STRATEGICALLY MANAGING CHANGE Planning Implementing Change Initiatives J

STRATEGICALLY MANAGING CHANGE Planning & Implementing Change Initiatives J. Michael (Mike) Geringer, Ph. D. O’Bleness Professor of International Strategy Director, Center for International Business – College of Business email: geringer@ohio. edu October 2013 Materials in this packet copyright © by Geringer & Associates, Inc. Do not quote, cite, reproduce or otherwise infringe without written permission. Leading Change in Turbulent Times Executive Education Seminar

We can't solve problems by using the same kind of thinking we used when we created them. Albert Einstein © Geringer & Associates, Inc

THE CHALLENGE OF STRATEGY IMPLEMENTATION & CHANGE Change in one major component can require change in any or all other components Thus, strategy formulation, implementation & evaluation activities should be performed on continual basis, not just at yearend or semiannually © by Geringer & Associates, Inc.

STRATEGY IMPLEMENTATION & CHANGE A Challenge: How to Translate & Communicate Strategic Vision & Produce Successful Implementation within Your Organization? – How to obtain the knowledge, skills & assets needed? • e. g. , technology developments, distinctive competencies, distribution channels, service networks…. ? – How to get your organization to successfully apply these elements? © by Geringer & Associates, Inc.

BUILDING A STRATEGY IMPLEMENTATION/CHANGE PLAN Step 1: Analyze starting conditions – Urgency: Am I dealing with anticipatory, reactive or crisis change? – Personal readiness: How ready am I to lead the change process? – Organizational readiness: • Who will be most affected by change? • How ready are they? – Awareness of need for change? – Skills required for the change? – Commitment to the desired change? © by Geringer & Associates, Inc.

STRATEGY IMPLEMENTATION/ CHANGE & COMPLACENCY “While it is difficult to change a company that is struggling, it is next to impossible to change a company that is showing all the outward signs of success. Without the spur of a crisis or a period of great stress, most organizations -like most people -- are incapable of changing the habits and attitudes of a lifetime. ” John F. Mc. Donnell, Mc. Donnell Douglas Corp. © by Geringer & Associates, Inc.

THE STRATEGIC CHANGE CURVE Anticipatory Good Strategic Performance Poor Reactive Crisis When to begin the change process? Time Source: Nick Fry and Peter Killing, Strategic Analysis and Action, Fourth Edition, Prentice Hall Canada, 2000

THE STRATEGIC CHANGE CURVE Anticipatory Good Reactive Crisis Strategic Performance Poor Things are going well. Do we really need to change? Can we experiment? Time Source: Nick Fry and Peter Killing, Strategic Analysis and Action, Fourth Edition, Prentice Hall Canada, 2000

THE STRATEGIC CHANGE CURVE Anticipatory Good Reactive Crisis Strategic Performance What needs to change? Where do we start? Poor Can we find an early win? Time Source: Nick Fry and Peter Killing, Strategic Analysis and Action, Fourth Edition, Prentice Hall Canada, 2000

THE STRATEGIC CHANGE CURVE Anticipatory Good Reactive Crisis Strategic Performance Who can I Trust? Where do we start? Poor Time Source: Nick Fry and Peter Killing, Strategic Analysis and Action, Fourth Edition, Prentice Hall Canada, 2000 We need to move fast.

THE STRATEGIC CHANGE CURVE: IMPLICATIONS BY STAGE Anticipatory Good Reactive Crisis Strategic Performance Poor • Clarity of change needed • Resources available (human, financial, etc. ) • Time available for developing & implementing change Time Source: Nick Fry and Peter Killing, Strategic Analysis and Action, Fourth Edition, Prentice Hall Canada, 2000

BUILDING A STRATEGY IMPLEMENTATION/CHANGE PLAN Step 2: Determining required strategic & organizational changes • What Changes Must Be Made? Depends on your firm’s vision, competencies & capabilities • What is special about your firm? • Why is “uniqueness” important in the marketplace? • How Urgent is the Required Change? © by Geringer & Associates, Inc.

BUILDING A STRATEGY IMPLEMENTATION/CHANGE PLAN Step 3: Establish conditions for action – Targets: Which groups should I influence? – Action priorities: What issues to attack 1 st, 2 nd, 3 rd? – Change Process-Tactics: • What leadership style & tactics should I employ? • How to achieve shared understanding, commitment, & action? • What structures, systems, processes must change, & how? • What resources will be needed to enable change & where/how do I obtain them? • Can I find visible, early successes to help promote the process? – Pace: How fast should I move? © by Geringer & Associates, Inc.

STRATEGY ALIGNMENT & IMPLEMENTATION/CHANGE PLAN Implementation/ Change Target Priority © by Geringer & Associates, Inc. Desired Behavior/ Outcome Tactics to Sequencing & Pace Utilize of Change Efforts

STRATEGY IMPLEMENTATION Implementation Process Questions: – Who are the people to carry out the strategic plan? – What must be done to align operations with new direction? – How is work going to be coordinated? © by Geringer & Associates, Inc.

KEY FEATURES OF LEADING CHANGE Purpose Explain basic purpose behind the change • ‘What was the problem? ’ • Who said so & on what evidence? • What would occur if no one acted to solve problem? • What could happen to us if that occurs? Picture Paint picture of how the outcome will look & feel • What is the outcome going to look, feel & sound like? • How are people going to get their work done & interact with each other? • How will a day be organized? © by Geringer & Associates, Inc. Plan Part Establish each Lay out plan for phasing in the outcome person’s part in plan & outcome • Outline steps & schedules for people to receive info, training & support they need to make transition • People oriented to tell employees how & when their worlds will change • Start with where people are & work forward to leave the past behind & emerge with new attitudes, behaviors & identity • Show employees the role & their relationship to others. Until they see it they can’t adjust hopes & fears to the new reality • Show employees what part they play in the outcome & the transition process

WHAT INHIBITS EXECUTION? • • • More time than planned Unanticipated problems Activities ineffectively coordinate Crises deferred attention away Employees without capabilities Inadequate employee training Uncontrollable external factors Inadequate leadership Poorly defined tasks Inadequate information systems © by Geringer & Associates, Inc.

SURFACE POTENTIAL BARRIERS EARLY ON Change gets bogged because barriers are not dealt with soon enough or openly enough to keep change process moving Barriers may exist anywhere & everywhere – even the difficult-to-see places… • Strategy • Leadership • Process • Resources • Structure Consider how this change effort will affect… • Operating principles • Culture/behavior • Jobs • People © by Geringer & Associates, Inc. • Management • Systems • Rewards • Values/Beliefs • Capabilities

IDENTIFY MECHANISMS FOR PROMOTING INTEGRATION • Relationship between differentiation & integration • Forms of integrating mechanisms – – – – Direct contact Interdepartmental liaison roles Temporary task forces Permanent teams Integrating roles Integrating departments Matrix structure © by Geringer & Associates, Inc.

PLAN FOR THE UNEXPECTED • Implementation & change efforts are attempted under uncertainty (& often high levels of stress) • Unexpected events & outcomes WILL occur • Develop – appropriate monitoring systems – suitable metrics – contingency plans © by Geringer & Associates, Inc.

Take the time to make this work … and it will take time. © by Geringer & Associates, Inc.