Thursday, December 3, 2009

Building a Foundation for Organizational Change

Making change happen is one of management’s perennial challenges. If you want a current example, just look at the CMO Council’s recent Marketing Outlook Report 2007. The top priority for CMOs is listed as ‘quantifying and measuring the value of marketing programmes and investments’. That sounds like it involves a whole lot of change: Change in what gets measured, change in how it gets measured and change in who does the measuring. And then there is all the change associated with using the measures to drive the business forward. The other nine priorities listed involve just as much if not even more change. I think you get the picture.

Change folklore suggests a number of foundation stones that must be put in place for real change to happen:

An Urgent Reason to Change
The first of these is an organisational crisis. One where doing nothing is not an option. A crisis forces the organisation to face reality and to prepare for the difficult journey to the new organisation. But a crisis by itself is just a recipe for organisational anarchy. The crisis must be managed in a way that it can be turned into an opportunity to grow stronger, not just an opportunity to survive in a weakened state.

Long-term Management Support
The second foundation stone is top-management support for the change. Top management support is necessary if middle-management is to take the change seriously. Otherwise middle management won’t make time for their direct reports to make the changes happen. And the change won’t become embedded in the organisation as daily business takes priority. But top management often starts change only to go on to start a newer change a short time afterwards. Top management must support the change over the 18-36 months required to embed the change into the new organisation as daily business.

Open & Honest Information
The third foundation stone is open and honest information about the change. Staff don’t like being told what to do. Least of all by ‘overpaid suits’ who don’t understand what life on the front-line is really like. They prefer to understand the nature of the change required and to decide themselves to engage. Change is an emotional process, not a cognitive one. Staff need to feel that the change is value-adding for them and that they have a real role to play in making it happen. But staff are very good at outing information where management says one thing, but does something else instead. Management must be open and honest with staff if the information is to be credible.

Experiential Training
The fourth foundation stone is training in the new world of work. Change is by its very nature new and frightening. Even positive change can quickly become negative if staff don’t know what it means for them personally. Staff need experiential training in the new way of work that the change will introduce. This will provide the foundation that staff need to start to make changed work into daily business. But training by itself only accounts for about 40% of the ‘training effect’. The other 60% comes mostly from providing staff with post-training support once back at the workplace.

Measures, Rewards & Punishments
The final foundation stone is measures, rewards and punishments that reinforce the change. We are all creatures of habit. This is rooted in the brain’s preference for routine activities that don’t consume much cognitive energy. That means the change must be supported by appropriate measures and rewards that reinforce the desired new behaviours. It may also mean punishing the wrong old behaviours. But they must be applied with care. No organisation wants alienated staff who were forced to change but whose heart and mind wasn’t really in it.

In a subsequent post I will set out how change actually occurs in organisations that have developed these foundations.

What do you think? Do you recognise all of these foundation stones in your own change programmes? Or is change something that never quite sticks in your organisation?

by Graham Hill

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