“Change is disturbing when it is done to us, exhilarating when it is done by us.”
Rosabeth Moss Kanter

“Everyone wants tomorrow to be better than today.” C.G.Krone

Change Management, as it is traditionally practiced, seems like a practical way to reduce resistance to change, and to smoothen, accelerate, and enhance the probability of success of organization change initiatives. However, on close examination, it has proven to actually cause more resistance to change, and to reinforce the worst effects of the old command-and-control management paradigm it represents, such as compliance, passivity, withholding, defensiveness and conformity. Whether it, on balance, adds value to change initiatives is open to question. New strategic self-management paradigm approaches to change are much more effective and efficient, and can actually multiply the intended results of organization change initiatives, through developing the capability, commitment, accountability and proactive creativity needed for success in change. In addition, the ongoing development of the organization’s capability to address change will be essential for surviving and thriving in the future, as environmental trends predict change at a faster pace, and in greater degree and novelty.

A Case in Point

A large retail drug chain was recently in the middle of a supply chain improvement initiative begun four years ago. It had revamped its outmoded supply chain processes, and was installing Retek software (similar to SAP, but for retail) in place of its antiquated computer systems. After four years of unsuccessful struggle, and an investment of about $150 million on the software, consulting from Deloitte and Touche, and Accenture, and the work of internal project teams assigned to the effort, the company asked me to conduct an assessment, and recommend ways of getting a return on the investment.

What I found, as a result of interviewing and surveying a broad cross-section of the organization’s leaders, was the virtually universal perception that the change effort was just barely working. It was described as “limping along”, and as having been a slow, costly, painful, frustrating struggle to date, with much work remaining to be done to attain the returns envisioned for the new supply chain.

Some specific findings included:
· Some gains had been made in terms of efficiency, capacity and throughput
· Data integrity issues existed in most links in the supply chain
· Variances/breakdowns were occurring in the work all along the chain
· Major process or system design elements did not work well in the environments for which they were     created, and/or did not work well together
· Whole departments were unable to reach their performance standards
· Many people did not have the capability to do the new work required
· There were few processes in place to enable the newly required collaboration across departments.
· Many inefficient, manual processes and obsolete systems were still in place
· The first system changes for the warehouses brought the company to a standstill, and the planned new mega-warehouse construction was seen by those closest to it as putting the enterprise at risk, due to the difficulties they have with implementing change.

In searching for the underlying causes of these problems, I found that:
· The underlying premises and rationale for the change were unknown to the supply chain designers and implementers
· No strategic vision, blueprint or standards were set forth for the change
· Major supply chain elements were designed in silos/vacuums and did not work or fit together upon installation
· No ongoing learning mechanisms were in place
· New processes and systems were being embedded in an obsolete containing organization architecture
· The competitive strategy was to imitate and somehow catch up to industry leaders.

The root cause of all this clearly seemed to be that the Change Management process of this effort was carried out in the traditional way, i.e.:
· Sponsorship was clarified in the organization
· Communication was delivered to the organization
· Technical training was provided for those who needed new skills
· New metrics were put in place to assess against the new performance standards
· Rewards were provided for the new behaviors
· Change Agents were designated to assist in the process.

The Old Paradigm: Command and Control

The ultimate cause of the problems was that the traditional approach to Change Management is based on the same command-and-control paradigm as the traditional practice of management it is intended to augment. As Peter Block put it in his current edition of Flawless Consulting, “ None of this is an argument against vision, standards, rewards, training or measurement. They are important elements of organizing people’s efforts. It is just that we have over-invested in them and abused them by making them imposed instruments of control and coercion. Then we compound the error: when they do not result in genuine change, we try harder to make them work, instead of betting on other strategies.” He says that this strategy is based on the myth that “…behavior can be defined, induced, driven, purchased and measured into existence.” The result, instead, is typically more resistance, compliance, passivity, conformity, and withholding -- versus the commitment, accountability and proactive creativity needed for success in today’s business environment.

Some studies, such as those by Reengineering guru, Michael Hammer, have found that 2/3 of large systems change initiatives fail to meet their objectives. These studies have concluded that the reasons for failure are primarily to be found in the soft, human side of change, versus the hard technical side. Change Management was created to address these reasons, but fails to do so, because it is still “inside the box” of command-and-control and behavior management.

Another approach to change, which I refer to as Enlightened Change Management, uses the technique of involving the stakeholders affected, to varying degrees, in the implementation of change. This can be in the form of inviting them to work on the perceived barriers to successful change. Done well, this approach appears to enable the organization to achieve its goals for a given change initiative. However, it still has the unintended effect of driving people a little deeper into the rut of dependency, conformity and passivity, which will make transformation to a strategically self-managing organization for survival in a more turbulent and competitive environment that much harder in the near future.

The New Paradigm: Strategic Self-Management

What has been missing in these initiatives, and in the supply chain case described above, was a new paradigm, sometimes called the strategic self-management paradigm, which is based on a set of premises in tune with today’s workforce, the complexity of organization change, and the challenges of a turbulent business environment. This paradigm was developed and evolved in some of the highest-performing organizations in existence over the past few decades. Its adherents have been so successful that they have largely kept their experience confidential, believing what they were doing was a competitive advantage. Those applications that have become known to the public have been held up in the literature as models of business architecture, such as plants and businesses at P&G, Clorox and DuPont. An example would be the P&G Lima plant, which reached a level of productivity three times greater than the company’s other comparable (and world-class) plants. Robert Waterman, co-author of In Search of Excellence, said Lima was “…probably the best-managed plant in the U.S., and the best example of what America does right.”

The strategic self-management paradigm holds that, given the opportunity, the average employee can be a committed, accountable, disciplined, creative, principled, proactive businessperson who thrives on change. It holds that organizations are complex living systems, and that change is inevitable.

Organization change based on these premises typically employs the following fundamental principles and practices: Change Infrastructures (parallel organizations) are put in place to ensure that all essential change processes are managed effectively, including the provision of strategic direction, intelligent involvement of all stakeholders, proposals developed by those with the best technical expertise, rigorous testing of proposals from all perspectives -- resulting in the best collective thinking the organization can muster. This approach also provides for appreciating and dealing with the complexity of the whole organization, through whole systems thinking, and for valuing what’s best for the whole, versus any part of it. In addition, it aims for embedding new processes and systems into a containing organization architecture that is redesigned for high performance.

While the command and control approach puts people in a reactive/self-preservation mental state, which tends to evoke resistance to change, the strategic self-management approach puts people in a purposeful mental state, which tends to cause people to seek change that is beneficial for the whole entity. Its high level of stakeholder involvement increases the speed and lowers the cost of change. Its systemic nature gives the change sustainability, and its provision for a high level of aspiration and stretch in thinking and creativity provides the possibility of dramatic increases in results and ROI.

Large-scale organization changes using these types of approaches have been uniformly successful, including 20 whole business or corporate transformational turnarounds, in Fortune 500 companies -- in which the entities went from being in trouble to sustained market leadership, typically in a period of a few years. One published example of this was the turnaround of the Clorox Kingsford Charcoal Division, an impressive story of the renewal of what was thought to be a dying business.

I have experience with two forms of this new paradigm approach to change. The Breakthrough approach is primarily aimed at focusing creative energy on rapidly achieving results previously considered to be impossible from a given change. The other, the Transformational approach, is more focused on evolving the design of the organization -- building the capability of people, and the empowering environment in which they can drive innovation and performance improvement, to increasingly higher levels. See the table below for a comparison of these methods of organization change.

Change Management Approaches

Conclusions/Implications
Traditional Change Management, and even Enlightened Change Management will cost you -- by limiting the results of your change efforts, by preventing you from taking advantage of an opportunity to multiply the results of your efforts, and by retarding the evolution of the organization needed for future viability. If you are not taking advantage of change opportunities to evolve your organization to a level that can deal with the new kinds of change, if you are instead driving yourself more deeply into the current evolutionary rut you are in now, you are sowing the seeds of your own demise.

Organization Change processes based on the new paradigm can accelerate and escalate your intended results, and may even multiply them. They can also transform the organization to a higher level, positioning it to survive in the more turbulent and competitive environment it will face in the future.

For more information, see my article on how Your Organization’s Culture May Be Sabotaging Its Performance at www.examiner.com/examiner/x-20018-SF-Workplace-Issues-Examiner~y2009m9d4-Your-Organizations-Culture-may-be-Sabotaging-its-Performance, and the one on Creating Thinking Organizations: the Ultra-High Performance Organizations of the Future at www.examiner.com/examiner/x-20018-SF-Workplace-Issues-Examiner~y2009m9d14-Creating-Thinking-Organizations-the-ultrahigh-performance-organizations-of-the-future.