Change Management

Problems have a way of cropping up. Even if an organization is almost perfect, forces outside the organization change constantly. Every organization must be willing and able to adapt to pressures. Healthy organizations recognize changing conditions and adjust. Unhealthy organizations hang on to "the usual way of doing things" long after they should change. The old saying "If it ain't broke, don't fix it" is misguided advice for today. Instead, it is important to recognize trends, to identify causes of the trends, and to search for ways to keep up with or ahead of trends.

Basically, there are two common methods for adapting to changing conditions: empowering employees as problem solvers (such as quality teams ) or assigning process consultants to develop solutions. Many organizations combine methods using problemsolving teams to implement ideas developed by an internal or external process consultant. Employees as problem solvers means that the people closest to the problem identify causes and solutions. Problem solving usually focuses on a single issue, department, or process. This usually results in many small projects involving several departments, but seldom a single, major impact.

Process consulting, on the other hand, is usually coordinated by a centrally assigned person or team. Typically, process consulting involves major divisions of the organization, or the entire organization, in a coordinated effort.

Definition and Scope

Change management requires sensitivity to workers' and to managers' feelings and capabilities. PT practitioners, acting as change agents , need to be honest about the issues. Ideas need to be framed in positive ways to defuse resistance. PT practitioners consider the organization's culture, organizational structure, and external conditions. Key groups from all levels need to be involved. Successful change teams need to carefully select the right intervention strategies. Workers need to prepare for the change. ^[3]

Role

The role of the change manager has evolved from controlling to facilitating the change process. In the past, changes were decreed by executives. Today, change efforts require worker involvement to maximize each person's contribution. Change managers were once responsible for planning, commanding , and coordinating the effort. Today, change managers (e.g., PT practitioners) consult , communicate, collaborate, and mediate to minimize resistance or fear. ^[4] They need to be effective negotiators and equitable resource allocators to maintain confidence. In addition they need to be effective communicators to alleviate foot -dragging.

Ownership

Fostering ownership among employees is necessary for change to be sustained. ^[5] Employees need to identify the new processes and procedures as their own, rather than regarding them as imposed. Too many managers naively believe resistance will evaporate in the natural process of change. PT practitioners need to ensure employee support by:

• Delegating teams and empowering employees to make change happen.

• Building incentives for using the new policies, practices, and processes.

• Unleashing the power in the group and utilizing worker's talents and skills in every phase of the implementation.

• Fostering involvement of everyone to promote a feeling of ownership.

To achieve support, effective PT practitioners often use indirect methods to get people to recognize and articulate the need for change. By dropping hints, stimulating ideas, and encouraging reflection, change managers foster ownership by allowing people to solve problems for themselves . At first, it may be necessary to use direct suggestions. However, this direct approach should not continue because without ownership resentment will build. ^[6]

Empathy is the first key to successful change because it enables the PT practitioner to realistically anticipate probable employee reaction. ^[7] Empathy is not an innate personality characteristic. It is a skill developed by listening, questioning, and welcoming comments and feedback. Empathy enables change managers to appreciate the other person's point of view and to predict whether people will accept, resist, or reject a change idea.

Resistance

When people feel threatened or do not believe change is in their best interest, they will resist, which can undermine success. ^[8] Employees worry that their feelings are not being taken into consideration. Longer- term employees often believe that the good aspects of the previous processes are not adequately preserved. When feeling threatened, employees can dwell on seemingly trivial details instead of visualizing the bigger picture. It is important for PT practitioners to acknowledge the employee's concern and to explain the reasons behind the changes. In some cases, it may be necessary to agree to disagree in order to move ahead. The key is to acknowledge and respect each individual's reactions .

Employee's concerns tend to occur according to the following stages: information, personal, implementation, impact, collaboration, and refinement. ^[9] In the beginning, people want to be informed about the positive and negative details of the change effort. They are worried about the impact change has on each individual, including the benefits, losses, and new skills needed. It is important to talk about the details of the implementation process, including timeframes and what happens if the change doesn't work out. Impact concerns revolve around results relative to employees and the organization. Collaboration questions focus on how people will cooperate and work together. Finally, employees will often have ideas for making the original changes better and will want to work toward continuous improvement. As employees work through the change process stages, they will come to appreciate the value of the changes.

Continuous Performance Improvement

Because markets and customer expectations change, it is necessary for organizations to continuously improve. The basic steps are:

• Determine customer requirements.

• Analyze processes to determine gaps between current performance and customer expectations.

• Gather starting-point data and set targets to eliminate gaps.

• Implement process improvements on a trial run to assess impact.

• Standardize good processes to sustain the improvement process.

• Measure and monitor ongoing improvements.

System Components

For successful continuous improvement, the following components should be present. ^[10]

• Leadership commitment by all levels of management

• Planning that links customer requirements with business priorities

• Policies and practices that emphasize customer focus

• Process management that involves the entire supplier-producer-customer relationship

• Education and training in measurement, problem solving, team-building , and continuous improvement

• Involvement of all individuals in the entire organization

• Measurement through continuous feedback from customers

• Benchmarking by comparing key processes with similar processes

• Performance accountability by establishing specific performance indicators linked with customer expectations

• Rewards and recognition systems to communicate success and motivate people

Problemsolving

As global profitability requirements change, processes that work perfectly well today are not necessarily adequate for tomorrow. There is a need to detect performance gaps and to discover new solutions for closing them. PT practitioners need to have methods for documenting and explaining causes through use of brainstorming, histograms, trend charts , cause-and-effect diagrams, or force-field analysis. Problem-solving activities need to lead employees and managers to address problems holistically. ^[11]

Quality Methods

Quality methods have a long history of effectiveness. Quality methods can start a chain reaction, leading to increased productivity, lower costs, and increased market share. ^[12] These methods begin by:

• Correctly identifying the customer.

• Understanding the customer's needs and expectations.

• Providing measurement against customer needs.

• Developing controls to create products and services that customers value. ^[13]

There are two types of customers: internal and external. Internal customers are the employees in departments affected by the work. The departments are known as "downstream" or "upstream" depending on whether they come before or after the problem. Determining the expectations of upstream and downstream departments is part of determining internal customer needs. In contrast, external customers are the purchasing consumers of the goods or services.

Quality Tools

Problem solving uses quality tools to collect, analyze, and interpret data to acquire sufficient understanding of the problem to accurately select and implement an appropriate intervention. For example, brainstorming encourages team members to share ideas without the ideas being judged by the group. Ideas are then prioritized by discussing their merits and voting for the best suggestions.

The first step in data analysis is to determine what data should be collected and documented. Data is frequently charted using the method that best illustrates the problem. ^[14] Common data charting techniques include:

• Histograms that indicate quantities on a grid using dots with lines to connect the dots, thus illustrating trends.

• Cause-and-effect diagrams are known as "fishbone" diagrams because of their data-reporting shape. Typically, information is organized according to materials, methods, equipment, and measurement.

• Force-field analysis that creates a T-shaped chart to capture the factors that encourage (positively influence) and those that impede (negatively influence) the situation.

Project Management

All too frequently, interventions are carried out ineffectively because project management methods were not used.

Definition

Project management combines common sense with practical, universal tools to accomplish targets in a systematic manner. ^[15] The intent of project management is to accomplish the goal on time and within budget. ^[16] Project management uses a systematic approach.

Deliverables

As project managers, PT practitioners begin by describing deliverables, which are the tangible outcomes (e.g., gap analysis or cause analysis summaries, intervention steps, improved products or services, or evaluation reports ).

Gantt Chart

The next step is for the project team to identify the tasks and subtasks needed to produce each tangible deliverable . The duration of tasks or subtasks is estimated. A Gantt chart (see Figure 6-2) is created to represent the tasks and deliverables. Completed deliverables (products) are indicated as milestones using a triangle or similar mark.

Figure 6-2: EXAMPLE OF PROJECT MANAGEMENT GANTT CHART

Schedule

At this point, the problem-solving team and management jointly determine the acceptable finish date. The schedule is created based on deliverable milestones, task and sub-task durations, and finish dates.

Constraints

It is critical for project teams to realize that no project is without glitches; the team should attempt to anticipate setbacks. Suspected problems are known as constraints. ^[17] Good project managers realize that projects do not go perfectly smoothly and build in slack time to compensate for anticipated constraints.

Project Meetings

Project team meetings should occur with sufficient frequency to ensure that all problem-solving team members are informed and able to contribute any needed information. ^[18] When projects are completed, close-out meetings focus on lessons learned (positive and negative project results) and ways to improve processes for the next project.

Benchmarking

Once the decision has been made to conduct a problem-solving effort, it is important to understand the competitive environment and to understand how to serve customers more effectively.

Definition

Benchmarking enables problem-solving teams to use a "systematic process for evaluating the products, services, and work processes of organizations that are recognized as representing best practices." ^[19]

Benefits

Benchmarking helps organizations set realistic goals designed to meet customer requirements, improve productivity, and become more competitive by adopting industry best practices. According to Cheney, benchmarking requires:

• Wholehearted management commitment

• Resources, including time and money

• Planning to identify the best-in-class for comparison

• Solid understanding of your own company's operations

• Analysis to determine performance gaps

• Openness to change and new ideas

• Willingness to share information with partners

• Integration to set new goals and standards

• Dedication to continuous benchmarking efforts ^[20]

Benchmarking Process

Cheney identifies 10 benchmarking steps.

1. Determine what to benchmark in order to focus on nettlesome practices that affect customer values, company performance, and competitive status.

2. Identify the best-practice organizations to benchmark by searching public records, databases, and publications . Communicate and network with industry gurus, talk with customers and suppliers.

3. Collect data to analyze, such as cost, quality, and timeliness. Decide what kinds of information will provide insight.

4. Determine current performance gaps by comparing common factors between organizations.

5. Anticipate future performance levels of your benchmarking partner for three to five years . Determine if it is possible to use these benchmarked performance levels as targets.

6. Communicate benchmarking findings to win support for the desired change.

7. Establish functional goals.

8. Develop action plans with input from line management and workers.

9. Implement actions and monitor progress.

10. Recalibrate benchmarks based on changing market forces and competitive business practices. ^[21]

Caution

Benchmarking usually involves site visits to best-practice organizations. There is a particular protocol that is usually adhered to by benchmarking partners. ^[22] American Productivity and Quality Center (APQC) (at www.apqc.org or 1-800-776-9676) can assist with protocol and site visit expectations. The key is reciprocity, confidentiality, and respect. Each benchmarking partner plans to share its findings and to provide comparable information equally. It is important that findings remain within the partnership and not be shared outside the partnership without permission.

Although most people realize that change is a necessary and normal part of life on an intellectual level, employees are accustomed to certain ways of doing things. When planning and implementing change, it is best to base any efforts on the understanding that "People are the most important part of any organization. People work best in an atmosphere of trust, sharing, and mutual contribution. Investing in them is well-rewarded." ^[23]

Case Study: Epilepsy Foundation of Michigan

Situation

Prior to the 1940s, little research or medical treatment was available for people with epilepsy in Michigan. The Epilepsy Foundation of Michigan was founded in 1948. Its primary purpose was to promote diagnosis and medical treatment for people with epilepsy. These early centers were academically oriented and staffed by medical experts in neurological and psychosocial issues. In the late 1970s, the federal government began to finance studies and medical care through nonprofit , specialized programs. The Epilepsy Foundation of Michigan did not win one of these contracts.

By the 1990s, medical treatment became available through the mainstream health care delivery system because of advances in technology and research. Major hospitals and clinics offered excellent medical treatment for epilepsy and were beginning to create comprehensive epilepsy programs.

The Epilepsy Foundation of Michigan realized that it could not duplicate what was now available in large health care clinics. For example, it was not possible to purchase adequate new equipment, which was readily available in major hospitals, or to attract the specialized physicians necessary to provide advanced services. In addition, the foundation faced cuts in state funding as the philosophy regarding delivery of public services changed. It also faced cuts from other traditional funding sources.

However, there was also a need for psychosocial assistance for people with epilepsy and their families. Community and school-oriented education and advocacy were emerging needs. Clearly, client needs and funding priorities had changed, creating a performance gap between the old (1940s “1980s) nonprofit research and medical service delivery model and the emerging education/ advocacy /psychosocial needs.

Intervention

The multiyear change process began by redefining the vision for services to people with epilepsy. Arlene Gorelick, president of The Epilepsy Foundation of Michigan, worked closely with the foundation board of directors to define a new service delivery model. The next step was to talk with mainstream medical facilities about creating a partnership to provide the medical care. This medical service migration was a lengthy process of negotiating with several health care providers to determine best fit and then creating a patient education program to facilitate the transition. Arlene communicated honestly with the foundation staff and kept them apprised of the plans and the negotiations. As expected, there was resistance to change. However, with consistent support from the foundation board and empathetic discussions between Henry Ford Health System (HFHS) and the foundation's medical staff, the migration of services was completed.

Arlene also had to manage the change of the foundation's service delivery process after the medical/academic services were replaced . Again with consistent support and direction from the foundation board, she discussed changes with primary funding sources to ensure that they would support the changes.

Currently, The Epilepsy Foundation of Michigan offers:

• Information and referral relative to first aid, treatments , school issues, pregnancy , health insurance, employment discrimination, transportation and driving issues, and financial assistance programs

• Seizure management

• Individual and family counseling and support

• Public policy and case or individual advocacy when a person's civil rights have been violated

• Employment support

• Public and professional education

• Disease management program (in planning), which is targeted for sale to managed care companies

Results

Service delivery for people with epilepsy improved by transferring medical care to a mainstream medical facility. The Epilepsy Foundation of Michigan could no longer afford to purchase modern equipment to provide up-to-date diagnosis and treatment. But Henry Ford Health System owned the necessary equipment and also accepts most personal health insurance plans, facilitating the payment for medical care. In addition, there are HFHS staff doctors with expertise in treating epilepsy.

The foundation now provides psychosocial and community services rather than research and medical services. Modern seizure management procedures enable many people with epilepsy to lead almost normal lives. However, myths and misunderstanding about the disease remain. The foundation helps alleviate the misconceptions and assist persons with epilepsy as they deal with the stresses and challenges of managing daily life.

Lessons Learned

1. Honest communication and clear vision build trust and a sense of fairness.

   Although change management is complex, honest communication and clear vision help the process move forward with fairness. In the early 1990s, foundation employees were nervous and depressed because they recognized the problems with the old medical/academic model. However, they were unable to determine a new direction and make the transition. Arlene, as change manager, benefited from the confidence and support of the foundation board.

2. Unwavering resolve and early successes engender pride and confidence.

   Although people worried and rumors existed, the organizational climate improved as change progressed and new services were developed. Commitment to the new opportunities was essential. Early successes produced pride and confidence. Steady, unwavering movement toward new goals required determination and the ability to inspire a willingness to persevere and iron out any problems with the new approaches.

Epilepsy Foundation of Michigan case study based on interview with Arlene Gorelick, Foundation President, on December 9, 1998. Case study written by Darlene Van Tiem, Ph.D. Used with permission.

 

Job Aid 6-1: CHANGE MANAGEMENT PLANNER

Directions: Answer the following questions.

What changes in products or services are needed to meet customer expectations?

What performance gaps exist in meeting those expectations?

How will customer satisfaction be determined?

How will employees know when customer expectations are met?

ISPI 2000 Permission granted for unlimited duplication for noncommercial use.

 

Job Aid 6-2: CHANGE MANAGEMENT EVALUATOR

Directions: Answer the following questions.

Has the change expectation been thoroughly defined?

How will this change disrupt the current organization?

Does the organization have a history of implementation problems? If so, describe.

Are the sponsors sufficiently committed to the project? If not, would education or replacing sponsors help?

Does synergy exist between sponsors, employees, and change targets? If not, what can be done to improve relationships?

What resistance is anticipated?

Is planned change consistent with organizational culture?

Are employees sufficiently ready for change effort? Would training help?

Are the right people, right communication plan, and right measurements in place?

ISPI 2000 Permission granted for unlimited duplication for noncommercial use.

 

^[3] Dormant, 1997, p. 432

^[4] Felkins, Chakiris, and Chakiris, 1993, p. 26

^[5] Dalziel and Schoonover, 1988, pp. 108 “127

^[6] Grossman, 1974, pp. 123 “127

^[7] Kirkpatrick, 1985

^[8] Jellison, 1993

^[9] Blanchard, Zigarmi, and Zigarmi, 1994, pp. 1 “31

^[10] Chang, 1992, p. 6

^[11] Weisbord, 1987

^[12] Deming, 1982

^[13] Juran, 1992

^{[14] .} Ishikawa, 1968

^[15] Greer, 1996

^[16] Frame, 1987, p. 5

^[17] Knutson and Bitz, 1991, p. 16

^[18] Thomsett, 1990

^[19] Spendolini, 1992, p. 9

^[20] Cheney, 1998, p. 2

^[21] Cheney, 1996, pp. 3 “4

^[22] Spendolini, 1991, pp. 151 “172; Cheney, 1996, p. 12

^[23] Kaufman, Thiagarajan, and MacGillis, 1997, p. 14