Monday, 16 May 2011

The importance of people and context in change management

Once the need for change and its feasibility have been both objectively ascertained, also by means of some specific tools, employers need to draw up a detailed plan of action aiming at introducing and implement it.

Burns (2004) suggests that the dimension and scope of a change project, and the relationship between these, can be analysed and investigated by means of a change continuum model, table 1.

The continuum encompasses at one end incremental changes, that is to say small scale change projects not implying and not intended to introduce radical changes, and at the other end transformational changes, those changes which, by contrast, relate to large scale projects and which can be thus considered as having remarkable, widespread effects upon the organisation. Examples of transformational changes are those consequent to merger, acquisition and restructuring.

The importance of people
Employers tend to be more careful and to pay growing attention to transformational change projects at large, rather than to those concerned with incremental change. This approach can be however considered as questionable. It is not in fact the scale and dimension of a change project which should be considered as a reference to define the degree of attention and care to be paid to individuals when devising a change plan, but rather the severity of the impact that the introduction of change is intended and is thus likely to make on people.

To this extent Armstrong (2006), after having identified two main types of change: strategic change, related to “long-term and organisation-wide issues” and operational change, concerned with the introduction of new systems, procedures or technologies, by reason of the direct and “more significant” repercussions that operational changes usually have on individuals, warns organisations about the importance of dealing with the latter taking the same care and paying the same attention for people as when dealing with the former.

For different reasons and irrespective of the extent of change, individuals invariably represent the key factor for the successful implementation of change, inasmuch as Lucas (2002) claims that many change management programmes fail to achieve their intended results by reason of the people factor: ”organisations know where they want to go – but they are not taking their people with them.” It could be argued that not only employers should “take their people with them”, but that, during a change process, these should also go throughout the change path hand in hand with their employees. This is actually why constant communication and the involvement of all of the organization stakeholders, target groups, trade unions and individual concerned is of paramount importance.

All of that does not obviously mean that businesses have to completely revert or substantially modify their plans; this is not indeed the main reason for employers involving their employees in the process of change and for opening with these a constantly open communication channel. Paraphrasing Lucas, it can be maintained that employers do not need to change their final destination. The main objective should rather be that to verify individual and hence the whole organisation readiness to change and find out whether something should be better redressed in terms of plan, design and schedule before its implementation or during the unfolding of the process. It is very likely that thanks to the involvement of all of the business stakeholders could emerge some useful suggestions and hints which whether implemented, although do not modifying the overall project objective and aim, could help employers to make smoother and plainer the process. Whether some restraining forces, risking jeopardising the overall change project effectual implementation, should necessarily emerge sooner or later, it is obviously better that these emerge sooner, rather than later in order to timely and effectively cope with the identified issues and avert to deal with these when it could be too late or anyway much more difficult to contrast and deal with the emerged troubles.
It could not be truer what Armstrong (2006) suggests to this extent: “It is important to bear in mind that while those wanting change need to be constant about ends, they have to be flexible about means.” This clearly also entails a thorough knowledge and understanding of the change models available and the use of the one which mostly suits and fits the circumstances.
The capacity and accountability to identify and assess the impact of the restraining forces coming to play and to investigate and monitor the way these may be subject to change themselves over time clearly rest with the employer and its management. An organisation likeliness to attain effective and durable competitive edge actually depends on these abilities and on the employer’s capability to identify, organise, activate and manage the necessary resources required to yield and maintain the desired results over the years (Pettigrew and Whipp, 1991).
The significance of context
Another good reason for keeping in due consideration the importance of people is directly linked to the fact that is very unlikely that a change process may not involve several, if not every, individual within the organisation, eventually as the result of somewhat of a knock-on effect.
Inasmuch as employee behaviour is sensibly influenced by the elements composing the internal organisational context in which these operate (table 2), when employers want to change this behaviour they try to develop changes essentially affecting the elements of the endogenous context which are most likely to influence, towards the intended direction, employee behaviour.

Since every change process aiming at increasing organisational performance produces considerable effects on the elements showed in table 2, it consequently derives that every change process make an impact on the organisational context.

Boddy (2008) claims that it is actually uncommon which a “significant change” may ever affect only one of the different elements composing the organisational context. On account of the “systemic nature of organisations” any change implemented in any given element composing the endogenous context is thus due to produce consequences, somewhat of a ripple effect, for the other components.

A good example of this is represented by the series of choices Tesco needed to make when decided to set and run its Internet shopping service in addition to its established retail business. One of the first elements coming to play was technology: Tesco needed to set an internet website in order to enable its customers to place their orders online and make payments in a safe and secure way by means of electronic transactions. Tesco management needed subsequently to make decisions about the structure of the new line of business. Had to determine hence whether it was preferable to create additional local/regional warehouses, where to store and from where to deliver the items ordered by its customers, or using the existing retail store network. This decision clearly had an immediate effect on the decision concerned with the organisation of staff, that is to say people. The retailer choice to enter the online service also made an impact and entailed changes in the financial element of the organisation on account of the relevant number of payments processed online. Last but not least, this activity also had a relevant impact on the business process, how would have an online order been transformed in a box full of items to be delivered directly to the house of each purchaser?

Apparently the decision had just been the one to “simply” enable Tesco customers to place their orders online, but the knock-on implications it caused and the decisions to make, following that idea, were really copious and involving practically all the components of the internal environment.

In order to influence individual behaviour and achieve change, managers basically attempt to essentially alter the elements forming the context. These, nonetheless, can react favouring or hampering the successful achievement of that bid. The elements of the internal context all exist and are in place before any change is implemented and the way these are operating when change is introduced is likely to influence the way managers implement change (Boddy, 2008).

An organisation’s culture and its shared values and beliefs can act as powerful drivers or obstacles to change. Individuals are likely to accept change which they perceive as suiting the organisation values and beliefs, whereas they tend to oppose change whether they feel that this is in contrast with the organisation’s culture (Boddy, 2008). Companies like eBay and Google, where change is part of corporate culture, have usually no problem to develop and implement frequent changes, but things are not so straightforward when change is not part of a firm’s culture.

Research shows that the success of change is sorely influenced by the context. More in particular, a study carried out by Pettigrew et al (1992), aiming at finding out why some managers were able to achieve success whilst others were not, within the same organization (namely the UK NHS), confirmed that the context plays indeed a relevant role for the successful attainment of the intended change. The study in fact revealed that some environments, called “receptive contexts”, are more likely to favour and ease change whereas others, called “non-receptive contexts”, are more likely to favour the erection of barriers to change.

The study identified seven factors, linked amongst them, which when existing provide the settings for a receptive change context. Although the research was carried out within the UK NHS sector the elements identified, summarised below, can be easily adopted and adapted to the other organizations:
1 – Quality and coherence of policy,
2 – Availability of key people leading change,
3 – Long-term environmental pressure – intensity and scale,
4 – A supportive organisational culture,
5 – Effective managerial – clinical relations,
6 – Cooperative organisational networks,
7 – The fit between the district’s change agenda and its locale.
Still considering the important role played by the context, it must be added that also the outcome of the past bids for change have an impact on the success of the present and future attempts. The history and the different levels of change certainly influence people approach and disposition toward change. In an organisation where past change attempts have been characterised by failure it is comprehensible that people would be wary about the future plans for change. In this instance previous failures clearly constitute the basis for a non-receptive, hostile context to change.
Employees’ optimistic approach and behaviour is usually associated with success (Boddy, 2008). In this case, is the attitude of people which can clearly influence the context and make a difference; the positive approach of employees can indeed create good basis for a receptive context where effectively and successfully developing and implementing change.
The different level at which change is developed and operated, for instance at corporate or divisional level, can also influence the success of the overall change process. The activities performed by managers at one level might under some circumstances jeopardise or favour the success of the process at a different level.
Albeit employers can, according to the circumstances, do little or nothing to avoid restraining forces to emerge, but can vigorously counterbalance them once these have ascertained their existence, businesses should do whatever they can to prevent that problems are generated by the organisation’s management. Managers must, for instance, avert the pitfalls associated with the silo thinking syndrome also when acting as change agents. They have to be aware of the ripple effects their activities and decisions can have on the other elements and levels of the organisation and have hence to be careful when making decisions and taking action, invariably duly considering beforehand the possible wider effects of their initiatives and actions.
One of the fundamental manager duties during the unfolding of a change process is to favour the creation of a coherent and consistent context aiming at encouraging and fostering the desired employers’ behaviour, in line with the organisation culture, values and beliefs.
Longo, R., (2011), The importance of people and context in change management, HR Professionals, [online].