, in two years. Knowing what others are clear about – and not - is a gift.  Inviting questions so you can further clarify is a great way to continue the collaboration.  Maybe the standard needs to change, maybe the standard needs to be clearer, maybe there is a need for another standard, maybe everything is completely clear.  Whichever it happens to be, clarity should always be your goal – but not clarity to you – clarity to others.

Keep in mind that a change may be simple and straightforward to you, but change and how it is viewed is in the eyes of the recipient of that change, not you. 

Want to talk more about change in your organization?  Call me any time – especially today because I’m snowed in!

 

 

Wednesday, 03 December 2014 00:00

The ROI of Culture in M&As

There is so much talk lately about acquisitions and mergers.  Seems like everywhere you turn, someone is buying someone or merging with another.  Big seems to be in.  I'm good with that, but with all the focus on the money end, I bet few are thinking about how bringing two cultures together will affect their bottom line.

Let's start with some statistics:

  • 70% of mergers and acquisitions fail to achieve their anticipated synergies
  • 50-90% fail to meet financial expectations
  • 50% suffer an overall drop-off in productivity for the first 4-8 months
  • 'People problems' are cited as the top failure factor in mergers and acquisitions

[Some information above is from "Culture Management in Mergers & Acquisitions" by SquarePeg.  You can download the PDF here.]

leaving money on the table change management

 

There are a variety of reasons why mergers and acquisitions fail (TechCrunch has an interesting list - which includes more than a couple of the 7 Deadly Sins), of course.  But the one that often goes under-recognized is the role of organizational culture.

I suppose in some ways it's not surprising that 'culture' isn't addressed more often or more thoroughly:  Typically, the people driving an M&A are the $5000 pinstriped-suit, Bluetooth-obsessed finance guys (and they do seem to be predominantly male) who are more comfortable with variables they can quantify, like shareholder value, than they are with more qualitative concepts like 'organizational culture'.

Except that it's not actually all that difficult to quantify the cost of a culture fit misfire - it's just a matter of breaking it down into its component parts.  Let's look at some ways to do this.

Loss of top performers:

In my experience, it's the loss of senior A-list employees that can cause the most lasting damage to a merged or acquired organization.  It's not just at the VP-level, either.  Losing senior managers - the ones who've been quietly ensuring that their departments run smoothly and productively, but who are often ignored during a flashy M&A and who are left reeling from a sudden, dramatic change in organizational culture - can leave gaping holes in an organization that take months, and sometimes years, to fill.

But let's quantify the loss.  Assuming we lose 5 senior managers with an average annual salary of $110,000 each, and using a turnover calculator from Drake International, this represents a cost of $5.7 million.  (Sure, Drake's a staffing company and they're a little biased, but even the most conservative estimate here is more than $2 million - and that's just 5 senior managers, not the employees who follow those managers to their new employers.)

Loss of market confidence:

If there's one thing M&A people love, it's Driving Shareholder Value.  But culture clash can mean a drop in shareholder value, as Microsoft's acquisition of Nokia last year has demonstrated.  There are probably other more recent one's, but I particularly like this one.

Loss of productivity:

Mergers and acquisitions can cause productivity losses even in the best-case scenarios.  An unaddressed culture fit problem can make the problem much, much worse - and exponentially more costly.

Let's think about it this way:

  • 5000 employees
  • Each of them spends 30 minutes a week for 3 months overcoming culture fit challenges (either in increased meetings or decreased work product)
  • That's 32,500 hours in lost time
  • At a blended cost of $150/hour, that's $4.8 million

It's not difficult to quantify the cost of ignoring the ROI of culture in a merger or acquisition.  The bigger question is:  Why are the M&A drivers leaving so much money on the table?  It isn't hard to manage, you just have to pay attention to it and put people on it that understand both culture and business.

 

Ideas are great.  Implementation is better.

Here's an idea:  I'll give you 3 job titles, and you choose the one you'd most like to have.

Change Agent
Innovation Catalyst
Change Management Consultant

You didn't choose Change Management Consultant, did you?

why is change management so boring

Somehow, 'Change Agent' and anything with the word 'innovation' in it sound a lot more exciting than 'Change Management'.  And yet, in many ways, change management is the most important part of the process.

Last week I met a fellow whose business card said he was a 'Change Agent'.  He was everything you'd expect someone with that title to be:  30-something, fashionable clothes, great sunglasses and full of information about the latest hot topics on TechCrunch and Mashable.  

Of course, I'm always interested in anything to do with 'change', so I started asking him what he did on a day-to-day basis.  "Oh, you know," he said.  "I inject ideas into the organizational framework and help us transform the marketplace."  

He did have some interesting ideas - he's definitely thinking about where his industry will be in the next 5-10 years, and how the market will change in that time.  That kind of thinking is important for any organization.

But between Big Ideas and Big Results there is...implementation.  And that's where Change Management comes in.  The problem is that 'management' never seems that exciting - especially compared with 'injecting ideas'.

That's why I like to think in terms of architecture.  Architects take someone else's Big Idea - "I want a beautiful house on this piece of land" - and then figure out how to make the big picture work wtih the small details to get it done.  They show you the model of the building with the graceful facade - and then they show you the detailed construction plans which outline how the thing is going to be built.  And then a good architect oversees the process, from the first groundbreaking to the final landscape design.

There's no question that there's something inherently exciting about coming up with a brand new idea for change - it's like starting a new notebook with nothing but possibilities ahead.  But in the long run there's something much more satisfying about being able to take an idea from conception to fruition to results that being an 'agent' or 'catalyst' just can't touch.

Wednesday, 11 June 2014 00:00

When change falls flat

People view change in different ways, and some are more resistant to change than others. Even if you believe the change you've just announced is positive, beneficial on many levels, and an easy sell, there will be employees who react negatively.

Even employees who are highly resilient may not embrace change if you fail to:

  • prepare them,
  • communicate with them along the way, and proactively
  • manage the change process.

When the change you've announced falls flat and you're met with resistance, it's probably a sign that you've made some missteps in preparing and presenting the initiative upfront. If this is the case, don’t panic. All is not lost.

Here are some general guidelines on how to win over the “resistors”:

Get to the bottom of the negative reaction.

Listen to your employees. Give them a nonthreatening forum in which to express their misgivings, fears, and struggles with the change you are proposing. Make sure you understand the nature of their negative reaction and what might be driving it. For example, they don't understand their new role, don't agree with the timing, or perhaps are just reacting to the "surprise" factor. Engaging in this discovery process with employees helps you and your team develop targeted implementation strategies. Equally important, it lets the resistors know that you're listening.

Communicate what you've learned.

Answer all negative responses in future communications. Address each of the issues they brought up in straightforward, clear language. When appropriate, take responsibility for missteps. For instance, if some employees are reacting negatively because you announced the change without adequate warning, admit your mistake and move on. Get employees involved in the forward momentum of the change process. Instead of dwelling on their resistance, get them focusing on where they can go from here — and how you will do it together.

Emphasize the positive.

Continue to be upbeat, and emphasize the potential good in the change. Winning over resistors involves helping them identify aspects of the change they can feel good about. For example, let them know which aspects of their job are changing and which are remaining stable. Point out how the changes will benefit them. Explain new opportunities and fresh possibilities. Above all, reassure them that they will receive ample resources and support necessary to navigate through turbulent times.

Be realistic about potential negatives.

Doctors have learned that when they inform patients ahead of time what to expect, their patients react better to pain. The same is true for employees. Don't minimize the challenges that are going to be a necessary side effect of the proposed change. Instead, prepare them for various contingencies. When employees know there may be lean times, for example, or a steep learning curve ahead, they will be better prepared. Moreover, "telling it like it is" shows respect on your part.

Engage your middle managers.

Think of middle managers as the eyes and ears of the change process. Ask them to check in with employees early and often during the process to ensure that everyone understands their new role, has a clear sense of organizational objectives, and has the resources to do what's expected of them. Have them regularly report back to you what they've learned. Resistance will continue to pop up along the way, but most negative reactions can be avoided or easily averted through frequent, accurate communication and consistent messaging — much of it by middle managers.

When change falls flat, take heart. You may not be able to undo the initial damage you caused by not preparing your employees well enough, but you will be able to win over resistors and make the change process smoother and more successful from this stage forward.

I do sometimes enjoy a great infographic - it's amazing how a different format can sometimes help you to see information in a whole new way.

Today I noticed an interesting infographic from OneSpring about managing big projects, and thought I'd share it.

Remember you can follow me on Twitter at @BethBanksCohn!

 

I think this cartoon is supposed to illustrate the many ways in which people will resist a proposed change in the workplace.  It does - and it definitely covers most of the most common resistance responses you can expect to any change initiative.

However, what struck me most about this particular illustration is that while one person is standing there doing the talking, 11 other people are having private thoughts.  Not all of them are negative, and not all of them will ever be shared with the person leading the change or even with the other people around the table.  And this is where change can run into serious problems.

Most of us know that feedback is important in the change process.  But as I've mentioned before, we shouldn't be too quick to dismiss change resistors, because they very often have something to teach us.  Maybe they do have a better idea; maybe they have an important piece of information that should be taken into consideration when mapping out and implementing a change strategy; maybe they're just an indicator that the organizational culture and communications need a lot of work before any change can really take root and be successful.  But as long as only one person is communicating while 11 others are silent, no amount of expert change management will make a change initiative successful.

change management communication

When a business needs to change dramatically, in order to stay in business or stay competitive in a changing marketplace, it can wreak havoc on employees.  Even the best top performers can find themselves struggling to keep pace with the change and return to a state of equilibrium.  However, the quicker that employees can return to that equilibrium, the quicker the organization will see the positive results of the change.

Many people think that the best way to encourage employees to return to business as usual is to ignore the 'feelings' around a dramatic change and focus strictly on the tasks at hand.  In fact, nothing could be further from the truth.  Change always raises emotional issues, whether in our professional or personal lives, and companies which acknowledge this will find employees much more receptive to - and better equipped to deal with - even the most dramatic changes.

By injecting change efforts with a little empathy for employees, leaders have an opportunity to positively influence the movement of individuals through the change process.  In their book, Aftershock, Harry Woodward and Steve Buchholz present an effective 3-part model for helping individuals through change:  Clarify; Share; Engage.

Clarify:  The first step toward empthy is to Clarify the issues and concerns an individual may have with the changes taking place.  It starts with listening - both to what's said and what's not said.  At this stage, it's not about refuting concerns, but to clarify that you understand them.  Most people's concerns about change stem from a fear of the unknown, and simply listening and clarifying those concerns by using active listening questions like "What do you fear losing?" and "What would you like to gain?" can help them move past their fears.  This is the beginning of empathy: When you engage in active listening and demonstrate you've heard and understand their concerns, individuals begin to feel they're not alone - which makes it easier for them to move forward into unknown or changing territory.

Share:  In the second stage of this model, you can focus on sharing your understanding of what's happening with the organization.  The key is to relate what you're sharing back to the concerns expressed in the 'Clarify' stage - don't just repeat the company 'party line' about the changes in a generic way, but make it specific and personal.  Even if you can't directly dispel every individual concern (you may not be able to guarantee their job, position or responsibilities), the fact that you're being honest and straightforward will make a big difference.

Engage:  Once you've clarified and shared - and hopefully calmed some of the individual's worst fears by demonstrating empathy for them - you're in a position to gain their commitment to move forward with you (and the organization) through the changes.  Engagement is the root of ownership:  when an individual engages in the process, they can take ownership of their role in the success of the change - and this helps them feel more in control of the process.  Ask them for ideas on how to successfully implement change; create an individual action plan, together; come up with ways to implement their ideas.  The more the individual feels like a valued, crucial part of the change, the more they can focus on what they'll gain rather than what they'll lose.

Don't get me wrong - I'm not suggesting that business change management has to start with weekly therapy sessions for employees in order to be successful.  However, providing a little empathy - especially at the beginning of the change process - can significantly reduce change resistance while encouraging rapid adoption of change.  In fact, in my experience empathy can actually reduce implementation time and cost by as much as 25% over the change cycle.  And that's a 'business result' everyone can appreciate.

 

Page 1 of 10
about

About

Beth Banks Cohn, PhD, founder and president of ADRA Change Architects, is dedicated to helping you and your organization reach your full business potential…
Read More


changesmart tm

ChangeSmart™ Advantage

Change is a fact of life today in business, but that doesn’t make it any easier to carry out successfully. ChangeSmart™ is a framework, a way to approach change. It is a roadmap for success.
Read More


BUY THE BOOKS

 
smart_book

CHANGESMART™

Improve your bottom line through change.
BUY NOW

 
leap_book

TAKING THE LEAP

Achieve your goals by focusing on three critical areas.
BUY NOW


contact

Contact Us

OFFICE: (732) 786-8223

FAX: (732) 786-8224

EMAIL: