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Change Management
1
Exhibit 1
Comprehensive Strategy-Based Transformation Approach
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Exhibit 2
Cascading Ownership
vidual contributors. Each of these layers must are invaluable opportunities to create (or force)
have identified, trained leaders who are aligned to leadership team alignment. Leaders must then
the company’s vision, equipped to execute their customize this message for various internal audi-
specific mission, and motivated to make change ences, describing the pending change in terms
happen. These change leaders must be released that matter to the individual:
from their current assignments and dedicated to Confronting reality and articulating a compelling
the work of change.
need for change
Demonstrating faith that the company has a
Client Example:
viable future and the leadership to get there
A major multi-line insurer with consistently flat earn-
Providing a roadmap to guide behavior and deci-
ings determined that it needed to change perfor-
sion-making
mance and behavior to prepare for going public. It
followed the cascading approach to change, training
and supporting teams at each stage: 10 officers Client Example:
setting the strategy, vision, and targets; 60-80 A consumer packaged-goods company experiencing
senior executives and managers designing the core years of steadily declining earnings determined that
of the change initiative; 500 leaders from the field it needed to significantly restructure its operations
getting the details right and driving implementation. to remain competitive, shedding upwards of 30% of
This structure remained in place throughout the the workforce in the process. The leadership team’s
change program, which doubled earnings far ahead challenge was to shift the focus from the massive
of schedule. downsizing and engage the survivors in embracing
the new business strategy. Through a series of offsite
meetings, the executive team built a brutally honest
4) Confront reality, demonstrate faith, and craft business case that downsizing was the only way to
a vision: Individuals are inherently rational and keep the business viable and drew on the company’s
will question to what extent change is needed, proud heritage to craft a compelling vision to lead
whether the company is headed in the right direc- the company forward. By confronting reality and help-
tion, and whether they want to personally commit ing employees understand the necessity for change,
to making change happen. They will look to the the leadership was able to motivate the organization
leadership for answers. Articulating a formal case to follow the new direction in the midst the largest
for change and creating a written vision statement downsizing in the company’s history.
4
Exhibit 3 Exhibit 4
Change Leaders’ Message to the Institution Organizational Reach of Change Program
transformation and be the zealots that create sistent and personal. The best change leaders
critical mass for change in the workforce. This speak from the heart and convey a deep sense of
requires more than mere buy-in or passive agree- personal commitment. They tell a consistent story
ment that the direction of change is acceptable. and view telling the story as a key responsibility in
It demands ownership by leaders willing to accept the change process.
responsibility for making change happen in all of
the areas they influence or control. Ownership is
often best created by involving people in identify- Client Example:
ing issues and crafting solutions. It is reinforced In the late 1990s, the Commissioner of the Internal
by a combination of tangible (financial compen- Revenue Service had a vision of treating taxpayers
sation) and psychological (camaraderie, sense as customers and turning a feared bureaucracy into
of shared destiny) incentives and rewards. Many a world-class service organization. Getting more
companies create “design and build” teams led than 100,000 employees to think and act differently
by key change agents to develop the core strate- required more than just system redesign and pro-
gies they will need to implement. Middle and line cess change. IRS leadership designed and executed
managers are likewise engaged in Phase III of the an ambitious communications program including
change program to flesh out the detailed imple- daily voicemails from the Commissioner and his top
mentation plans that they will follow. staff, training sessions, videotapes and newsletters,
and town hall meetings that continued through the
6) Practice targeted over-communication: The best-
transformation. Timely, constant, practical com-
laid plans are only as good as the institution’s
munication was at the heart of the program, which
ability to understand, adopt, and act on them.
brought the IRS’s customer ratings from lowest in
Too often, change leaders make the mistake of
the country to its current ranking above the likes of
believing that others understand the issues, feel
McDonald’s and most airlines.
the need to change, and see the new direction
as clearly as they do. The best change programs
reinforce core messages through regular, timely
advice that is both inspirational and actionable. 7) Explicitly address culture and attack the cultural
Communication is both outbound and inbound. It center: Company culture is an amalgam of shared
should be targeted so as to provide employees history, explicit values and beliefs, and common
the right information at the right time, to solicit attitudes and behaviors. Change programs often
their input and feedback and to check in on their require amending, creating (in new companies or
emotional response to what they’ve heard. Change companies built through multiple acquisitions),
programs often require over-communication retaining (in storied consumer goods or manu-
through multiple, redundant channels. However, facturing concerns), or merging (in mergers or
communication must be timed, coordinated, con- acquisitions of large companies) culture to be
5
elevate and resolve issues, change leaders can cess. Provide highly visible rewards (promotion,
then make the adjustments necessary to maintain recognition, bonuses) as dramatic reinforcement
momentum and drive results. for embracing change. Sanctioning or removing
people standing in the way of change reinforces
10) Speak to the individual as well as to the insti-
the institution’s commitment.
tution: Change is a personal journey as well as
an institutional one. It truly does happen one
Conclusion
person and one team at a time. Individuals (or
Most leaders contemplating change know that people
teams of individuals) need to know how their
matter. It is all too tempting, however, to dwell on the
work will change, what is expected of them dur-
plans and processes, which don’t talk back and don’t
ing and after the change program, how they will
respond emotionally, than to face up to the more diffi-
be measured, and what success or failure will
cult, and more critical, human issues. These guidelines
mean for them. Be honest and as explicit as pos-
should help dispel some of the mystery of successfully
sible. People will react to what they see and hear
mastering the “soft” side of change.
around them. Involve people in the change pro-
NEW YORK
Reggie Van Lee John Jones Paul Hyde
Senior Vice President Vice President Vice President
212-551-6421 212-551-6713 212-551-6069
van_lee_reggie@bah.com jones_john@bah.com hyde_paul@bah.com
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