Change Management

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Change Management

Contents

Introduction:

Section 1 Summary:

Section 2 Learning Points:

Section 3 Critical Evaluation:

Section 4 Application in UAE industry:

Conclusion:

Introduction:

This case study has been worked out on the basis of the experience of actual change managers who talk about how to go about managing the necessary changes. It has been very clearly stated that success in managing changes in an organisation is very closely linked to some common aspects like top management support, understanding the problem and involvement etc. The recommendation is to follow a systematic method and not go by ad hoc steps and decisions.

As per the directive of the professor this report will first give a summary of the case, followed by the key learning points and thereafter a critical analysis of the case and finally ending with the highlighting of the applicability in a real life industry in UAE.

Section 1 Summary:

The only thing certain these days is uncertainty and only thing that does not change is the constant rising needs for change and the changes do not – as usual – follow any definite pattern. This study – called Making Change Work – in 2008 by IBM enumerates a few pertinent issues involved in managing change effectively. With a failure rate of about 60 percent most CEOs felt that changes were very shabbily handled in their organisations.

Since the failure of a project implies lost opportunities, unnecessary expenditure and the loss of confidence the necessity of understanding the main stumbling blocks e.g. rigidity in mindsets and attitudes, corporate culture and underestimating the extent of complications involved, becomes very important aspects for the success of the change management process. The surprising part is that most of the executives found these nebulous and intangible aspects – which they termed as ‘soft stuff’ – very difficult to change which may require considerable amount of time and effort and that too various techniques which needed consistent application over long duration of time. Support of the top management followed by involvement of employees, honest and timely communication and finally the corporate culture are the factors which decide the chances of success or failure of a change management project.

Management needs to have a realistic understanding of the challenges facing them together with the complexities of the problem since without that the complexities involved may get diluted if not totally overlooked. Having acquired a comprehensive knowledge and understanding of the challenges the action plan should be worked out to address all the aspects of the challenge and its complexities. To be successful companies must follow structured, consistent and formal change management processes instead of applying ad hoc, impulsive, immature and improvised solutions since change management is no longer an art but a tried and tested professional science.

Section 2 Learning Points:

  1. Change Management projects often fail due to a variety of reasons and hence such projects should be treated with all sincerity, seriousness and concern. Like all failed projects the unsuccessful change management projects also leave behind a trail of wasted money, failure to cash on opportunities and above all a low morale for people concerned.
  1. Out of five projects only two turn out to be successful in terms of delivering the project objective within the planned time frame, budget allocated and quality parameters specified. Thus about three out of five change management projects fail either completely or partially i.e. either over shot the time frame, or budget got exceeded or the quality delivered was not acceptable.
  1. The main hurdles in the change management process are from the areas of changing mindsets, attitudes, corporate culture and underestimating the complexities involved. These soft challenges are much more difficult to handle compared to other resources like people and money. Further, changes in these areas of mindset, attitude and culture typically take longer time to change fully and permanently compared to other business processes and technology etc.
  1. Top management support, sponsorship and participation had been found to be the most important factor for the success of a change management process. The other important factors are employee involvement, honest and timely communication and whether the corporate culture encourages and promotes the change.
  1. Bringing about changes in the behavioural pattern and the cultural norms – especially of the top management – are not only most crucial but also difficult to achieve in the process of ushering in the change when compared to addressing the visible factors like structures, performance measures and incentives.
  1. In order to be successful a change management project needs a complete, full and realistic appreciation understanding of not only the upcoming challenges but also the complexities involved. Thereafter the specific and exact actions to be triggered to address the challenges and containing the complexities are then required to be firmed up. In the absence of early and clear understanding of the tasks ahead may lead to a potential danger that the complexity involved may get underestimated or in extreme cases may even get overlooked. At the initial stages of planning and deciding of a change management project, underestimating the complexity and importance of managing behavioural and cultural changes is very frequently seen. Once the awareness about culture, attitudes, mindsets and complexity is achieved the immediate next step is to initiate suitable action since the desired changes do not come without careful planning and rigorous execution of the plan.
  1. An organisation wide change call for simultaneous change processes being implemented at various levels and it is very common that people become resistant to change since every change is viewed as a disturbance of the equilibrium which they have arrived at over the years. Early awareness of the required changes and subsequent action towards communicating these help to mitigate the expected response of the people in offering resistance to the change management process.
  1. Some effective step would be
  1. Learning about the historical background of the organisation undertaking the change management process, complete with its strengths and weaknesses, success and failures, good and bad experiences and above all the culture, attitudes, mindsets of the top level management.
  1. The scope of the change management project together with the expected outcomes and likely impacts are to be assessed realistically together with how the change will affect the people, its organisational culture and the behavioural norms apart from its impact on the working process and technology. It is important to not only be realistic but also to share the information widely within the organisation.
  1. Once a clear picture of the complexities of the change is acquired, a plan of the action for the actual change process is to be worked out for tackling the complexities. On communication of the plan to everyone concerned for testing and implementation, it may become necessary to adjust and fine tune the plan since many unexpected thing are likely to emerge.
  1. The plan should be long enough – generally well beyond the time limit set for completing the change process – to address the culture, attitudes, mindsets of the top level management since changes in these areas take not only time but also patient, continuous and consistent actions so as to deliver ongoing business value to the organisation. Unless the required changes ‘sink in’ at these levels all efforts (and expenditure) may go down the drain.
  1. Consistent and structured approach to change management which give tangible benefits to the organisation have not yet got accepted in most places. Even if some formal announcements are made then all such activities take the shape of some improvised, ad hoc, immature or informal solutions. With the constant rise in the absolute volume of change together with the related level of complexity the trend of adopting improvised methods of change must make way for introducing formal change management practices executed by professionals.
  1. Evolving and implementing standard change management methodology should include the following steps:
  1. Change management should be an integral part of every project or organisation.
  2. Thos activities of change effort should be focussed on which deliver the maximum benefits.
  3. A standardised change method which can be applied to project after project need to be evolved and implemented with full publicity throughout the organisation along with monitoring its adoption.
  4. This standardised change method should be taught to the upcoming next generation leadership.

Section 3 Critical Evaluation:

Though the report has been very well written and is highly informative yet there are a few areas which could have been covered and then this report would have been a complete document.

To start with, this report talks about ‘projects’ and not about a continuous job in a, say, shop floor or a service sector. In fact the ground realities of a ‘project’ scenario are significantly different from that of a workshop. The project teams get bound together during a project execution and therefore the group alignments and cultural intervention are present but not to the extent it exists in a shop floor or a service department. In the case of the latter category of work places the groups have been in existence for considerable time and – if nothing untoward happens – they will work together up to their retirement.

When such groups are required to undergo a change management process the situation is somewhat different from that in a project. These work groups have been around for quite some time and the people have evolved unique identities which will also need to be worked on. Apart from the cultural aspects of such cases the social factors will need to be addressed. In such situations the complexities of the change module will need to be viewed differently.

Next, the situation mentioned about the culture of the organisation. It does not specifically mention the social culture of the people. In a place like UAE the organisation exists within a society with its social norms and values. While addressing the changing of mindsets, attitudes, corporate culture it would be prudent to also consider the social culture within which the organisation exists.

Finally, there must be some means of finding out as to whether the change management process is making headway in the right direction especially in the difficult areas of changing mindsets, attitudes, corporate culture. These need not be quantifiable but even indicative signs would serve the purpose. This report is silent on the indications or signals that may be expected so as to tell whether the efforts are yielding results or not.

Section 4 Application in UAE industry:

The Emirates Steel which is the only integrated steel plant has felt the need for changing the pattern of working. Due to frequent changes in the specification of the steel required for government projects they need to change the inputs quite frequently.

The top management very soon realised that to keep up to their reputation something needed to be done and that too very fast. A slight introspection revealed that the material procurement system (which was manually operated) needed to keep pace with the new demands. Hence the concept of computerised working was thought and this idea was given wide publicity. People were convinced in the first place that there would be no retrenchment or downsizing but they would be needed to work on the computer ERP system which incidentally was no rocket science. People were told that all they needed was the willingness and rest was the company’s botheration which included training, development and familiarity. The pilot project was taken up in the Central Receiving Stores which was inaugurated by the Operation head. Training consisted of both class rooms as well as on the job, and was conducted by the senior officers of the plant.

As usual, an interest group within the Purchase department duly supported by some director level people, found too many faults with the ERP system. However, each of the so called faults was ironed out and within eleven months of installation the ERP started talking to its detractors on level terms. The top management had extended full support to the Change process and very soon the interest group ceased to exist.

The management took the simple formula of ‘process first, people next and officers last’. With this somewhat standardised change inducing method, the steel producer is now in the process of integrating its maintenance and production planning activities with the Materials management functions on the ERP.

Conclusion:

Change management is an integral part of all organisations. Very soon there will be Change Management department like the Accounts department, HRM department, Materials Management department etc. All these days’ people have agreed that change management is important but they thought that these changes can be ushered in by smart people from within the organisation who are known to be highly innovative and aggressive. It is now becoming clear that improvised methods of implementing a change process is almost certain to fail miserably. Change management has evolved to become a stream of management science which may soon start having an independent existence like the Marketing, HRM etc.

It is advisable that organisations should contemplate standardised change management systems which they may use immediately when needed as well as fine tune the system for making it more effective.

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