Summary - Key Lessons for Managers and Consultants

• The reputation of large-scale corporate strategy remains severely damaged by the false promises of the dotcom era. Instead, organizations are focusing their strategic thinking

• Bringing down the barriers within and between organizations may reduce one set of obstacles to change, but it creates another - multiple stakeholders. Successful change management involves confronting and reconciling, not bypassing, the different - sometimes conflicting - aims of those involved.

• Radical change can be easier than incremental change because it demonstrates the willingness of senior managers to resolve - rather than pay lip-service to - serious issues.

• Effective change management consulting follows Teddy Roosevelt's advice of speaking softly and carrying a big stick. In terms of its public interaction with employees, it needs to adopt innovative, even unexpected approaches. Behind the scenes, consultants have an important role to play in maintaining momentum and credibility.

Case Study 6.1: Changing People for a Change

Inspiring change within large organizations often comes down to harnessing the will of key individuals. Goals, no matter how noble, remain abstractions until the people charged with achieving them take them to heart and act upon them. This project shows how well-planned and thoughtfully executed one-to-one personal intervention, particularly coaching, can reorient an organization in a time of massive opportunity.

The NHS was set up in 1948 and is now the largest organization of any type in Europe. Although the NHS is recognized as one of the best health services in the world by the World Health Organization, and widely regarded as the jewel in the crown of the British post-war state, the demands of modern healthcare are driving widespread improvements to the service.

The main tool used to date in getting more value out of the NHS has been the setting of targets. The NHS Plan, published in July 2000, is a detailed action plan for developing the service over a 10-year period. The plan defines a mass of measures for putting patients and people at the heart of the health service. As a result of the plan's implementation, patients will have more say in their treatment and greater access to information. New hospitals are being built, and more doctors and nurses trained and recruited. There will be net increases of at least 15,000 more general practitioners and consultants, 30,000 more therapists and scientists, and 35,000 more nurses, midwives and health visitors by 2008.

Patients' experience of healthcare will be impacted by shorter waiting times for hospital and doctor appointments, and cleaner wards, better food and updated facilities in hospitals. For example, waiting times for operations will fall from an existing maximum of 15 months to 6 months by 2005, and to 3 months by 2008. On the organizational side, there will be tougher performance standards for NHS organizations and better rewards for those who perform best.

However, by 2004 the government was signalling that targets do not, in themselves, guarantee improvement. As business managers know, it is the contribution that targets make to the cycle of management that gives them value. Targets that make sense to those who must pursue them and that contribute to broader goals act as directors of action and motivators of individuals. In the case of the NHS, according to an article entitled ‘About Turn' published in the Economist (London), 14 February 2004:

A recent analysis of the health service by the OECD found ‘few indicators showing unambiguous improvements in outcomes over and above trend improvements that were already apparent before the surge in spending'. It said that targets can be achieved only if the incentives are right. Behaviour is affected only if service providers ‘feel motivated to meet the targets'.

This case study shows how one management team's response to the modernization agenda focused on behaviours rather than numbers.

Change at the sharp end

The government's modernization agenda ripples out to every element of the NHS, including local delivery organizations such as Harrogate Healthcare NHS Trust. This trust provides acute, mental health and community healthcare to the population of North Yorkshire, primarily to the conurbations of Harrogate and Ripon. It employs over 1,700 staff in the region. Modernization triggered the appointment of the trust's chairman and chief executive, and the subsequent creation of a new top-level management team.

Furthermore, the opportunity to achieve a three-star performance rating for NHS Trusts in England for 2003 meant that the trust could apply for Foundation Trust status. Foundation Trust status shifts the balance of power in favour of the community, making the organization more customer focused. The Foundation Trust strategy devolves resources and decision-making to the front line of the health service, making it more responsive to people's needs and improving its accountability to those it serves. While the government believes that all NHS trusts will progress to Foundation Trust status over a five-year period, in the initial phase only trusts that achieve three stars in the annual ratings are eligible for change of status.

For Harrogate, becoming a Foundation Trust would require sensitive and strategic management within a challenging time frame. Miles Scott, the new Chief Executive, saw that the trust could use the external changes involved in the change of status to restructure the organization for the future. Scott recognized that it was vital to engage all those working within the organization in order to take advantage of the opportunity for change: ‘We all understand how important the people side of change is and it needs to be more than just changing name badges.'

RightCoutts was engaged to support the organizational change process, with attention to both the executive team and the clinical team. The executive team included the chief executive and the directors of finance, HR, planning and performance, facilities, operations, the medical director and the chief nurse. Developing the executive team involved ensuring that every member was familiar and comfortable with his or her new roles and responsibilities.

The project's work with clinicians required the development of a general management perspective to augment their professional viewpoints. The changes involved in the NHS Plan require clinicians to manage resources as well as fulfil their specialist responsibilities. The trust therefore wanted its clinical directors to become more business focused, and to acquire the skills and knowledge needed to adapt their own processes while leading their teams through the period of change.

Hands-on change

The approach proposed by the project team aimed to draw together clinicians and general managers within the trust, working with individuals to assess their input to the work of the executive team as a whole. This approach allowed the trust's people to own the change process and influence its design, ensuring that its details met their needs and resulting in early buy-in. Working in this style demanded a shift in mindset for clinicians and general managers alike. Both groups had traditionally worked from the same agenda, but from different angles. Now the groups would share perspectives, appreciate each other's constraints, and develop solutions together.

RightCoutts' consultants began their work with the senior team by observing a working meeting, gaining a feel for how the team members tackled their responsibilities and interacted with each other. The consultants also conducted 360-degree appraisals by telephone in order to gain further confidential feedback on individuals.

The consultants then met with the directors on a one-to-one basis to discuss their needs. The team used psychometric tests in some instances to help identify areas for improvement. Personal development plans aligning individual needs to the trust's objectives were agreed for each director, ensuring that each individual had a precise, tailored roadmap for their onward development.

The team next put in place a programme of coaching sessions. The coaching sessions gave individual directors the opportunity to discuss their progress and to surface any issues associated with personal or organizational objectives. Sessions were held away from the client's work environment wherever possible. Off-site meetings helped build strong, committed relationships between executive team members and consultants, while minimizing any disruption to the daily flow of business at the trust.

Coaching is a high-value intervention, especially at senior levels of an organization. Supporting change in leaders often involves subtleties of attitude or behaviour, and finding and addressing such subtleties entails individual attention and sensitive management. Coaching enabled the project to address the organization's strategic goals and its leaders' personal capabilities in the same frame of reference. Strategy and individual action could be married, making the identification between the organization's mission and its leaders complete, intimate and robust. Coaching also helped the executive staff work more effectively together as a team. Dr Carl Gray, Executive Medical Director at the trust, says:

The coaching has certainly helped me in my transition to a senior role within the trust. As a member of the Medical Director team you are set apart from your colleagues, who are sometimes looking for an authority figure to tell them what to do and at other times are seeking an advocate to argue their case. It's a difficult and challenging role for anyone to adopt, regardless of their personality type and the RightCoutts approach has given me confidence and a new perspective in my role from an early stage.

Chief Executive Miles Scott agrees that the coaching approach has made an impact throughout the organization: ‘Everyone has got something different out of the RightCoutts coaching. Without doubt, the organization is making the progress I wanted to see - the sense is that coaching has been a helpful tool towards this.'

As well as its applied skills in personal and team development, RightCoutts brought a thorough, up-to-date understanding of the NHS and the changes it is undergoing. In particular, the team appreciated the diversity of work undertaken within a trust, and the multi-disciplinary nature of its environment. The principal consultants and programme manager on the RightCoutts team had extensive knowledge and experience of working alongside clinicians and general management, and were specifically chosen to work on the project because of their backgrounds. Their backgrounds helped get the project off to a quick start, avoiding the need to explain NHS procedures, agendas and culture. This close alignment was an essential ingredient in meeting the needs of the trust in a very short time frame.

Reaching the stars

This was a highly visible project, with many hopes riding on its success. With a new executive team in place, there was naturally some pressure to make a meaningful impact on the life of the trust as quickly as possible. Furthermore, audit dates and deadlines for the achievement of three-star status provided a shared sense of immediacy throughout the project.

The project team had also to consider the positions and personalities of the senior managers they were working with. The trust's senior management team was working in an already well-performing, but very time-pressured, organization. Rapidly establishing the relevance and benefits of the project for the senior team and securing their buy-in was essential to the project's success. Tony Martin, RightCoutts' Programme Manager, says: ‘Holding meetings at shorter intervals than normal and providing consultants who were dedicated to the project and its outcomes was essential. By taking the time to hold diagnostic one-to-one sessions with individuals as well as group work, we were able to truly engage people into the initiative.'

The project team's work with the trust was a key factor in the award of three-star status. Three-star status brings national recognition to the trust's excellence in serving the local community. As objective confirmation of the organization's good work, the new status had a huge impact on staff motivation and quickly became a strong factor in recruitment. The award has elevated the trust's image to that of an employer of choice.

Moving to ‘hard' measures - those that match the indicators in the NHS Plan - Harrogate delivered the best waiting-time performance across the nation during 2003-04. In fact, the trust met NHS Plan targets for waiting times two full years ahead of schedule. The trust is now well positioned to attain Foundation Trust status. This will bring a new financial regime providing access to additional capital investment for building projects and materials, as well as drawing local people into the management team.

The trust has seen a marked change in the level of cooperative working among the senior management team. The success of the project has confirmed that this style of personal intervention can create great benefits within the trust. At the time of this writing, work continues to apply the approach at further levels of the trust's organization.

Coaching is a consulting technique that focuses on individuals and their core skills, behaviours and beliefs. This technique cannot be operated blindly, or according to formula. To risk an obvious pun, the Harrogate trust could only gain the benefits of coaching by trusting their consulting colleagues. This project is an excellent example of how personal commitment to the community and a willingness to change can be matched with national programmes that aim to improve the lives and well-being of millions.

Case Study 6.2: Releasing the Future from the Present

A classic review of an international organization nearing 50 years' service to young people is ensuring that half a million people will continue to develop their skills and challenge themselves every year.

We have heard less in recent years about the traditional mode of management consultancy, and it is tempting to think that the industry has changed thoroughly and irrevocably. Before the age of large-scale systems integration projects began, and managers turned their attention to defining change projects with strict ROI (return on investment) plans, management consultants were engaged for their skills in the areas of strategic direction setting, vision building and organization. Breadth and depth were valued, while specialist skills in systems or methodologies were secondary matters. The consultant was, more often than not, an informed, committed and engaged ‘outside eye', bringing a range of experience to bear on the challenges of a well-established organization at a time of business challenge.

Capgemini's work with the Duke of Edinburgh's Award International Foundation is a timely reminder that the strategic challenges facing organizations have never gone away, and proof that a classic consulting intervention can bring long-term benefits. No amount of technology or rapid results methodologies can burn away the toughest questions at the leading edge of any organization: Where are we going? What do we mean to our customers?

Reaching young people

The Duke of Edinburgh's International Award is a self-development programme available to all young people worldwide. The programme aims to equip young people with life skills to make a difference to themselves, their communities and the world. More than 5 million young people from 111 countries have been motivated to undertake a variety of voluntary and challenging activities through the scheme. Over 520,000 young people worldwide are currently participating in the programme.

The Award operates on a national basis in 60 countries and there are 133 Independent Operators in a further 53 countries. The International Award is a generic title, and each National Award Authority (NAA) can choose its own title. The various national Awards include the El-Hassan Youth Award in Jordan, The President's Award in Ireland and The Source of the Nile Award in Uganda. In most NAAs the Gold Award is presented by the head of state.

The Award has three levels, bronze, silver and gold, each with different minimum starting ages and periods of participation. Each level has four sections:

• Service: to encourage service to individuals and the community through regular involvement in community projects, conservation work, voluntary work in hospitals or community homes or more specialized training such as lifesaving, first aid or rescue services.

• Expeditions: to encourage a spirit of adventure and discovery, understanding of the environment, and the importance of working together in a team with a common purpose. Expeditions may be made by foot, bicycle, boat or horseback, or in any equally challenging adventurous journey. Proper training and preparation, self-sufficiency, self-reliance and the exploration of new surroundings are the key elements. Participants frequently make their expeditions in countries other than their own.

• Skills: to encourage the discovery and development of personal interests and social and practical skills. There are over 200 hobby and vocational skills from which participants can choose, including photography, cacti growing, magazine production and metal work.

• Physical recreation: to encourage participation and improvement in physical activity. Participants are required to take part in some form of organized physical recreation and show individual progress. Most team and individual sports are included, such as football, athletics, archery, swimming and canoeing.

• At Gold level participants must also undertake a five-day residential project aimed at broadening their experience of living and working with others.

Originally launched in Britain in 1956, the Award programme quickly sparked huge interest in many other parts of the world, and its expanding internationalism was marked in 1988 by the formal establishment of the Duke of Edinburgh's International Award Association (IAA), with responsibility for the coordination and development of the Award worldwide. The IAA is made up of the National Award Authorities and Independent Operators of the Award.

The IAA is serviced by an International Secretariat based in London and managed by a Board of Trustees whose members come from many parts of the world. The Association is financially supported by the Duke of Edinburgh's Award International Foundation, a charitable company set up in the UK. This source provides funds for the core costs of the Association. Further funds are raised through charitable giving from individuals and corporations and from events held in different parts of the world.

The International Secretariat of the Association, comprising a secretary-general and a youthful team of 14 full-time staff, plays a vital role by:

• providing consultancy and support to members of the

• Association;

• assisting in coordinating their activities;

• maintaining international operational standards;

• promoting the Award to new countries and assisting with its establishment.

Due for review

With more and more countries joining the organization, and continuing growth in the numbers of young people entering the programme, the Award remains as relevant in the 21st century as it was in the 1950s. However, while successive new generations of participants were passing through the programme, the organization had maintained its fundamental shape and positioning. No fundamental review of the IAA, or the workings of the International Foundation (comprising the trustees and the secretariat), had been carried out for a decade, yet it was evident that during that time the world of young people and the organization itself had undergone many changes.

By 2003 it was time to take a thorough, professional look at the organization's strategy and operations in relation to its overall mission. The timing was apt, since Paul Arengo-Jones, the current Secretary-General (in effect the global CEO) was due to retire in a year's time and it was vital to specify the required profile of his successor before the recruitment process could start. The need to create the Secretary-General's profile in turn demanded a clear, up-to-date, agreed view of the aims and objectives of the organization and how they should be pursued and attained.

Financial stability had been achieved and maintained over the long period of Arengo-Jones's leadership. Extensive, energetic and creative fund-raising had ensured that the books were balanced. In more recent times a combination of external factors, including global recession and the events of September 11, caused a funding gap to appear. The funding gap was an added factor in prompting the decision to undertake a complete review of the organization.

The IAA decided that ideally the review would be undertaken by independent external consultants with global experience as well as in-depth knowledge of business strategy, finance, HR and organizational issues. The Association also wanted a team of consultants with a sound reputation and a world-class track record of advising major global organizations. This was not just a matter of practical qualifications: the Award's relationships with businesses and communities around the world form a key aspect of its presence, aims and funding opportunities. Capgemini agreed to take on the project on a pro bono basis, dedicating a small team of professionals keen to carry out such a strategic, all-encompassing project for an organization with a global span.

The IAA leadership decided from the start of the project that the Capgemini team would have complete freedom to go anywhere in the organization, talk to anybody, ask anything and see everything, including all documentation and financial records. The project's objective was to undertake a comprehensive strategic review of the organization's activities, structure and finances, identifying strengths and weaknesses and making appropriate recommendations for change. The team were asked to pull no punches in assembling their report and making their recommendations.

Laurence West, Capgemini's sponsor for the project, was impressed with the organization's open culture:

The Secretary-General was very supportive right from the beginning, and we had excellent access. There were lots of currents of opinion, but the culture of the organization is that it's okay to have different opinions. The people there passionately believe in what they're doing. They were also keen to see how they compared to other organizations, including commercial ones.

Shaping the review process

The team divided the three-month review process into three phases. The first phase focused on gaining an understanding of the organization's current strengths and weaknesses, based on interviews, workshops, and financial analysis. The second phase addressed understanding stakeholder views and requirements through interviews with National Award Authorities, Independent Operators, donors, other youth organizations and trustees. This phase would also include identifying funding opportunities through strategic research and analysis. The third and final phase involved developing the organization's vision and mission through workshops and discussions with staff members and other stakeholders, and detailing how to implement them.

The team looked at all aspects of the organization's work including communications, branding, fundraising, corporate governance and finances. The team recognized the importance of seeking views from National Award Authorities and Independent Operators. These are the people who actually run the various Award schemes all around the world and who therefore have the closest appreciation of the organization's impact. The team interviewed a quarter of these key stakeholders in detail in order to discover which of the services provided centrally were of highest value, of medium value and of lower value. The project involved both one-to-one interviews and a series of group workshops, some of which were held at Buckingham Palace and Windsor Castle.

Paul Arengo-Jones recalls the largest workshop was held offsite at Capgemini's offices:

All our directors, staff and regional directors were in for the annual regional meeting. We put aside one day for an offsite workshop where the consultants would tell us what they'd found out so far. We could all pose questions, there were breakout groups on different issues and we all reported back. We deliberately chose to have the workshop on neutral ground, and we had a facilitator for the day who was not involved with the project to maintain the objectivity.

Right from the start, the team stressed the importance of wholehearted buy-in from each full-time member of the Secretariat's 14-strong staff. As with any review involving external consultants, staff members might have been worried about possible job losses or work restructuring. But, as Paul Arengo-Jones points out:

The consultants handled everything very sensitively and diplomatically. They got everyone involved, so that nobody felt excluded. Once staff realized that they would be included and treated equally they all realized they had something to say. The staff sessions were once a week, and everyone was given specific tasks to do; for instance, researching a particular topic for the next session. It was very inclusive: it wasn't just someone in a corner, beavering away.

Capgemini's West adds that the consultants' external perspective was highly valued, which helped to build trust: ‘People are inevitably influenced by their existing situation. We could add value simply by being independent and objective.'

The need for buy-in extended to the IAA's membership. Membership of the IAA is entirely voluntary, with the National Award Authorities around the world having complete freedom of choice as to whether or not they belong to the Association. The organization therefore has to take its members with it, and demonstrate continuing relevance to their aims and circumstances. Any proposals for change would have to be cogently argued, transparently rational and likely to be universally accepted. The organization could not resort to anything resembling a ‘command-and-control' governance culture, an option that remains possible for even the most empowered commercial company.

A road map for the future

The team's report was submitted to the Board of Trustees on time in April 2003 following a 12-week schedule of interviews, workshops and analysis sessions. The report identified a number of fundamental strengths and weaknesses in the current pattern of operations, as well as some important opportunities for, and potential threats to, further development.

The report also proposed a reformulation of the International Foundation's statement of strategic intent. The revised statement would clarify and distinguish between its vision, its mission, and its overall strategy in achieving its mission. The report included a detailed picture of what the International Foundation would ideally look like in 2012, and outlined a three-phase programme of short-term, medium-term and long-term change to achieve this position.

A number of detailed recommendations were made in the report. Within three months of the report's delivery, the majority of the recommendations had been accepted in full and implementations begun.

The first outcome of the review was a strategy of regionalization, with four regions and full-time regional directors confirmed as the best structure for the future. The review recommended that the regional offices be enhanced to play a greater role in the delivery of the Award programme worldwide and in the maintenance of quality and standards.

The staff roles within the Secretariat would also be clarified. Alongside the ongoing development of the regions, clarification would result in a more focused and improved service to the IAA. Then a profile of the capabilities required by the new secretary-general to be appointed upon the retirement of Paul Arengo-Jones in 2004 would be developed. This profile would help ensure that the new appointment became a positive and logical step in the continuing development of the Association and its aim to remain as the foremost global Award programme for young people.

The report also addressed the marketing of the organization. Given that after 15 years the Association had matured into a global youth charity, the vast experience and capability of National Award Authorities and Independent Operators would be accessed to help others. At the same time the global brand (the ‘global bird' symbol) of the Duke of Edinburgh's International Award for Young People needed greater exposure and marketing so that more support could be generated from governments and other funding sources for the development of the Award worldwide.

A quarter of National Award Authorities and a small but significant number of Independent Operators were interviewed by the team for the review process. Their feedback showed that these organizations valued the IAA's production of operational materials, especially those aimed at provisional NAAs. The interviewees also praised the advice and consultancy they received from London and from the regional offices. They appreciated the regular communication from the Secretariat, the regular Award World publication and the organization's annual report. Secretariat visits to participating countries were valued, as were international training courses and events.

The interviewees scored other services as being of medium value. These included promotional materials produced for participants, since the use of the English language in the publications limits their use in some countries. Lack of access to IT facilities presented some challenges to Internet and intranet use. Interviewees did not generally value the availability of IAA branded goods such as T-shirts, as most NAAs can produce these locally more cheaply than the IAA can.

A detailed action plan to implement the report's recommendations was prepared by the Secretariat in summer 2003. Paul Arengo-Jones estimates that around 70 per cent of the recommendations were adopted without change: ‘Some of the suggestions were instantly acceptable, others didn't necessarily work for us as a charity.'

The first actions of phase one of the change programme include new fundraising plans with clearly specified targets. These plans are linked to a new events calendar and new communications material for donors. Detailed plans were also produced for the launch of a ‘Young Fellowship' to bridge the age gap between those entering for the Awards and those sponsoring and supporting the scheme.

Further actions included the development during 2003-04 of a revised process for a rolling three-year budget. The new budget process includes involvement from all budget holders and is supported by improved finance and accounting procedures. Work began on the reorientation of the organization's annual report specifically to support marketing and fundraising requirements, and development of written job specifications for all staff to recognize reallocated roles, key objectives and training requirements.

Paul Arengo-Jones states:

The strategic review was a most excellent and thorough piece of work. It provided us with an independent and objective analysis of our position and made clear which areas and activities were in good shape within our organization and which needed sorting. It was a wonderful catalyst for a whole series of changes which are now being put into operation with good effect. With the resulting new strategy in place, everyone here is now facing the future with renewed confidence. When I can hand over to my successor next year, it will be an organization headed in totally the right direction, and I can be confident that the Award will continue to thrive and succeed in the 21st century as well as it did in the second half of the 20th.

This project shows how even a broadly based international organization that has effectively invented its own business domain can benefit from an outside eye. Managers in the midst of a successful business that touches the lives of millions around the world are not always best placed to see how their organization could be improved and their services developed. As relationships develop in a distributed concern like the Duke of Edinburgh's International Award community, the way forward can easily become obscured by the minutiae of operations and the very maintenance of those all-important relationships. Capgemini were able to act as midwives to the future: bringing out the logical conclusions for the IAA's strategy from the organization's stakeholders. The team's success has released the organization's future spirit from its current experience - much as the IAA's ‘global bird' icon symbolizes the freedom, growth and determination of the many thousands of young people who participate in the Award.

Capgemini's contribution must also be measured at the personal level. Management consultants have been accused of packaging their methodologies in the pursuit of repeatable and scalable engagements. The knowledge that is acquired in each project can be fed into the firm's methodologies, and the methodologies help to sell and structure future engagements. But consulting is not the application of formulae or the cranking of methodological handles. Consulting is a process carried out by people, with people, and for people. The IAA team was impressed with the personal commitment of the consultants assigned to this project. Their persistence and flexibility alike were valued by Arengo-Jones: ‘The personalities have to gel well for it to work, because there is a degree of upset and suspicion at the start. The consultants were professional and energetic, but also brought a wealth of experience. They made themselves available - even in the pub after work!'