john gaynard lecture on change and transition management in warsaw

V EDYCJA FORUM

ZARZĄDZANIA KOMPETENCJAMI PRACOWNIKÓW W PRAKTYCE

Managing Personal and Staff Effectiveness during Organizational

Change

A lecture by John GaynardSenior Partner

Syre Consulting (Systèmes et Ressources sarl)Paris

Warsaw September 2005At a conference organised by the Profirma Consulting Company

John Gaynard works for his own consulting company:

Syre Consulting (Systèmes et resources sarl)14, avenue de l’Opéra

75001 Paris,France

Téléphone: +33 1 30 61 46 17 or +33 1 47 58 67 08

Website: http://www.syre.comBlog : http://johngaynardcreativity.blogspot.comTwitter account: http://twitter.com/jfitzgaynard

John Gaynard, Senior Partner, Syre Consulting, http://www.syre.com

http://www.syre.com/

http://twitter.com/jfitzgaynard

http://johngaynardcreativity.blogspot.com/


How I got into Change and Transition Management

I will begin with a piece of personal history. I used to work at the World Bank, in the European Office Headquarters in Paris. In 1988 I had been at the Bank for four years and I worked in the recruitment department. A new President was appointed. He was a former U.S. Congressman and his job was to make the Bank more effective and more efficient. After his nomination, he immediately started talking about the major change effort he would launch to make the Bank more responsive to its clients. My manager at that time was a person who was nearing retirement. He was one of the best managers I ever had. One morning he came to me and he said, “John, recruitment has been frozen. With all this talk of change, there will be absolutely nothing to do for the next 10 to 12 months, so decide which of your skills you want to upgrade. Then every morning, come into the office and work on that skill. In every other department, work will also come to a standstill. People will be worried; they will be talking in the corridors all day long. Hard information will be impossible to come by, so rumours will occupy the minds of most people. If you don’t want to be caught up in the stress and if you don’t want to waste the next year of your life, fix yourself a personal objective and work on it.”

At first, I didn’t believe him. How could the whole World Bank, with more than 10.000 staff members, come to a halt? But, he was right. With regard to organizational effectiveness or respecting its mandate in the developing world it did come to a halt. None of the economists that year travelled to evaluate new loan projects in the developing world. They stayed in Washington or Europe because they were frightened that if they left the office even for one day they would lose their job.

That is when I first learned that during major changes, if the change is not communicated effectively from a human point of view performance levels can drop to only 15% of organizational potential. The World Bank is in the Public Sector. It prides itself on being more effective than other United Nations Organizations. The United Nations Organizations are continually implementing change initiatives which never seem to succeed. These organisations can survive because, ultimately, they are financed by their member countries who keep them alive for political reasons. But companies in the private sector who manage change as badly as international organizations usually go bankrupt very quickly.

That manager put me on the path that eventually lead me to do an MBA, in which I began to become very interested in Strategic Human Resource Management and Change Management. I have since worked on change programmes with many international companies in France, Belgium, Holland and the United Kingdom.

Survivor Guilt

I was promoted during that 1988 change and that promotion taught me about survivor guilt. A promotion did not give me as much pleasure as I had expected. In fact it pained me because at the same time some of my best colleagues had lost their jobs in very emotional circumstances. Survivor guilt also reduces personal and organizational effectiveness, but it is rarely taken into account in change programmes.



At that time, for personal reasons, I could not leave the World Bank. But I realised much later that the 1988 change was the event that triggered my decision not to stay with the organization for the rest of my career. When I finally did leave, 10 years later, after another two badly-managed changes and another two promotions which came at very high human cost, I said to myself that there must be some better way to manage change. I set out to find it and that is how I came across the work of William Bridges.

One of my first activities after leaving the World Bank was go to Canada and study the work of William Bridges with an associate of his, Chris Edgelow. I had come across Bridges’ name in a Fortune Magazine article about best change management consultants in the United States. In a few minutes, I will be going into more detail about the methods developed by Bridges after he himself had gone through a difficult change. His ideas initially came from reading the French 19 th

century anthropologist Arnold van Gennep. Van Gennep had found that in traditional societies, every time there was an important change the person involved in the change had to go through a rite of passage. This rite of passage was nearly always made up of three stages:

1. Separation from the previous status. 2. An in-between time before the assumption of the new status. 3. Reincorporation of those passing into a new status.

What I have learned About Communicating Change

The first major assignment I did in France was with an American computer company where communication had totally broken down between the majority of the staff, the unions and the Human Resources department. In fact, because of the level of stress most of the Human Resource professionals were on sick leave for a large part of the time I worked with the company. The change had begun badly, and then got worse, because of bad communication. I would like to share with you the principles I have learned about communicating change, both from my professional experience and from working with Bill Bridges and Chris Edgelow (a Canadian consultant).

1. The change should never be communicated unless it has been well thought out. The strategic analysis must have been done and the strategic choice must have been made. The date for the change to begin must be fixed in advance and must never be delayed. It is usually on the day the change is announced that staff recognise the implications for themselves and their own transitions.

2. So that staff can recognise the implications for themselves the change should be communicated only when the Four P’s are in place. The Four P’s are : Purpose, Picture, Path and Part.2.1. The Purpose should describe why this change is the right one. WHY does

the company need to change? Why does it need to change now? What would happen to the company if this change were not undertaken? The mistake that is often made during times of change is to focus on the solutions (this is what is going to happen), but before staff accept what is going to happen they need to agree with the WHY of the change.



2.2. The Picture (or Big Picture) should present a vision of where the company is going to be in one, three and five years when this change has been evaluated as successful. Many staff members are not motivated by the details of a change, but they are made enthusiastic by the vision.

2.3. The Path (or Change Plan). Other staff members are not motivated by the big picture. They need to see the details. What is going to happen tomorrow, next week and next month? They will be reassured if they see that the change has been carefully thought out, with dated milestones and regular reviews.

2.4. The Part (or the role) should take into account everybody who is affected by the change. As soon as the change is announced people need to know what role they are going to play in the new system. What are the new, emerging competencies they will need to acquire to be successful in the new way of doing things? How will they acquire them? What are the training programmes to be put in place? Which competencies are no longer required? If there is no part for a person in the new organisation, that person should be told as soon as possible and then helped to get a new job. There is no point in hiding bad news. It is only after a person has been made aware of the bad news that he or she can put in place what is necessary for the rest of their life. But if a majority of the workforce does not agree with the purpose of the change, or the purpose has been badly explained, staff may feel that they are being treated unjustly.

The Most Effective Way of Maintaining Organisational Effectiveness during Times of Change

As I learned after I left the World Bank, Bill Bridges had developed an effective way to keep the disruptive effects of change to a minimum: the Management of Organizational Transition.

It takes some time for the practitioner to understand why Bridges' methods work. Using them with clients and seeing the results at first brought me pleasurable amazement, but not complete understanding. I began to understand why these methods were so successful when I began to read Karl E. Weick, who has spent most of his career trying to understand how people make sense of their world. The methods work because Bridges is addressing not only the educated minds of the participants, but also the human need to make sense out of what is going on, and that is a need that goes back to the foundations of our world. If man did not have the need to make sense out of his surroundings, and to improve them, would civilization exist as it does today? In many change situations, people are not given the right information or enough time to understand what is happening. If they are not allowed to understand they cannot perform one of the basic human functions.

The purpose of this lecture is to focus on how managers and team leaders at all levels of the company can minimize the effects of non-stop change on your organization and its people. This is done through the effective management of individual and group transitions by encouraging individual sensemaking. This



sensemaking begins by separating Change Management from Transition Management.

The Importance of Doing Change Management and Transition Management Separately, but in Parallel

The first question you need to ask about managing change is : "What do I really need to manage? Do I need to manage a change or do I need to manage a transition?" If a change was announced a few months ago and it is not going well, you are most probably in a situation where you need to manage the transitions which have been triggered by the change.

Change begins with an outcome. It is the external situation that changes: the new manager, for example, or the new team, or the new ERP system.

Transition is the internal, psychological process people go through to come to terms with the new situation.

Change is external, transition is internal. Change starts with a beginning, transition starts with an ending. Managing change is to manage a process in time, with a date for the change to

begin and an end date, when the new situation should be in place. Managing transition is to accompany the psychological process that most people

have to go through when they are confronted by change. This process is made up of three stages : Managing Endings Managing the Neutral Zone Managing the New Beginnings

To manage endings successfully is to communicate exactly what existing behaviours, attitudes and competencies must stop and what must start.

To manage the neutral zone successfully is to put in place the right training programmes to bring the new competencies, behaviours and attitudes into the organisation

If Endings and the Neutral Zone are managed successfully, the New Beginnings come naturally. But during the New Beginnings the arguments for the change need to be reinforced and all positive news about the changes, whether quick wins or long-term gains must continue to be communicated systematically.

Making change happen successfully requires an acknowledgement of the losses that can come with endings.

How Organizational Change, when badly managed, Can Seriously Diminish Effectiveness

One of the impacts of that announced, but not formally announced, change at the World Bank was ten months of rumour and worry while every job was analysed by the Human Resources Department. Eventually either the job was going to be abolished or it would be redesigned and a new list of competencies would be established. I can remember one Human Resources Manager from Central America who was hired just before the Bank announced the freeze on recruitment. He left his country to move to the United States with his wife and young children and three days after he arrived in Washington he learned that he was going to be fired the next day.



Finally, the announcement came. Every World Bank Staff member was fired, all ten thousand of them. Either they could decide to take voluntary redundancy or they would have a period of three days to write a new CV and reapply for their own job or for somebody else’s job. Can you imagine the sort of friendly atmosphere that created? I can remember people calling each other “Judas!” in the corridors. Other staff members, especially among the ones who had been there for many years became severely depressed. It took the people who were kept on many months before they became fully effective again.

The Importance of Keeping One’s Own Competencies Up-to-date

My job in the recruitment department was abolished during that 1988 change. But because of the advice I got from my manager, and from the personal work I did during that year, eight hours a day, instead of listening to all the gossip, I discovered that I had the right competencies to apply for many of the new jobs. So, as I mentioned previously, I came out of that change with a promotion, as a manager responsible for implementing a part of the World Bank’s new voice and data telecommunications network.

That is when I learned that during times of change, to maintain our own personal effectiveness, we as individuals are responsible for looking after our own DATA. This is another Bill Bridges concept and Human Resource professionals can use this concept in two ways: for themselves and when they need to coach people during times of great change.

1. “D” stands for Desire. What do you really want to do with your life? I had joined the World Bank as a telecommunications specialist and I now found myself in the Recruitment Department. I decided to update my telecommunications skills during that year of “inactivity” and move back into telecommunications.

2. “A” stands for Abilities. What are you really good at doing? If you are not using your abilities productively, what projects or situations can you find that will allow you to use your abilities and talents to their full extent?

3. “T” stands for Temperament. Are you introvert or extravert? Are you fact-based or more intuitive? Are you competitive, empathetic, happy to work with detail or a born communicator? What type of job, or changes to your job, could help you to make the most of your character and personality?

4. The second “A” stands for assets. Assets can be either physical, such as an apartment you own, savings, or an insurance policy or investments. But assets can also be professional qualifications, linguistic skills and expertise in a domain such as marketing, logistics, human resources, finance or many other domains. During times of change it is useful to look at your assets, especially in terms of professional qualifications and to ask yourself if you are using them to their full worth. If not, how coul d you use them better?



A Second Anecdote: the danger of evaluating change programmes

A second piece of personal history is about when I started to study traditional Change Management. I was given a six-stage framework. I will go into the first stages in a moment, but the last stage of the framework, stage six, was to evaluate the change, to find out what had worked and what had not worked and what could be improved the next time around. But my professor told me that hardly anybody ever got to that stage. “Why?” I asked very naïvely. His reply was “Because it is dangerous.” Again I asked “Why?” and I was told “If you compare what has actually happened to the original objectives, you will find that the majority of changes fail. The managers who put those changes in place don’t like to be reminded about the fact.”

I discovered by myself, as my experience grew that the Professor was right. As a consultant, it can be dangerous to suggest post evaluation to some managers when you are talking about a change that has failed. But I have also learned that there are a lot of very good managers around. The best senior managers I have ever worked with have no problem with doing a change evaluation, in saying “OK, so what has worked and what has not worked and what do we do now?” If you are working with a manager who refuses to evaluate past changes, be careful about getting involved in his or her next changes. Because the next changes will be no more successful than the last ones.

The Importance of Putting a Date on Change

I have known situations where members of senior management have refused to announce a date for a change to begin, because they are frightened that the change announcement will provoke labour problems. But usually, at the beginning of a change, somebody from the senior management team says “The Change is going to begin, for example, on September 15 or December 3 and this is what we expect in six months, a year or two years.”

One major piece of learning for me is that change management programmes have lots of beginnings and very few endings. Managers are reluctant to talk about endings. They prefer to talk about new beginnings, but if the endings are not handled properly it is very difficult to reach the new beginnings.

The Stages of Traditional Change Management

What were the first stages of that Change Management programme I learned? I was told that all good change management starts with Strategic Analysis? Why does the company want to change? Is it because the competition has become too disruptive? Are its products too old? Are its services not up to standard? Are its present markets saturated? Is it not using its core competencies correctly? Does it need to acquire core competencies?



Once the Strategic Analysis has been done, a strategic choice has to be made. Either the company moves into new markets or new products or puts in place the right competencies to better sell and support its products or its services in its present markets.

Implementation can then begin, using the model developed by Kurt Lewin. The first part of the change implementation, according to Lewin, was to unfreeze the minds of the people who are going to be affected by the change. It was nearly always taken for granted that people would be resistant to the change and I have heard companies even describe their own staff during times of change as “Neanderthals” or “Dinosaurs”. Once these pre-historic creatures are satisfactorily warmed up, then the change can begin. When, a year or two later, the results expected from the change have been achieved, ideally you then refreeze people at the point where they have learned the right competencies and have adopted the right behaviours for the effective management of the new organisational structure.

I have since learned that people do not resist change. They know that change is inevitable. But what they do resist are the personal transitions which they know will be triggered by the change.

The problem with the refreezing part is that the managers usually get it wrong. Refreezing is difficult. I find that many good staff members in companies which are affected by change do not know what competencies they have to phase out, because they are not told which competencies were perfectly satisfactory for the old job but which are no longer satisfactory for the new job. They are rarely told what competencies they need to acquire or on what competencies they are going to be evaluated in the new organisational structure. This leaves them in a no-man’s-land.

When the new competencies are specified to staff the most effective training programme must be put in place to help them acquire the necessary skills. If adequate training is not given, staff who were initially enthusiastic about the change can become very disillusioned and even bitter if they see that their goodwill has not been effectively recognised and rewarded by the company.

It happens that the new competencies expected from a change are so unrealistic that nothing can help staff to acquire them. I remember an international pharmaceutical company which acquired a research facility in France. The French company had been specialised in looking for new drugs for stomach cancer. The acquiring company told the researchers that they would now be expected to find new drugs to cure respiratory problems. How can you expect a scientist who has spent 15 or 20 years of his or her life specialising in stomach cancer to make such a big jump?

One of the scientists said to me, “Even in the domain that I know, in which I am considered a world specialist, I have had to work 80 hours a week to keep up to date over the past 20 years. I had to spend 20 hours on basic administrative tasks, 20 hours on research projects inside the company, 20 hours a week reading journals to keep up abreast of what is happening in my domain and then 20 hours a week in which I tried to do some original research and writing of my own. So how can I be expected to get myself up to date in the new therapeutic area, to do the equivalent of a thousand 80-hour weeks, in just six months?”



The scientist left the company. His career anchor was the knowledge he had built up over 20 years so he joined another company that could use that knowledge. The research centre was finally closed down in France and all its work was moved to England. The lesson from this is that you have to be realistic about what you expect from a change programme.

Other staff may put in place the right competencies immediately, but because nobody evaluates or measures those competencies in relation to the change objectives those staff members do not realise they are getting it right. So, in the absence of good feedback and evaluation, they just keep on changing, hoping that one day somebody will tell them to refreeze.



The model I now prefer to use for Change Management retains some elements of the work of Lewin. It also integrates the thinking of Bill Bridges and Karl E. Weick and lessons learned from the change work done at General Electric in the 1990s by Noel Tichy. The model takes into account the need to manage in parallel the organizational change and the organizational and individual transitions.

Phase 1 - Unfreeze Mindsets

Managing the Organization

- Develop diagnostic and linguistic skills- Show the patterns of what is happening- Show that intentions and results are not

compatible- Do what is necessary, structurally, to

stop strategic drift

Managing Individual DynamicsEndings

- Help people to disengage from the past- Disidentify with past- Deal with disenchantment

Phase 2 - Change and Rebalance


- Avoid the quick fix- Set a clear date for the change- Reinterpret, relabel, resequence steps so

they unfold with fewer blockages- Animate people- Provide a direction- Encourage updating of processes- Facilitate respectful interaction

Managing Individual DynamicsThe neutral zone

- Take individuals through the “Wilderness”

- Know and respect the Death and Rebirth Process

- Encourage a new perspective on both endings and new beginnings

Phase 3 - Resume Emergent Change


- Encourage improvisation- Encourage education & learning- Be attentive to local changes- Stay resilient to anomalies- Be flexible in execution

Managing Individual DynamicsNew Beginnings

- Realign individuals’ values with corporate values

- Communicate positive news constantly- Give people new energy

History repeats itself . .



My Recent Experience

In my recent experience some of the big engineering and aeronautical companies are still managing change in the traditional, Kurt Lewin way, and, yes, they even do regular reviews and evaluate the success of their changes. But they are only now beginning to wake up to the need to do transition management, to handle better the need to support their people as they manage endings and losses, go through the neutral zone and wake up to the new beginnings.

Many FMCG (Fast Moving Consumer Goods) companies and software companies are so busy running knee-jerk change initiatives that they are not managing major change in a systematic way. When I talk to people who work in these FMCG companies, or high-tech companies, I can see that they are continually trying to manage thirty changes at the same time, but in spite of this they often say “We know all about change and innovation. We manage change successfully every day.” However, the reality in these companies is that many changes are announced but very few are successful. The vast majority of their employees have become very blasé towards change. They hear the change announcement, but they know it will soon be forgotten and that nothing will change.

The sad aspect of this is that when a company which has been producing a successful product or service loses its way it finds it very hard to get back on track. Thereafter many excuses, such as the increasing speed of change or the toughness of the markets, are presented to explain away bad change management or just plain arrogance.

One of the first activities I undertake when I start work with such a company is to get the staff, in a workshop, to list all the changes they are supposed to have implemented over the past three years. Sometimes the staff list as many as 40 changes. When I later show this list of changes to the senior management they say “This is crazy.” They point to 20 of the changes and they say, “These changes are over, finished. Why are people still doing this?” And I reply, “Because nobody ever told them that the change was over. And by the way, how are you doing with the other 20 changes which you consider are not yet over but in my opinion are totally bogged down?”

I then work with the company to communicate which changes are finished (that is to say there is a successful new beginning or the change has been written off as a failure), which changes are still in the neutral zone and which are still in the stage where people are having to manage endings. Once this work has been completed, the staff of the company can get out of their minds all the changes they felt guilty about not managing. This gives them the time to concentrate on the priority changes, to handle their transitions and to become more effective.



More Information On The Change Management Model, Integrating Bridges and Karl E. Weick

Phase 1 - Unfreeze Mindsets

Managing the Organization - Companies are often at their most successful just before major problems appear (recent examples are Marks & Spencer in the U.K. or Xerox or Cisco in the U.S.) The opinion of many staff members is "We are successful so why should we change?" To unfreeze this "steady state" and the mindsets it has encouraged, the effective change manager must have the analytical skills to see clearly that success will be short-lived. He or she must understand why, how and when the company has drifted away from a successful pattern and the direction it needs to take to get back on track. The leader must then be able to demonstrate considerable linguistic and presentation skills (metaphor, use of stories and examples) to communicate the long-term implications if action is not taken to address the underlying problems. The leader must explain why strategic thrust change must now replace the strategic drift that has emerged. The leader must create a clear and compelling direction for the company's managers and employees, without going into all the details, many of which must be worked out by operational managers ( Good examples of this are Jeffrey Immelt at General Electric, Larry Bossidy at Allied Signal.)

Managing Individual Dynamics - Once the individual employee has understood that change is necessary for the organization, the immediate reaction will be "OK, I now understand what the company needs to do to be successful long-term, but what about me as a person in the short-term?" If the individual sees the change as positive, he or she will react positively. If the change is seen as negative for him or her, the reaction will, understandably, be negative.

Therefore the change manager must do everything possible to understand the need for change, and this change in particular, so that he can manage the process in which many team members will need time to disengage from the past, to disidentify with the old routines and procedures that made them successful, and to go through a period of disenchantment before they accept the new way of doing things. If this need for disengagement on the part of a large number of persons (which may take a number of months to play itself out) is not explained or respected, the change will get bogged down at the mid-manager level and it quite simply will not happen. Unsuccessful change attempts then lead to uncontrolled loss of market share, demotivation, down-sizings, lay-offs and maybe the end of the company.

Phase 2 - Change and Rebalance

Managing the Organization - Both the leaders of the organization and the managers must resist the temptation to fix the symptoms instead of the cause. They must continually use language skilfully to reinterpret and relabel what is going on so that team members can understand the perils of the old way of doing things and the benefits that will come from the new way. Therefore managers must understand



organizational structure, processes, climate and culture so that they can explain changes to these parts of organizational life. Understandable processes, that maintain the necessary flexibility, must be co-created and put in place. There may be a lot of tension between individuals, who will all go through transition at different rhythms, so it is more than ever necessary to ensure that the corporate values are respected (in practice, not just in theory) in all interactions. Each small success should be a cause for celebration. Temporary processes (HR, IT, Marketing) need to be put in place to ensure successful transition until the permanent new processes have been installed. There should be continual conversation and feedback at all levels, which will allow continual updating of what is working and what is not working.

Managing Individual Dynamics - One day the team-member will feel elated, because he or she thinks that they are finally beginning to see the new way of doing things. The next day, the same employee may be once again grappling with disenchantment. The employees will be tempted to say that the new way is not working. They will want to go back to the old ways of doing things. The manager must understand that the priority is now to take care of both him or herself and the team members through the wilderness. He or she needs to understand how team members respond best to internal and external motivation. The manager needs to continue to explain, hour after hour, day after day, why the old way of doing things had to be dropped and what successes can be expected when the new way of doing things is finally in place. Creativity sessions should be put in place so that team members can participate in the co-creation of the new way.

Phase 3 - Resume Emergent Change

Managing the Organization - Important learning must be kept from previous phase (knowledge management of what worked and what did not work). New processes and routines are now proving their effectiveness. Individual staff members have stopped talking about the past and are enthusiastic about the new ways of doing things. The die-hard resisters will be gone, the people who are in love with continual change will complain because they are finding things have slowed down too much for their liking. Managers must be ready for the next surprise from the market or the competitive landscape. Action-learning and education should continue to be encouraged, because history will repeat itself. But now, the organization has been through one successful change, with all the transitions that entailed, and it will be ready for the next change--as long as the lessons are not allowed to be forgotten.

Managing Individual Dynamics - The individual will now regret all that time that was wasted during the neutral zone phase. Why didn't he or she accept all those courses that were offered? Now the old enthusiasm is back, the energy has returned, but events seem to be unfolding too quickly, there is no time for training, no time to think about the patterns and the processes behind what must be going on. During the successful change and transition, the individual has developed inner resources that will stand him or her in good stead for the next change. However, both manager and team member will need to continue to talk, to use the analytic and linguistic skills which will allow them to understand what is going on before history again repeats itself.



What This Means For Managers - Managers must develop their change management skills and understand the transition process. If they have not handled their own transition process, and if they do not understand the nuts and bolts of the change they are trying to implement, they will not be able to help team members understand the change or manage endings, transitions and beginnings necessary for productive change.

What This Means For Individuals - Working for a successful organization means continually saying goodbye to old competencies and old ways that are no longer needed for the job (managing endings), updating core skills for the job (managing the neutral zone), and consolidating new skills and competencies (managing new beginnings). Organizational success depends on individual success. Individual team members need to understand the importance of this process, which explains why change is necessary and transition takes time and which will give the justification needed in the competition for resources needed in the personal updating process.

References

Bridges, W. (1988, 1990,1996), Surviving Corporate Transition, Mill Valley, California, William Bridges & Associates

Foster, R. & Kaplan, S. (2001), Creative Destruction, New York: Currency/Doubleday

Van Gennep, Arnold (1909), The Rites of Passage, reprinted by Routledge in 1960Weick, Karl. E. "Emergent Change as a Universal in Organizations", in Beer &

Nohria (2000), Breaking the Code of Change, Cambridge, MA, Harvard Business School Press



john gaynard lecture on change and transition management in warsaw

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