Organizational Change Management

Organizational Change Management (OCM) is dead as we all know.

In fact we have been doing it wrong all along while implementing Digital Transformation for our esteemed customers.

Hence we need to find a new way of addressing the human aspect of Digital Transformation during its implementation’s phase.

My name is P.K. Saxena and I am CTO of Sofcon Systems India Pvt. Ltd.

Sofcon is 27+ years old Industrial Automation, Controls, Instrumentation and Substation Automation Company located at NOIDA in Uttar Pradesh State, India.

My guide for this journey is Eric Kimberling who is the CEO and founder of Third Stage Consulting Group.

Third Stage is an independent consulting firm which helps clients go through their Digital Transformation journeys smoothly in all countries.

To begin with let me share with you our experience background.

In short, I actually started my career 30+ years ago as an Automation Solution provider while Eric started his career 40+ years ago as Organizational Change consultant for big ERP projects at big fortune 500 companies.

So it pains to me to write an article and to suggest that Organizational Change Management is dead.

However I still want to dwell upon this topic and narrate what went wrong with most Organizational Change Management programs and what it is that is wrong with their strategies.

Also I would like to bring forward to you what we can do differently to make sure that our Digital Transformation journey taken by each of our client succeeds in the coming years.

Traditional OCM doesn’t work

So when most people think about Organizational Change Management and this includes

ERP consultants

Software vendors

System integrators

then most of them are basically  thinking about rendering training in communications area.

For example training for things which are focused on a transactional aspect of the software.

How do I type whatever I need to type into the system?

How do I find the field I need?

Further how do I do something in the system to make sure that the process works?

Kind of Problems

Certainly this approach has problem with following two things:

One problem is —it is focused on a very transactional aspect of change which is important but the big, the more important thing is that it forgets to focus the more strategic aspect of change.

Surely I will elaborate it further-just be patient.

The second problem is that by the time we get to training and to communications, it is too late.

Because we can realize importance of rendering training in communication field of OCM mostly in downstream part of Digital Transformation when we have something to communicate and something to train.

But by then people have already formed in their mind resistance to change.

Also by then they have already created confusion in their mind.

Because it is coupled with whatever problems they had faced earlier in the transformation cycle.

So by the time we start communicating people about the aspects of changes created in the Organization due to implementation of Digital Transformation, it is considered a late delivery.

Because rendering training to the people at this phase of project is just not enough.

Since it is too late at that point.

Hence we really have to look at what could we do differently to affect the change earlier in the Digital Transformation process.

Indeed we have to ensure that we are proactively addressing some of the resistance that happens from implementation of OCM.

The Trojan horse OCM Approach

So let me share with you one such case study which I came to know from Eric.

In particular this is the case study of a project when Eric was working a few years back with one of his larger clients.

In addition this was a very large and a very successful client for Eric.

Further it was a very well-known company and it was considered very disruptive and innovative company in their industry segment.

Generally their industry segment is not known for innovation or disruption.

However back in the 80s they completely turned their industry on its head with an entirely new business model based on types of commodity products.

While Eric was working with them during implementation of a large Digital Transformation.

Basically I am referring to the time period when Eric has been through few years into a massive multi-year implementation phase of Digital Transformation.

And one of the things he has been helping them with is Organizational Change Management.

Later in this case the client shared with Eric why they did not like the term Change Management.

In fact they did not like the concept of Change Management.

Certainly on one hand they understood the need to manage the human aspects of change.

Also on the other hand they knew that they needed to change but they did not like the concept of formalized Organizational Change Management as program.

Learning from Case Study

So one of the things Eric learned from this client and it is a common pattern we also see with a lot of different clients is that people in general resist Organizational Change Management when it is a standalone team or a standalone activity.

Hence one of the things, Eric as well as I recommend to our clients is to find a way to bake Organizational Change into more of the core DNA of what the project team does.

For example instead of having an entire dedicated team just for doing only Organizational Change Management.

In addition it can be very effective to diffuse that organizational change responsibility to all their parts of the team.

Also more importantly it can be effective to diffuse that organizational change responsibility to business users and stakeholders.

Of course generally business users and stakeholders are not considered part of the project team.

But they are the people who are going to own these changes in these new business processes /

as well as they are going to own theses changes in new job designs.

Further roles of responsibility for most of the individuals in the organization is going to be redefined.

So if we can get them to own the Organizational Change

and do that not under the guise of Organizational Change Management as a separate program

but do it just part of the DNA of what they do

then that can be a lot more effective than

what we have seen in traditional Organizational Change Management approaches.

OCM should be part of your DNA

So the question arises how do we make it part of our DNA?

Also what exactly does that mean?

In particular one of the things that Eric has found to be very successful with a lot of clients is to craft the organizational change strategy behind the scenes based on the unique needs of the organization

as well as  based on the unique culture of the organization.

Also provide the change templates and methods and tools

to the business owners /

to the stakeholders /

as well as to the mid-level management executives /

or to the different people within the organization.

Since they are not necessarily part of the transformation.

Hence project team have them own the change and deliver the change and be the face of change.

And also be the voice of the frontlines.

So that we can also not just share changes.

But also we can have them push communications.

As well as we can have them push transformation changes out to the organization.

But also can we get a pulse on what is happening?

Since the changes are happening on the front line.

So if people are freaking out because it is too much changed /

Or else they do not understand the change /

Anyways whatever it might be.

We have ways to capture that input along the way.

Strategy

And this can be a very effective way to ensure that we have more people owning change rather than just a small concentrated group of change Professionals.

Or we have change team members where their only job is to focus on change management.

However now the risk of doing this approach which I am mentioning here is that oftentimes transformations are more complex than we expect.

Also oftentimes it takes more time and money than we expect.

And if we pursue it then we end up getting back to into a corner.

Also we may have to cut something in order to meet our deadlines.

Or else we have to cut something to meet our budget which otherwise we are trending to exceed.

In short we are probably going to cut change management.

Likewise it becomes very easy to let change management to fall by the wayside.

So that we can focus on doing the other more tangible stuff that we can see that is immediately in front of us which usually has more to do about the technology.

Hence we have to make sure that we have a good strategy which is not something that is going to be attractive to cut from the overall strategy. And scope of what it is we are doing during our transformation.

Don’t forget about Culture!

One of the most common things that organizations overlook when going through their transformations and building their organizational change strategies and plans is the whole concept of culture.

Generally too often companies come in with a cookie cutter approach to change management.

Whether it be a proxy type of approach through software vendors or through System Integrators.

Because sometimes they have their own OCM Lite methodologies.

And oftentimes there is a cookie cutter approach as they do not take into account the culture of the organization.

As well as they do not know what it is that they are trying to become as an organization.

For example a lot of companies Eric has been working with are global Multinational companies that are growing organically throughout the world.

As a result they have been acquiring other companies and over the years they have grown a decentralized siloed type of organization.

Accordingly they have built enough critical mass and scale that now they want to figure out how do they pull this all together?

Also how do they act more like a grown up company that acts like one company.

Of course on paper that sounds good in theory.

Moreover it sounds good as well.

But getting there is a lot more difficult.

Especially when people are used to operating in decentralized mode.

As well as doing whatever they want for lack of a better world.

However now Eric’s team is going there and is telling them how they have to operate.

Because corporate says that there is a mandate for them to operate in a certain way.

Cultural Shift Strategy

So in order to get there they need to be mindful of the fact that that is a big cultural shift.

As well as people are not just going to jump for excitement because they see the benefits.

Otherwise they see that the company is going to be more profitable potentially by acting more like one company.

So we have to figure out based on that cultural shift where we are doing

what is the change strategy that is going to help us get there

and what are the change management tools that can best help us get there

and then the other part of culture to be aware of is that we just need to understand

as well as make sure that our transformation in general lines up with the culture

that we’re trying to affect

so a lot of times organizations in the example I just mentioned wanting to standardize operations

they will not necessarily understand the level of effort

it is going to take to get there and the amount of magnitude of change

and how they are going to change throughout the implementation

and they also oftentimes will make decisions

as well as they operate the project in a way that is inconsistent

or misaligned with that desired future state cultures

So we need to make sure that our overall transformation is focused on the culture.

We are trying to enable and obviously that is something that goes well beyond the capabilities of any one organizational change team

or

Organizational change work stream on a project that is getting back to the executive level which is something else that Organizational Change Management should address as well.

Create a tailored OCM strategy and Plan

So one of the best ways to quickly get to change strategy

and plan that makes the most sense for you is to conduct an organizational readiness assessment

which would be a combination of quantitative surveys to gather a quantitative pulse on the culture of the organization

and where we anticipate some of the resistance to change

or the difficulties with change might come from

and also a qualitative focus groups

so really understanding and unpacking the culture

and the different political nuances

and internal dynamics that we need to consider

so that we can create a change tool set

or a change plan that focuses on who you are as an organization today the pitfalls along the way

and where it is we are headed in terms of transforming our culture.

Take Aways

So that is probably the biggest word of advice which I learnt from Eric,

I can afford to give you in this article is to make sure to conduct that organizational readiness assessment

and that is something that having it dedicated or

a focused organizational change team can add a lot of value is by conducting that assessment

and creating the plan that goes behind that but when it comes time to execute that plan and to push the changes through the organization

that is where we need to diffuse the organizational change activities in a more decentralized way and let the business own that

and make that part of the DNA and take that Trojan horse approach

that I mentioned earlier.

So I hope you found this information useful.

I also encourage you to download Third Stage Consulting’s annual ERP report which I have included in a link given below in Resources section

and that includes tons of information and best practices around ERP projects in general including organizational change management best practices.

So I hope you found this information useful.

Digital Prabhat

Resources:

THE 2020 ERP REPORT

20 LESSONS FROM 1,000 ERP IMPLEMENTATIONS