Post on 22-Jan-2015
description
Managing Cuts +New GrowthUn:balanced Transformation
AGENDA
What is change?
© Doujak Corporate Development
What is change?
© Doujak Corporate Development
We’re restructuring our complete organization!
I have to move my desk!
What is change?
© Doujak Corporate Development
Merger
New strategy
New operations
Reengineering Downsizing
New way of working
New IT system
New organisationalstructures
New processes
New management tools
Turnaround
New culture
AGENDA
Why change?
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Adapt to changing conditions.
Become competitive.
Stay competitive.
AGENDA
How to lead change?
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= the BIG question we‘re trying to answer!
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Narrow ↔ Broad
Discontinuous ↔ Continuous
Periodic ↔ Constant
Fast ↔ Slow
Top Down ↔ Bottom Up
Hard Cuts ↔ New Growth
What am I supposed to do?I need some orientation…
© Doujak Corporate Development
© Doujak Corporate Development
OK…let’s start by analyzing the overall situation!
© Doujak Corporate Development
The Change MapWhat‘s your situation?
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
The Change MapDifferent challenges require different appraoches.
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
• Turnaround projects• Goal: focus on survival + decrease the
current need for change
The Change MapWhat‘s your situation?
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
• Goal: increase the capabilities and willingness for change of individuals, groups, and organisations.
The Change MapWhat‘s your situation?
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
• Proactive turnaround, anticipating a crisis + strategic redesign
• Goal: move into a more stable environment and increase the change capacity of the organisation
The Change MapWhat‘s your situation?
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
• Goal: find, test and imlement innovative potentials for new growth and success.
• The identity of company is being transformed and renewed.
The Change MapWhat‘s your situation?
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
• Change is day to day business for the learning organisation (emergent change).
• Continuous development and innovation• Decentral self-organisation, fostered by the market,
reward systems and the organisation‘s culture.
The Change MapIn which direction to move?
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
The Change MapUn:balanced Transformation
Curr
ent N
eces
sity
for C
hang
e
High
Low
HighLow Change Capability
Securing survivalCrisis management -
restructuring
MobilizingAdapting and developmental
capacity Learning organization
Market responsiveness
RenewalGrowth
Radical repositioningStrategic turnaround -
organizational redesign
© Doujak Corporate Development
What‘s influencingthe need?
• Financial pressure• Competitive pressure• Market pressure• The organization‘s ability to perform
(compared to peers)• Level of coordination• Level of target achievement• Level of customer satisfaction• Internal systems • Structure and processes• Organizational culture• Leadership, values, „climate“• ...
What‘s influencing the capabilities and the readiness?
• Has the organization some experiences with change?
• Do people have the skills for change? (Change Mgmt know how)
• How is the need for change perceived?• Is it a radical change?• Are systems and support structures in place
to facilitate the change?• How high is the trust in the ability to
change?• How high is the personal readiness for
change?• Does the change match people‘s values?• ...
The Change Map
© Doujak Corporate Development
What to think about...
Un:Balanced TransformationAnchoring hard cuts and new growth simulaneously
Hard cuts New growth
Goals Focus on short-term performance, efficiency and economic capital
Focus on long-term success, future growth potential and intellectual capital
Steering Top-down – close, clear, directive, linear, by program – “planned change”
Bottom-up involvement: self-organization, collaboration and networking, open. Emergent change.
Contents Decrease resources/costs – focus on processes, structure, systems, downsizing Involvement, participation, innovative culture
HR a cost factor capital, a resource, “entrepreneurs”
Logic of feelings longer coping processes (worries, distrust, aggression, disappointment, leave-taking – gradual new commitment)
focus, community (teams are important) and a basic feeling of joy, challenge and confidence
Reality construction
Feelings of loss and defeat influence perception Buoyant optimism, a combination of discipline and spirit of adventure influence perception (pioneers, winners of the future)
Architecture Core team steers the process of hard cuts – intense involvement of HR and line managers for implementation
Support autonomous initiatives and structures and short-term experiments – conducted on the sidelines of day-to-day operation
(“incubation” until matured)
OrientationPull towards the past and to the inside – a need for
stabilization and renewal of the employee – company contract
Pull towards the future and to the outside – desire to “ignore” or overcome existing conditions
ExecutivesProducers, ambassadors and bringers of “bad news” – the
situation calls for their presence in the roles of “implementers”, coaches, communicators and crisis/transition experts (security, orientation)
Architects, enablers and promoters of innovation – the situation calls for letting go and strengthening autonomy, encouraging
“revolutionaries”
Motivator for people
Security and risk minimization, finding one’s own position, maintaining stability
Involvement, challenge and free play, commitment. Performance in new, demanding areas
© Doujak Corporate Development
Approaches to ChangeOld and new images of transformations
Old Images New Images
Maintaining a balance between fields of tension and contradictions accelerates change.
Change management as management of Unbalance and Balance.
Conflicts must be deescalated. Transformation needs conflict.
Feelings are a side-effect in transformation processes; we have to accept them. Feelings are the motor for all phases of change.
Transformation decisions require a broad consensus. The combination of top-down decisions and bottom-up involvement is crucial.
Transformation is change planned top-down; management accounting and controls are a success factor (“planned
change”).
Transformations are a squaring of the circle - “planned quantum leap” (planned change) and at the same time self-
generated change “emergent change”.
A good concept makes up 90% of success. From step one, concept development must be interlinked with implementation work.
Now the others need to change. After all, we initiated it. For all those involved, transformation also means (more or less extensive) personal change.
It is important to always involve everyone. Clear-cut and step-by-step integration according to phases and stakeholders.
Before we can step outside, we need to have solved everything on the inside. Integration of relevant environments from the very beginning.
© Doujak Corporate Development
• Get your team (management, change, ...) together.• Plan 3-4 hours.• Put the change map on the floor.• Ask everybody to postion him/herself.• Spend the next 3 hours on deciding on a common
view of your situation.• Agree on how to evaluate the need.• Agree on how to evaluate the capacity.
© Doujak Corporate Development
Action Steps
Next we need a road map & outline who does what when.
© Doujak Corporate Development
How to ChangeThe Five Phases Model
The organizationsperceived ability to perform
Mas
terin
g th
e di
fficu
lties
on
the
high
land
pla
nes
– an
chor
ing
succ
esse
s
5
Cons
isten
t im
plem
enta
tion
- con
necti
ng th
e de
sire
for
inno
vatio
n w
ith
broa
d in
volv
emen
t
4
Cour
ageo
us d
ecis
ions
- j
umpi
ng in
to th
e co
ld w
ater
3
Crea
ting
visi
ons
of th
e fu
ture
- dev
elop
arc
hite
ctur
e an
d ro
adm
ap
2
Brea
king
thro
ugh
routi
ne –
w
e m
ust c
hang
e1
Time
© Doujak Corporate Development
How to ChangeThe Five Phases Model
© Doujak Corporate Development
Breaking through routine: We must change!
Creating visions of the future: Develop architecture and roadmap
Courageous decisions: Jump into the cold water
Consistent implementation: Connect the desire for innovation with broad involvement
Mastering the difficulties on the highland planes: Anchor successes
Key strategies:
• Disrupting routine: “Change starts with me”
• Evaluating the need for action: “From outside to inside”
• Assessment of the willingness and ability to change: “Let’s test ourselves!”
• Communicating by shaking up: “Opening up – taking a position – sending signals”
• Identifying the key players: “Finding the best people”
Phase OneBreaking through routine – we must change
Typical situation and dynamics• Diversity of perspectives and views concerning
situation and future developments• Energy for change varied• Contradictory signals from stakeholders• Doubts about information quality• Ambivalent collective mood: routine vs.
increasing interest in renewal vs. fear/blockades
Mas
teri
ng th
e di
ffic
ulti
es o
nth
e hi
ghla
nd p
lane
s –
anch
orin
g su
cces
ses
5C
onsi
sten
t im
plem
enta
tion
- co
nnec
ting
the
desi
re f
or
inno
vati
on w
ith
broa
d in
volv
emen
t
4
Cou
rage
ous
deci
sion
s -
jum
ping
into
the
cold
wat
er
3
Cre
atin
g vi
sion
s of
the
futu
re -
de
velo
p ar
chit
ectu
re a
nd r
oadm
ap
2
Bre
akin
g th
roug
h ro
utin
e –
we
mus
t cha
nge
1
Time
© Doujak Corporate Development
Phase TwoCreating visions of the future – develop a roadmap
Mas
teri
ng th
e di
ffic
ulti
es o
nth
e hi
ghla
nd p
lane
s –
anch
orin
g su
cces
ses
5C
onsi
sten
t im
plem
enta
tion
- co
nnec
ting
the
desi
re f
or
inno
vati
on w
ith
broa
d in
volv
emen
t
4
Cou
rage
ous
deci
sion
s -
jum
ping
into
the
cold
wat
er
3
Cre
atin
g vi
sion
s of
the
futu
re -
de
velo
p ar
chit
ectu
re a
nd r
oadm
ap
2
Bre
akin
g th
roug
h ro
utin
e –
we
mus
t cha
nge
1
Time
Key strategies:
• Work on the vision: “We are creating a (fitting) future.”
• Develop strategy and master plan : “Big picture of drastic cuts and new growth”
• Decide architecture and teams: “Containment due to process stability and trust”
• Communicate seriously and transparently: “That’s there we want to go and how we get going”
• Deepen and broaden change management know-how: “About the art of change”
Typical situation and dynamics• First concepts and ideas about possible future• Concepts too vague to get implemented on a 1:1
basis• Unclear: who will be concerned, degree of
commitment, details of implementation• Only key people are involved • Perceived performance increases, potential
threats are felt less • Collective emotional level: interest is
predominant, those who are directly involved feel spirit of a new era
© Doujak Corporate Development
Phase ThreeCourageous decisions – jumping into the cold water
Mas
teri
ng th
e di
ffic
ulti
es o
nth
e hi
ghla
nd p
lane
s –
anch
orin
g su
cces
ses
5C
onsi
sten
t im
plem
enta
tion
- co
nnec
ting
the
desi
re f
or
inno
vati
on w
ith
broa
d in
volv
emen
t
4
Cou
rage
ous
deci
sion
s -
jum
ping
into
the
cold
wat
er
3
Cre
atin
g vi
sion
s of
the
futu
re -
de
velo
p ar
chit
ectu
re a
nd r
oadm
ap
2
Bre
akin
g th
roug
h ro
utin
e –
we
mus
t cha
nge
1
Time
Key strategies:
• Plan and implement pilots and quick wins: “Taking advantage of the trampoline”
• Cost-cutting and decisionsabout people “Challenging the unpleasant aspects first – with support measures”
• Promote growth and innovation: “Incentives and scope for freedom”
• Deal with resistance: “Work with the resistance – not against it!”
• Use evaluation as a motor: “Broad, stimulating – with consequences”
Typical situation and dynamics • First implementation steps: try out big things “en
miniature”• Initial euphoria• Subsequent disillusionment:
“misunderstandings”, “misinterpretations”• Resistance: reactions out of fear, sometimes
aggressive• Collective emotional level: “Defending the former
identity” vs. “Conquering new territories”
© Doujak Corporate Development
Phase FourConsistent implementation – connecting the desire for innovation with broad involvement
Mas
teri
ng th
e di
ffic
ulti
es o
nth
e hi
ghla
nd p
lane
s –
anch
orin
g su
cces
ses
5C
onsi
sten
t im
plem
enta
tion
- co
nnec
ting
the
desi
re f
or
inno
vati
on w
ith
broa
d in
volv
emen
t
4
Cou
rage
ous
deci
sion
s -
jum
ping
into
the
cold
wat
er
3
Cre
atin
g vi
sion
s of
the
futu
re -
de
velo
p ar
chit
ectu
re a
nd r
oadm
ap
2
Bre
akin
g th
roug
h ro
utin
e –
we
mus
t cha
nge
1
Time
Key strategies:
• Speed up implementation activities and projects consistently: “Pulling yourself out of the swamp.”
• Adapt architecture continuously: “Nothing is forever”
• Winning over undecided and skeptical individuals: “From the team to the organization”
• Adapt systems step by step: “Good systems save energy”
• Continue to learn and build up skills for transformation: “Looking behind the backdrop and creating skills”
Typical situation and dynamics • Initial euphoria has worn off by now – the
setbacks have hit home • “Should we stop or continue”• Middle-management are at the centre of change
as mentors and multipliers responsible for implementation
• Change process becomes broader, more and more projects are completed
• Top-management impatient, middle-management overloaded with work, many people who will be affected are not yet involved
© Doujak Corporate Development
Phase FiveMastering the difficulties on the highland – anchoring successes
Mas
teri
ng th
e di
ffic
ulti
es o
nth
e hi
ghla
nd p
lane
s –
anch
orin
g su
cces
ses
5C
onsi
sten
t im
plem
enta
tion
- co
nnec
ting
the
desi
re f
or
inno
vati
on w
ith
broa
d in
volv
emen
t
4
Cou
rage
ous
deci
sion
s -
jum
ping
into
the
cold
wat
er
3
Cre
atin
g vi
sion
s of
the
futu
re -
de
velo
p ar
chit
ectu
re a
nd r
oadm
ap
2
Bre
akin
g th
roug
h ro
utin
e –
we
mus
t cha
nge
1
Time
Key strategies:
• Harmonizing leadership systems: “Integration at all levels.”
• Cultural change: integrate behavior, norms, values into day2day-business: “Awareness creates new possibilities”
• Continue training on a broad basis: “Practice, practice, practice!”
• Increase outward orientation: “Happiness lies on the back of a horse”
• Bring leadership into the focus of attention and finish the transformation: “With enthusiasm towards new efficiency”
Typical situation and dynamics • Longest and most decisive phase – albeit not the
most exiting one• Clear project orientation and broad
implementation, • Systems integration and in-depth anchoring:
slowly but surely – all systems, all staff members• Transformation is becoming second nature to
people
© Doujak Corporate Development
• Well it depends very much on the phase you‘re in!• The team (change, management,...) should be aware
of these phases!• The question is „In which phase is the organization?“
versus „In which phase is the change/mgmt team?“• Think of how the people must feel• Get some feedback from the organisation• Establish a sounding board• Establish regular feedback loops• How does your team feel?
© Doujak Corporate Development
Action Steps
© Doujak Corporate Development
Action Steps
See the book starting on page 235 for specific actions in each
phase.
Let me know how they worked!
How to I get people to come along?
© Doujak Corporate Development
© Doujak Corporate Development
I´m going to be confronted with
horrible emotions...
Cool! Finally some change!
I‘m afraid. Will I loose my job?
I couldn’t care less…
I hope they‘ll be able to keep it
under control...
The Logic of EmotionsEvery emotion has a function
disappointmentsadness
joycourage
daily routine fearuncertainty
anger aggression
curiosityinterest
daily routine
© Doujak Corporate Development
The Logic of Emotions
Thinking and feeling cannot be seperated.
• Emotions are drivers and barriers to our thinking.
• Emotions bias our focus and attention.
• Emotions impact learning and remembering.
• Emotions attract certain thoughts and reject others.
Emotions are the drivers of change processes
Implications forleadership.• Emotional and affective tune is just as
important as the cognitive understanding.• Communication doesn‘t work without a
minimum of emotional conformity (being on the same page).
• As a result affective accomodation, responding to people, picking them up where they are is important.
• Affective moods, verbal and non-verbal, are highly infective. They spread at lightning speed and impact following situations and messages.
© Doujak Corporate Development
The Logic of EmotionsEmotions are the drivers of change processes
Emotional Consternation Emotional Leadership
Fear, insecurity: denial of the need for change, mental block, unable to actpositive: focus
Stabilization: address fears, crossover model, strategies for crisis management, enable a solution orientated mood
Anger, aggression: borders are being defined, defence through devaluationpositive: things worth keeping are defended
Tension regulation: “fighting arena”, offer support to prevent burnout, expectation management
Disappointment, resignation, sadness: structures, dissolve, holding points are lost, doubt about own competencies and problem solving capacity, slowdown, cling to the past, depressive moodpositive: open mind for new things
Continuous: reliable communication, ongoing rhythms and rituals, consistent staffing, celebrate (small) quick wins appreciate the past, farewell rituals
© Doujak Corporate Development
The Logic of EmotionsHow people act
Increasing fearinsecurity, time pressure,
burnout, stress
Betrayal, cynicism, mistrust
Resistance, avoidance
Discrimination dynamicsscapegoats, mobbing, groups, in-group/out-group-dynamics,
intrigues
Decreasing loyalty internal dismissal, decreasing
commitment, quitting
Position fights, power games“dog-eat-dog”-mentality
(social Darwinism)
Projections on outside worldcustomers, other
departments, leadership, idealization and devaluation
Psychological illnessdepression, anxiety disorder,
addiction
Psychosomatic illnessback problems, cardiovascular diseases, stomach problems
© Doujak Corporate Development
Expecting resistance
• Is the urgency for change considered low?• Are there any ambiguous expectations?• Are there doubts about successful project closure?• Are the results uncertain?• Are negative results to be expected?• Are the results unalterable?• Are the results associated with few advantages but with high costs?• Is the change profound?• Are those affected insufficiently involved?• Does the change imply poor performance up until now?
The more often you answer „Yes“ to these questions, the higher the expected resistance.
Where is it coming from?
© Doujak Corporate Development
The Logic of Emotions
• Decide wisely – layoffs as the last resort
• Communicate as clear and concise as possible – open – interactive – with content and emotional messages
• Plan hard cuts comprehensively based on a stakeholder analysis
• Communicate plausibly what the hard cuts will bring and why they are necessary
• Implement as announced including support
• Monitor and evaluate results continuously
How to deal with Hard Cuts
© Doujak Corporate Development
Action Steps
The Logic of EmotionsLeadership needed
Assuring one‘s own ability to work through
willingness and capability to self-reflection, self-criticism, self-honesty.
Assuring employees‘ ability to work through
containment, and security
Enabler of processes: impulses, facilitation,
coaching
Development of individuals, groups and
the organisation
• Clear language and information: vision, objectives, tasks, feedback
• Open communication: speak and listen honestly
• Build transparency: motives and foreseeable consequences, culture of information
• Social perception• Ability to deal with conflicts, provide
structure (“containment”)• Appreciative, accepting and
respectful attitude with resistance and fears. Practice listening!
• Employee participation: views, experiences, competences, in an appropriate manner
© Doujak Corporate Development
Action Steps
More on Managing Cuts and Hard Cuts...
www.doujak.eu/thinking
© Doujak Corporate Development
Thanks for your attention!
Marc SniukasDoujak Corporate Development
Lainzer Strasse 80A-1130 Vienna
Mobile: +43 699 122 333marc.sniukas@doujak.eu
Follow Marc atwww.twitter.com/sniukas
Blogging for Manchester Business School at http://sniukas.tm.mbs.ac.uk
© Doujak Corporate Development
Doujak Corporate Development
Doujak Corporate Development is a consulting company partnering with CEOs and their executive teams to resolve the global strategic and organizational challenges they face.We help them to shape strategy and develop the capabilities and organizational culture, structure, processes and systems needed for global execution and transforming their businesses.
What we do
Strategy• Purpose & Culture• Strategic Innovation• Strategy Development• Strategy Implementation
Change Management• Un:balanced Transformation• Hard Cuts + New Growth• Restructuring• High Impact IT
Professional Development• Top Executive Coaching• Top Executive Teambuilding• Inhouse Programs• Open Programs
© Doujak Corporate Development
Corporate DevelopmentDeveloping....
47© Doujak Corporate Development
Purpose
Culture
Strategy
Organization
Leadership
Stakeholder Relationships
Our FocusDimensions of our work
48© Doujak Corporate Development
Content Process
What? Why? Who? How?
Lainzer Strasse 80A-1130 Vienna
Austria
Tel: +43.1.306 33 66Fax: +43.1.306 33 66 9
office@doujak.euwww.doujak.eu