Change Management

9 September 2016

I take this opportunity to express my sincere thanks to Dr. Pramod Solanki (Head- People and organizational Development) for suggesting this study and giving me an opportunity to have hands-on experience in the Human Resource Management area. I am grateful to him for reviewing my work throughout the process. I am also thankful to him for giving me his valuable time and support without which this project wouldn’t have completed. I am indebted to a number of contributors I am grateful to Ms.

Shefali Sankpal (HR Executive); who was my mentor for this project, for supporting me and clearing all my doubts. She also helped me know the organization better. I would also like to thank my Professor, Dr. Satishchandra Kumar (Reader, University Department of Applied Psychology, University of Mumbai) for guiding me throughout the journey of this project and helping me at every stage. I would also like to thank my parents for supporting me throughout the journey of this project.

Lastly, I would like to thank all my friends/colleagues at L & T -Ms. Deepa Borse, Ms. Preeti Munot, Ms. Durva Shrivastava and Mr. Bhooshan Chaudhari, for their valuable contribution. Declaration: I Ms. Monika P Bhambi, a student of Masters Program for Industrial Psychology, University of Mumbai, declare that this project has been carried out by me under the guidance of Dr. Satishchandra Kumar and Dr. Pramod Solanki.

 “Change is the only thing that will never change. So better adapt to it. ” Change is something that presses us out of our comfort zone. Change is for better or for worse, depending upon how you view it. In the words of Charles Darwin “It’s neither the strongest nor most intelligent of the species that survive; it is the one most adaptable to Change”. There are two types of change in an organization: “planned” change and “unplanned” change.

Planned change refers to initiatives that are driven “top-down” in an organization, before you change an organization change has to be planned; while “unplanned” change typically involves changes due to new ideas, conflict between individuals, departments or teams and political power struggles inside the organization. What distinguishes planned change from the routine change is its scope and magnitude. Planned change aims to prepare the entire organization, or a major part of it to adapt to significant changes in the organization’s goals and direction. Change management is a relatively new concept that focuses on WHY and HOW organizations change. Based on theory and research, it offers practical advice to managers who are confronted to change.

It is a structured approach to change in individuals, teams, organizations and societies that enables the transition from a current state to a desired future state. It also entails thoughtful planning and sensitive implementation, and above all, consultation with, and involvement of, the people affected by the changes. John P kotter (who teaches leadership at Harvard business School) has made it his business to study both success and failure in change initiatives in business. “The most general lesson to be learned from the more successful cases is that the change process goes through a series of phases, that in total; usually require a considerable length of time.

Skipping steps only creates the illusion of speed and never produces satisfactory results” and “making critical mistakes in any of the phases can have a devastating impact, slowing momentum and negating hard-won gains”. An article by John Kotter in the Harvard Business Review on Leading change: This article was originally published in the spring of 1995 which previewed Kotter’s 1996 book Leading change. It outlines eight big errors that organizations make while transforming. Let us take a look at each of them in brief: 1) Not establishing a great enough sense of urgency: Compared with other steps in the change process, phase one can sound easy. It is not.

Well over 50% of the companies fail in this first phase. The reasons for this failure could be that sometimes executives underestimate how hard it can be to drive people out of their comfort zones. Sometimes they grossly overestimate how successful they have already been increasing urgency. Sometimes they lack patience: “Enough with the preliminaries; lets get on with it. ” In many cases, executives become paralyzed by the downside possibilities. They worry that employees with seniority will become defensive, that morale will drop, that events will spin out of control, that short-term business results will be jeopardized, that the stock will sink and that they will be blamed for creating a crisis.

A paralyzed senior management often comes from having too many managers and not enough leaders. Phase one in a renewal process typically goes nowhere until enough real leaders are promoted or hired into senior-level jobs. Transformations often begin, and begin well, when an organization has new head who is a good leader and who sees the need for a major change. If the renewal target is the entire company, the CEO is the key. If change is needed in a division, the division general manager is the key. When these individuals are not new leaders, great leaders, or change champions, phase one can be huge challenge. When is the urgency rate high enough?

The answer to this question, as per kotter, is when about 75% of a company’s management is honestly convinced that business as usual is totally unacceptable. Anything less can produce very serious problems later on in the process. 2) Not creating a powerful enough guiding coalition: It is often said that major change is impossible unless the head of the organization is an active supporter. In successful transformations, the chairman or president or division general manager, plus another five or 15 or 50 people come together and develop a shared commitment to excellent performance through renewal. In both small and large organizations, a successful guiding team may consist of only three to five people during the first year of a renewal effort.

But in big companies, the coalition need s to grow to the 20 to 50 range before much progress can be made in phase three and beyond. Because the guiding coalition includes members who are not part of a senior management, it tends to operate outside of the normal hierarchy by definition. This can be awkward, but it is clearly necessary. If the existing hierarchy were working well, there would be no need for a major transformation. But since the current system is not working, reform generally demands activity outside of formal boundaries, expectations and protocol. A high sense of urgency within the managerial ranks helps enormously in putting a guiding coalition together. But more is usually required.

Someone needs to get these people together, help them develop a shared assessment of their company’s problems and opportunities, and create a minimum level of trust and communication. Off-site retreats, for two or three days, are one popular vehicle for accomplishing this task. Companies that fail in phase two usually underestimate the difficulties of producing change and thus the importance of a powerful guiding coalition. Sometimes they have no history of teamwork at the top and therefore undervalue the importance of this type of coalition. Efforts that do not have a powerful enough guiding coalition can make apparent progress for a while. But, sooner or later, the opposition gathers itself together and stops the change. )

Lacking a vision: A vision says something that helps clarify the direction in which an organization needs to move. Without a sensible vision, a transformation effort can easily dissolve into a list of confusing and incompatible projects that can take the organization in the wrong direction or nowhere at all. Without a sound vision, the reengineering project in the accounting department, the new 360-degree performance appraisal from the human resource department, the plant’s quality program, the cultural change project in the sales force will not add up in a meaningful way. In failed transformations, you often find plenty of plans, directives and programs but no vision.

A useful rule of thumb: If you can’t communicate the vision to someone in five minutes or less and get a reaction that signifies both understanding and interest, you are not yet done with this phase of the transformation process. 4) Under communicating the vision by a factor of ten: Transformation is impossible unless hundreds or thousands of people are willing to help, often to the point of making short-term sacrifices. Employees will not make sacrifices, even if they are unhappy with the status quo, unless they believe that useful change is possible. Without credible communication, and a lot of it, the hearts and minds of the troops are never captured. This fourth phase is particularly challenging if the short-term sacrifices include job losses. Gaining understanding and support is tough when downsizing is a part of the vision.

For this reason, successful visions usually include new growth possibilities and the commitment to treat fairly anyone who is laid off. In more successful transformation efforts, executives use all existing communication channels to broadcast the vision. They turn boring, unread company newsletters into lively articles about the vision. They take ritualistic, tedious quarterly management meetings and turn them into exciting discussions of the transformation. They throw out much of the company’s generic management education and replace it with courses that focus on business problems and the new vision. The guiding principle is simple: Use every possible channel, especially those that are being wasted on nonessential information.

Perhaps, even more important, most of the executives in successful cases of major change learn to “walk the talk”. They consciously attempt to become a living symbol of the new corporate culture. This is often not easy. Communication comes in both words and deeds, and the latter are often the most powerful form. Nothing undermines change more than behavior by important individuals that is inconsistent with their words. 5) Not removing obstacles to the new vision: To some degree, a guiding coalition empowers others to take action simply by successfully communicating the new direction. But communication by itself is not sufficient. Renewal also requires the removal of obstacles.

Too often, an employee understands the new vision and wants to help make it happen, but an elephant appears to be blocking the path. In some cases, the elephant is in the person’s head and the challenge is to convince the individual that no external obstacle exists. But in most cases, the blockers are very real. Sometimes the obstacle is the organizational structure: Narrow job categories can seriously undermine efforts to increase productivity or make it very difficult even to think about customers. Sometimes compensation or performance- appraisal systems make people choose between the new vision and their own self-interest. Perhaps worst of all are the bosses who refuse to change and who make demands that are inconsistent with the overall effort.

In the first half of a transformation, no organization has the power, momentum or time to get rid of all obstacles. But the big ones must be confronted and removed. If the blocker is a person, it is important that he or she be treated fairly and in away that is consistent with the new vision. Action is essential, both to empower others and to maintain the credibility of the change effort as a whole. 6) Not systematically planning for and creating short-term wins: Real transformation takes time, and a renewal effort risks losing momentum if there are no short-term goals to meet and celebrate. Most people won’t go on the long march unless they see compelling evidence in 12 to 24 months that the journey is producing expected results.

Without short-term wins, too many people give up or actively join the ranks of those people who have been resisting change. Creating short-term wins is different from hoping for short-term wins. The latter is passive, the former is active. In a successful transformation, managers actively look for ways to obtain clear performance improvements, establish goals in the yearly planning system, achieve the objectives, and reward the people involved with recognition, promotions and even money. Managers often complain about being forced to produce short-term wins, but I’ have found that pressure can be a useful element in a change effort. When it becomes clear to people that major change will take a long time, urgency level can drop.

Commitments to produce short-term wins help keep the urgency level up and force detailed analytical thinking that can clarify or revise visions. 7) Declaring victory too soon: After a few years of hard work, managers may be tempted to declare victory with the first clear performance improvement. While celebrating a win is fine, declaring the war won can be catastrophic. Until changes sink deeply into a company’s culture, a process that can take five to ten years, new approaches are fragile and subject to regression. The problems start early in the process: the urgency level is not intense enough, the guiding coalition is not powerful enough and the vision is not clear enough. But it is premature victory celebration that kills momentum.

And then the powerful forces associated with tradition take over. Ironically, it is often a combination of change initiators and change resistors that creates the premature victory celebration. In their enthusiasm over a clear sign of progress, the initiators go overboard. They are then joined by resistors, who are quick to spot ay opportunity to stop change. After the celebration is over, the resistors point to the victory as a sign that the war has been won and the troops should be sent home. Weary troops allow themselves to be convinced that they won. Once home, the foot soldiers are reluctant to climb back on the ships. Soon thereafter, change comes to a halt and tradition creeps back in.

Instead of declaring victory, leaders of successful efforts use the credibility afforded by short-term wins to tackle even bigger problems. They go after systems and structures that are not consistent with the transformation vision and have not been confronted before. They pay great attention to who is promoted, who is hired and how people are developed. They include new reengineering projects that are even bigger in scope than the initial ones. They understand that renewal efforts take not months but years. 8) Not anchoring changes in the corporation’s culture: In the final analysis, change sticks when it becomes “the way we do things around here”, when it seeps into the bloodstreams of the corporate body.

Until new behaviors are rooted in social norms and shared values, they are subject to degradation as soon as the pressure for change is removed. Two factors are particularly important in institutionalizing change in corporate culture. The first is a conscious attempt to show people how the new approaches, behaviors and attitudes have helped improve performance. When people are left on their own to make the connections, they sometimes create very inaccurate links. The second factor is taking sufficient time to make sure the next generation of top management really does personify the new approach. If the requirements for promotion don’t change, renewal rarely lasts.

One bad succession decision at the top of an organization can undermine a decade of hard work. Poor succession decisions are possible when boards of directors are not an integral part of the renewal effort. There are still more mistakes that people make, but these eight are the big ones. In a short article everything is made to sound a bit too simplistic. In reality, even successful change efforts are messy and full of surprises. But just as a relatively simple vision is needed to guide people through a major change, so a vision of the change process can reduce the error rate. And fewer errors can spell the differences between success and failure. Further, Kotter has provided eight steps overcome these eight errors.

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