MixedNutz Productions

Change Plan

Fear of the Unknown

Future

The Ear Technologies Story

Ear TechnologiesThe Value of ListeningA Virtue of Obedience

EAR TECHNOLOGIES PHILIPPINES INCORPORATED

est 2004

Ear Technologies Hearing Aid CenterExclusive distributor of Siemens

Hearing Instruments in Northern Luzon

Five (5) branches: Baguio City (SM City Baguio) 2004Dagupan City 2005San Fernando, La Union 2006Tarlac City 2007 (closed 2009)SM Pampanga 2008Laoag City 2010

• Corporate Officer• Chairman – Edwin M. Cosalan, MD• Pres/COO – Jerry Agerico B. Rosario, MD• Secretary – Sme Juancho Estrella, MD• Treasurer – Louie V. Medenilla, MD• • Board of Director’s• Orlando Del Rosario, MD• Carlos Dumlao, MD• Julio Eming, MD• Edgardo Pormento, MD• Gerardo Mario Tolentino, MD• • Member/Stockholders• Loreto Balanon, MD• Armando Bonifacio, MD• Emily Estaris, MD• Merla Floresca, MD• Jose T. Jose, MD• Florencio Jude, MD• Ronnie Mamaril, MD• Leonardo Mangahas, MD• Bernice Padalla, MD• Pedro Patao, MD• Joecel Joyce Reyes, MD• Mary Jane Tipayno, MD• Frederick Mars Untalan, MD• Zenaides Wi, MD

The birth of Ear Technologies

The FOUR Pillars of ENT North Luzon

Treatable Population

• 5% - 10% can be helped medically or surgically. (This would include cochlear implants.)

• The remaining 90% - 95% can significantly correct their hearing loss with hearing aids. Hearing aids can not totally restore hearing, but they can make a big difference in improving the quality of life for people with hearing loss.

Source: Better Hearing Institute (1999). Number of Persons Using Hearing Devices by Age of Person and Type of Device. (online). Available: http://www.betterheading.org/faq.htm (June 2, 2000).

Ear Technologies LAOAG

Ear Technologies PAMPANGA

Ear Tech is really making

money!

So why the change…?

Organizational Diagnosis

Present situation at Ear Tech…

complacency

Problems• NO MISSION / VISION

– Purely came together for business

• NO FORMAL ORGANIZATIONAL STRUCTURE– No clear delegation of duty– Operations controlled by self appointed COO

• NO GOALS• NO CORE VALUES• NO STRATEGIC PLAN FOR THE FUTURE

– for profit only– short sighted plans -(ex. tarlac branch)

McKinsey 7S FrameworkShared values• Financial success ; • To be the major distributor of hearing aids in Northern Luzon

Strategy• To setup satellite hearing aid centers in key areas in Northern to distribute and sell the product.• For profit orientation only

Structure• Centralized operations managed by one board member

Systems• System is controlled by one board member.• No defined systems of operations.

Staff• Increase turnover rate.• High overhead cost.

Style• Hierarchal, follows “seniority rule.”

Skills• Available skills set of people, but under utilized because operations is managed by one board member.

Misalignment…Environment is changing

The FOUR Pillars of ENT North Luzon

“I paved the way. Kung wala ako, wala

din kayo dito…”

“we are the first

ENT group outside

MM, tayo pa din ang nauna..”

“we are earning, we have enough money. That’s already ok..!”

“what we’re doing now is effective,

maintain..!”

vision for the change effort

RATIONALE

• COMPLACENCY – boards contented with profit– boards leave all operational duties to one; trusts the annual

reports without verification efforts

• URGENCY TO INSTITUTIONALIZE FOR THE FUTURE OF THE CORPORATION

– for long term sustainability of the business– for potential growth and expansion– readiness for competition

INSTITUTIONALIZE

• Need to plan for the future of company’s sustainability

• Need to re-establish and re-orient company to visualize their desired future state

• Need to re-organize and re-engineer company systems (human and non-human)

• Need to ensure succession of management

vision for the change effort• What is your vision for the change effort/Rationale for

the vision – Redefine organizational culture– Competitive business processes– Adaptive to the changing physical environment– Modify job design / responsibilities of staff– Standardized Staff skills / knowledge and policies /

procedures – Maximum company benefits– maximize business potentials– Lead the untapped market– evolve to a different level in Ear tech’s their life cycle

Decentralization & delegation of

responsibilities

vision for the change effort• Redefine organizational culture• Competitive business processes• Adaptive to the changing physical environment• Modify job design / responsibilities of staff• Standardized Staff skills / knowledge and policies /

procedures • Maximum company benefits• maximize business potentials• Lead the untapped market• evolve to a different level in Ear tech’s their life cycle

• Need to plan for the future of company’s sustainability

• Need to re-establish and re-orient company to visualize their desired future state

• Need to re-organize and re-engineer company systems (human and non-human)

• Need to ensure succession of management

If no action is taken, Ear Tech will…

Other ENT doctors incorporated

stakeholder analysis

STAKEHOLDERS description

ENT investors/members Earn from dividends & rebates

Board of Directors Decision making/policy making body

New ENT doctors (non member) Earn from rebates. High possibility of forming another “ENT company”

SIEMENS Exclusivity contract with Ear Technologies

Chief Operations Officer Controls HR, Finances, Operations, Supply Chain (real-time). One Man Team!

Clients No choice sila, may-ari ng EarTech mismo ang nagprescribe ng heraing aid nila!

Staff/employees “mga tuliro” at laging napapagalitan!

Specialty Society Regulation of Hearing Aid Centers

Four Pillars We have to obey them!

STAKEHOLDER INTEREST (WIFM) POSITION INTENSITY OF POSITION SOURCE OF POWER DEGREE OF INFLUENCE NETWORK OF INFLUENCE

Four Pillars Lesser influence and lesser authority Resistor High REFERENT; REWARD High Wide

COO Lesser control of the corporation Resistor High INFORMATION/ REFERENT; REWARD High Wide

ENT Investors/ Other Board Members More "power" to decide for the corporation Ally/ Bystander/ Resistor Medium LEGITIMATE; REFERENT Medium to High Medium to Wide

Other ENTs and New ENT doctors (non-members) More opportunities to earn Ally/ Bystander Unknown to Medium INFORMATION; REWARD Medium Narrow to Unknown

Clients Better Service Ally Low INFORMATION; REWARD Medium Low to Medium

Supplier (Siemens) More sales Ally Medium EXPERT & INFORMATION; REWARD Medium Wide

Staff/ Employees Defined job descriptions/ Additional or change of duties and responsibilities Bystander/ Resistor Low INFORMATION; REWARD Low Narrow

ENT SPECIALTY SOCIETY Prestige Bystander Medium INFORMATION; COERCIVE High Wide

4 Pillars

COO

ENT Board Members

Customers

Other ENT/ New ENT (non-members)

Staff

Supplier

ENT Society

Force Field Analysis

Force Field analysis

•Driving forces Hindering

forces

UR

GE

NC

Y F

OR

IN

STIT

UTIO

NA

LIZ

ATIO

N

PRESENTSTATE

RE

-OR

GA

NIZ

ATIO

NR

E-O

RIE

NTA

TIO

NR

E-E

NG

INE

ER

ING

FUTURESTATE

ENT Investors/Other Board MembersENT Investors/

Other Board Members

4 PILLARS

COO

Supplier

New ENT/non-members

+5

+4

+2 +3

+1 STAFF

ENT SOCIETY

+1CUSTOMERS

Total Driving Force: 3 Total Hindering Force: 13

Desired PLAN for Ear tech (if and when)

– Redefine organizational structure– Competitive business processes– Adaptive to the changing physical environment– Modify job design / responsibilities of staff– Standardized Staff skills / knowledge and policies /

procedures – Maximum company benefits– maximize business potentials– Lead the untapped market– evolve to a different level in Ear tech’s their life cycle

Forces driving change

• 1. increasing # of new ENT doctors• 2. increasing demand of customers• 3. tougher competition ahead• 4. Increase # of stores/branches• 5. New ENT doctors who are business oriented• 6. New technology

• are they valid? Can they be changed? Which are the critical ones?

Forces restraining change

• 1. poor communication channels• 2. worn out business processes• 3. increase staff turnover rate• 4. obedience

• are they valid? Can they be changed? Which are the critical ones?

Is the change viable?Can progress occur?

• YES!

Driving forces vs restraining forces• Increasing number of

new ENT doctors• Increasing client

demand • Increase # of

stores/branches• Tougher competition

ahead• New ENT doctors who

are business oriented• New technology

-- encourage more ENT doctors to practice in the North!

-- more ENT doctors – more patients

--- convince the mngmt that there is competition soon!

-- other ENT doctors may set-up a similar business

-- convince them that new technology is easier & it increases sales!

Driving forces vs restraining forces• Poor

communication channels

• High staff turnover rate

• Has not been done before

• Obedience!!

• Encourage more meetings

• HR training• New things are here

to stay• Obedience is good;

teamwork is better!!

Interventions

•

– What this is fundamentally & why?– How would you go about implementing your

intervention•

Communication Plan• Key messages – materials that you might use & how you will be communicating your messages• when do you communicate?, • what do you communicate?,• how do you communicate?• will they still have a job after the change• will they maintain their rank, • will they have an interesting role, what will their future be?

• People will have new questions to be answered, and new ideas and understandings of the intermediate and final states will be developed. In response, people have to be kept up-to-date with actual and future states, and answers given to their questions.

• Use of flowcharts• Provide feedback• Face to face communication• No emails, no memos

– Do all your position or role descriptions have 'communication' as a key responsibility?– Do your managerial performance agreements or contracts include 'communication' as a key result area?– Are managers recognised for communicating well and counselled or penalised for not communicating?– Are staff at all levels encouraged and supported to give critical upward feedback?– Does your organisation see training as one of your key communication channels?

Interventions

• Communicate need or urgency for change to four pillars, other board members, and those who need to be informed of the planned change.

• Find allies that will help in the change movement.• Lay a ground work of strategies for the change that the group

can build on.• Team building of members, management, and staff.• Peer and management evaluations.• Staff reorientation of policies and staff training for better

performance and customer service.• Do strategic planning.

Communication Plan

• SEND A CLEAR MESSAGE: Need to institutionalize for company sustainability. Why? Threat from competitors who can capture or overtake the company in the future due to its continued complacency.

• Face to Face/ One-on-One Discussions• Board meetings• Focus Group Discussions

FACE-TO-FACE/ONE-ON-ONE DISCUSSION

• WHO: Four Pillars, Board Members who are considered MOVERS or SHAKERS

• WHERE: Over dinner, over a round of drinks, over a camaraderie and bonding moment event

• WHY: Can be powerful allies for the change• Strategic Approach: Empirical Rationale

BOARD MEETINGS

• WHO: All Board Members and Involved Management Members.

• WHERE: Function Room/Board Room• WHY: To propose FORMALLY of the planned

change• Strategic Approach: Empirical Rationale/

Normative Reeducative

FOCUS GROUP DISCUSSION

• WHO: Management staff and employees and other non-board member ENT doctors

• WHERE: Clinics/Satellite clinics/Conventions/ Round Table Discussions

• WHY: For feedback and evaluation of current practices, Eliciting suggestion for future improvement of company and its services

MONITORING THE CHANGE• Public relations

– % of press releases that are picked-up by media

– Average number of media that pickup story per press release

• Sales & Marketing– % of recected patents

• Human Resources Training– % of training courses that match

organizational requirements – % of training courses that match

organizational requirements – % of HR budget spent on training – % of attendees at training sessions – % of employees who are willing to

recommend company as employer

• Documents– Average frequency of updates of documents– % of duplications/document variations

• Corporate– % of directors that own shares in the company – Percentage of directors that own shares in the

company.– Level of industry expertise of new board members– Frequency of senior manager branch tours

• Demonstrates high priority to safety.

• Key Performance Indicators (KPI of KPI’s)– % of KPIs that are automatically measured – % of KPIs that do not reflect business goals – % of KPIs within set objectives % of measured KPIs

• Improvement & Innovation– Percentage of goals accomplished from most recent

strategic plan.– Delay in production of financial reporting– Frequency of compliance reviews– Average number of quality checks vs. target– Percentage of strategic objectives achieved

• Percentage of strategic objectives achieved within a given period. Depends on annual or pluri-annual management plan high-level objectives.

MONITORING plan

• Passing of Board Resolutions (for final decision) and implementation of resolutions.

• Regular Board Meetings with specific goals stated in the agenda.

• Key performance indicators for management staff and employees

MONITORING plan

Succession plan Closure

MONITORING plan

• INSTITUTIONALIZED CHANGE– Mission - Vision in place– Strategic Plans for Short and Long-term Goals– Formalized Organizational Chart– Defined Job Descriptions for Employees

MONITORING plan

MONITORING PLAN

• FEEDBACK• ITERATION AND UPDATING OF COMMUNICATION

STRATEGY• EVALUATION MECHANISMS IN COMMUNICATION

STRATEGY• PURPOSE OF COMMUNICATION VIS A VIS PHASE OF

THE PROGRAM: obtaining buy-in, commitment to change, lessen resistance, reduce anxiety, ensure clarity of objectives, share information/vision, challenge the status quo

SUMMARY

• For ETI to be ready for the future, and to be a competitive institution, it should recognize the URGENCY for CHANGE through OPEN COMMUNICATION among board members and initiate the desired plan for change.