“People aren’t against change – they are against royal edicts” – Gary Hamel and Michele Zanini.
Around 70% of planned organizational change interventions fail. This figure is often repeated, and remains stubbornly high. This is despite the time, energy, and money spent on strategy retreats, external consultants, bulky business plans, and creative Microsoft PowerPoint presentations. We need to improve implementation rates. What goes wrong?
The pandemic has been a learning experience. Many companies made radical changes to business models and working practices. Although implemented overnight, with limited pre-planning, these changes faced no resistance, and were successful. What went right?
First, everybody knew why these changes had to happen. Second, those who were affected were intimately involved in designing and implementing the changes. Third, this happened quickly; no time for analysis, pilots, deliberation, or argument. If things didn’t work out, the changes were replaced by other new ideas – again at speed.
Finally, the backstage politics that normally accompany major changes were absent.
This is a ‘burning platform’ approach to change implementation, with high levels of participation, rapid action, no-regrets decision-making, and no (small ‘p’) political interference. Does this suggest that we need a new model of change management? No, but it does mean paying attention to parts of the standard model with which we are familiar.
We need to know why
It maybe goes without saying that everybody needs to have a clear understanding of the problem. But that is often a challenge.
Take the UK industrial dispute which recently brought the UK rail network to a halt. Does the problem lie with pay, or with modernization plans? Or both? Views differ.
A recent report into NHS problems identified a catalogue of issues including core values, diversity, career progression, appraisal systems, and staff incentives. This agenda would take years to implement. Also, it was not prioritized, so good luck with getting agreement on where to start.
Without a common understanding of the issues that need to be fixed, an organization will be sailing into a fog, not knowing the direction, or how long it will take to get there.
This is not a rational process
It is a mistake to think that strategic change is all about scenarios, business plans, and numbers. This is only part of the story. Change is a deeply politicized process – and the politics must be managed. This starts with your stakeholder matrix. Who have the highest stakes in the changes, and who have the most power to back or block them?
Conventional wisdom suggests focusing on those with the strongest interests and the greatest power. But in a time of rapid change and uncertainty, those who have no stake today in what happens may find tomorrow that they are closely involved.
The powerless can be recruited by the powerful, thus strengthening their numbers, and their influence. To manage these shifting sands, and avoid being taken by surprise, pay attention to all four quadrants of the stakeholder matrix, tailoring tactics to each group accordingly.
It’s all about timing
The pandemic showed that major changes can be implemented quickly. The conventional approach to strategic planning takes time. We need to gather the information, explore the options, assess the implications, prepare the business plan, agree the budget.
We don’t want to make mistakes – but we don’t want paralysis by analysis either. Delay means that the initial urgency and excitement are lost, and momentum stalls. The problem that triggered the process in the first place may have changed in the meantime.
Even in the absence of a crisis like the pandemic, the pace of events is now relentless. There’s little point in taking 18 months to develop a strategy that could be out of date before it’s implemented. The pandemic experience says JDI: just do it. If it doesn’t work, don’t punish the innovators, but learn from the experience, and do better.
It’s also about customizing
Should we apply the same standards and conditions in every part of an organization? Universal solutions are seductive. They are less costly, and easier to implement. But changes must be tailored to local conditions if they are to work.
For example, middle management have a reputation as change blockers. But middle managers subvert top-down diktats which they know won’t work in their areas. If the changes were to be pushed through and fail, they would get the blame. It makes sense for middle management to ignore executive orders and tailor solutions that they know will be locally effective.
The other advantage of local adaptation is that it leads to local ownership. Those who were involved in designing a change initiative are more likely to be committed to making it work. Change imposed from above is more likely to meet resistance.
What about the money?
The textbook tells us to provide adequate resources for strategic change. But what does this mean in practice? Research in the health service offers different advice**. Two units that received lots of additional funding made less progress with their change programmes than a ‘low priority’ service which got no extra cash.
Why? The units with the extra money got extra scrutiny from powerful stakeholders, who had to be managed, which was distracting. The unfunded unit was left to get on with it – turning their service into a national showpiece.
It may help, in some cases, to ignore the textbook. See if change can be driven successfully with existing budgets, using local staff and resources.
Avoid the distraction that a serious injection of funds and external people could create and take ownership away from people who knew the culture and local conditions.
Who’s in charge?
A multi-faceted strategic change program raises questions over who will be responsible for implementing it. The textbook advises role clarity. But this isn’t always necessary or desirable. It takes a large number of people to implement a large change program.
Some ambiguity is inevitable. Different individuals and groups may take the lead at different stages, depending on their expertise and the demands of the program.
A recent CIPD report describes how, during the pandemic, ‘pop-up leaders’ – individuals and teams – stepped in to handle different aspects of the crisis. Tom Peters once said, ‘Great leaders do not create followers, they create more leaders’. ‘Distributed leadership’ encourages involvement at all levels, in contrast to traditional, senior, individual leaders.
The NHS review mentioned above recommended a national Review Implementation Office. But one of the underlying problems that the review identified was ‘pressure from above’. A national change management body would intensify those pressures.
Local teams would have no ownership of either the problems or the solutions. This is a recipe for failure.
The HR contribution
How can HR help to bridge the strategy-implementation gap? In this article, we have highlighted six key issues where HR can contribute:
- Clearly communicate the purpose of strategic change and keep people up-to-date. Accept that views will differ, but try to establish a common understanding of purpose and outcomes.
- Manage the politics of change. Understand the potential roles of all your stakeholders, winners and losers. This should apply also to those who have little interest in the changes, and limited power to influence them, because those conditions can change.
- Accept the risks of acting quickly and learn from the results. When change is imperative, no-regrets decision making means accepting that mistakes will happen. But reward the risk-takers, learn from their mistakes, and improve next time.
- Insist on local adaptation. Resist the appeal of overly standardized solutions. Local ownership guarantees commitment to solutions that are more likely to work.
- Be cautious of throwing big money at big problems. Ask those who are involved how they feel about this. Would an injection of funds and external involvement lead to disruptive distractions and diluted ownership? Will they be able to work with current budgets? Is there willingness to take ownership?
- Offer leadership development to all organizational levels, using a range of development options, such as coaching, team development, targeted input, and action learning. This is no longer a senior management preserve. Major changes with multiple facets typically need a distributed model of leadership, or ‘pop-up leaders’, to cover the bases.
Make a concerted effort to bridge the gap between strategy and execution. Target the key areas where active involvement from HR can make a difference.
Above all, challenge conventional wisdom where local conditions can increase the success rate beyond what others are telling you.
*Hope Hailey, V. (2021). Responsible Business Through Crisis: Senior Leaders On Building New Cultures Of Trust. London: Chartered Institute for Personnel and Development.
**Wiedner, R., Barrett, M., & Oborn, E. (2017). The emergence of change in unexpected places: resourcing across organizational practices in strategic change. Academy of Management Journal, 60(3), 823-854.
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