A New Paradigm for Change Management

Article A NEW PARADIGM FOR CHANGE MANAGEMENT

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By Anders Baude, Imagine a whole new world where many of our assumptions [email protected] and Harry Wallenholm, about how we manage change are no longer true – where change [email protected], processes are much more condensed and much less unwieldy Implement Consulting Group than the ones we have gotten used to. We think that this is a real possibility and our claim is that resistance to change would be largely reduced in such a world.

Four assumptions from the Assumption one: old paradigm Change is a top-down process For many years, we have planned and Change management is often seen as managed change processes by relying a top-down process, where strategic on a number of outdated facts and change initiatives are developed by top assumptions. Some are explicit, while management and subsequently rolled out others are more implicit and may not downwards through the organisation. always be obvious to us, although they The assumption has two historic roots, determine the way that we set up change each of which results in two different processes. Here, we compile the ideas perspectives on managing change: of the old change paradigm into four assumptions. 1. From early history, we see examples of organisations that use a top-down approach to management, i.e. the

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church and the armed forces. Going on Once all the thinking has been completed to the beginning of the 1900s, scientific and packaged, the change activities begin management also developed methods and the broad mass of employees become based on hierarchical structures and involved in the process. top-down management. They devel- oped management models that sepa- Assumption two: rated the control functions from the Change is a linear process implementation functions, where the Another assumption about change is the manager’s role was to lead, manage “planning school”. Here, the belief is that and follow up. In the event of change, change can be planned and managed in a management had explicit responsibility linear process similar to a project with a for analysis, strategy and decision­ clear start and end point. The most impor- making on the basis of managers’ tant representative of this school is Kotter knowledge, power and influence in a and his 8-step model. The model is the hierarchical organisation. If there were archetype for a whole raft of subsequent important questions within the organ- change management models and has isation, the best answers were found helped to make change management an at the top. The role of middle managers issue that occupies all top managers. and employees were to implement top management’s decisions. Kotter’s 8-step model brings together the two historical roots of change manage­ ment into one process model that is business-driven, project-oriented and 2. In the 1930s, the organisational devel- sequential, but also takes the human side opment movement began conducting of change into account. scientific studies of groups, group processes, development and change. As the name indicates, the model Among its pioneers was well-known describes an 8-step linear process where thought leaders such as Kurt Lewin. most of the “thinking” is done by manage- Looking at a change process, they put ment during the introductory step and emphasis on the ability and power of where the following steps concern how the organisation’s employees and on the planned change programme should the different processes and methods be implemented and how resistance can for engaging and motivating people be overcome. to implement changes. But even this approach was based on the assump- Assumption three: tion that changes are initiated from the Change generates resistance top and will subsequently take place Generally, theory and models relating to at the lower levels of the organisation change management assume resistance and in the later stages of the change from the people who are the target group process. of the planned changes. A central theme be- comes how to overcome the resistance from the people who must change in accordance with what management has decided. Even in today’s change processes, most of the analysis, strategic thinking and plan- The assumption of resistance results in ning is carried out in closed rooms and avoiding resistance being a primary con- involves just a few people who dedicate cern in models, tools and communications themselves to describing (often in detail) on change management. And consequent- and preparing for the future changes. They ly, management training revolves around see their role as analysing reality in order overcoming resistance and persuading to formulate objectives, strategies and people in the target groups of the change change programmes on the basis of the initiative to do their work differently from analyses. how they previously did it and/or to change their attitudes.

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Assumption four: that influence the paradigm of change Change is an issue for HR management. The focus on resistance means that change has become a HR issue. Based on Driving force one: the knowledge and methods of behavioural The exponential pace of change sciences, current change management Almost all businesses are affected by a mainly focusses on the “human side of number of major global trends and drivers. change” – on persuading people to do They represent fundamental changes in something that someone else has decided business logic which are driven primarily on and that has a major impact on their by digitisation, automation and globali- behaviour. The HR responsibility normally sation. This in turn leads to new types concerns the ownership of models, change of behaviour from customers, users and management training for managers and citizens and also to the emergence of new support for managers during the change competitors which are often based on an process. entirely different type of business logic from that of the existing players. In 2016, we conducted a study involving 25 major Swedish and global companies, This changing business logic has a dra- where the majority said that HR was the matic impact on the old change paradigm home of change management in their in two ways in particular: organisation. Only a few of the compa- nies had placed responsibility for change • The sequential, project-oriented management in a different place in the approach is severely challenged by the organisation, and in these cases, it was speed of change. We simply cannot closer to the executive management team. organise our change activities in the traditional way. Instead, we need to Several respondents felt that it was a move much faster. problem having HR as the home of change management. They felt that it resulted in • It is no longer useful to have a clearly too great a distance between the people defined objective for change processes responsible for the strategic issues of the due to the complexity of change and business and those who owned change the high level of innovation. Although it management. may sound irrational, the change jour- ney must be started and taken forward Our study also showed that the use of the without specific objectives. It’s change methods and tools which had been devel- for change’s sake – in a positive sense. oped and agreed on an organisation-wide level often worked well in the case of minor We have reached the stage of what changes organised by middle managers, could be called “hyper-change”. This is perhaps in co-operation with smaller a situation where change is constantly project groups. However, these methods taking place, often at a high speed, and and tools were often less effective in the where renewal is increasingly the result case of major initiatives covering the of innovation. Also, the boundaries and entire organisation, such as digital trans- rules concerning how we run a certain formations or large-scale restructuring type of business are repeatedly called into that is managed centrally. question. Against this background, the old rules of change management no longer apply. They were formulated at a time Five driving forces that call the when change happened at a very different paradigm into question pace and when the future was still to Times have changed. The old paradigm on some extent predictable. change management was developed in different times where the pace of change Driving force two: and the focus of work life was different Everyone knows everything from today. We see five main driving forces In the old change paradigm, it was

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assumed that managers had a greater The wisdom of crowds can and must be knowledge and understanding of the busi- used if businesses are to remain compe­ ness than other people in the organisa- titive. The old change model is being tion. While this of course may be the case, called into question and we must be managers’ knowledge advantage has gen- prepared to include far more people much erally decreased significantly over time. earlier in the process. In addition, this enables us to eliminate resistance and This is because: encourage employees to commit to the forthcoming change. • The general level of education has risen dramatically as more and more people Driving force four: go to university. This has increased Unlimited digital communication employees’ ability to understand and Social media and digital platforms have make a contribution to complex issues. changed the way we communicate. Through both channels, we can access a • The knowledge we need is often only large number of people quickly and have a mouse click away on the web. In conversations with them. The platforms different contexts, consumers, users also allow us to bypass different levels in and citizens are increasing their own the hierarchy and reach out to people in power by acquiring knowledge from a way which was not possible in the past. a range of different digital platforms. Another key feature of digital communi- Patients who visit their doctors will cation is that it is seldom one-sided. It is have already researched their illness. based on a dialogue, often allowing for an In the same way, employees are gaining ongoing exchange of ideas. an understanding of the environments and driving forces that businesses are As an example, there are political move- exposed to. Thus, employees are some- ments which would not exist without times well-informed about the choices social media. They have used digital plat- that companies are facing. forms to circumvent the old structures and groups that previously managed The old model consisted of a few people information and determined how we who did the thinking and a large mass of talked to one another. employees who implemented the ideas of the few. In an era when more and more A glance at the heart of our organisations people have the knowledge needed to shows that we are only at the beginning of make a valuable contribution, this top- this process. When compared with how we down model is no longer the most effective use social media in our private lives, these solution. digital forms of communication are rela- tively undeveloped in most businesses. Driving force three: There is not even a well-designed model Aggregated knowledge that defines how companies should In the old paradigm, it was not effective make use of the opportunities that digital or even possible to involve many people communication has to offer. in the early stages of a change process. Nowadays, the situation is different. Digital The old paradigm, which was based on a working methods offer opportunities for significant physical, social and mental early participation and involvement in distance between management and change processes and are now quick and employees, is already disappearing. It will easy. This makes it possible to gather “the soon become obvious to everyone involved wisdom of crowds” bringing together con- in managing change that they must begin tributions from many individual people in to engage in conversations with all the order to resolve complex problems more relevant groups, regardless of where they effectively than a few experts are able to. are located and how many people they consist of.

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Driving force five: in a new way. We have identified some Equality important principles of the new method Equality has risen. And despite occasional of managing change. We base our new setbacks in the past, in many parts of the paradigm on the environmental trends world, there are now powerful movements and driving forces described above – as within society which aim for a society that well as current research and knowledge values people equally. This is becoming in change management. clearer to each new generation as it joins the labour market. Young people increas- 1. See the change process as ingly feel that they are living in a globalised recurrent waves world both digitally and geographically, In the old paradigm, we divided change with greater equal opportunities to travel, processes into separate phases with the study and work abroad. typical stages of analysis, decision and implementation. Instead, we should see This development is reinforced by the the phases of change as one coherent internet and, most importantly, social process where, to put it simply, we try to media. The digital platforms have a get as many people involved as early as “flatter” structure than traditional media, possible. which scales back hierarchies and makes it harder for elites to dominate the con- At the start of the process, managers versation. As everyone’s voice has a more identify a direction rather than specific equal chance of being heard, you can objectives. The direction must be under­ acquire power and influence by having pinned by a clear “why” – that is, the something interesting to say and by factors that make up the reason for the persuading other people to listen and planned change. to appreciate your opinions. The change process will then not be linear This phenomenon has considerable impli- in nature. Instead, it will be designed cations for a number of social constructs. to take place in “waves” which switch For example, we can see clearly that the between involving large numbers of people positions of power are shifting. These and narrowing down to allow a small include: management group to set priorities, check developments against the planned direc- • Consumers increasing their power tion and make the necessary decisions. in relation to suppliers We find an important success factor in having clear rules for the divergence and • Patients increasing their power in convergence of the process. relation to the healthcare system When you set up the change process, a • Employees increasing their power key consideration is to focus on co-crea- in relation to managers tion (including external resources if this is applicable). Keep in mind that “you don’t This powerful trend is influencing the old have time to rush” – in the short term, a models of change by reducing the oppor- process structured in this way can take a tunities for using traditional, top-down little longer, but in the long term, it will be power and by increasing the risk that this much quicker, as it ensures both partici- type of power will be met with mistrust pation and joint ownership and also and will not correspond with most people’s generates more ideas, improves the view of reality. quality of the analysis and supports decision-making. Transparency and clearly defined decision-making points are A new change paradigm important factors for ensuring that the The old paradigm has become obsolete, process is seen as fair and honest and, and there are therefore strong reasons for at the same time, is not long-winded or developing a new change paradigm that lacking in energy. organises, designs and manages change

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When designing processes of this kind, it • They are making clear and transparent is a good idea to borrow methods from decisions, but they design an iterative/ agile development which include itera- learning process and facilitate this tions, pilot projects, tests and prototypes process without taking over. They also as some of their main cornerstones. In create an environment that enables many cases, innovation and change activi­ other people to contribute. ties merge together, and it is often useful to regard them as a coherent process. 3. Combine traditional and digital methods and tools 2. Introduce a new type of change We must make deliberate and active use leadership of a combination of the methods and tools One starting point for the new change available to allow for the type of facilitated paradigm is that it is possible to signifi­ process that we have described above. cantly reduce resistance to change by These include traditional methods of introducing a new type of change leader- creating meaning and encouraging ship. This new form of leadership applies involvement, such as small or large the principles of designing and managing workshop-style meetings and, most processes that we described earlier as importantly, digital tools and methods. “waves” and are characterised by: To ensure the maximum level of involve- • Giving meaning – leaders who make ment, participation and commitment, a sometimes turbulent and chaotic we propose using the following three environment comprehensible and allow keywords: changes to be introduced. • EARLY – start involving everyone at • Early involvement – leaders who enable an early stage. Do not wait until all everyone to contribute to problem- the thinking and planning has been solving, analysis and implementation. completed.

• A fair process – leaders who drive the • MANY – involve as many target groups process with the maximum openness, as possible, preferably all of them. honesty and respect for everyone involved. • OFTEN – better to be simple and often, rather than seldom and complex. In this type of leadership, leaders some- times meet new demands during change Digital tools and methods are an essential processes. Leaders, who succeed in the means of achieving this. These can new change paradigm, have a number of include simple survey tools, social media clearly defined characteristics: platforms and co-operation tools or more advanced applications that have • They explain the strategic requirements been specially developed to manage and clearly indicate the direction of and support transformation and change the process, but they are able to hand processes. over control, ask the right questions and request help with the process from An important element of the early stages others. of the change process is identifying the direction and creating a shared overall • They have a reasonable level of practi- view of who should be involved. This can cal knowledge and good judgement, but be followed by collecting, aggregating they do not always have answers to all and prioritising knowledge and data in the questions, do not always know best the later stages. Hypothesis-driven and cannot always do more than every- development and other development one else. scenarios can also be useful tools in the early stages.

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The methods we use should also encour- In the new change paradigm, the focus is age everyone involved to learn during not on managing resistance to change. the course of the process by creating the Instead, we focus on linking together space needed for follow-ups, feedback and opening up the different areas of and reflection. the change as part of a transformation process. This makes it possible to move For the change process to function effi- change management out of HR and give it ciently, it also needs to be supported by a new “home” closer to the executive man- transparent communication about the agement team in organisational terms, change which is continuous, clear and because the ownership of change man- accurate. Some of the digital tools agement can be more easily integrated specially designed for managing change with strategy and innovation than with HR. which are mentioned above provide good communication functions, together with This means that training in change man- intranet pages, emails and various social agement for managers can be incorporated media such as Twitter and Facebook. into other management development activities and, if appropriate, can remain 4. Assign responsibility for change the responsibility of HR. We see the management outside HR natural home for change management In 2016, we carried out our study of closer to the executive management team, change management involving 25 major perhaps in the form of a strategy group or Swedish and global companies. The study something similar. shows that the majority of large compa- nies and organisations have a specific However, this is also about where the function which is responsible for develop­ practical responsibility for change man- ing their internal capacity for change – agement lies during the implementation currently the responsibility lies with the of the change processes and programmes. HR department in the majority of cases. The responsibility is often within the pro- This function takes responsibility for ject or programme organisation, without identifying a suitable framework for this having been considered more closely. change management and providing train- As a general rule, the practical change ing in using the framework for managers functions should be linked to the manage- and project leaders. The function often ment team of the organisation that is the provides tools and methods that can be recipient of the change process, rather used in conjunction with change and than the project organisation that is deliv- transformation processes. ering the change.

New times – new change paradigm Times have changed and this calls for a new way of managing change. The new change paradigm makes it possible to improve the quality of analysis and decisions, while also significantly reducing the resistance to change and introducing FAST FACTS faster and simpler change processes. ABOUT IMPLEMENT

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