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Why change programs don’t

produce change
U.S. Financial

• Deregulation was posing serious competitive


challenges.

• The only solution was to change fundamentally how


the company operated. And the place to begin was
at the top
U.S. Financial
• CEO Established:

1. A new organizational structure.


2. A new performance appraisal.
3. A new payoff system.
4. New training program.

• Turn Managers into change agents


U.S. Financial

• Two years later CEO Launched the change


program, virtually nothing in the way of actual
changes in organizational behavior had
occurred.
What had gone wrong?

The answer is “everything” was wrong.


Common problem

• Increased competition
• Companies were struggling to reestablish their
dominance.
• Regain market share and ensure their survival.
Task alignment
• In many companies change led by general managers of
those units, not by the CEO.
• aligning employee roles, and responsibilities and
relationship to address the organization most important
task.
• Unlike the CEO at U.S. financial, they didn’t employ
massive training programs or rely on speeches and
mission statement
Contrasting assumption about change

Programmatic change Task alignment


• Problem in behavior are a • Individual attitude and
function of individual beliefs are shaped by
knowledge, attitude and recurring patterns of
beliefs, behavioral interactions.
• The primary target of • The primary target of
renewal should be the renewal should be the
content of attitude behavioral
• The target for renewal • The target for renewal
should be at the individual should be at the level of
level roles and responsibilities.
The fallacy of programmatic change

• Most change programs don’t work because they are


guided by a theory of change that is fundamentally
flawed.

• This theory gets the change process exactly


backward. In fact, individual behavior is powerfully
shaped by the organizational roles that people play.
Six steps to effective change
• Companies avoid the shortcomings of
programmatic change by concentrating on
task alignment.

• six steps called critical path that develop a self


reinforcing cycle of commitment, coordination
and competence.
Mobilize commitment to change
through joint diagnosis of problems

• Developed a shared diagnosis of what is wrong in


organization
• What can and must be improved.
• The group of 20 person visited a number of
successful organizations.
Develop a shared of how organize and
manage for competitiveness

• After group committed analysis of the


problems, GM can lead employees toward a
task aligned vision of organization.

• defined new roles and responsibilities


Cont..

• The group came up with a model of the


organization in which cross functional teams
would accomplish all work, particularly new
product development.
Foster consensus for the new vision,
competence to enact it, and cohesion to move it
along.

• Simply develop a new vision is not enough to


overcome resistance to change
• Strong leadership from the general manager is
crucial.
Cont..

• The changes in roles, responsibilities, and


relationships foster new skills and attitudes. Changed
patterns of coordination will also increase employee
participation, collaboration, and information sharing.
Spread revitalization to all departments without
pushing it from the top

• Members of teams cannot be effective unless


the department from which they come is
organized and managed in a way that supports
their roles as full fledged participants in team
decisions.
Institutionalize revitalization through formal
policies, systems, and structures.

• when the new approach has become entrenched,


the right people are in place, and the team
organization is up and running.

• The revitalization of the unit was highly successful.


Employees changed how they saw their roles and
responsibilities and became convinced that change
could actually make a difference
Monitor and adjust strategies in response to
problems in the revitalization process.

• The purpose of change is to create an asset that did


not exist before a learning organization capable of
adapting to a changing competitive environment.
• Finally, as improved coordination helps solve relevant
problems, it will reinforce team behavior and
produce a desire to learn new skills.

• This learning enhances effectiveness even further


and results in an even stronger commitment to
change.
Thank you