Change Management Case...Author of the case: Carlos Eduardo Bagatin – HCMMP-1-1071 The organization's governing body in Brazil had just taken responsibility for the 2013-2017 four-year

Human Change Management Insitute Author of the case: Carlos Eduardo Bagatin – HCMMP-1-1071

Change Management Case

How to manage change by implementing a project

management methodology in a culturally rigid and

conservative organization

By Carlos Eduardo Bagatin HCMMP-1-1071

Certification Committee

Vicente Gonçalves – CEO HUCMI

Tatiana Dale – Visagio – HUCMI Australia - Visagio

Edgar Alvarez – HUCMI Equator – Actitud y Talento

Certificated in February 02, 2015


Author: Carlos Eduardo Bagatin – HCMMP-1-1071

Type of Case: Success

Type of Project: Process Change

Project Start Date: January 11, 2013

Project Completion Date: December 11, 2013

Total number of hours spent on Change Management: over

5000 hours

Number of people in the Change Management team: 12

Number of people involved in the project on a full-time

basis: 03

Project investment: approximately $ 100,000

Abstract: The company focused in this case is a Japanese multinational that manufactures industrial equipment. Headquartered

in São Paulo, Brazil, the company is present in over 15 countries, has approximately 200 employees and average annual revenues around

US$ 120,000,000.00. We will analyze the organizational aspects, resistance, difficulties, impacts of the development and

implementation of project management tools on the human aspect in

the engineering department of the organization, and how these obstacles were overcome through the use of effective and efficient

Change Management.

I - Project Description

i. Project Objectives

In 2013, the company's Brazilian affiliate decides to implement project management concepts and tools in the engineering

department.

It was a pilot project because no project management methodology had ever been used in the headquarters in Japan or

in the other fifteen branches of the company.


The organization's governing body in Brazil had just taken responsibility for the 2013-2017 four-year period and was looking

for solutions to reduce project implementation expenses and promote better equipment and service delivery in order to increase

project profitability.

The cultural challenges and resistance that had to be faced were huge because the company was a family company and because of

the rigid, methodical and conservative Japanese culture.

The company has enough technological knowledge but faces many

difficulties in the administration of day-to-day processes, conflict resolution, etc. Its governing body was created using a totally

vertically integrated functional organizational structure.

The setting was very negative. Profitability of all the projects implemented in 2012 was unacceptable and customers complained

about delays in project delivery and poor quality equipment and services.

ii. Key Challenges

To give legitimacy to the chosen solution and thus avoid later

questioning, a consultancy in project management methodology was

hired.

The implementation of the projects using methodologies based on the PMI and PRINCE2 concepts, and adaptation of other frameworks such

as COBIT5 (Governance), ITIL, and Scrum (Agile), impacted not only on the results of the projects but mainly on all the people involved -

not only those belonging to the engineering department and projects, but also those in all other departments of the organization:

warehouse, finance, technical assistance, etc.

The sponsor of the project chosen to be implemented was the company's Chief Financial Officer, directly supported by the President,

who was responsible for presenting the decision-making process and rationale to the other stakeholders.

It would be necessary to set up a group of people who would be responsible for replicating and communicating the new methodology.

At least the following departments should be represented in the group: Engineering, Technical Services, Warehouse, Executive


Board, Finance, Purchasing, Commercial, Quality Control and Human

Resources. A project manager was appointed to manage the steering committee,

facilitating conflict, boycott and resistance management.

Major Difficulties:

As a Japanese-originated company, its top management did not welcome changes of any type.

The involvement and commitment of various sectors of the company were required. Quality, costs, stakeholders' support, risk

assessment, project length and ability to meet the deadline, etc., would depend on the support from other departments through

input of information and help in the continuous improvement process.

With the company's functional, vertical organizational structure, the many veteran department managers with no technical

background could not understand how this change could improve the company's results, as they had been in the company for over

fifteen years and the way things had always been done was the best way to do them. In addition, many did not want to take on

new challenges because they were in a comfortable situation or close to retirement.

iii. Project development (change management approach to overcome challenges and difficulties)

The purpose of the project was based on three pillars of the

company's vision and strategic objectives:


O strengthen these purposes, the identity of the project was built

using the following slogan: "Understanding to Better Serve".

Two paths were followed to spread the project management culture: workshops on the subject for all employees and awards for innovative

ideas to optimize processes and reduce costs.

There follows the Change Management phases:

Recurring activities in all project phases:

Initiation Phase: In the initiation and implementation phase, the

mapping and classification of the stakeholders were as follows.

Please see below the mapping and classification of the stakeholders:


Please see below the indicators the communication plan:

Please see below the indicators maturity level to deal with loss:


Still in this phase, the RACI matrix is performed as follows:

Please see below the indicators the following change milestones were

established:


Please see below the SMART objectives:

Acquisition Phase: In the Acquisition phase, the team's additional technical training needs were defined and the risks of cultural shocks

between suppliers and the team were analyzed. In addition, the roles and responsibilities of the RACI Matrix were validated with the

suppliers.

Please see below the risk map:

Execution Phase: In this phase there took place the Kick-Off event, which was attended by the major stakeholders. An action plan to

address the organizational impacts was also prepared.

A WBSOI (Work Breakdown Structure of Organizational Impacts)


was developed, with the main themes:

Please see bellow the WBSOI:


Please see below the mapping some impacts and action plane to


mitigate impacts:

In this meeting it was also decided to replace the existing functional,

top-to-bottom organizational structure with a balanced matrix organizational structure, where the change manager, the project

manager and the other sector managers would share the same level of decision-making power and be horizontally aligned.

Implementation Phase: In this phase, in the GO/NO GO meeting,

based on a payback analysis and on a risk management plan that contained a contingency plan, tolerances and the formal

communication to the other stakeholders, it was decided that the project would continue.

Still in this phase, group dynamics involving people from different sectors were created. At this point, a graph (a kind of "S" curve) was

drawn to show the number of hours that would be spent in each phase of the change management project (hours x months):


At this stage, we try to put together a SWOT analysis type, with the

objective of analyze GO / NO GO and formal authorization from the beginning of the execution of the project.

Please see below the SWOT matrix:

From the various group dynamics, the following were chosen:

crossword involving project management topics, brainstorming sessions, workshops, importance of teamwork.


Crossword - example


Please see below the table showing the maturity level to deal with

loss:

Closing Phase: In this phase, during the "closing" meeting, each

participant was asked to say a phrase that describe their participation in the project. There was held a big event that included distribution

of prizes, delivery of certificates and recognition of outstanding performances and results. A team relocation plan and a plan to

support possible post-project implementation changes were also developed.

Please see below the table showing the gradual dissolution of the

project team:


Production Phase: Once implemented, the change had to be

supported until it was consolidated and integrated into the company's organizational culture - otherwise all efforts would be lost.

Still in this phase, we created change consolidation indicators which were regularly monitored and controlled.

To choose the types of indicators we used the 5W2H technique.

The following indicators were used:

Results Achieved: The type of organization where the change project was implemented would cause anyone to give up even before

starting.

A Japanese multinational organization, culturally rigid and extremely conservative, with a strong functional structure would not accept

changes of any type.

Many of the people involved in the change had been with the company for long years and were in the so-called comfort zone.

With the engagement of change team and support from the

company's directors, these people began to support and collaborate

with the project.

After the project management methodology was implemented, costs decreased, profitability and sales increased and customers were

happier.


Please see below the indicators:

There was time left - something that did not happen before - to

develop new products and provide technical and organizational training to the employees.

The results and impacts from the change had been successfully

controlled, despite occasional stress peaks and stakeholders contrary to the change.

To crown the project, the change team was invited to implement

change in other Latin American affiliates. In addition to the business objectives, the legacy of the project

influenced the organization so deeply that today the company has

both a change and a project management office.

It was possible to confirm that change implementation through project management can be used for various types of organizational

changes and that the sequential nature of the phases of change


management is perfectly aligned with the project management

theories.

Lessons learned:

Documents

Change Management Case...Author of the case: Carlos Eduardo Bagatin – HCMMP-1-1071 The organization's governing body in Brazil had just taken responsibility for the 2013-2017 four-year