Leading Cultural Change

Editor's Notes

• #3: What is the goal of this presentation? The main objective is: To encourage openness to change in the workplace Help you understand what are the steps to leading successful cultural change Go over some use cases/case studies (examples) of successful, semi-successful, and unsuccessful change within organizations
• #4: Organization Metrics – For example, customer service stats, quality standards, financial performance, safety incidents, or other measurements significant to your organization Performance against competition – Competition that is doing very well is a strong indicator that it’s time to step back and determine how your culture needs to change to remain competitive. Disengaged workforce – Increased turnover rates, lackluster performance, difficulty recruiting high-quality talent, negative employee surveys, lack of innovative ideas, you may have a culture of disengagement Sub-optimal leaders – When organizations grow rapidly, leadership development often lags behind. Leaders at all levels may lack the skills to model and coach, and don’t know how to unleash potential of their employees. Identified and Missed Opportunities – your organization’s workforce is missing opportunities to improve processes, eliminate waste, increase productivity or make the move to digital. Your culture is no longer supporting, encouraging, or enabling employees to act on these opportunities. The changing world has left you behind - Change such as social media use, technological improvements, changing workplace demographics, or environmental issues – is a sign that the changing world has left you behind.
• #6: 8 stages to leading change: 1. Establish sense of urgency 2. Create guiding coalition 3. Develop vision and strategy 4. Communicate change vision 5. Empower broad-based action 6. Generate short-term wins 7. Consolidate gains & make more change 8. Anchor new approaches in culture
• #7: Why is urgency important to a change effort? Urgency is important because meaningful organizational change cannot occur without the cooperation of the affected stakeholders. This is why creating a sense of urgency for a needed change is the first step  leaders must take to gain the cooperation of management and employees. How to Create a Sense of Urgency With Your Team There are several steps leaders can take to create a sense of urgency and gain the commitment of managers, employees, and other stakeholders.  They include: Showing the seriousness of leadership commitment to the coming change by eliminating obvious waste; Sharing  bad news with the organization; Requiring managers and employees to talk directly regularly with unhappy suppliers, customers, and other stakeholders to understand their concerns; Sharing data throughout the organization that supports the claim that change is necessary; and Ensuring organizational decisions and management actions are in agreement with change communications (walk the talk).
• #8: This is the group that is going to direct the change effort. Two types of people should be avoided at all costs. No snakes, no egos. The size of an effective coalition seems to be related to the size of the organization. Change often starts with two to three people. The group in successful transformations grows to a half a dozen in smaller companies to 20-50 people in larger companies. Trust must be present with this group and a common goal.
• #9: Managers should provide 80% Leadership (vision, strategies) and the rest Management (plans, budgets). Visions should be feasible.
• #10: Communicating the change vision and initiatives are essential to the change management process.
• #11: No jargon, technobabble. A verbal picture is worth a thousand words. Big meetings, small meetings, memos, formal and informal interaction – all are effective for spreading the word. At one company, I did a big roadshow, presentations to each department. For months people kept saying “Hi, Mary!” in the elevator. I had no clue who they were. This organization had an IT department of 5,000 people. That was just the IT department. Ideas only sink in after being heard many times. Behaviour from important people that is inconsistent with the vision overwhelms other forms of communication. Unaddressed inconsistencies undermine the credibility of all communication. Nip that in the bud. Explain it. Fix it. Two-way communication is more powerful than one-way communication. Go to people’s department meetings and let them ask you anything. Tell them they can message or email you anytime with any questions or concerns. Go to lunch with people.
• #12: It’s not about you – It’s about the people Start Video at 8:11 min, Stop Video at 9:52 min It's not about you - it's about the people "A great leader inspires people to have confidence in themselves." - Eleanor Roosevelt They create more leaders. The ideas of the hero flying in to save the day, to solve all the problems, just doesn't make sense."
• #13: It’s not about you – It’s about the people Video 8:11 - It's not about you - it's about the people - "A great leader inspires people to have confidence in themselves." - Eleanor Roosevelt They create more leaders. The ideas of the hero flying in to save the day, to solve all the problems, just doesn't make sense." To 9:52
• #14: Organizational arrangements can undermine a vision by disempowering people. Whenever structural barriers are not removed in a timely manner, the risk is employees will become so frustrated that they will sour on the entire transformational effort.
• #15: People are taught technical skills but not the social skills or attitudes needed to make the new arrangements work. Don’t make getting training a disempowering experience of “shut up and do it this way”, instead “we will be delegating more, so we are providing this course to help you with your new responsibilities”. Explain why. It must be the right kind of experience.
• #17: Why are short-term wins so important? Evidence sacrifices are worth it – Wins greatly justify the short-term costs involved Reward change agents with a pat on the back – After a lot of hard work, positive feedback builds morale and motivation Help fine-tune vision and strategies – Short-term wins give the guiding coalition concrete data on the viability of their ideas Undermine cynics and self-serving resisters – Clear improvements in performance make it difficult for people to block needed change Keep bosses on board – Provides evidence that transformation is on track Example: People high in the hierarchy started recognizing the improvements brought by the chain and further supported it. Build momentum – Turns neutrals into supports, reluctant supports into active helpers, etc. Example: At one company I was at, I had people who used to be vehemently against the change, come directly to me later to actively help support it after they saw some short-term wins.
• #18: Complacency – Example – People went to an annual management meeting. The CEO praised all the executives and staff for all that they accomplished, there were awards that night at the banquet, the next morning presentations on “best practices” dissolved into more back patting, and the CEO ended the event with a congratulatory speech. What happened next? Everyone’s sense of urgency went out the window. Their mindsets changed into “Look at all we’ve accomplished. We’re in great shape. So relax and enjoy the music.” During the next year, a dozen change initiatives were put on hold or slowed down. People stopped implementing change, and swept back into traditions that caused problems in the past. Resistance – Whenever you let up before the job is done, critical momentum can be lost and regression may follow. Until changed practices attain a new equilibrium and have been driven into the culture, they can be very fragile. Interdependence – Later in this presentation, I’m going to go over a case study of an organization where many departments are interdependent on each other that required the change. For example, Finance, Underwriting, Claims, IT, Marketing & Sales, and Risk Management. In a system with interdependence, several or all the elements may need to be changed in order to move A. Let’s say A in that example is to implement a new source of revenue, such as insuring physicians and clinical staff in a new state like Alaska.
• #19: More change, not less – The guiding coalition uses the credibility from the short-term wins to tackle additional and bigger change projects. More help – Additional people are brought in, promoted and developed to help with all the changes. Leadership from senior management – Senior people focus on maintaining clarity of shared purpose for the overall effort and keeping urgency levels up. Project management and leadership from below – Lower ranks in the hierarchy both provide specific leadership on projects and manage those projects. Reduction of unnecessary interdependencies – To make change easier in short and long term, managers identify unnecessary interdependencies and eliminate them.
• #20: Remember these. Because they are really very important for cultural change with an organization. You’ll see some examples of norms of behavior and shared values in the next slide.
• #21: Culture is important because it can powerfully influence human behavior, because it can be difficult to change, and because its near invisibility makes it hard to address directly. Generally, shared values, which are less apparent but more deeply ingrained in the culture, are more difficult to change than norms of behavior. New approaches need to be anchored firmly the organization’s group norms and values. Culture is powerful for 3 primary reasons: Because individuals are selected and indoctrinated so well Because the culture exerts itself through the actions of many people (50 to 1000s depending on the size of the organization) Because all of this happens without much conscious intent and thus is difficult to challenge or even discuss This is why you see in growing organizations with many new employees, the new employees are able to see issues with the companies culture and may start to question it.
• #22: Culture changes only after you have successfully altered people’s actions, after the new behavior produces some group benefit for a period of time, and after people see the connection between new actions and the performance improvement. Changing culture comes last, not first. It depends on results. It requires A LOT of talk. Without verbal instruction and support, people are often reluctant to admit the validity of new practices. This is why I meet with my people weekly, and why I always inform them what is going on in the organization, or any changes that are coming. Changing culture may involve some turnover. Sometimes the only way to change a culture is to change key people. It makes decisions on succession critical. If promotion processes are not changed to be compatible with the new practices, the old culture will reassert itself.
• #30: Step thru what each of these components mean
• #31: Step thru what each of these components mean Incentives: Success stories shared to departments who had not rolled onto the system yet
• #32: Step thru what each of these components mean
• #33: Step thru what each of these components mean
• #34: Handout – 5 min – Self-Reflection Think and talk through your own examples.