Transformation of Organization the Strategy of Change Management

8/12/2019 Transformation of Organization the Strategy of Change Management

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A borderless,invisible, cyber-connected, Kenichi Ohmae, 2005. The Next Global Stage

A Global World

The surplus

societyhas a surplus of similarcompanies, employing similarpeople, with similareducational backgrounds, working in similarjobs, coming up with similarideas,

producing similarthings, with similarprices and similarquality.

Kjell Nordstrom and Jonas Ridderstrale,Funky Business


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The Magnitude and

Frequency ofBusiness Changes

Scientific

Management

(1895)

The Global

Economy

(1985)

Productivitiy

and Efficiency

(1970)

The IT

Revolution

(1990)

The

Security

Issues

(2000) and

oil & gas

price

A Global World

The price of global communication


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National Diamond: Context

Slow investment process (WB Survey 2005)


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The thoughts of Michael Porter

Why nations have differences in prosperity? What drives

nation to become more competitive and prosperous?

Government policy? : Italy, Germany has low govtintervention...in South Korea and Japan, Govt intervention in

some of the industry (machines, robotics, advance materials) is

modest

Cheap-abundant labor? : Germany, Switzerland, Sweden, hashigh wages and labor shortages...besides, the high wagesshould be the target of competitiveness

Bountiful natural resources? : Germany, Japan, Singapore,South Korea...has limited natural resources

Mcroeconomic factors?, such as exchange rates, interest

rates, govt deficits, but Japan, Italy, and South Korea hasbudget deficit...Germany and Switzerland has appreciatingcurrcies, Italy and South Korea have high interest rates

Differences in management practices? includingmanagement-labor raltions..but different industries require

different approach to management.

Source of Prosperity

Source: Michael Porter (2003)


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The Diamond Model

Goverment Chance

IFC

(associations)

Source: Michael Porter (2003)

SuccessfulTransformation:Leading Change!


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Change

Elements

Objectives/

Visions

Timing

Strategy/

Systems/

Process

People

AcceptanceLeadership

The Change Elements(Model developed by Handry Satriago, 2008)

When to change?

What to change?Where to change?

Who and How

to lead change?How to make people

accept the change?

Timing

When do you want to make change?

How long do you have time to change?

How long your change process will be?

How often do you want to make change?

Timing


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An Iceberg phenomena

Cost for change in the technical factors

Cost for changing systems and structure

Cost for overcome resistance from the people

Cost for communication and socialization

Cost for training

Cost for.all other

An Iceberg phenomena

Losing customers

Give the competitors access to our market

Losing the brand and product advantages

Losing the confidence from partners, suppliers, customers

Andcost for fix the problem and rebuild again


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Change

Elements

Objectives/

Visions

Timing

Strategy/

Systems/

Process

People



When to change?


Who and How


accept the change?

Vision

Where is your new strategy to be directed?

What are your change objectives?

Where do you want to bring your people through the

changes?

How to communicate your change strategy to your

team?

Vision


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Change

Elements

Objectives/

Visions

Timing

Strategy/

Systems/

Process

People



When to change?


Who and How


accept the change?

Strategy

Change approach: Evolution vs Revolution

Changing systems and structures

Change process is a continuous process

Dont afraid of making mistakes on

changesas long as you learn from it

Strategy


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The Change Process

STAGE 1

Not much talk about

Changes

Not much ChangeInitiative

UNCONSCIOUSLYINCOMPETENT

STAGE 2

Start talking about

Changes initiatives

Change program

begins Draft company

position

Outline a Change plan

Conduct A Change

Awareness

CONSCIOUSLYINCOMPETENT

STAGE 3

Talk about and do

Change

Managements

Change happens

Everyone involved in

Change

management Teams are trained,

results shown

Measured anddocumented

CONSCIOUSLYCOMPETENT

STAGE 4

Self starters

Only little talk about

change; they just do it

Culture totally adopts

basic change concepts

Managing change is

blended with other

management processes

System redesigned to

support continuous

change process Learning continually

UNCONSCIOUSLYCOMPETENT

Sometimes, a revolution

need to be done to change

the no-longer-fit cultureSpeed-Simplicity-Self Confidence

No.1 or No.2 in The Business

Small Company Big Company Simultaneously

Quick Market Intelligence

WorkOut!

Six Sigma

A Creative Destruction


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Think ofUnthinkable..Hard times give you the courage to

think the unthinkable (Andy Groove)

Linking Change with HR Systems

Spiral career movement continuously moving people with depth

competency

Performance based reward and 360o evaluation systems

The approach is top downAll leaders must be intoxicated first and

toxicate their team

Change initiative has to come with measurement

Create a rhythm to monitor and evaluate the change result

Pushbut fair


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Change

Elements

Objectives/

Visions

Timing

Strategy/

Systems/

Process

People



When to change?


Who and How


accept the change?

Leadership

Leaders is the change agent

Walk the talk

Who will lead the change

How to lead the change

Leadership


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The Story of Ralph Stayer

1980: Ralph Stayer is the CEO of

Johnsonville a family business that

produce sausage.

Competition and the current performance

The flock of a geese versus buffallo

Fix self, fix team, fix the business

Success is the greatest enemy!

Change and Learning must never stop..

High Say/High DoOpen, honest and direct communication

Never

Always

SAY

DO Never

High Say

Low Do

Low SayHigh Do

Low SayLow Do

High Say

High Do

High Say

High Do

Best PracticeCreates high trust;builds satisfaction& commitment

Bad practice

Especially ifemployeesthink there isa lingeringproblem orfuture danger

Mixed signals

Low trust inleadership;communicationseen as all talkand no action

Mixed Signals

Creates low trust

environment;encouragesgrapevine; highspeculation andlow trust


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Direct Leaders RoleDirect leaders have the key role incommunicating change messages

Most of whatemployees

want to knowis how the

change affecttheir jobs

Companymessages

10%Business-

specificmessages

20%

How are thechanges w illaffect my job

70%

The 4Es Foundation

Strong track

record of

delivering results

with the values.

Competitive spirit ...

instinctive drive for

speed/impact...

strong convictions

and courageous

advocacy.

Enormous

personal energy -

strong bias for

action.

Ability to

motivate and

energize others

... Infectious

enthusiasm to

maximize

organization

potential.

Execute

Edge

Energy

Energize


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Change

Elements

Objectives/

Visions

Timing

Strategy/

Systems/

Process

People



When to change?


Who and How


accept the change?

People

The most important key is people

acceptance on the changes

Consistent and informative

Reward and punishment

People


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Change InitiativeFocused on

Customer Needs(Target)

QUALITY(TechnicalStrategy)

ACCEP

TANCE

(Cultur

alStrat

egy)

The Change Concept

Many times the focusjust on Technical

Q x A = E

4 x 3 = 12

5 x 3 = 15

4 x 4 = 163 x 5 = 15

Even withlower

technical/investment,

change couldbe effective

Change is About The People!


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Integrity

Behavior Tied to Set of

Values

Professional

Standards

Legal

Requirements

Great leaders dont lie Liars are not easily forgiven

Never fear these words: I dont know

Ethics begin at the top

Build a strong organizational culture

Once you lie, your follower will never trust

you

Leader knows when to say No

Documents

Transformation of Organization the Strategy of Change Management