What does change management encompass?

Change management is fundamentally about managing expectations and accountabilities.  It encompasses the preparation, transition, and support of the people within an organization to enable a successful shift to a new way of working. This strategy includes alignment at all levels of the organization and answers questions such as what do I do differently? and what’s in it for me? from the CEO all the way to the individual contributor. 

Typical work areas include stakeholder management, governance, communications, skills and competencies (training), organizational alignment, performance management, and monitoring of all of these areas. Change management drives engagement and enables user adoption and business transformation, bringing sustainable user performance.

The change curve (Figure 1) moves from contact and awareness to understanding and acceptance to commitment to action (i.e., adoption by an individual or an organization). All of those work areas I listed are done along the curve at the right point in time to communicate to everyone what they need to know and what they need to do so that they’re engaged when it’s relevant for them.

Figure 1

The change curve

The change might be that you have a new boss. You’re going to do a new task — whatever it is. OK. You know what? It’s going to happen. Individual adoption comes when you start to do something differently. You communicate with a different person, and you do a different task — whatever that might be. Organizational adoption comes when the whole collection of people does the same thing differently, and that’s what you’re trying to achieve.

The reality is that the adoption of change comes with habit and familiarity. What you’re really trying to do is give people a milestone and a benchmark so that when they do it differently, the change can be rewarded, and over time it will be more comfortable.

Why do people resist change?

People resist change for four main reasons:

1. I didn’t know.

2. I wasn’t able.

3. I wasn’t involved.

4. I wasn’t willing.

Think about this in real-life situations. First, if I’d known, I would have, but I didn’t know so I didn’t. I just wasn’t aware. Second, if I could’ve I would’ve, but I couldn’t, so I didn’t. I didn’t have the skills. Third, I wasn’t involved. Nobody I know was involved. Nobody I trust was involved, so it couldn’t have been a good idea. Then finally, fourth, it just wasn’t a priority for me. I have other things to do.

When you look at what you’re trying to achieve on a project, which is adopting change or making a successful transition, you’re trying to directly and proactively address those four things. The way in which you do that is to provide information and two-way communication so everyone involved know about it. They can ask lots of questions; they can get full understanding.

How does a change management strategy benefit the organization?

Change is always occurring in any organization. When there is a significant level of change that is anticipated, having a strategy allows for deliberate and focused attention that can influence the manner in which the change will occur.

The funny thing is, when change is done well, it just feels right. When it’s not done well, you know it’s wrong. It’s really where you have a combination of leadership, understanding, and participation, as well as individuals doing the same based on the leadership within the business.

What role does management play in that success?

The people who implement change management don’t drive change, management does. I’ll sit in a room full of people who do this, but we, the project team, don’t make it happen; the business makes it happen. We created the foundation and the opportunity for that to occur. I don’t lead the thousand people at a particular site or the thousand people at 200 sites. Instead, what I can do is provide the right information to the 200 people who lead those 200 sites at the same time.

But I don’t manage all those people every day who will need to turn left instead of right on Monday. I can tell them what they need to do. I can set up training classes. I can give them an opportunity to ask, “Why are we turning left instead of right?” I can make sure that their leaders know that they all need to turn left instead of right. But I am not in those 200 places.

The success comes when the communication, the training, the skills, and the information are all there. The success stories are when you get that alignment of the leaders and the individuals, understand that everyone is aiming in the same direction at the same time, and so you actually get that successful change as planned and as anticipated.

Why is communication such an integral part of change management?

Once a company has started a project, the people not on the project think that those on the project have made all the decisions and that they just haven’t told them yet. A lot of what you’re doing with communication is saying, here’s what we know; here’s what we don’t know. Here’s when we’ll know what we’re going to know next, and here’s when we’re going to tell you.

An example is what happened when I was working with a customer that was creating another company. In the finance implementation, the roles were changing both within the finance work stream at a field level and also there was a shared services group being established. Therefore, there was uncertainty within the finance roles regarding what would stay local and what would become a shared service. The leader of one of the regions was very resistant to sharing information on what was going to happen in terms of roles and processes and so forth. Like many leaders, he thought, “Well, we don’t know yet; we’re not sure. What if we tell everyone and then they all overreact to that, but it changes later anyway?”

Without information, people imagined information, and one of the managers was sure that he was going to lose his job. As a result, one manager ended up going on a stress leave and another manager quit, and neither of them was actually going to lose his job.

If you don’t tell them what’s going on, people will take change into their own hands. If you’re not anticipating and planning for how you’ll manage people through change, they will manage their own way through it to protect themselves. Being mindful of that is key.

A lot of managing change comes from building trust by sharing information — sharing what you know and sharing what you don’t know and being as honest as you can along the way so that people believe you when you say we don’t know or we will know later.

There’s enough anecdotal information in the marketplace that there’s a degree of anxiety that comes from implementing SAP if you’ve never had it before. Since companies typically implement SAP in order to reduce costs or to grow or both, there’s a fear factor or a reality that people think about in terms of what does that mean for me? Will I like what I’m going to do next? What’s it going to do to my job? Managing change gives individuals the best context to answer such questions as what will my job look like in the future? What can I anticipate? What can I prepare for? Because if you don’t tell them, they’re going to make it up.

Who should lead a change management initiative?

Change is led and managed by the people who lead and manage a business — the leadership of a change management initiative should be done by someone within an organization who has a passion and commitment to the success of their people and has the respect of leadership to create and lead the strategy. What’s interesting is that the person who leads the change management initiative almost becomes a bit of an ombudsman for your organization during that period. That’s why having a trusted and respected leader is key.

The leader can really come from any area of the business, but it needs to be somebody who is good at people management. I’ve seen it come from operations, I’ve seen it come from training, I’ve seen it come from HR, and I’ve seen it come from IT. I would say it most typically probably comes from the HR/training area, but it doesn’t need to.

When I meet with customers, and they’re talking about whom to put into that role, one of the things that I highlight is the support that person will need. Because they’re dealing with top-level work as well as the leadership work; they’re very often going to be exposed to the leadership of the organization in a much more unguarded and direct manner than they would otherwise be in their day-to-day life. They’re going to have pretty open conversations with the senior leadership of an organization, yet they’re also going to be a task-oriented manager. Because they’re going to interact with a more senior level than they would otherwise, they need to be supported in doing that. Sometimes the organization will not let somebody who is a manager go play at the VP/senior level because the organization sees it as a threat.

At what point in a project should project managers begin planning a change management strategy?

Project managers should begin planning a strategy from the onset of a project. To begin with, the decision makers on the project are stakeholders who need to be aligned and the overall project expectations need to be communicated. At the onset of a project, the leaders of the organization are the first people who need to be engaged as stakeholders to make decisions. Engage the CEO and senior leadership and ask questions like where are we going? What are we doing? What resources do we need? What money do we need? What decisions do we need? What governance is played out?

Project managers may or may not consider that part of change management. They know they need to get it done because they’ve got to get decisions made to launch the project. Everybody in a company is a stakeholder somehow in change management. Although a certain person may not be the one who is impacted, you’re really looking across the full spectrum of an organization.

From the point of engaging the leadership onward, the strategy shifts to the full audience that will be impacted and how to engage successfully along the project life cycle. You don’t need to engage the end user on day one. If it’s a phased project, you engage one part of the audience at one point in time; you engage another part of the audience at another point in time. So really there’s a global or a broad set of expectations you’re sharing, and you get more and more targeted and specific with each group as it’s relevant.

What does a project manager who has never created a change management plan need to know?

Change management is really about putting discipline around common sense. Most good project managers would anticipate many considerations and components of change.  What the project manager needs to know is that it is necessary to actively manage change rather than let it occur, as without direct focus, the decision-making process, governance, escalations, timeline, cost, and success of the project will be impacted.

If you have not actively managed change, resistance will demonstrate itself in the form of revisiting decisions, which takes time, money, and escalations. That is part of governance, which is part of decision making. From a project management perspective, you want the activities planned to happen when planned. You don’t want to have the timeline slide. Timeline slide raises cost and reduces success. If everyone is prepared to play their parts when they need to, then your project continues as planned, with no surprises around decision making or repeating effort around execution  

I was at a company that had forklift drivers in North America and forklift drivers in Europe. In North America, a forklift driver is a forklift driver is a forklift driver. In Europe, we had people who moved raw materials, people who moved goods in process, and people who moved finished goods. All three of them were paid differently by the union based on what they were moving and were defined as different roles, and each one made more money the more investment had been made in the project.

Both locations needed to learn how to pick, pack, and ship. In Europe at that company, they wanted to put those three groups through separate training because they were treated differently. That meant we would end up developing a North American set of training plus three sets of training for Europe, when in fact they were all doing the same thing. That would also mean that we would have four different profiles in the system and four different sets of training, raising project costs.

We went back and forth, and because they couldn’t get alignment at a leadership level that they really did the same thing, we ended up developing all of it. Ultimately, we got around to where we agreed, finally, that they all do pick, pack, and ship, and we put them through one set of training.

From an overall product management standpoint, that was taking time, taking money, taking cost, when in fact there wasn’t really anything different going on. Had we not pushed to get to where we agreed it was really all one role — one set of tasks, one set of preparation — we would have created an ongoing cost for sustainability that would be greater during the project itself, and greater post project in terms of what the results would be.

What is the main focus area in a change management strategy?

In a project there are three integrated areas: people, process, and technology. The process is defined first, shaping the business outcomes to drive best practices. The technology is developed in a manner to accelerate and enable the business process. The people need to be prepared to follow and use the process and technology to bring about the value and results expected from the project. 

The focus for the change management strategy then is primarily focused on the business context and outcomes with technology as an enabler. Technology will be the backbone for how the business is managed. But what the person is doing as a task is really running the business process. So if you look at the order-to-cash process, what is significant to the individual in order-to-cash is who my internal customers and suppliers are and what I do in my process to be efficient. The technology is what’s going to allow me to be traceable and connected, and our business process to be repeatable and predictable and high quality.

What I’m trying to learn is my business process. Technology becomes the enabler by increasing quality, increasing repeatability, increasing our ability to manage that process to achieve the best cost management and the best business results, because human error is coming out and variability is coming out. Technology enables the business process by reducing variability, reducing errors, and reducing cost.

How does the change management element vary from a small setting to a large setting?

The primary elements of change management are the same in a small or large project as much as they are in a personal versus professional setting. What changes are the context, scale, and scope, and as a result, the actions, events, and methods used to influence change. 

I would say that my experience is that the ability to reach the organization directly in a small company is greater. The ability to have face-to-face or person-to-person touch is much greater. The formality can be reduced. There’s the ability to prepare the organization by having more direct contact in a more informal manner.

In a larger organization, the formality increases because the opportunity for individual touch is lower, more complicated, or more costly. If I’ve got two locations with 200 people, the CEO can actually stand up and talk to all 200 people. Even if it’s four locations with 200 people, the CEO can actually get in front of all of them. But if we’re a global company with 50,000 people, he or she can’t do that. We need to put some infrastructure and mechanisms in place so that there are consistent expectations and messaging because leadership can’t touch it and see it as much.

How can a change management strategy address employees who are reluctant to make the necessary changes?

Change management is about building trust and building shared ownership — people protect and invest in what they own. If you can create shared ownership, you’re going to get people to invest in the success of the project. If you align incentives for leadership, they then invest in ownership and they invest in the success of that project instead of saying, “That’s that project manager’s problem, not my problem. If it fails, they fail, not me.”

I think one of the unique things about SAP as a tool is that fundamentally, IT implementations pre-SAP were much more technical in nature. They weren’t really business tools. It’s like the plumbing and the electricity in your house. When you look at SAP, it’s like the layout of your house. It’s how many bedrooms do you have and how do you get from one to the other and what’s in those rooms and so forth. It’s much more tangible and impactful to how you behave in business every day. Success of an SAP implementation requires business engagement. It can’t be done invisibly.

Employees are used to behaving in one way, and that way is about to shift. You need managers coaching and reinforcing the measures of success as they would anything else in their business, where SAP is just one of these many toolsets for how to run that organization.

Incentives would be the number one motivation for management to drive that success. In order for that to be successful, you need education — like kids in school who memorize what they’re going to get tested on. Incentives drive behavior, and so aligning incentives for leadership is a key success factor because that’s “what’s in it for me.” For leaders, it’s financial success. They can be successful once they have that tag of responsibility if you educate them on what they need to do. That for a leader is answering questions such as what decisions do I make? What resources do I make available? When do I participate? What do I need to know and how do I lead?

What issues have you seen arise in poor change management initiatives?

Typically, the challenges come in two forms: “If you build it they will come” and “checklist change management.” The first scenario assumes that people will blindly follow without engagement. This command-and-control method simply is not ideal, and increasingly unviable with the changing workforce of Gen X, Y, etc. Checklist change management is characterized by lots of activity with little reality check: Doing all the “right” things does not necessarily lead to the “right” outcome.

To be successful, you need to balance two facets of change management: strategic organizational alignment and project-level change management. The strategy is like saying, “We’re going to put a man on the moon in 10 years,” or leadership saying, “Here’s the direction we’re taking.” At the more detailed level, it’s like saying, “Here’s what Bobby, Mary, and Suzy are going to do Tuesday afternoon at 3:00.”

If you have strategic organizational alignment, but Bobby, Mary, and Suzy don’t know what to do, nothing changes. You just have a fantastic vision. If you have all the details of what Bobby, Mary, and Suzy do, but you don’t have a vision, they don’t change, because nobody told them to really do anything differently. You need to have both of those two things. You can’t just say, “We told everyone what to do, so they’re just all going to, on Wednesday at 2:00, do something differently, right?” They’re not, because there’s no vision.

If you’re not clear on what people’s jobs are and what their accountabilities are, it’s very hard to prepare them with the right tasks to do their jobs. At a very fundamental level then, people don’t know who’s responsible for it, they don’t go to the right training, and the process doesn’t occur. At a very tactical level, you can’t execute the process if the people don’t learn what they need to do their jobs.

From a broader standpoint, if you don’t have the right governance, the right decision making, and the right engagement, there are a few things that can go wrong. One, you won’t build the right process because you don’t have the right people involved. Two, decision making, time lines, and so forth can go wrong and extend your project and your cost and, therefore, your success.

Laura Casasanto

Laura Casasanto is a technical editor who served as the managing editor of SCM Expert and Project Expert.

You may contact the author at lauracasasanto@gmail.com.

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