Change Management to Improve Strategy Execution • Using Change Mgt to Improve Strategy Execution • Change is an INFINITE FLOW • Ability to absorb is FINITE – • Failure is from the incongruity between flow and absorption capacity • Change Absorption Framework
Change Management to Improve Strategy Execution • 1. How will enterprises develop an understanding of their current capacity for change? • 2. How will enterprises accurately assess the scope and impact of a change initiative? • 3. How will enterprises increase their capacity for change? • 4. How will enterprises ration, orchestrate and manage change to improve strategy execution?
Change Capacity • Change capacity is defined by • Employee willingness and ability to change. • It is affected by • Organizational history and culture, leadership credibility, attitudes and trust toward management, perceptions of urgency, employee skills, and a collective experience of change. • Understanding the enterprise’s current change capacity is the first step
Raising the Absorption Capacity • When you raise the absorption threshold, • you are increasing the capability to absorb change. • Usually this is done by: • increasing the flexibility in the organization, • lowering the levels of hierarchy, • increasing accountability and responsibility.
Expanding the Absorption Curve • By identifying critical success factors, best practices and methodologies for instituting change, an organization can • expand the absorption curve which pushes up and out the absorption threshold (beyond which any more change is counter productive) thus increasing the capacity to change positively.
Expand the Absorption Curve • By identifying critical success factors, best practices and methodologies for instituting change, an organization can expand the absorption curve • which pushes up and out the absorption threshold (beyond which any more change is counter productive) • thus increasing the capacity to change positively.
Orchestrating and Managing change to Improve Strategy Execution • Change is a process and as a process it can be managed using • Frameworks • Best-in-class • CSF • Best practices and • methodologies
Tactics for Managing Radical Change • The pace of change depends on the process that is, • Tactics, or techniques used to encourage an organization’s member to accept change • Complies with current organizational values and norms, skills, structures and incentive is evolutionary • Change that challenges or undermines the status quo, creates a new vision, and accomplishes fundamental change is revolutionary
BPR Improvement Innovation/Reengineering • Process Improvement and redesign Process Magnitude Increment Radical Improvement 30-50% 10x-100x Sought Starting base Existing Process Blank skeet Top management Relatively low High commitment Role of IT Low High Risk Low High
Discussion Questions • Compare/contrast Orders of Change Magnitude with Change Scope/ Depth Framework? • Compare the change magnitude framework with the change absorption framework?
Dimension of Change Stemming from Reengineering Industrial Age Org. Information Age Org. Structural Dimension Hierarchical org. based on Networked Org. based Function / product. Cross functional teams Rigid Bureaucracy Flexible Adhocracy Org. Integration through Org. integrate through structure information systems Management Dimension Management by Management by internal Internal objective and external objectives Functional Organizational Structural empowerment Informational empowerment
Dimension of Change Stemming from Reengineering Industrial Age Org. Information Age Org. People Dimension Fragmented Tasks performed Holistic Process by individuals accomplished by teams Functional specialists Case management and process generalists Expertise as functional Knowledge as an Specialist organizational resource