Chapter 2: Process for Leading Change - Comillas University - PDF

Chapter 2 Process for leading CHANGE Íñigo García de Amézaga Evolution of banking entities in Spain  Learning Objectives Key factors for successful changes (Kotter) Theories about how to implement a change (Lewin and Kaplan&Norton) Stages of change. Cognitive Dissonance Ne...

Chapter 2 Process for leading CHANGE Íñigo García de Amézaga Evolution of banking entities in Spain  Learning Objectives Key factors for successful changes (Kotter) Theories about how to implement a change (Lewin and Kaplan&Norton) Stages of change. Cognitive Dissonance Negotiating a change in an organization  Factors to make SUCCESSFUL CHANGES Urgent need for …Make“dissonance”, manage information, “sell” the change need Commitment in the …Transfer responsibilities, look for participation leadership structure People involvement …Look for participation during the analysis phase and when exploring solutions Manage …Must have a strategy well defined communication …Define objectives, measure the evolution, formal Results Indicators and informal communication about the process Gestión del cambio 04  5 Factors to implement a SUCCESSFUL change LEADERS URGENT CHANGE COMMUNICATION RESULTS WITH MANAGEMENT NEED + COMMITMENT + AGENTS + + INDICATORS = CHANGES Lack of ✓ ✓ ✓ ✓ = Motivation Lack of ✓ ✓ ✓ ✓ = direction ✓ ✓ ✓ ✓ = NO OWNERS NO ✓ ✓ ✓ ✓ = COMMITMENT ✓ ✓ ✓ ✓ = NO RESULTS SUCCESSFUL ✓ ✓ ✓ ✓ ✓ = CHANGE Examples about those kind of changes?  Fable to illustrate Resistance and Adaptation to CHANGE https://www.youtube.com/watch?v=jtW6rqdrRUM  Leading a change (Adapt. de J. Kotter) Preparation: 1. CREATE a sense of urgency 2. PULL together a guiding TEAM Definition: 3. DEVELOP a clear shared vision and strategy Make things happen: 4. COMMUNICATE the vision 5. EMPOWER others to ACT- REMOVE barriers 6. PRODUCE Shor-term WINS 7. CONSOLIDATE & build on the gains- Don’t give up Institution: 8. Create a new CULTURE- Institutionalise the change Unforeseen issues  Learning Objectives Key factors for succesful changes Theories about how to implement a change (Lewin and Kaplan&Norton) Stages of change Cognitive Dissonance Negotiating a change in an organization  Gantt Chart: Implementation Plan GRÁFICOS DE GANTT ▪ VISUAL INFORMATION ▪ TIMINGs ▪ LISTA DE TAREAS Y PERSONAS PARA REALIZARLAS. ▪ BARRAS REPRESENTANDO LA DURACIÓN. Gantt Chart  FORCE FIELD Kurt Lewin Driving Forces=seeking change Resisting Forces= Maintaining STATUS QUO ACTUAL SITUATION IDEAL SITUATION Professionalism Inertia Achivement Frustration Personal Fulfillment Ignorance Security Insecurity  Phases in the Change Kurt Lewin Phase 1: Unfreeze The company or people must wake up to the new reality. The way of doing things in the past are not acceptable today. Phase 2: Change People create the new vision and establish the plan to get it done. Phase 3: Freeze Once the https://www.mindtools.com/pages/article/newPPM_94.htm new processes are implemented you need time to create the culture. Training and support are key in this phase. Celebrate also https://www.mindtools.com/pages/article/newPPM_94.htm FORCE FIELD Kurt Lewin  Balanced Scorecard (Kaplan & Norton) Finantial Strategic Management Mission Internal Customer and Processes - Vision and strategy Values - Communication plan to organization - Coordinate through departments Learning - Define inducers (Programs) and indicators (KPIs) - https://hbr.org/2007/07/using-the-balanced-scorecard-as-a- strategic-management-system  Balanced Scorecard (Kaplan & Norton) BASIC BALANCED SCORECARD TEMPLATE VISION STRATEGIC KEY PERFORMANCE TARGETS INITIATIVES OBJECTIVES INDICATORS KPIs YEAR 1 YEAR 2 YEAR 3 PROGRAMS (ACTION PLAN) BUDGETS/ RESPONSIBLES Net Revenue FINANCIAL Asset Valuation Cash Flow CUSTOMER Brand Recognition Market Share Customer satisfaction Inventory Management PROCESSES INTERNAL Cycle time Quality Employee Training LEARNING &GROWTH Employ retention Adopt QI techniques  Inducer Vs Indicators for RESULTS (Kaplan & Norton) INDUCER OF RESULTS INDICATORS KPIs …what you do …what you see Quality of your Technical vs. Managerial skills # users/program Complete the social request vs maintaining the # Training courses request % Budget spent Rotate people quite often vs maintaining expertise in projects # active volunteers Prepare people very specialized vs people Fund raising oriented to multiple choices # Tele-assistance calls https://hbr.org/2007/07/using-the-balanced-scorecard-as-a-strategic-management-system  TEAM WORK Continue developing PROPOSAL, considering: - Strategic phases (Kotter) - Cultural matters (Lewin) Define inducers e indicators about expected results (Kaplan & Norton)  Learning Objectives Key factors for succesful changes Theories about how to implement a change (Kotter, Lewin and Kaplan&Norton) Stages of change Cognitive Dissonance Negotiating a change in an organization ATTITUDE TOWARDS CHANGES?  EVOLUTION OF ATTITUDES TOWARD CHANGE SHOCK & COMMITMENT DENIAL ANGER ADJUST ACCEPTANCE FEAR BARGAINING DEPRESSION  EVOLUTION OF ATTITUDES TOWARD CHANGE Video in Moodle Video in Moodle  RESISTANCE TO CHANGE Whatever the change is introduced in an organization resistance to it appears because the change threatens to : NOT WILLING Current ways of doing Traditional attitudes NOT ABLE Established relationships NOT KNOWING  THE PYRAMID OF RESISTANCE Leadership Leadership activity and visibility. Commitment from leaders is key. ARCHITECTURE OF CHANGE PROCESS Organization design and performance follow- NOT up: In a change you must WILLING Shared visión and business case for change. define the STEPS to Performance management alignment implement it with SUCCESS Culture Study the impact of the change in current culture. Cultural alignment is needed. NOT ABLE Individual and team skills Skill development Programme. Specify new ROLE MODELS Communication Effective communication NOT KNOWING  BALANCE – NEED OF CHANGE PERCEIVED BENEFITS WILLINGNESS TO CHANGE PERCEIVED COSTS Gestión del cambio 05  How to deal with resistance Early communication Give explanations for the changes. Involve people and ask them to participate. Encourage teamwork. Convince people of the advantages. Listen and understand. Share the credit. Celebrate success.  Types of resistance to change Power-driven / Lidership Ideological I don’t want Participation Psicological I can’t Training and awareness Justifiable I don’t know Information Problem Solution  RESISTANCE TO CHANGE Reasons people resist change  Own interest (negative personal balance)  Unkown about change implications  Low tolerance to change (Cognitive Dissonance)  Unbalance ecuation - costs and benefits  INTERNAL REASONS FOR RESISTANCE TO CHANGE ▪ LOW SELF-ESTEEM “I CANNOT, I don´t know” ▪ HIGH LEVEL OF SELF EXECUTION “Not to do it well, better not DO it”” ▪ IDENTIFY potential issues RISK with ERROR and this with PUNISHMENT ▪ INDIFFERENCE “Why complicate life?” ▪ LAZINESS “It is hard to change” ▪ ROUTINE “Let´s do as always” ▪ APATHY “It is easier to continue with the same way of doing” ▪ NO RESPONSIBILITIES “It is not my subject” ▪ PRIORITIES “I HAVE no time to change it”  RESISTANCE TO CHANGE HOW TO WORK  Communication/ Education  Engagement/ Active participation  Facilitate/ Support  Negotiations / Agreement  Positive Manipulation  Coercion implicit or explicit  FRUSTRATION TOLERANCE FRUSTRATION TOLERANCE Level of sensitivity to the unpleasant, uncomfortable, unexpected or unfair that affect people  FRUSTRATION TOLERANCE RESILIENCE The ability to face adversity, overcome it and come out stregthened from it HOW TO BUILD RESILIENCE: https://www.youtube.com/watch?v=1r8hj72bfGo  FRUSTRATION TOLERANCE RESILIENCE  Learning Objectives Key factors for succesful changes Theories about how to implement a change (Kotter, Lewin and Kaplan&Norton) Stages of change Cognitive Dissonance Negotiating a change in an organization  ATTITUDE 3 components: Cognitive element: An organized and lasting set of beliefs Affective element: It has a predisposition favorable or unfavorable towards an object Behavioral element: Guide the behavior of the person We can identify ATTITUDE with different functions: Function of adaptation to the circumstances Self-defense function Function of expression of values ​and knowledge  A CHANGE in ATTITUDE TYPES: Simple changes of opinion Deep feelings changes Natural changes resulting from maturation and individual expertise Changes as a result of deliberate persuasion or influence Attitudes are a result of the subject's learning and are considered stable. Attitudinal change is the modification or replacement of an old attitude with a new one.  THEORY of Cognitive Dissonance (Leon Festinger) Cognitive dissonance is the mental disconfort (psychological stress) experienced by a person who simultaneously holds two or more contradictory beliefs, ideas or values. Also occurs when confronted with new information that contradicts said beliefs, ideals, and values from maturation and individual experience. THEORY of Cognitive Dissonance: Human being seeks balance in his attitudes. There is consistency and consonance in his world. Whenever there is no harmony, congruence or consonance in the cognitive system of the person we say he is in dissonance.  HOW to REDUCE DISSONANCE TECHNIQUES: Changing the original belief Changing behavior Changing some aspects of the environment Adding new cognitive elements Everyone has his own mental map where Everything is in perfect balance. Phases to get a new balance: Reflection "Realize" Expression "Make yourself understood" Inquiry "Understanding the Other" https://www.youtube.com/watch?v=SGjuJwc2gs4  SITUATIONS that can create DISSONANCE DECISION MAKING: This is because there is no absolute best option. People after making decisions will try self convincing that chosen alternative is even more interesting. Dissonance is greater: When the degree of attraction between alternatives is very similar https://en.wikipedia.org/wiki/Buridan%27s_ass The greater the number of alternatives to chose The more different the alternatives or possibilities to choose A GOAL NOT ACHIEVED: We do not like errors as they create dissonance. Justification is a normal habit. Making an UNETHICAL ACT: After someone has done something illegal, his attitude towards that act will be more indulgent of what they were previously.  SITUATIONS that can create DISSONANCE Suffer an unpleasant situation: The most typical way of reducing dissonance is to self-convince that in reality the situation was not as bad as it seemed at the beginning. Not fitting in a TEAM/Group: There is a SOCIAL COST to pay To reduce the dissonance: Convince ourselves that there was no much effort of adaptation and it is not worthy to belong to it Overestimate the group, so as to close the eyes to the negative aspects Forced actions: In a company it can happen. People must do a change in their beliefs. The degree of dissonance will depend on the “reward” obtained and the pressure performed.  TEAM WORK Questions discussed at class in Chapter 2 7. Continue developing PROPOSAL, considering: - Strategic phases (Kotter) - Cultural matters (Lewin) 8. Define inducers e indicators about expected results (Kaplan & Norton) 9. How to reduce resistance (think reasons for resistance)  Learning Objectives Key factors for succesful changes Theories about how to implement a change (Kotter, Lewin and Kaplan&Norton) Stages of change Cognitive Dissonance Negotiating a change in an organization  NEGOTIATING CHANGE Clues Understand other people's feelings, Empathy even when you haven't shared their experience Win-win Better to win together Mutual Dependence We need each others Transform some alternatives Creativity Negotiate with each part, taking Global vision into account the full picture  10 STEPS TO AGREE AN ATTITUDE CHANGE OBJECTIVE ACTIONS  Explain the facts that you think shows the problem EXPLAIN AND DEFINE THE PROBLEM  Ask, ask, ask to define what is/is not the problem  Ask him about the root causes SPECIFY THE REASONS  Show empathy  Ask for other reasons  Show him that you understand his reasons UNDERSTAND, DO NOT ARGUE  Present your reasons (linked to his reasons) MAKE AN AGREEMENT TO ACT  Ask about his solution  Complement and finalize your solution  Write down the agreement Coaching 01  POLITICAL POWER INFLUENCE INFLUENCE without and AUTHORITY AUTHORITY NO INFLUENCE Influence NO INFLUENCE and NO AUTHORITY AUTHORITY Authority  RESULTS RELATED TO THE PROPOSED CHANGE SOLUTION DESCRIBE THE EFFECT ON THE BUSINESS OR ACTIVITY OF THE ORGANIZATION OBJECTIVES AND MEASURED BY THE ORGANIZATION PERSONAL ACHIVEMENTS REPRESENT THE PERSONAL BENEFITS (SUBJECTIVES) YOU CAN GET BY ACCEPTING THE PROPOSAL FOR CHANGE RESULTS ARE DELIVERED BY ORGANIZATIONS, PEOPLE ACHIEVE  ECONOMIC DECISION MAKER ROLE: FINAL APPROVAL ONLY 1 PERSON (OR A COMITTE*) ALWAYS PRESENT  Access to the funds  Decide about the funds  Can follow his own criteria  Has power of veto FOCUS: COST/BENEFITS RELATIONSHIP HOW IS THE ORGANIZATION AFFECTED? QUESTION: What is the global impact?  TECHNICAL DECISION MAKER ROLE: REFUSE SOMETIMES MANY OR NOBODY (DIFFICULT TO KNOW)  Judge the measurable facts  Make recommendations  He is not saying the final YES  If he can say NO (he often says NO) FOCUS: PROPOSAL QUESTION: IS IT FEASIBLE? DOES IT MAKE SENSE?  USER DECISION MAKER ROLE: JUDGE THE PROPOSAL IN THE SHORT TERM MANY PEOPLE  Direct relation between proposal and successful change  Follow personal criteria  People that supervise the proposal or work on it FOCUS: WHAT THEY HAVE TO DO QUESTION: HOW DOES IT AFFECT ME? WIN OR LOSE?  ALLY ROLE: ACT as GUIDE Ideally at least ONE Advice and explain internal  Start point information:  Influencers during the decision process  How people really think FOCUS: ACHIVEMENT QUESTION: How can I help? Venta Estratégica 10  INFLUENCING A CHANGE BASIC IDEAS:  Know INFORMATION, NOT assumptions  Investigate RESULTS AND ACHIVEMENTS for different decision makers  Know the financials- REAL ACCOUNTS  PLAN A STRATEGY, not a strategy improvisation  SUCCESSFUL CHANGE CHANGE GENERATORS ORGANIZATION VISION Lucubration Conflict Short circuit EFFECTIVE MANAGEMENT Passivity / Frustration abandonment Uncertainty MANAGERS role INDIVIDUALS CHANGE AGENTS CHANGE ENGINES What organization really needs  TEAM WORK Questions discussed at class in Chapter 2 7. Continue developing PROPOSAL, considering: - Strategic phases (Kotter) - Cultural matters (Lewin) 8. Define inducers e indicators about expected results (Kaplan & Norton) 9. How to reduce resistance 10. Prepare the project and present it for decision makers