Managing Change:

1. Managing Change: The Human Impact

2. The statistics Studies generally agree that somewhere between fifty and eighty percent of mergers fail. (Alexandra Reed Lajoux, The Art of M&A Integration, 1998)

3. Common change models Elisabeth K�bler-Ross: Death & Dying (1969): The Five Stages of Grief: denial, anger, bargaining, depression, and acceptance. William Bridges: Managing Transitions (1991): Three Stages: Ending � Neutral Zone � Beginning The �Change House� (AMP, 2000): Denial room � confusion room � renewal room � contentment room

4. Problems with these models Relevant application (eg. is death & dying that similar to job loss?) Most assume people progress through pre-defined stages They give a false impression of order and predictability (ie. control � appealing isn�t it?)

5. So why is change so hard? Evolution has taught us to resist change and seek control of our environment We are �hardwired� to respond to threats (both real and perceived) � eg. the �fight or flight� response Many people see change as a �threat� and as something they have no control over

6. It�s all about control Those with internal locus of control have the perception that they are responsible for what happens to them Those with external locus of control have the perception that luck, fate, other people or outside forces beyond their personal control determine their lives (Rotter, 1966)

7. Research on locus of control Internals, tend to: take responsibility for what happens to them see the events of life as having a cause-effect relationship with themselves as the cause be more independent be more achieving be more reliant on their own judgement and resistant to influence have a greater sense of personal power Externals, tend to: suffer feelings of inadequacy suffer feelings of anxiety suffer feelings of fatigue suffer feelings of confusion suffer feelings of depression feel that things are pointless feel powerless feel worthless feel frustration and anger

8. Does this sound familiar? Your involvement please �Elect� a spokesperson for your group As a group discuss your response to the following �

9. It�s a business decision � Your boss has asked to see you in 5 minutes to give you some important information You meet and are told that you have been made redundant and will finish up this week Questions for discussion: Describe your initial feelings Describe your likely actions Describe your various thoughts

10. Why is it so? Same event: made redundant Different feelings Different actions Different thoughts �Men are disturbed not by things, but by the views they take of them.� (Epictetus, 100 AD)

11. We often believe � event thoughts feelings actions

12. But you have just shown � event thoughts feelings actions

13. Change involves emotions Shock Anger Irritability Frustration Disbelief Fear Confusion Denial Anxiety Depression Stress Excitement Joy Relief

14. Don�t be fooled � Change is rarely: Rational Predictable Controllable Therefore, people are often not in the best frame of mind to take in information and to make decisions (leaders and followers alike!)

15. Change would be easy but .. Our thoughts are responsible for our feelings Our feelings drive our actions �Managing change is about managing emotions� And leaders have the biggest impact! Are they internals or externals?

16. Effective leaders need to manage: The rational side of change: analysis, planning and project management The emotional side of change: Being aware of their own reaction to change Understanding how others are reacting, or may react to change Minimising damaging emotions and the behaviours that delay progress

17. Example: restructure Rational Side: Establishing key success measures Flexible transition planning that is well executed Involvement of all key stakeholders (where possible) Clearly defined well executed selection process Well planned and executed communication plan Risk management (customers, property, IP) Preparation of notifying managers/leaders

18. Example: restructure Emotional side: Leaders need well developed abilities in: Understanding their own emotions Understanding the emotions of others Managing strong emotions, and therefore using more appropriate behaviours, that have the right impact on others, who are also experiencing change. Summarise only (next slide introduces EI)Summarise only (next slide introduces EI)

19. How do leaders learn this? You may recall Epictetus: �Men are disturbed not by things, but by the views they take of them.� Leaders (and followers) can learn how to �change their views� This is a very powerful strategy when we can�t change (ie. control) our situation

20. Case study Background: Manager at a local council Claims of bullying, harassment and intimidation against her She was stressed, angry and losing confidence in her ability as a manager Her team was understaffed, de-motivated and performing poorly Talk about case study - background (next slide � solution)Talk about case study - background (next slide � solution)

21. Case study Solution: Five one-hour coaching sessions Focus on understanding and managing her emotions Some �unhelpful� thoughts: People often try to pull the wool over my eyes I must always have all the answers Case study continued (next slide � outcome)Case study continued (next slide � outcome)

22. Case study Outcome: She now feels more confident and in-control of the situation No longer takes things �personally� Is less easy to anger Her manager reported a �change in attitude� and better relationship skills

23. Where do you focus your efforts? One-third who already posses the desired values, attitudes and behaviour and hence already fit the desired culture One-third who are willing and able to change to fit the desired culture One-third who do not fit and will never change to fit the desired culture

24. Monitoring progress Forget the popular change models: a more realistic way to navigate change is to monitor individual and group emotional states in terms of: Frequency: how often are they feeling frustrated, angry or stressed? Intensity: on a scale of 1-10, how strong is this emotion? Duration: how long does it last for?

25. In summary � Individuals are responsible for their own behaviour and are in control They feel what they think and then act accordingly If they control their thoughts, they can manage their feelings and behave more effectively By doing so, they gain a greater control over the situations they find themselves in They feel free to make choices which support their goals and objectives

26. Questions?