Change and engagement, part one

The way we are changing is changing. The predominant approach to change has been to mandate it. An elite, at the top of the organisation, perceive a need for change and direct others to implement it. They will anticipate some resistance and have some strategies ready to overcome it. Often this change will involve some type of restructuring.

There is mounting evidence that this type of change doesn’t work very well and may actually deplete rather than add value. For some organisations, the frequency of this type of change results in a series of self-inflicted, debilitating injuries.

A recent Bain & Company study of 57 major reorganizations found that fewer than one third produced any meaningful improvement in performance. Some actually destroyed value.

Mandated change, bold strokes and long marches

Twenty years ago, in her book The Challenge of Organizational Change, Rosabeth Moss Kanter and her co-authors identified two types of change, bold strokes and long marches. Bold strokes are big strategic moves, such as buying another company, generating a large capital investment, or developing a new product. Bold strokes are usually mandated by the actions of “one or a few people”.

(Tom Peters’ take on mergers)

Long marches are more operational initiatives such as merging departments, transforming quality or customer relationships. According to Rosabeth Moss Kanter, “they require the support of many people and cannot be mandated in practice”

Of course we will continue to need a degree of mandated change, and other stakeholders such as government will mandate external change. We just need to hope that the skill and ability to design and manage change will improve.

Too frequent use of restructuring will come to be seen as the  corporate equivalent of the old medical practice of blood-letting and a sure symptom of dysfunction.

According to Rosabeth Moss Kanter, long march change will have more dependable long term results and is more likely to change culture and habits. She then elaborates on the enduring foundation of sustainable organisational change – decision making.

Every large and complex organisation has many thousands of people who have each day the opportunity, or are literally required, to take action on something. We think of these as “choice points.” For an organisation to succeed in any long-run sense, these millions of choices must be more or less appropriate and constructive day in and day out. But this is an immensely difficult problem, because it requires the ultimate in decentralisation – literally to the individual level – along with centralisation in the sense that those individual choices must be coordinated and coherent.[1]

This same theme is echoed two decades later by Marcia Blenko in the Harvard Business Review:

In reality, a company’s structure results in better performance only if it improves the organisation’s ability to make and execute decisions better and faster than its competitors.[2]

Her she is elaborating on the centrality of decision effectiveness in sustaining effective change.

The engagement connection

Marcia Blenko’s establishes a link between decision effectiveness and employee engagement. Rosabeth Moss Kanter emphasised the importance of “choice points” throughout the organisation. And while the focus is on big business, even small businesses manifest thousands of choice points if we consider all employees and stakeholders.

Embedding a stakeholder ethos (including employee engagement) throughout the organisation will build resilience and adaptive capacity. Over time, it is more likely that those highly engaged staff will be making decisions and choices aligned with the best interests of the company. And over time there will be less need for mandated change.


[1] Rosabeth Moss Kanter, Barry Stein and Tod Jick. The Challenge of Organizational Change: How Companies Experience It and Leaders Guide It. New York: Free Press, 1992, page 492, 495

[2] The Decision-Driven Organisation, by Marcia Blenko, Michael Mankins and Paul Rogers In Harvard Business Review June 2010, page 57

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Engagement and change: part 2 – lean thinking

This post by guest blogger Alex Twigg is the second part of a two-part post.

Much of the change in workplaces over the last few decades has been predicated on notions of economic efficiency and have been known variously as “downsizing”, “rightsizing”, “outsourcing” and more recently as “mergers and acquisitions” – and as the Kotter and McKinsey studies mentioned in part one shows – not much of it successful. In the February / March edition of the Harvard Business Review, an article on mergers and acquisitions quotes the following – “Companies spend more than $2 trillion on acquisitions every year, yet the M&A failure rate is between 70% and 90%.”

By contrast, an alternative model of change – one that is intrinsically engaging of employees, that is about “learning to do things with others” is a workplace transformation process known as Lean Thinking – a western lens on the Toyota Production System.

The ‘lean” or “less” of Lean Thinking is often misunderstood. It is not about cost cutting (the old traditional focus of change) and it is certainly not about retrenching – i.e. less staff. Rather Lean Thinking is based on two values: continuous improvement and respect for people. The system of “lean thinking” is the mutual reinforcing of these twin values through a structured process of principles and actions – that in its essence is fundamentally engaging of employees.

Reducing waste

Lean Thinking is not premised on the assumptions of “economies of scale” and its twin “resource optimisation” – the assumptions that shape traditional approaches to organisational change. Rather it focuses on a notion called “flow” and the removal of waste. It is primarily focussed on process efficiency rather than economic efficiency.

The traditional approaches to change and Lean Thinking depend on very different primary sources of data to inform change. In the former the data derives from an abstraction of the productive process – namely the organisation’s statements of account. The primary question in this approach is “how do we make the economic equation of this organisation work?” This is the question that has shaped all the “”downsizing” “rightsizing and “mergers and acquisitions” activity of the past. In “lean” the primary source of data for change is from the organisation’s productive processes themselves – through the identification and removal of waste to answer the primary question of “how do we make value flow?”

Lean Thinking identifies 7 forms of waste, namely motion, waiting, transportation, storage, defect waste, over producing and excessive processing. Space precludes a discussion of each of them me so for present purposes a description of the first will have to suffice as a sense of the thinking behind waste generally.

Motion waste consists of all unnecessary movement and searching. Searching is the biggest form of motion waste – searching for information, looking for the correct person, tool or document. It is estimated that between 20 – 50% of time in a physical workplace is spent looking for people, tools, specifications, patient information … and in an office environment, some 15% of our time is spent looking for information that is within an arm’s length! In addition to searching, motion waste includes all unnecessary bending, lifting, reaching and walking. 

To systematically remove waste from an organisation’s processes requires the active involvement of the employees who are uniquely positioned to see the waste. Managers cannot see deep enough into the processes to really identify the waste that the employees see and experience daily.

This creates a dilemma for organisations – managers have the authority to effect change but not the complete awareness required on which to base this change; and employees by contrast have the awareness but not the authority.

The employee engagement strategy to Lean Thinking is to structure a process that seeks to resolve this dilemma. It requires 2 guarantees to give it meaning – one procedural, namely participation by all in identifying waste – the other substantive – no redundancies as a result of lean initiatives. The former is essential to identify and remove waste. And the latter is required otherwise employees won’t participate. Clearly no-one will participate in identifying waste if their jobs are put on the line as a result – and flow cannot be improved if employees do not participate in identifying waste.

The central component of a change process premised on employee engagement is a closed loop feedback system for responding to and implementing employee generated suggestions for improvement based on identifying and reducing waste. This is nothing like the good old suggestion box though on the surface it may appear similar.

This system is built on a structured process of organisational learning that teaches the organisation the following:

  • value stream mapping skills that allows everyone to see the organisation’s current end to end process to providing its services or manufacturing its goods, as well as imagine an improved future state. This creates a framework for employees to think about and identify the effects of waste that they experience everyday at work.
  • root cause analysis skills that allows everyone to identify the causes behind the effects of waste that they experience everyday at work as frustrations, irritations, inefficiencies etc.
  • developing the systems and processes – the architecture if you will – of this transparent, closed loop system that allows people to see that the individual opportunities for improvement they have raised have been captured, and how and who is able to participate in addressing them.

Removing waste reduces lead time enabling more resources to be
dedicated to adding value

When this process is introduced in workplaces it results in literally hundreds of employee identified “Opportunities for Improvement” or OFIs.

If one is looking for a measure of employee engagement, how good is this one? Surely this is a direct expression of an employee’s commitment to an organisation? And very importantly it is a measure that arises directly from every employees work – i.e. their involvement in the organisation’s processes rather than arising indirectly – i.e. from something external to their everyday work – like completing a survey that creates a new bureaucratic structure that adds little or nothing to either the flow of goods and services through an organisation or the flow of problem solving in the organisation.

Lean thinking is an example of the sort of workplace improvement strategy that the Department of Labour is supporting through its High Performance Working Initiative.  You can find out more about this at www.dol.govt.nz/er/bestpractice/hpwi/index.asp

Guest blogger: Alex Twigg

Alex Twigg presented at the recent HRINZ National Conference in 2011. He has extensive experience in employment relations (ER) in a variety of roles including mediation, arbitration, advocacy, facilitator and process consultant. Over the last four years he shifted from operational to strategic ER – focusing on the link between people, process and organisational performance.

Alexander is currently employed by the Department of Labour’s Partnership Resource Centre.  He works with unionised workplaces helping the parties improve their workplace relationships and then help them put those relationships to work using frameworks such as ‘Lean Thinking’ to help both parties achieve their mutual and separate interests.

Employee engagement and change – part one

When thinking about employee engagement I am struck by the how similar the employee engagement scores are from around the English speaking world. The results are all similarly low – around the 25 – 30 % mark. And it seems little really changes year after year.

The costs of low engagement and ineffective change management

David McLeod, in a report to the British government in 2008 estimated the cost to the UK economy of their low levels of engagement to be between £59 and £65 billion pounds. But low levels of engagement not only have an economic cost; it also deprives employees an opportunity to find meaning, dignity and community in work. This is the social cost; as yet unmeasured but equally important and perhaps even larger than the economic cost.

But these costs say nothing about the cause or the solution to these perennially low levels of employee engagement. I believe the cause of the problem is hinted at by another well known workplace statistic. Many will be familiar with John Kotter’s research findings in 1996 that 70% of organisational change fails to achieve its objective. Fewer might be familiar with McKinsey & Co’s study in 2008. It showed little improvement over the 12 years between the 2 pieces of research notwithstanding the focus change management skills and practice has received over this period.

What’s going on here? Is there something about the way we effect organisational change that inhibits or undermines employee engagement? If we shift our focus from trying to change employee engagement scores to changing the way we effect organisational change might we improve both?

I think that if we want to see employee engagement scores increase we need to turn our attention to focussing on an approach to managing change that is intrinsically engaging of employees.  In short I think we need to change the way we think about and give effect to organisational change.

Effective change

So what’s wrong with the traditional approach and what does an alternative model of change look like? We seem to be currently addicted to an approach to change that is predicated on notions of expert knowledge and its association with management control, what Marvin Weisbord calls “learning to do things to or for others” as opposed to “learning to do things with others”.

The traditional model of change is typically one of a few people, mostly managers (at times working with consultants), who generate change proposals and consult with employees affected by the proposal. A common feature of this sort of change is the short period of time employees and their representatives are given to comment on the proposals relative to the time taken by managers and their representatives, to develop the proposals. If the adage Kathleen Dannemiller and her colleagues articulate in their thinking about workplace change is correct – namely that “we commit to the things we help to create” is true –then its little wonder that our levels of employee engagement – a measure of our employees commitment to their organisation, is so low.

This article was first published in the August/September issue of the Human Resources magazine. Part two explores practical means of improving engagement and adaptive capacity for change.

Guest blogger: Alex Twigg

Alex Twigg presented at the recent HRINZ National Conference in 2011. He has extensive experience in employment relations (ER) in a variety of roles including mediation, arbitration, advocacy, facilitator and process consultant. Over the last four years he shifted from operational to strategic ER – focusing on the link between people, process and organisational performance.

Alexander is currently employed by the Department of Labour’s Partnership Resource Centre.  He works with unionised workplaces helping the parties improve their workplace relationships and then help them put those relationships to work using frameworks such as ‘Lean Thinking’ to help both parties achieve their mutual and separate interests.