Are our leaders ready to take over the change management processes? In other words, how many of them have acquired the necessary skills before starting to dance with Sarah?
I was riding in the middle of an organisational storm. You could call it a business take-over or a merger. The term doesn’t matter. What matters is the induced “change” would affect all stakeholders, including customers, employees and even the families of employees.
Business leaders always dream about ways and means to uplift the level of business performance, making minor to major changes to the areas under their control and also by influencing changes to the areas over which they even don’t have direct control.
Are our leaders ready to take over the change management processes? In other words, how many of them have acquired the necessary skills before starting to dance with Sarah? I am sure some of you are now confused about dragging a Sarah into the discussion. Leave her alone for a moment.
Let’s agree with one premise. Organisational changes are not done for the sake of having changes. The aim is to make a tangible difference to the way of doing things in an organisation and consequently to get better outcomes. For this, the leaders not only have to work with machines, equipment and material, but also with people. Unless you energise or format people to perform the way you want, you would fail to realise your expectations.
Understanding how people behave and respond to the changes is paramount in this effort.
To manage “the change” effectively, any leader needs to develop necessary skills and experience. As a personal point of view, all the experience I had gained from working for the unique thuggish Sri Lankan public sector and the ruthless Australian public sector helped me to weather this storm to some extent. While doing so, I obviously applied the management theories I learnt at Sri Lankan and Australian universities as well. Still, I came short of achieving the best results, say at least at the beginning.
Why? A kind of answer to this question is in the main elements described in the following narrative.
Eye of the storm
In Australia, the NSW State Government hatched a plan for around 10 years to introduce reforms to the NSW Local Government and it was implemented in 2016. It was a long and comprehensive process and all NSW councils were assessed over a period, in terms of the financial sustainability, the effectiveness and efficiency of delivery of infrastructure and services and the sufficiency of having scale to engage across community, industry and government.
The end result of this process was to name councils which were “fit” and “not fit” for the future. As expected, the majority ended up as “not fit”. Then, the reforms were forced upon with the carrot and the stick and the selected councils were prompted to merge with the neighbouring councils to survive.
It was a carnage. Mayors and councillors were sent home unceremoniously and independent administrators were appointed to manage councils until the future elections were held to appoint a new set of mayors and councillors. By the way, elections are yet to be held.
Not only the unfit councils were merged but also the “fit” councils were merged with the “not fit” to make the merged council “fit” for the future in the long run. All, councils were asked to prepare “fit for the future” plans and to implement the plans. That means that no one was immune to the ‘change” irrespective of getting merged or not. The NSW Department of Local Government provided financial help and technical support to the merged councils to kick off this arduous journey.
Political fronts of a few councils fought and fought hard against these reforms as the merged councils meant a less number of wards and in turn, a less number of councillors. Let me tell you that animalistic and self-centred instincts of politicians defy the geographical boundaries. The resistance was so fierce and it led even to the change the State Government political leadership for controlling continual bloodbath and it even led to the change the basic policy on reforms.
However, a few councils knew by heart that quality of their own service delivery was deficient and went ahead with the merger. They used “the change” as an opportunity to improve the level of performance and service delivery.
I work for one of the very few “fit” city councils, say Council A. It was directed to be merged with the adjoining “not fit” council, say Council B. The merged A-B Council became the largest City Council in NSW, in terms of the population. The new council announced its long term vision, to become the best in NSW, being the largest already.
This was the perfect storm I was caught up in the middle, as an employee in the middle level management.
Organisational culture of Council A
Council A had a unique but a dynamic culture. This council performed like a private business. It had ISO 9001, ISO 14001-Environmental Management and the Health and Safety Accreditations originally. Later an informed decision was taken not to renew the accreditations, but to continue with the quality management setup supported by a self-auditing process.
Council A had well-documented processes and procedures, young and energetic leadership and it was blessed with having an Integrated Business Management System combining financial, governess and information management sub-systems. This council led the way in the NSW Local Government sector as a model council and deployed the best practice asset management systems for managing its billions of dollars worth physical infrastructure assets. It became self-reliant financially, stopping borrowing of funds from the State or Federal Governments to run council services.
In terms of the governance model, it has gone through a full cycle of its management structure from the typical city council set up akin to the British model as practised in Sri Lanka as well to a purchaser-provider business model practised in New Zealand and then finally reverted back to the typical council model, however, with improved processes and procedures. Becoming a part of this transformation journey helped me to upskill my capacity as a middle level manager and to understand what works and what does not.
During this cyclic process, the organisation structure was continually refined, future leaders identified, trained and nurtured and the innovation and the continuous improvement culture was built into the organisation culture. The pinnacle of the recognition the council’s effort was the nomination of Council A as the best NSW City Council in 2014 and also it was assessed as one of the few ‘fit for the future’ NSW councils.
Organisation culture of Council B
This council had been formed as a typical city council with usual bureaucratic red tapes and led by a matured leadership. The CEO of this council was the longest employed CEO, i.e. 33 years, of any NSW city council. The relationship between the council and the community was healthy, being a very laidback, homely council.
The long serving staff had the power and the authority to run programs and projects from the inception to the finish without handing over it to another at any stage. This methodology had an inherent flaw that there was no one checking or questioning the decision-making with the view of improving existing processes and procedures.
Council B had a large number of community services which required borrowing of funds. It lacked values such as innovative thinking and continuous improvement, adaptation to keep up with the changes of the operating environment. The systems in place were working but technically outdated. NSW Department of Local Government determined Council B was “not fit” for the future.
In May 2016, the official proclamation of the merged council was announced. Suddenly, the employees of the both Councils A and B became one team. This was when the serious business began.
The CEO of Council A was naturally identified as the interim CEO and the majority of senior management of Council A ended up as the senior management team members of the merged council. This management team led the change management process. A few reputed specialist consultants were appointed to develop a transition plan and the leaders underwent a series of rigours training programs on how to run the change management process.
The new management team took a number of key measures to communicate the message to Council B staff that this was not a takeover of B by A, but forming one team for engaging all for a long journey, supporting each other to convert own weaknesses into strengths and to build more upon own strengths. This was easier to be said than done. Employees of Council B felt like it was a “take over”.
Think about a scenario where you are thrown into a group you had never associated with, asked to sit in a new office far from home, reported to a different manager and on top of that doing new duties, in addition to the duties you are proficient with and follow new processes, procedures and apply technologies but for the same remuneration package. No wonder you would feel helpless, having the worst deal and have no control over the situation. Under these circumstances, any human would feel nervous, insecure and uncomfortable.
The merger was to be implemented in two stages. Merging technical systems such as financial systems, data systems and IT systems was swiftly done as it only required technical experts.
The first lesson learnt was that to implement ‘change’, organisations need not only the managers but also leaders. That begs the question: “Aren’t managers the leaders as well?” Not really.
As John P. Kotter (Harvard University) said: “Leadership (and leaders) and management (managers) are two distinctive and complimentary systems of action (or species). Management is coping with complexity and leadership is coping with change.”
Council A-B had highly-skilled managers to merge technical and financial systems. They developed a comprehensive plan and implemented. Humans involved in this process became another set of machines or robots and they responded well to the instructions.
Merging two cultures requires time and space and a very delicate change management plan supported by a psychologically effective, humane communication plan. To merge cultures, organisations need leaders not managers. So, the leaders Council A-B sprang into action. So all management team members including me in the Council started to ‘Dance with Sarah’.
Who is my affectionate lady Sarah? I want you to keep guessing who that is, because it is futile to know about her before you know the dance steps, in other words, human instincts.
Let’s forget about an organisational merger scenario for a moment. Just concentrate on any change at a work place. Employees are human. They have lives inside and also outside of their work places. Each and every employee is different to each other. So, the challenge to the management is how to deal with different people.
The best way to deal with them is to identify how humans typically behave irrespective of what duties they carry out, which level they are in the organisational structure and where they work: either inside an office or in the field, and where they live: close by the work place or a long way away.
I have attended many management workshops and one particular workshop is worth mentioning. It was about the human instincts and leading the change based on human instincts. The workshop was conducted by Andrew O’Keeffe who wrote the book ‘Hardwired Humans’. So, to credit him, I borrow some of his concepts as well here.
Humans are social animals. There are a few human instincts applicable to all, irrespective of who those human being are.
Social belonging: Human are comfortable to be in a chosen group. At home environment it is the family. At work, it is the team. When the team increases in numbers, say more than seven (a magic number!), its effectiveness goes down and the members lose the social belonging character. This is why leaders should not make teams of more than seven members when making changes to team structures, if the leader wants to witness team dynamics.
Then, the departments or divisions have a cluster of teams. In the family environment, this is the family clan. When the clan becomes larger and larger, the families gradually lose the connections and interactions with other families of the clan. There may be respected elders, or the leaders in the clan to whom the extended family members obey and keep listening to.
When the clan grows beyond 150 (a number based on the research done on behaviours chimpanzees and monkeys), the leader loses control of the clan. This is same for an organisation as well.
Employees who work in departments which have employees well above 150 tend to develop bonds only within own divisions and do not care about knowing what is going on the whole department. This is not a good sign for a head of a department. The leader of such a department would struggle to get best out of employees.
Hence, the team size would determine whether it is functional or dysfunctional. Also, too small teams less than five suffer sense of isolation. Too large teams fail to have the sense of inter-connection. A leader of a small team has clarity. The leader would empower the team and guide them during the change management process. Leaders should focus on the team needs and this will result increase in people moral and output.
Leaders cannot practically focus on too big teams. That causes the team also to lose focus. Teams expect the leader to protect them from external influences. When the team is too big, the leader would struggle on this front. A perfectly-populated team treats newcomers delicately and in a short period of time, the new member would perform as an established team member. In big teams, a person can be ignored and shunned. This will lead to complete rejection, prompting the team member to leave the organisation.
In organisations, the clan could comprise around 150 people maximum. An effective clan leader should know the names of the members of the clan, the important characteristics related to individual people, and individual roles within the clan. This is impossible for a leader if the clan is too big.
Further, the leader should appreciate the value of each member: individually, establish strategic direction for the clan and encourage the sense of the community of practice. At the same time, the leader has to empower line managers to increase the performance capacity of the clan. A leader simply cannot do all the above if the clan size is more than 150.
Loss aversion: Loss aversion is a basic human instinct. When a person faces a changed situation, he or she mentally assesses it and always expects a “loss’ and faces the situation “loss” in mind. The challenge is how to change this human instinct.
Influence the classifying moment: Human classifications are binary in nature. We decide “either/or”. Humans do not analyse taking time and make rational decisions at the first instance. They classify the situation and judge people in such a way “good or bad”, “with us or with them”, “them or us”, “team player or not a team player”. Humans do not judge in percentages like 40% good 60% bad.
When a change is introduced in an organisations, employees judge it binary manner. This is black or white response. Why do humans do that? The response is based on their previous experiences, intuitive power and the first impression of the situation. Some say it is the gut feeling.
Hence, management wants to influence this “classifying moment or response” for employees to think favourably on the change. This is no means of an easy task because you go against the nature.
One way of influencing this classification is how the management communicates the change to the employees. Psychologist George Miller found a human brain could identify the significance of seven items of data maximum before start making mistakes or leading to confusion. He says the span of human memory is around seven elements or two seconds of time data.
If this is the case, the most important words would be the first few words the management say about a change. Andrew O’Keeffe says it is the first seven words that are the most important.
Think about a stony-faced manager walking down the aisle with an envelope in hand and say to a subordinate, “I want to see you in my office.” The employee’s first impression would be that this is not going to be good for me. Maybe the envelope contains the bonus cheque. It does not matter what it is, but the manager has ruined the employee’s concentration and focus to work by uttering that statement and it would take hours for the employee to recover.
It does not matter if the message is good or bad news. The first seven words must be chosen based on principles such as specific without being generic, plain language for easy understanding, truthful to generate trustworthiness, single concept to avoid confusion, right level emotionally, no jargon to avoid misinterpretation and a narrative as a theme for follow-up discussion.
Focus on the compelling reason: Management has to communicate the real reason for the change without trying to put an untruthful spin or selling pitch to the reasons behind the change. The worst thing would be the management saying one thing and doing another.
The gossip and rumours: If the truth is not told at the beginning, the gossip and rumours generated among employees would have a snowball effect over time. Management has to take actions to fill the vacuum in communication otherwise it would be filled with rumours. Sometimes, identifying gossip groups, knowing the gossips in circulation and educating them subtly with facts rather than confronting and threatening them would be a wise approach.
Manage to the individual level: No matter how difficult the effort would be, the change management should go down to individual level at the end of the process. The most favourable approach would be face-to-face communication, especially employees who would lose due to the change must be consulted individually.
Common derailers: The change management should be run by the leaders with necessary people skills and the project must have enough resources. Further the leaders who run the change management project must have a trustworthy past. The day-to-day actions and the body language of the leaders must be consistent with the message they deliver. If the leader is not trusted by the employees, the change management project would be a failure.
Dance with Sarah
Why I waited such a long time to start the dance. The reason is that without having a deeper understanding on human instincts, I should not introduce Sarah to dance with you. Otherwise, she would step on yours toe with her high heels. Let me tell you that it would not be a nice feeling.
Sarah is an acronym for ‘Shock, Anger, Resentment or Rejection, Acceptance and Help’. When the change is thrusted upon an employee, he or she would at best be “shocked”. The employee cannot expect the world around to be fair, because she/he is fair. That is the bitter reality.
Also, the employee would be angrier because the situation the employee is undergoing has nothing to do with his/her fault or performance. The anger is generally combined with resentment and rejection, to accept the change.
The world does not turn the way one wants. Hence, after initial deliberations, the employee comes to a stage that the acceptance of a negotiated change suitable for both parties is the only way to move forward. The leader has an important role to play to ensure that the employee has the correct mindset at this stage to join this arduous journey, while addressing employee’s basic pressing needs.
Acceptance does not mean that the both parties are perfectly happy. It is only the beginning of a healing process. The organisation must have customised help packages for each employee. It can come in the form of physiological assistance or a training package. Sometimes it needs a performance-based monetary reward system.
Sarah is unpredictable. The employee’s reactions do not necessarily follow the above order for all change management situations and emotions could jump from one to another and back and forth. The other reality is that even if someone is in the acceptance mode, it does not mean that the shock and anger have completely vanished from the affected person. Sometime it remains for long time.
The other fact is that Sarah is a line dancer. When you dance with her, be prepared to move one step forward and two steps backward as the situation requires and also be prepared to move sideways when a private moment is needed to control employee’s emotions.
Leaders will learn how to respond to her sequence of steps and then you can even lead her the way you want her to dance. It is an art and a skill that leaders should learn by themselves as no book could teach this art. This is the reason that in the world, only a chosen few are celebrated as real leaders who managed to instill real changes in the business world.
(Eng. Janaka Seneviratne is a Chartered Engineer, a Fellow and an International Professional Engineer of the Institution of Engineers, Sri Lanka with thirty years of experience as a professional engineer. The author is contactable via firstname.lastname@example.org.)