Engineering, Construction and Industrial Industries

Structured Change Management is Progressively More Important for Optimal Performance

April 17, 2014

There is a simple logic flow that leads us to the definition of Structured Change Management and why it is necessary for the many transformational and improvement efforts underway in capital projects today. The logic flow is presented below:

Structured Change Management

The "why" for improvement projects and initiatives taking place in an organization is to improve performance. There can be many reasons to launch an initiative, including: client demands, competitive response, internal performance (or lack of), regulation or legislation, market shifts, etc.

Each of these triggers present an opportunity or an issue the organization needs to address. Improvements in performance result from the "what" in the logic flow - changes to processes, systems, tools, job roles or organization structures.

These are the targets of the solution that is developed to address the opportunity or issue. The ultimate "how" shows up at the end of the logic flow - any change to processes, systems, tools, job roles or organization structures ultimately impacts how some people do their jobs.

It may be a dozen people in a work group, several hundred people in a particular department or division, or thousands of people across the entire enterprise.

In the end, improvement projects or initiatives require some individuals to change how they do their jobs. If these individuals do not adopt the change to their day-to-day work, the improvement project will not succeed.


Defining Structured Change Management

We have identified a work process in our company which we chose to identify as "Structured Change Management". The process we identify here should be considered invaluable in successfully implementing "improvement projects" inside of an organization or program. There are many management consulting companies in the marketplace who utilize a change management process. Indeed there is a plethora of information available on this topic.

A number of years ago we indentified a company by the name of Prosci (www.Prosci.com) as a leading company in the change management field. What we viewed as valuable is that all of Prosci’s work is research based. In addition, Prosci is not in the change management consulting business per se. They train individuals and /or teams of people on the process of change management.

Definition: Structured Change Management (SCM) is the set of tools, processes, skills and principles for managing the people side of change to achieve the required outcomes of the improvement project or initiative.

Structured Change Management has three distinct parts that will be addressed in more detail:

Structured Change Management - The set of tools, processes, skills and principles for managing the people side of change to achieve the required outcomes of the project improvement or initiative.

Achieving the Required Outcomes

The last part of the definition, but the first we address, is how to achieve the required outcomes of the improvement project or initiative. Many who are new to Structured Change Management or perhaps skeptical might be surprised by this part of the definition. This, in no uncertain terms, connects SCM to the ultimate value or objectives that our and our clients’ organizations are looking to derive from implementing the changes.

Benchmarking data clearly shows the connection between managing the people side of change and achieving the required outcomes of the project or initiative. The Prosci correlation analysis of data from benchmarking studies shows that projects with excellent SCM are six times more likely to meet objectives than those with poor Structured Change Management.

Improvement projects with good Structured Change Management in place are five times more likely to meet objectives than those with poor SCM. The analysis goes one step further, showing that effective Structured Change Management also increases the likelihood of staying on schedule and on budget.

The 2002 McKinsey Quarterly article, Helping employees embrace change, draws a similar conclusion based on data from forty projects. The bottom line is, the better the people side of change is managed the more successful an improvement project will be.

Not only does the data suggest that a connection exists between Structured Change Management effectiveness and project success, it is important for trained SCM users have this as part of their own definition of SCM.

Structured Change Management is not applied to an initiative simply to keep SCM people busy, or because it seems like a good idea.


Informing, Engaging and Managing and the People Side

This is particularly important when Structured Change Management is being discussed with program managers, project teams and senior leaders. When having a discussion about the value that Structured Change Management delivers, it is important to focus on what the audience cares about.

Program teams care about being on time and on budget, and creating a measurable improvement in how the organization operates via the project or initiative. Senior leaders care about financial and structured objectives.

Knowledgeable people in SCM who can directly connect Structured Change Management effectiveness to the objectives are more likely to receive the commitment and support they need.

Adding this to the definition moves us away from Structured Change Management as a "soft" discipline to a crucial component of successful change. In the end, there is only one goal of applying Structured Change Management to an improvement project or initiative - meeting objectives and delivering value to the organization.

The people side of change refers to the reality that when a new process is introduced or a new technology is implemented, individuals will have to do their jobs differently. Think about these two rhetorical questions:


1. What value does a new process deliver if no one follows it?


2. What value does a new technology deliver if no one uses it?


The answer to both questions is: NONE.

Improvement projects and initiatives that impact how we do our jobs need structure and planning to address the people side of their changes. And, most of the structured and important changes in an organization ultimately impact people and how they do their jobs.

The Prosci process for connecting Structured Change Management to business results presents a simple framework where we identify the Project, the Purpose (why we are changing), the Particulars (what we are changing) and the People (who are changing).

By building this context and connection, we can help program teams and senior leaders begin to identify the "people change" required for a project or initiative.

A key component for managing the people side of change is understanding how one individual makes a change successfully. In the end, organizational change occurs one person at a time. In other words, the individual is the unit of change.

Even for very large and complex changes, the ultimate success of the initiative is tied to how successfully each individual who must adopt the change and makes their own personal transition from their current state to their future state.

The Prosci ADKAR® Model presents a simple but powerful framework for describing successful change at the individual level. ADKAR® states that for an individual to make a change, he or she needs:


Awareness of the need for change

Desire to participate and support the change

Knowledge on how to change

Ability to implement required skills and behaviors

Reinforcement to sustain the change


Changes are successful when each person who must do things differently has Awareness, Desire, Knowledge, Ability and Reinforcement. ADKAR® describes the "ends" of successful organizational change. Structured Change Management, as a discipline, provides structure for helping individuals change, since those individuals are the "people side" of the change effort.

It is no longer enough to simply have a communication plan or a training plan. The people side of change plays too important of a role in meeting objectives to approach it in an ad hoc manner.


Tools

Effective Structured Change Management draws upon a number of tools to enable successful individual change. Some of these tools are familiar and used readily on projects - namely the communication plan and training plan.

In Prosci’s methodology, there are five major plans created - Sponsorship Roadmap, Coaching Plan, Resistance Management Plan, Communication Plan and Training Plan.

Each of the plans have a particular element of individual change as their focus; for example a Communication Plan aims at creating Awareness and Reinforcement, a Resistance Management Plan focuses on Desire, and a Training Plan addresses Knowledge and Ability.

The plans are the levers or tools available to bring about personal transitions and represent concrete deliverables that can be woven into a project plan. However, to be most effective these plans are built within a holistic process.


Processes

A Structured Change Management process provides the structure for managing the people side of change. Like processes for managing the technical side of a project, the SCM process describes the sequence of activities that a Structured Change Management practitioner would follow on a particular project or initiative.

Prosci organizational Structured Change Management process has three distinct phases:

Phase 1 - Preparing for change, a series of readiness assessments and analysis provides the situational awareness required to manage the change at hand. The outputs of Phase 1 are a customized Structured Change Management strategy, the necessary supporting structures (sponsorship and team model) and special tactics for the initiatives.

Phase 2 - Managing change, the five Structured Change Management tools or levers described above are created and integrated into the project plan.

Phase 3 - Reinforcing change, mechanisms are established for gathering feedback, identifying resistance, correcting gaps and measuring adoption and compliance.

This holistic process ensures that best practices are incorporated, important steps are not missed and lessons learned are applied to speed up the SCM process.


Skills

Structured Change Management is not done by a single individual, or even a team dedicated to SCM. The "face and voice" of Structured Change Management are found throughout the organization.

Executives and senior leaders must fulfill the role of "sponsors of change" in support of an improvement project or initiative - demonstrating their commitment, authority and support.

Frontline supervisors and middle managers play a key role in communicating with direct reports, coaching them through the change process, building support and managing resistance. In times of change, employees look to the person they report to and the person in charge for direction.

From a skills perspective, this means that effective Structured Change Management requires competencies in leading change throughout the organization. People trained in SCM are enablers, but the "employee facing" roles in Structured Change Management are the executives, program leaders, managers and supervisors.


Principles

Finally, there are key guiding principles for change that are evident in the tools, processes and activities of Structured Change Management. For instance, the notion that change happens as a process, and not as a discrete event, is a key principle for how change can be successfully managed.

A second principle is "the right answer is not enough" - that employees need a compelling case for change above and beyond a perfect solution.

Value systems also play a key role in how changes are introduced and managed. These, along with other guiding principles, shape how Structured Change Management is applied on a project or initiative.


Summary

Structured Change Management is a holistic and structured approach for enabling and supporting individual change that requires tools, processes, skills and principles to be effective.

In the end, the degree to which the people side of change is effectively managed determines the value an improvement project or initiative delivers to the organization.

By working to bring about a clear and shared definition, people trained in Structured Change Management can be more effective and credible within the programs and projects they support.