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© WZL/Fraunhofer IPT
Culture Based Change Management
DGQ Jahrestagung – 56th EQG Congress – FQS Forschungstagung
15th June, 2012
Dipl.-Ing. Thomas Zentis
Prof. Dr.-Ing. Robert Schmitt
Fraunhofer Institute for Production Technology IPT
Page 1© WZL/Fraunhofer IPT
21%
79%
The numerical impact of change management and strategic company focus
Surveys show that the importance of change management increased during the last years
79% of medium-sized companies’ CEOs would give the topic “Strategy” a high ranking
45% of interviewed persons from the top, middle and lower management think that long-term planning has an important influence regarding to business success
25% are even convinced that this is the reason for the great success of the company
Source: Personalwirtschaft 6/2004
2003
200840%
49%
11%
60%
3%
37%
0%10%20%30%40%50%60%70%
Very important Important Less important
High
Rather high
25,3%
45,0%
21,8%
6,4%1,5%
0%
10%
20%
30%
40%
50%
Very large Large Middle Small Very small
Source: Deloitte. Begleitstudie zum Axia-Award
Source: TU Clausthal
Leading a company successfully means to adapt to permanent changing parameters,
not to hold the status quo
Page 2© WZL/Fraunhofer IPT
Preconditions for change projects
Change does not equal Change
It is not a one-off process, but a continuous one
Change is dynamic. There is no clean line between conception and implementation
According to the prevailing corporate culture, change is influenced by supporting and inhibitive factors
What is the resulting challenge to gain sustainable change?
There is a variety of methods to support change projects
This collection is like a black box from which the optimal supportive method can only be chosen after considering the surrounding conditions and corporate culture
Page 3© WZL/Fraunhofer IPT
The process of Culture Based Change
Identify the change
QG 1
Preparation
QG 2
Decision Design
QG 3
Implementation
QG 4
Reinforcement
Support change process methodically
Change Project type 2
Change Project type 1
Cultural Characteristic 3
Cultural Characteristic 2
Cultural Characteristic 1
Analyze the corporate culture
Page 4© WZL/Fraunhofer IPT
The type of change describes the goal of change and the way to it
Every kind of change includes features and goals classified in standardized types of change:
– Headcount reduction– Program of cost reduction– An increase of productivity– Outsourcing– Reorganization and restructuring– Implementation of new IT
Depending on the kind of targeted change, there are different aspects of corporate culture importance and there are different methods of change management to be used
Page 5© WZL/Fraunhofer IPT
What is corporate culture anyway?
Stories Architecture
financial orientation
dress style
managers personality pressure to performworking times open doors kitchenette & smokers’ corner
readiness to assume riskattention to detail result-oriented atmosphere
employee turnover company’s foundercolleagueship inventive talent
creative freedomHierarchy Personnel development
rituals mythsnetherworld company history gossip
Feedbackappraisal of criticism idea of man
time oriented Controlling communicationexemplified values Power
team trip leadership
Page 6© WZL/Fraunhofer IPT
A conducted survey shows a strong connection between Change Project Type and Cultural Characteristics
Projects for increase of productivity benefit from a high identification of the employees with their enterprise. This gives those employees an understanding of their personal additional benefit of the change intended
For outsourcing, the consistency of a leader’s point of view is an essential element for a project’s success. Employees will understand their decisions as elaborate and necessary
A frequent change of leaders has a strongly negative influence on change projects for reorganization and restructuring. Change needs time and continuity to become successful
An intensive and personal contact between leaders and employees facilitates the challenging processes of reorganization such as reduction in staff. An elaborated communication concept helps to keep employees informed
If new IT will be implemented, this should be argued by the advantage for the enterprise and the optimization of products. Commitment fades when projects become ends in themselves
Source: www.cuba-change.com
Page 7© WZL/Fraunhofer IPT
Three main success factors for sustainable change can be deduced
Change projects must not coincide with the frequent changing of leaders’ positions or executives’ opinions
A stable working environment needs to be developed by promoting aspects of interpersonal workplace relationships
Employees need to believe in the strategy and goals of their executives to identify with their company
Page 8© WZL/Fraunhofer IPT
Core results of the survey
The influence of corporate culture on different project types has been clearly indicated
Role and behavior of leaders are vital important (significant) for all change types
At the same time consequent implementation of change methods is a good indicator for positive project success
Leaders have already perceived, that employees need to be supported during change projects. Methods for motivating employees are mainly applied during the phase of implementation
Little importance is tributed to preparing and designing change projects. Anyhow, adequate preparation and communication is crucial for the employees’ commitment to change
Page 9© WZL/Fraunhofer IPT
The process of Culture Based Change
Identify the change
QG 1
Preparation
QG 2
Decision Design
QG 3
Implementation
QG 4
Reinforcement
Support change process methodically
Change Project type 2
Change Project type 1
Cultural Characteristic 3
Cultural Characteristic 2
Cultural Characteristic 1
Analyze the corporate culture
Page 10© WZL/Fraunhofer IPT
Integration of classical and innovative Quality and Project management Instruments
Preparation Design Implementation
Reinforcement
Decision
Cultural manifestation
Secure and communicate first successes
Communicatevision
Form leadershipcoalition
Create feeling for urgency
Plan first successes
QG 2
Motivate, enable, brief and authorise people
Identify constraintsfor implementation
Adjust implementation plan to changed boundary conditions
Control and monitorresults
QG 1
Experienced know-howObserve environment
Prioritize alternatives
Develop a strategy
Analyse environment
QG 3 QG 4
QG 5
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Finding the system‘s bottleneck
The central issue [CI] is the shortage of the system
The CI often arises from V-connections between independent branches
The elimination of the CIs leads to a maximum improvement of the system
Defining and managing the Strategy
Positive aims are defined
Specific information about desired target state is given
Break-down to concrete aims for employees
Decision:Core Problems are detected and a Strategy derived
W
W
WW
Control zone
Sphere of influence
V-connection
CI
SE SE
SESE
Strategic aim
Operative aim
Vision
XXX X XX
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Preparation: An overview of communication methods provides inspiration for the application within a company
An overview of communication methods provides inspiration for the application within a company The selection of appropriate communication tools and channels helps the change agent to reach the employees
and to be reachable for their concerns Approx. 80 communication-efforts with detailed descriptions (target group, frequency, chances/dangers etc.)
Communications-toolbox
SponsorChange Agent
Concerned
Different roles regarding different people:
„To my sponsors I am a change-agent, but to my
employees I am a sponsor“
: persons concerned: communication channel: direct sponsor: indirect sponsor
: member of process team
Sponsor cascade Communication cascade
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Conclusion
Leaders need to form the change strategy, but strategy still can be defined by the prevailing corporate culture
For the success of a change project it might be necessary to break down the existing hierarchical structure as well as grant capacity and room for team work and inter-divisional projects
Once a change process is initiated, leaders need to be aware that they should stick to the process at all times and thereby form the foundation for stability
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Thank you for your attention!
Dipl.-Ing. Thomas ZentisGroup Manager
Telephone: +49 (0)241/ 89 04 -704E-Mail: [email protected]
Fraunhofer IPTSteinbachstrasse 17
52074 AachenGermany