1. Demystifying
Change Management
What HR needs to Know to Produce Organizational Change
Scott Leuchter
Partner
Camden Delta Consulting
Chicago Human Capital Club
September 27, 2011
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2. Agenda
• Introduction
• The Burning Platform
• Goals for Today
• The Psychology of Change
• Organizational Change vs. Change Management
• Change Reactions & Management Considerations
• How to Asses Change Readiness
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3. Grounding Our Discussion
The human side of
change is the
“soft stuff”, and
the soft stuff is a
lot harder than
the “hard stuff”
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4. Introduction
• A little about me
• A little about what I do
• A little about Camden Delta Consulting
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5. Camden Delta Consulting
Camden Delta is a management consulting firm that provides Strategic Change
Management & Human Capital solutions that support organizational transformation
Strategic Workforce Integrated Talent
Planning Management
Strategic
Organizational
Change
HR Strategy and Leadership
Organizational Development &
Effectiveness Coaching
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6. The Burning Platform
• Organizational Change is
omnipresent and inevitable
feature of organizational life
• CEO’s rate speed, flexibility and
adaptability to change as their
top business challenge since
2004
• 31% of Board of Directors cite
the failure to effectively manage
change as the top reason for
firing CEOs
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7. The Burning Platform
• Strategic Imperative: 70% of all organizational change
initiatives FAIL
Type of Change Median Success Rate
Strategy Deployment 58%
Recruiting & Downsizing 46%
Technology Change 40%
Mixed Collection of Change Efforts 39%
TQM-Driven Change 37%
Mergers & Acquisitions 33%
Re-engineering and Process Design 30%
Software Development and Installation 26%
Business Expansion 20%
Culture Change 19%
ALL 33%
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8. Goals for Today
• Understand the psychological factors and considerations
that determine change
• Understand the difference between organizational
change and change management
• Understand the different reactions to change
• Provide a framework to help you assess readiness and
manage change in your organization
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10. The Psychological Reality of Change
• People are not rational or linear
• People are loss averse
• People make decisions through peripheral processing
• Decisions to change are anchored on prior knowledge
• What people Think and Feel will determine how they will
Behave
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12. Case Study in Change
• Who
• Fortune 500 “Worlds Most Admired Companies”
• Global Financial and Professional Services Firm
• Human Resources Function
• What was the change?
• What was the rationale?
• What happened?
• What did they do?
• What happened after that?
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13. Key Definitions
• Change
• v. to make, become or behave DIFFERENTLY
• Organization
• a TOOL used by PEOPLE to coordinate their ACTIONS to obtain
something they desire or value
• Organizational Change
• The PROCESS by which organizations MOVE from their current state to
some desired future state to increase their effectiveness.
• Change Management
• The PROCESS of planning, implementing, and evaluating change
within organizations or communities
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14. Organizational Change vs. Change Management
Underlying Theory Role of Change Intervention
Agent Strategies
Organizational -Psychology -Facilitator -Not traditionally linked
Change -Process Consultant to strategy
-Focus on one
component/unit at a
time
-Change attitudes to
change behavior
Change -Psychology -Content Expert -Driven by strategy
Management -Sociology -Process Consultant -Simultaneous focus
-Economics -Member of cross on several areas
-Project functional team -Leverage models to
Management -Part of project change actions
organization
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15. Change Management Models
Change Component Frequency Percentile Rank
Urgency and need to change 16 59% 1
Clear vision 16 59% 1
Assessing organizational readiness 15 56% 2
Planning the change 15 56% 2
Metrics, monitoring, controlling 15 56% 2
Change management structures/delivery 14 52% 3
Short-term wins 14 52% 3
Building Consensus 12 44% 4
Context for change 11 41% 5
Communication 11 41% 5
Consolidation 11 41% 5
Putting resources in place 9 33% 6
Clear empowerment and team authority 6 22% 7
Leadership 5 19% 8
Sponsorship 4 15% 9
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16. Change Measurement
• What do you measure?
• Subjective
• Objective
• When do you measure it?
• Before
• During
• After
• Who do you measure?
• Employees
• Customers
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17. Change Reactions
• Stress / insecurity / psychological
adjustment
• Readiness / preparedness to change
• Performance / coping with change
• Receptivity to change
• Attitude toward change
• Openness to change
• Intentions to resist / willingness to
cooperate
• Innovation / change adoption
• Commitment to change / status quo
• Adjustment to change
• Perceived benefits of change for learning
• Resistance to change
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18. Change Resistance
• Top reasons why management resists change and creates
obstacles
• Lack of awareness of why the
change is happening
• Lack of involvement in the change
process
• The change is not aligned with their
operational objectives
• They anticipated negative impacts to
their day-to-day operations
• They fear loss of control or power
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19. Change Resistance
• Top reasons why employees resists change and creates
obstacles
• Lack of awareness of why the
change is happening
• Perceived negative impact on their
current role
• Past performance of the organization
with change
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20. Management Mistakes
• Most common mistakes made by managers and
supervisors
• Ineffective communication with employees
• Actively resist the change themselves
• Ignore the change
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21. Management Roles
• Most critical roles for manager and supervisors in times
of change
• Communicate with direct reports about the change and why the
change is happening
• Demonstrate support for the change
• Coach employees through the change process
• Engage with and provide support to those driving the change
initiative
• Identify and manage resistance
• Assess change readiness
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23. Assessing Organizational Readiness
• Assess your organizations readiness for enterprise
implementation
• Assessment must be based on the Principal of Compatibility
• Before, During, After
• Alignment with business strategy
• How does the organization view change?
• What does success look like?
• What is the organizations history with change?
• How much change can we handle and when?
• What are the main barriers and challenges to this change?
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24. Assessing Your Organization
• Assessment Methods
• Survey / Questionnaire
• Interviews / Focus Groups
• Observations
• Analyze
• Content / Statistical Analyses
• Identify and challenge assumptions
• Act
• Share analysis and results with senior leadership
• Make recommendations planning decision(s) based on the data
• Share the information and plan with employees
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25. Conclusions
• Appreciate that change is a human psychological
phenomenon experienced by individuals and influenced
by groups
• Recognize that change management models neglect the
psychology of change and adjust accordingly
• Assess employee readiness prior, during and after a
change event
• “To change or not to change, that is REALLY the
question”
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26. Goals for Today
• Understand the psychological factors and considerations
that determine change
• Understand the difference between organizational
change and change management
• Understand the different reactions to change
• Provide a framework to help you assess readiness and
manage change in your organization
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28. References
Slide 6: IBM. (2002, 2004, 2006, 2010). Global CEO Study;
Slide 7: Smith, M. E. (2002). Success Rates for Different Types of Organizational Change. Performance Improvement,
(41) 1, pg. 26-33
Slide 13: Jones, G. R. (2007). Organizational theory, design, and change. Pearson-Prentice Hall.
Slides 14: Martins, L. L. (2010). Organizational Change and Development. APA Handbook of Industrial and
Organizational Psychology, 3, pg. 691-727.
Slides 18-21: Prosci. (2009). Best Practices in Change Management Benchmarking Report
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