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Secret of change management: why most change management programmes fail and how to transform your organisation rapidly. Better Ways to Make Things Happen - Extract from “Building a Better Business” by Patrick Dixon - based on his work advising many of the largest multinationals on ways to motivate teams to accelerate business transformation, and to make change management programmes deliver on time and on budget.

“Humankind has two basic and equally important strong needs:  stability and change.” Tom Peters

“Man has a limited capacity for change.  When this capacity is exceeded – it is in “future shock”.  Alvin Toffler

“Change starts when someone sees the next step.”  William Drayton

“All my experience suggests that individuals will eagerly embrace change when given a chance to have their share of voice in inventing the future of their company…to create a unique and exciting future in which they can share.”  Gary Hamel

The secret of change management is winning people over and making them enthusiastic drivers of business transformation. Radical change happens instantly without a change management programme when everyone sees the crisis and knows what to do eg fire breaking out in a big HQ. Of course we need systems and processes, progress meetings, and a huge amount of detailed organisation to deliver complex changes, but in my experience, that is rarely the root problem.

Need a world-class change management keynote speaker for your event? Phone or e-mail Patrick Dixon now.

Over and again I have seen hugely technical, world-class companies in fields such as engineering and technology, who tend to see every problem as just another process to be engineered, with far less attention to the all-important human factor.  How does each person FEEL about the changes proposed?  Do they BELIEVE in the new direction?  Are they ENGAGED in the process?

Change management is a complete waste of time if people have no compelling vision of where they are going.

The past decades are littered with the debris of failed corporations that had the wrong products, wrong services or were unable to compete because of archaic structures, out-of-date systems and bad decisions.  But making things happen differently inside a big organization is a huge challenge.  In fact, it all takes so long that large companies have to start adapting many years before they expect the future to arrive.

What happened to work ?

The trouble is that ambition or no ambition, those of us who work for a living have never had to work so hard, under such difficult conditions, for such uncertain rewards.

Many managers I know are feeling battered and bruised. Hit by one event after another, there’s little time to regroup or reflect, and leading can be a lonely place. Profit warnings, share price pressures, painful layoffs and great geopolitical uncertainties can sweep away even the most comprehensive strategies – and that’s despite outstanding management over many years. 

To be a winner in future you need to be propelled by an unshakeable conviction that your mission is still important, that prosperous times lie ahead, and that in some way your company is helping to build a better kind of world. Your own passion for running the race matters most of all in a downturn when people are insecure and loyalty is tested.

The geography of the corporate world is everywhere in upheaval: nationals and multinationals, global mergers and acquisitions, buy-outs, friendly and hostile takeovers, bankruptcies and reorganizations, making over half a million Americans redundant every week in bad times, and creating as many new jobs just as fast a few months later; disappearance of many old downtowns as centers of business and community life, disappearance of  family-owned stores before the megaliths of super chains. 

And tomorrow?

At current rates of merger there will only be a handful of global companies controlling all commercial activity in America and Europe.  Of course the pace is unsustainable and before long we will see a frenetic number of demergers as super-corporations come to see that being bigger can have drawbacks for shareholders, consumers or workers.  But demergers also bring big changes and stress.

Hundreds of thousands of individuals have gone to work one day for one company, to find the next day they are working for another.

Management chaos from endless re-organisations

Often, these mergers create chaos in management, confusion in products or services as well as great uncertainties for people.  Such changes are often traumatic. When you merge two cultures, two tribes, two families, two histories  - what do you get?  Hundreds of thousands of changes. More changes than there are people.

Familiar household names disappear overnight as a result of re-branding, takeovers, market pressures.  Factories open, close, move… all within months. Landmark buildings are destroyed and new ones built.  Boom times also produce huge changes for people, with constant reshaping of jobs and teams to accommodate growth, coupled with immense work pressures and strains on personal life.

Weary of change – yet more change to come

This all adds up to a world of chaotic instability. Yet within this shaky, unstable world, the boardrooms are frustrated with how long it takes to make major changes.  By the time a corporation has managed change, the world has changed again, new values have risen to the forefront, and the company is in drastic need of change, yet again. 

Sink or Swim!  They never catch up. And the people affected, the mass of ordinary workers are, quite simply, getting worn out. 

Exhausted.  Disillusioned.  They no longer see the point.  Change upon change, again and again ...  and they must change with it…?  Not again.  With all these job changes, people have lost the sense of loyalty and emotional bonding to their employers. 

How can you expect someone to give their lives with passion to make more profits for an organization which they know very well could easily turn round and dump them (again) tomorrow?

It would be a whole lot easier if they believed in what their employers were doing in the first place, deeply, passionately, from their hearts – but do they?  Many companies have totally failed to engage the real interests of their workers. 

Constant rapid change at work is enervating, demotivating, depressing, especially when the benefits of change are unclear.  It breaks up stable teams, weakens meaningful work relationships, destroys many previous efforts.   Just ask people who have been through three major mergers in three years.

Thriving on chaos no more

Tom Peters wrote the best-selling book “Thriving on Chaos”, suggesting that winners of tomorrow would deal proactively with chaos, as a source of market advantage, not a problem to be ignored.  The book sold millions and became a legend. 

Today, we have come to see things rather differently.  Chaos can be unhealthy. To many people, our world today seems shaped by random forces, over which we have little or no control.  And everyday as the world changes, it can feel a more meaningless place.

It is true, as Tom Peters reminds us, that managers and organizations need to be supple, flexible, rapidly adaptive, and ready for constant radical change.  However, it all comes at a high, personal price. 

Resistance to change is a Number 1 business killer

Every year billions of dollars are wasted trying to make people change the way they work.  Resistance to change is a number one killer of healthy corporations.  Boards may spend days, weeks or months approving a battle plan, and executive teams work hard to flesh out the details, often running up huge consultancy bills in the process.

But little or nothing happens. 

Frustrated at every turn, the response is usually to spend even greater efforts:  more company bulletins, more team meetings, more plans, agendas, strategies and budgets.

Finally frustration turns to anger, and anger becomes personal.  Jones must go.  Thomas must go.  Clear the place out and get in some people we can work with.

But with Jones and Thomas may also go valuable knowledge of the organisation, products, services and customer relationships.

So why is Change Management such a huge money-spinner for management consultants, and such a huge source of angst for business leaders?

The reason is simple:  people don’t want to change.

Why?  Because they don’t see the point, or even if they do, they are convinced that the end result will not be worth the effort, for them, for those around them, even perhaps far beyond that.

“It is only the wisest and the stupidest that cannot change” Confucius

Vision is the most powerful motivator for change

 It’s easy to move people when they’re captivated by hope for a better future (whatever that may be for them), and are very frustrated with the current situation.  People who are very satisfied with the current situation and feel negative about what is proposed are impossible to change and energy-consuming to manage.  
The trouble is that what companies call a better world is often a hundred million light years away from what workers feel is a better world for them.  

Result:  zero motivation to change.

Tell me this:  the latest restructuring is better for who exactly?  The company answer is usually for customers who get better services and products at ever lower costs, and also for shareholders who get better returns.  But for the 78% of staff without share options? 

How to create an unstoppable people-movement for radical action.

Why Building a Better World is the main driver for successful management of change
Establishing need to change
Changing Culture – the power of group feelings

Humans are strange creatures:  and many aspects of our collective nature remain mysteries.  What happens for example in the concert hall between a gifted violin player and his audience?  Why is it that live concert performances have a different dimension for the players than a studio recording?   How is it that you or I can walk into a crowded room where everyone is silent and within a couple of seconds detect the general mood, and the emotional energy?

Need a world-class change management keynote speaker for your event? Phone or e-mail Patrick Dixon now.

The mysterious power of groups

And one of the greatest mysteries is the personality of groups.

Groups are very special creations.  They quickly develop their own character which can very enduring.   We need to understand what groups are about, to find better ways to change them.

Any group creates their own culture.  Take a group of ten men and women. Over the next decade every single member could be replaced twice over and yet, if any of the founders of the group was to visit ten years later, they may well find much that is familiar, and which derives from the group’s first days together.

This is true of clubs, churches, associations, non-profit organisations and business groups of every size.

Now of course we would expect a certain degree of this if, for example, the group is still writing software for financial services clients, or community services for young people.  But I am talking about the more subtle differences between one such group and another:  for example whether the group tends to socialise in the evenings, or includes spouses and partners in bid decisions, or is very creative, or very ordered and precise, whether everyone works strictly to a time clock at the start and end of the day or whether they use flexitime, whether they where suits or t-shirts and scruffy jeans.

Groups have a life of their own

Groups are “alive” in the sense of having a living identity of their own that is distinct from and goes beyond the individuals within it.

It is almost a spiritual thing, just as elusive when it comes to formal analysis as the strange magic that is wrought upon an audience by a world-class performer.  There is an invisible but significant added dimension, a force operating on another level altogether.

This added factor can affect buildings, even when empty.  Places have atmospheres as well as associations.  They connect with memories in our past and with our imagination, as well as with our subconscious associations.

That’s why office relocations are sometimes so effective in assisting change.  Take two organisations and merge them together,  The smaller is shoe-horned into the existing offices of the larger with all kinds of territorial feelings, in addition to cultural insecurities.  Then the two are relocated as one, and the two work-forces become less easily definable.

Non-profits, clubs, churches and other religious organisations have powerful group “energy”

Group culture is a particularly big issue in non-profit organisations and religious groups such as churches.  When there is no written contract, no pay, no terms and conditions of service, no formal beginning or end to the working relationship, no enforceable objectives, no reward system, and no line management, the power of groups is especially great.  What people want to do together.  How we did things in the past.  The way we do things around here.

Leading groups can be difficult because we imagine perhaps that we have a certain authority and with it a liberty to make changes.  But in practice the hidden power of the group can be stronger than the leadership.  You see this hidden power when someone who was relatively open to a particular course of action, or used to doing things in a certain way, joins a group with a different culture.  Within a few months you may find that the person’s own perspectives and preferences have changed. So long as they identify strongly with that particular group of people, they may be inclined to “go with the flow”. 

You may find that everyone in that group is being held collectively to a particular course of action, not by each other (because if they were on their own they would chose differently) but by the invisible power of the group itself:  this combination of past and present, of culture and previous ways of doing things.

These are all reasons why group leadership requires far more investment of time and energy than many people realise, to take people in a new direction, and why so-called “change-management programmes” are often so unsuccessful.

Changing group behaviour requires a high level of personal passion and integrity, a compelling vision of a better future and a convincing and clearly understood strategy about how to get there.

These leadership passions need to carry each individual, and the group you you are dealing with, and be strong enough to deal with other forces that operate within it, including shadows and echoes of the past.

Invisible groups members need addressing – alive or dead

Groups often express strong loyalties to, for example, the values of the founder of an organisation, or a previous leader, even if retired, distant or dead.  They may express loyalties to a national team – in the case of a foreign takeover.  They may be deeply loyal to a set of foundational principles that first drew them into the business.

Hidden influences need to be laid out on the table, honoured, respected, talked over and incorporated into any changes that are proposed.  If those influences are to be overlaid by others, or set aside in some way, then you need to show why.  Group members need to know that the group’s heritage and values are appreciated and important.

They need to know why following the old way will result in real trouble, and why the new direction is the only way forward.  They need to see, touch and feel some of the realities of this better world.  To have an early sense that it really will be for the best in every way.

It has often been said that people don’t tend to think in meetings.  The real change of mind and heart tends to happen beforehand, and the real work of persuasion therefore happens outside a meeting room, especially of those whose opinion carries most weight. It is also the case that meetings allow those who are uncertain to get a collective feel for where others want to go.  Meetings allow those who do not have strong feeling on an issue to fall into line behind those who do.

Innovation and entrepreneurs – vision of improvement

Humans are free spirits

The human spirit is a free spirit.  You can pay someone to come to work, but even if they turn up (and it is amazing how often resistors go sick),  you can’t force them to make a single phone call or write a single e-mail.  In the troubled 1970s and early 1980s “working to rule” became a normal part of industrial life, when tens of thousands of workers would deliberately sabotage corporate objectives by doing the absolute minimum to prevent themselves being sacked immediately (which in itself would have triggered widespread revolt).

But every employee works to rule.  It is the nature of human beings to do only what seems worthwhile and to ignore everything else. If someone thinks that what they have been asked to do is a complete and utter waste of time, you can guarantee that it will be done slowly, badly or not at all.

Need a world-class change management keynote speaker for your event? Phone or e-mail Patrick Dixon now.

Instant Change Management Made Easy

But there is another way.  Change management can be rapid, easy, relatively painless, and totally effective.  But how?

Here is a fact:  if a major fire breaks out in a building, and there has to be a full-scale evacuation, and much of the building is destroyed, you do NOT need a change management programme to:

- Get large numbers of people to suspend everything they are working on
- Get them all to work together fast to leave the building
- Get them organised into a major effort to recover back to full operational efficiency in a temporary building up the road

The problem is clear and demands urgent response. Failure to act fast, with total complete efficiency could mean some get trapped in the building and burn to death.  Failure to recover fast could mean major losses and some people losing their jobs.

Using our “building a better world” model:

•    It’s obviously a far better world for all without exception to get out as fast as possible
•    It’s a better world for all to rebuild rapidly and to operate very flexibly in the meantime

Just believe – and things happen

So then, if you are trying to change an organisation, here are some fundamental questions:

- Why is this change so necessary?
- Who will benefit from all the effort?
- Do you really believe it is of the utmost importance yourself – or is it something you feel has been imposed by others – whether shareholders, analysts, out-of-touch board, short-sighted boss or whatever?
- Are you certain the change is going to end with you in the right place?
Workers have long memories

Many workers are thoroughly cynical when it comes to yet another reorganisation.  They have long memories.  They know change management programmes often get overtaken by events – markets change, investors move on, competitors move in, or a merger / acquisition makes it irrelevant so they have to start all over again.

The majority of senior executives in large corporations have been through several reorganisations in the last few years, and rarely do you find people who have been enthusiastic about all of them, and who would defend the rightness of  all those major changes.

Many are worn out, fed up, hardened veterans of fickle, badly thought out and poorly implemented changes.

Know which hills to die for

Successful change management means fighting fewer battles, changing less to make more happen.

As every battle commander knows, only some hills are worth dying for.  A central role of effective leadership is knowing which they are, and seizing them with minimum casualties.

Why added shareholder value is (almost) useless as a reason people should change

We have seen in an earlier chapter how very few people get turned on by the idea of adding shareholder value, or increasing the bottom line – except as a way of increasing their own pay package.

I have seen all kinds of bizarre attempts by senior leaders of large corporations to convince their workers that their proposed changes will be for the better.

They all tend to derive in some way from the idea of boosting share price, increasing profits, keeping analysts happy or resisting takeover.  While it is true that all these things can ultimately affect every person in the organisation, the one person of course that is most exposed in all these things is the CEO, and one can’t help but notice that at the heart of most of these drives for change seems to be a key anxiety in the CEO’s own mind about staying at the helm or being able to depart with honour.

Show why your changes make life better and they will rush to make things happen

Let us be clear.  Significant change is usually expensive.  Change always diverts resources from other activities – even a simple office or desk move can be time-consuming.  But change for change sake – where the purpose is unclear, or the strategy unsound – is usually disastrous.  Bad changes lower morale, lower productivity, frustrate customers, increase inefficiency, drive great people out of the business and straight into the welcoming arms of competitors.

Let us also be clear, effective change management flows out of strong vision, unshakeable purpose, high-connectedness with passion. 

Show people how you want to build a better wider world, and they will change your own business world for you. 

Riding the Revolution – the power of irresistible change

When people capture a vision, they are changed inside, and they will change their world. 

It’s a law of the universe: 

Passionate people make things happen because they can do no other. 

They are compelled to act by inner conviction and are an unstoppable force.  You can help shape their ideas, influence their strategy, run with their energy.

But surely leadership, vision and strategy should be top-down?  Surely an organisation running on multiple personal agendas will result in total chaos?  Facilitating or servant leadership is the key.

Facilitating Leadership

Smart leaders enthuse others to go in a particular direction, because they have got hold of that same vision for themselves.  It is now their agenda, their calling, their vision, their drive, their ambition.

Smart leaders know how to inspire, motivate, direct and release. 

We’re talking about people-movements.  The kind of rapidly changing and adaptive groups that you find in activist organisations and non-profit humanitarian ventures.

If you can't win the moral argument, you are wasting your time when introducing change

Failure to win hearts and minds has serious consequences.  Those who try to manipulate, bully, or intimidate people into following a stupid regulation, will find they create a million paths of resistance, a grass-roots campaign that results in destruction of leadership.

And winning that argument is a more subtle process than you may think.  It's not a matter of going out and telling people they’ll get a bonus if they comply.  Bonuses and other tangible rewards are weaker motivators than you may hope, because they appeal only at one limited level to the human spirit.

Let's take an example of a large organisation which has just merged with an even larger one.  Those fortunate enough to have secure jobs are told that they will get a big reward if they drive a savage, ruthless, rapid restructuring with mass redundancies.

Then managers find they have a low-level rebellion on their hands, with silent obstruction at every level.  What went wrong?

The answer is that the managers forgot that people work for people, not for organisations.  They also forgot that most individuals worth employing are not prepared to build a better world for themselves at the expense of their friends.  Often it’s not what happens, but the way it’s done that builds a better or worse world in people’s minds.

But when did you last hear friendship being talked about as a key factor in making decisions in large organisations?  This is typical of the terrible mess organisations get into by applying primitive, untested, unscientific, psychological theories from previous centuries to a third millennial workforce.

Need a world-class change management keynote speaker for your event? Phone or e-mail Patrick Dixon now.

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