Change Management

Lecture 5

Objectives

Cultural Change IT Based process change

Cultural Change Introduction

If you were asked to give a new recruit some words of encouragement on how to be successful within your organisation, what would you say?

You might give some formal advice about carrying your ID at all times, but you might also make some of the following suggestions:

Keep your head down It’s OK to make mistakes here, as long as you

don’t repeat them The boss likes to see you working really hard

at all times We work hard but play hard. The people who

get on here work long hours but enjoy themselves in the pub afterwards.

It doesn’t pay to ask too may questions You’ll find everyone pulls together here and

will want to see you as part of the team

Summary

With this helpful advice you begin to educate the person about the way things get done around the organisation.

You also reveal what some of the required behaviours are, and thus you actively reinforce the prevailing culture.

Culture

Culture is vitally important for the organisation because of its impact on performance.

Molennar et al (2002), quoting leading writers in the field, say:

To truly understand corporate culture, its characteristics must also be understood.

The following is a compilation of the most prevalent cultural characteristics:

Corporate culture represents behaviours that new employees are encouraged to follow (Kotter and Heskett, 1992)

It create norms of acceptable behaviour (Hai, 1986) Corporate culture reinforces ideas and feeling that are consistent

with the corporation’s beliefs (Hampden-Turner, 1990) It influences the external relations of the corporation, as well as

the internal relations of the employees (Hai, 1986) Culture can have a powerful effect on individuals and

performance (Kotter and Heskett, 1992) It affects worker motivation and goals (Hai, 1986) Behaviours such as innovation, decision, making, communication,

organising, measuring success and rewarding achievement are affected by corporate culture (Hai, 1986)

Is we want to learn about how to change culture, we need to understand how it is created.

Schein (1999) suggests that there are six different ways in which culture evolves.

Some of these can be influenced by leaders and some cannot:

A general evolution in which the organisation naturally adapts to its environment

A specific evolution of terms or sub-groups within the organisation to their different environments

A guided evolution resulting from cultural ‘insights’ on the part of leaders.

A guided evolution through encouraging teams to learn from each other, and empowering selected hybrids from sub-cultures that are better adapted to current realities

A planned and managed culture change through creation of parallel systems of steering committees and projected-oriented task forces

A partial or total cultural destruction through new leadership that eliminate the carriers of the former culture (turnarounds, bankruptcies)

Schein underscores the fact that organisations will not successfully change culture if they begin with that specific idea in mind.

The starting point should always be the business issues that the organisation faces

Brands

Crosby and Johnson (2001) say: ‘The strongest brands are those that elicit emotional

attachment from customers. When interacting with your company, customers and prospects may have feelings of safety, pride, excitement, comfort, confidence, caring or trust. These interactions activate feelings and build strong brand commitment.

…. It’s important not to overlook the effects of brand on the employees of the firm. Employees often have a large role to place in managing customer relationships and the brand can help guide their behaviour. In effect, the brand is a promise to customers of how they can expect to be treated by the company. To the extent employees understand the expectations being created by the brand, and are motivated and trained to live up to those expectations, then the firm can have a truly integrated customer relationship management strategy.’

Guidelines for Achieving Successful Cultural Change

Always link to organisational vision, mission and objectives

Create a sense of urgency and continually reinforce the need to change

Attend to stakeholder issues Remember that the how is as important as the

what Build on the old, and step into the new Generate enabling mechanisms Act as role models Create a community of focused and flexible leaders Insist on collective ownership of the changes

Six Key PointsContinually increasing customer and citizen focus

Extending the council’s capacity for community and partnership working

A visible and congruent leadership and management style

Moving to a more consistent performance and enabling culture

More effective ways of working

Clarity and impact of core values and direction setting on service delivery

Six Employer Brand Values

Value: Integrity Behaviours

Expressing views and opinions in an open, honest and constructive way

Consistently delivering on their promises and commitments

Taking accountability for decisions and actions Value: Unity

Behaviours Contributing enthusiastically to team goals,

sharing and aligning own objectives with team(s) Supporting and encouraging players on their own

team and other teams Building personal success on team success and

contributing to other teams’ success

Value: Diversity Behaviours

Treating diverse views, cultures and communities with respect

Learning from the variety of different cultures, countries, functions and teams within the organisation

Acknowledging different approaches and seeking win-win solutions

Value: Performance with Passion Behaviours

Setting and exceeding stretching targets, individually and in teams.

Demonstrating high levels of pace, energy and commitment in achieving goals.

Finding new opportunities to improve their game and being courageous by trying them

Value: Celebration Behaviours

Sharing success, recognising and rewarding achievement of other players.

Encouraging the celebration of success and building a ‘success leads to more success’ culture

Having a can-do mentality and encouraging others to do the same

Value: Learning Behaviours

Being proactive in professional and personal development

Sharing learning and supporting development of other players

Going outside the ‘comfort-zone’, challenging the status quo, and learning from mistakes

IT-Based Process Change

IT has become a significant part of every person’s working life.

According to US economic analysis figures, companies are now spending an aberage of 30 percent of their capital expenditure on information technology compared with 5 percent in the 1960’s.

It is viewed as a critical resource

The potential gains of successfully implementing IT-based change are many and varied.

Organisations are attracted by the idea that they will gain the capability to do a range of highly desirable things.

Some of the potential gains concern innovation and development: To achieve flexible responsive production of

customised goods To segment the market place in new ways

through analysing information, and then create new products for those segments

To serve customers in new ways by creating access via the Internet

To create new forms of partnership and new types of organisation

But many of the potential gains concern achieving efficiencies to: Reduce the need for agents and intermediaries by

providing employee or customer self-service facilities over the Internet or Intranet.

Achieve sophisticated functionality at reasonable cost (for instance by introducing standard packages such as ERP)

Allow globalisation of operations Enable choices to be made about how the company is

structured while retaining the necessary level of central control

Produce better information, with a greater level of detail than was possible before, and make it available faster to allow better decisions to be made.

Enabling 24-hours working to maximise the ability to serve the globe and make best use of resources.

Encourage greater staff involvement by making information available to more people in the company

Increase the opportunity for flexible working on the read or at home

Reduce staff costs Increase the value of skills and knowledge by

sharing information well

The Role of Management

Business deployment External networks Line technology leadership Process adaptiveness IT planning IT infrastructure Data Centre Utility Managing outsourced services

IT Management Competencies

Business Deployment Examination of the potential business value of new,

emerging IT Utilisation of multi-disciplinary teams throughout the

organisation Effective working relationships among line managers and IT

staff Technology transfer, where appropriate, of successful IT

applications, platforms and services Adequacy of IT-related knowledge of line managers

throughout the organisation Visualising the value of IT investments throughout the

organisation Appropriateness of IT policies Appropriateness of IT sourcing decisions Effectiveness of IT measurement systems

External Networks Existence of electronic links with the

organisation’s customers Existence of electronic links with the

organisation’s suppliers Collaborative alliances with external partners

(vendors, systems integrators, competitors) to develop IT-based products and processes

Line Technology Leadership Line managers’ ownership of IT projects

within their domains of business responsibility

Propensity of employees throughout the organisation to serve as ‘project champions’

Process Adaptiveness Propensity of employees throughout the organisation

to learn about and subsequently explore the functionality of installed IT tools and applications

Restructuring of business processes, where appropriate, throughout the organisation

Visualising organisational activities throughout the organisation

IT Planning Integration of business strategic planning and IT

strategic planning Clarity of vision regarding how IT contributes to

business value Effectiveness of IT planning throughout the

organisation Effectiveness of project management practices

IT Infrastructure Restructuring of IT work processes, where appropriate Appropriateness of data architecture Appropriateness of network architecture Knowledge of and adequacy of the organisation’s IT

skill base Consistency of object (data, process, rules) definitions Effectiveness of software development practices

Data Centre Utility Appropriateness of processor architecture Adequacy of quality assurance and security controls

Source: Sambamurthy and Zmud in Saur and Yetton (1997)