Change Management

CHANGE MANAGEMENT

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BASICS / DEFINITIONS

Change Management

Quotation

» The only thing that is constant is Change .«

Heraklit of Ephesus (about. 540 - 480 BC.)

Change Management

Definition

Change
Management

Required, targeted and holistic
change of company for future

success.

Change +

 Change Management
 Adaption
 Turnaround  Analysis , planning,
implementation

 Manage, control

 Entrepreneurial
activities

Change Management

Definition

Change management is the conception, planning, organization,
implementation, control and stabilization of the change processes of a
company, with the aim to maximize the effectiveness and efficiency of

the change process and to reach the widest possible acceptance of
managers and employees.

Change Management 3.

Reasons Continuous control of change measures ensures
the flexibility within a company. The
1.
organization can better and faster adapt to
Only companies whose learning rate is higher new situations.
than the rate of change of
their environment will achieve Proper change management
long term success. is a guarantee for success
and survival in the
Change Management causes a globalized economy.
targeted dynamics that harbors continues
growth potential. 4.

2.

Change Management

Effects

Generates positive energy for change
Builds confidence in own strengths
Allows learning and development across the organization
Strengthens the networking through communication
Aligns the organization of new
Promotes a collective process thinking

Change Management

Application Examples

Process optimization

Business Process Reorientation and
Management strategy communication

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and anchoring statement
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Reorganization Introduction of text.
Mergers new overall or
partial processes

Corporate strategy and
culture

Change Management Authority &
change
General triggers
Value
Routine systems

Change is a Principle Resistance
process of change & comfort

The correct Sender
answer is and
not enough
receiver

Change Management 6. Economy
7. Technological progress
External triggers 8. Ecology
9. Competitors
1. Faster production possibilities
2. Scarcity of resources
3. Focus on core competencies
4. Globalization
5. Customers

Change Management 5. Inefficient processes

Internal trigger 6. Management

1. Reformulation of the 7. Employees
corporate strategy
8. Organizational
2. Wrong decisions in the past development
3. Demography and social

influences
4. New management

concepts

CHANGE CONCEPTS

Change Management

Phases

Analysis Planning Implementation Performance review

 Thorough analysis of the  Determination of the  Practicing new behaviors  Target-actual comparison
situation objectives  Possible further adjustment
 Integration and motivation
 Short description of the  Selection of a suitable of employees
analysis concept of change
 Training

Change Management Planning 3. 4.

Analysis Implementation Performance review

1. 2.

Analysis

Diagnosis of your change project

 Quantitative Analysis
Who is affected to which the extent?

 Qualitative Analysis
The extent and threat level do the necessary changes have for those affected?

 Analysis of previous experience
of the changes and the ongoing ability and willingness to change

 Determining the type of changes.
If it is only to a structural change or a change in culture?

Change Management Planning 3. 4.

Planning Implementation Performance review

1. 2.

Analysis

Development of a change strategy

 Specification of objectives for change
 Preliminary design of the change process
 Development of content solutions
 How do we achieve that the solutions will be adopted and implemented by the affected employees?
 Define roles and tasks, and determine the change manager
 Time and Profit Planning
 Planning of the communication strategies and methods of changes
 Plan the measures how to deal with resistance, conflicts and crises

Change Management Planning 3. 4.

Implementation Implementation Performance review

1. 2.

Analysis

Implementation of the change process

 Develop a change awareness among stakeholders (Transparency and impart knowledge)
 A (positive) change of attitude presumes that there is awareness of the benefits of the new approach
 Change of attitude
 Change of behavior

Change Management Planning 3. 4.

Performance review Implementation Performance review

1. 2.

Analysis

Outcome evaluation

 Regular measurement of results
 Publication
 Communicate successes
 Learning from mistakes
 Plan further changes

Change Management

Phase model according to John Kotter- Overview

Creating the Engaging & enabling Implementing & sustaining
climate for Change the organisation change

6 78

12 3 4 5 Generating Never Incorporating
short-term wins let up! Changes into the
Development a Communicating Empowering
change vision the vision for broad-based Culture
buy-in
Creating the Action
guiding coalition
Establishing a
sense of urgency

Change Management Creating the
climate for Change
Phase model according to John Kotter
Step 1 to 3 1 23
Step 1
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text. sense of
Step 2 urgency
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Step 3
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Creating the Development a
guiding change vision
coalition

Change Management Engaging & enabling
the organisation
Phase model according to John Kotter
Step 4 to 6 456
Step 4
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text. the vision for broad-based short-term
Step 5 buy-in
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Step 6
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Change Management Step 7 to 8 Implementing & sustaining change

Phase model according to John Kotter 78

Step 7
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Step 8
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Never Incorporating
let up! Changes into
the Culture

Change Management 1. Description of the 2. What kind of change
change project process is it?
Process
3. ACTUAL situation starting
9. Implementation plan position

8. Communication strategy Circle 4. Who plays
which role?
7. Motivational strategy- 6. Corporate Culture
What makes the future How much resistance 5. Target groups:
attitude and skills
attractive? can arise?

Change Management

Classic three-phase- model in the Change Process

Unfreezing Movement Refreezing

 Bring Satus quo out of balance and  Movement to a new condition if enough  Consolidation of new attitudes and the
prepare all parties involved for the change willingness to change is established. new created balance.
process.
 Creation of a new solution and new  Integration of new problem solving
 Overcome resistance and encourage attitudes till a new balance is established. strategies into company processes.
willingness of participants.
 Next Change-Project after successful
conclusion of this phase.

Change Management

7 Phases of the psychological Change Process

Perceived Competence 2. Association 7. Integration

High False game; sense of security, inflated Adaption of sucessful attitudes to the active behavior
estimation of own competences repertoire

1. Schock 3. Understanding…

Big discrepancy between high In the necessity of change, Insecurity
expectations and reality
6. Realization

Perception of causal coherences
between attitude patterns and
success or defeat

4. Acceptance … 5. Try…

Of reality. Letting go of old To search new
habits attitudes
• Success– Failures
• Anger- Frustration

Time

Change Management Effective  How leadership works together
Organization  Identifying the leadership
Effective Phases
actions
 Operating Model  Individual leadership actions
 Structure
 Roles  Ensuring we have the right skills
 Competencies  Learning plans
 Populate  New capabilities
 Governance  Career plans
 Decision Making
 Migration plans
 Confirming the vision,  Redeployment
values and behaviors  Legislative compliance
 Redundancy
 Individual values and  Support
the capacity to change  Morale maintenance
 Communication
 Strategic message

 Balanced score card
 Performance management
 Reward alignment
 Communication

Change Management

Processing curve - Psychological perspective

System performance 3. Defense 7. Integration

Trouble Confidence

4. Rational Productivity gain

100 % acceptance Loss of productivity
Frustration
1. Premonition 2. Shock 6. Opening
5. Emotional
Concern Fear Curiosity,
Acceptance enthusiasm
Planning Mourning
Publication Realization

Introduction Time

Change Management

Approaches in the planning and implementation

In the planning and implementation of changes four approaches need to be distinguished

TOP DOWN

 Change process is planned by top management
 Staff changes are to implement even though they are not involved in the planning

DISADVANTAGE :
 Resistance
 Management has excessive expectations

BOTTOM UP

 change process continuously consists from the lowest level upward
 changes are initiated by competent staff

DISADVANTAGE :
 Potential is not fully exploited
 Possible lack of knowledge

Change Management

Approaches in the planning and implementation

In the planning and implementation of changes four approaches need to be distinguished

BOTH DIRECTIONS

 Countercurrent process
 Combination of bottom up and top down
 Combines advantages of both approaches and will eliminate the disadvantages

MULTIPLE NUCLEUS

 Subject organizations where there is no pronounced hierarchy
 changes start at the same time in different places
DISADVANTAGE :
 Possible chaotic sequence
 Risk of uncoordinated partial solutions

Change Management

Implementation

Dissolve Change Stabilize

Analysis Perspective Joint Base Timetable / Arouse enthusiasm Fix sustainability Success
Milestones monitoring

Preparation Analysis Planning Implementation Development

 Reason  Strategy  Hypotheses  Fast success  Feedback of results
 Vision  Structure  Strengths  Detailed objectives achieved
 Objectives  Systems  Weaknesses  Detailed plans
 Expected Results  Values  Opportunities risks  Detailed concepts  Target balance
 Roles  Skills  Conflicts  Introduction  Revision
 Milestones  Style  Stabilization
 Stakeholder  Features
 Risks

Coaching and Communication

INSTRUMENTS

Change Management – Analysis

Management Audit

Audit Benefit

 Management Audits are general examination procedures to evaluate processes for the  Identification of potential employees
performance, whereby mainly the practical knowledge of the company is  Increasing the motivation of employees
systematized.  Transparency for future tasks

 Strategy is determined  Requirement profile  Knowledge Test  All participants will  The detected potential
 Audit conversation
 Acceptance issue is needs to be created  External assessment compare their results of the employees serves
 Self-assessment
resolved  Key capabilities from as the basis to enforce

included  Creation of an individual the strategy

profile

Change Management – Analysis

Management Audit – Example 1

Project definition Requirements Employees: Jan Smith
Notes
Features Bad Average Good
…
This text is intended to Communication …
demonstrate how your own Quality assurance …
text will be displayed when Strong personal presence …
you replace the. …
…
Decision making …
…
Assessment by: Promote teamwork …
…
Coaching and support

Manager 1 Target orientation
Manager 2 Take charge
Manager 3 Placeholder

Summary

Change Management – Analysis

Management Audit – Example 2

POTENTIAL High Talents Mrs. Doe Stars
Placeholder
Placeholder Placeholder

Low Mr. Smith Mrs. Doe Placeholder

Critical cases CURRENT PERFORMANCE Achievers
Low High

Change Management – Analysis

Stakeholder analysis

Stakeholder Objectives / interests Attitude to the project Influence of stakeholders Impact / Power

Client Provides money and resources, Positive Direct (Medium) High
Employees expects a professional project
Board of Directors management.
Environmental association
… Provides his technical know-how. Neutral Direct (Large) Medium

Want a successful project. Positive Direct (Large) Low

Want to boycott the project and Negative Indirect (Small) Low
stop it if possible. … …

……

Change Management – Analysis Effect of Decisions

Scenario analysis positive
extreme scenario
Positive Extreme Scenario
trendline
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Trend Scenario

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Negative Extreme Scenario years 5-10 11-20 negative
>20 extreme scenario
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trouble event decision point
(f.e. use of measures)

Change Management – Analysis

TPC Matrix

Technical value-level Strategic Direction Task distribution / Process organization Staff

 Mission ? ?
 Vision
 Strategic direction Do we have the Are the right employees
 Business model right organization? at the right places?

Political level ? ? ?
Cultural level
Who wins / loses Who is the beneficiary Who is a promoter / opponent?
by realigning? of this constellation?
?
? ?
Do we have enough role
Which of the values need Do we have adequate models for the values?
to be strengthened? strategic management behavior?

Change Management – Analysis

Acceptance matrix

Assessment of Skeptics Promoters include first
personal risk core ca. 40% ca. 5% include later
don’t include
high low Opponents Suppressers
ca. 40% ca. 40%

high low

Assessment objective risk core

Change Management – Instruments

Roadmapping

2020

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2021

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2022

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Change Management – Instrument

Communication

Change or modification is not an indispensable part of everyday business. Changing market conditions, customer and technical
progress permanently challenge all involved. Structures and processes must be designed differently and staff must also be convinced

and amazed.

Implement change properly

Change Management – Instrument

Content

Placeholder  Why the change is necessary
text  Express gratitude to the employees

Placeholder  How will it be after the change
 Explain change process
Placeholder
 Anticipate possible problems
Placeholder  Presentation of the effect without change

Placeholder  Identify external forces
 Find out what will not change

 How to express resistance
 Demonstrate how far you have already come with change

Change Management – Communication Further Training
Motivation
What the management should try initially:
Information
 Clearly inform about causes and goals of change
 Sufficiently motivate through immaterial and material incentives The Employee
 Motivate employees to active involvement Protection

in the process of change
 Professionally qualify employees through further training
 Protect and support employees who are negatively affected by

the change (f.e. protection against dismissal, retraining)

Change Management

Motivational tools

Participation Rapid success Awards

Promote agreement Successful role models Intrinsic incentive
potential
Avoid rejection Communication
Qualification
Top-down Severance
impulses

Preservation of the Offsetting transactions
tried and tested

PLANNING/ IMPLEMITION

Change Management – Key factors

Phases for a successful implementation of the CM

1. Management by objectives

"Where do the issues arise?"

8. Selection of the key persons 2. No action without diagnosis
"A good analysis is already
"people ultimately control processes" halfway the success of a project"

7. Vivid communication 3. Holistic thinking and acting

"Communication as a management tool" "No neglect of the people"

6. Process-based management 4. Participation of stakeholders

"Factual and emotional coherences" "creation of identifications"

5. Helping people help
themselves "Distributed
self-organization of employees"

Change Management – Key factors  Onboard the employees
 Raise awareness for the issues
Supporting and resistant elements
Awaken energy & create trust
 Review communication regularly
 Develop early warning system Thinking in processes and structures
 Organize workshops
 Dynamic thought & action approach
Ensure learning  Acceptance of the unpredictable

Organize from outside to inside Align business to environment

 Customers and the market have the highest priority  Consideration of the factors and conditions in the external
 Align strategy, objectives and measures environment of the company
 Employees and shareholders have a lower priority

Communication

 ensure internal networking through communication
 Communication is a key managerial function

Change Management

Conditions for successful leadership through the process

01 02 03

BE ACTIVE BE RESPONSIBLE BE CLEAR

Change yourself and your area otherwise Do not hide behind others; Ensure at all times perfect clarity
be you’ll be changed. take 100% responsibility about visions, strategies, change objective,
at any time!
content and effect chains.

04 05 06

BE FLEXIBLE BE A ROLE MODEL BE PART
OF THE PROCESS
Changes start with you. Dispose of ineffective Live the new behavior, the new
habits and prove you that you can change values and the new culture actively ... only then will Work openly with others and use
yourself. the general support system.
your employees follow.

Change Management

Supporting/promoting and resistant elements

+ Change-promoting elements - Change-resistant elements

 Live a clearly articulated vision  Continuous monitoring & evaluation
 Progress and future orientation  Rigid workflows
 Initiative & Ideas  Rigid hierarchy
 Accept personal boundaries  Encrusted structures
 Respect for moral principles  Too much responsibility for individuals
 Social responsibility
 Fairness
 Equal opportunity

Change Management

Crucial success factors

Effective New Permanent and targeted Well-planned and organized
leadership qualifications communication method

 Support actively and visibly  Enforce new training on the job  Consistently open and honest  Early introduction of activities
 Show the commitment as units to qualify staff for new tasks  Use of the available measures of  Systematic approach

promoters for change  Implement trainings with coaches communication
 Continuous motivation of the entire for additional qualification

team

Change Management

Obstacles

Resistance Inadequate Limited time,
of middle leader resources and
management
 No visible and budget
levels active support
 Overshadowed
 Because of loss by everyday
of power and / or work and
limited project responsibilities
involvement
Resistance of
employees

 Fear of the
unknown

Change Management

Resistance on an individual level based on perception, personality and needs

Fear of the New Habit
and Unknown
As a try not to make decisions all the time
e.g. Switch of a system in the job (complexity reduction)

Economic Factors Security

e.g. insecurity regarding the fulfillment of new Change as a possible threat for people
or altered job requirements with a distinct need for security

Selective Information Processing

Security attitude towards own perception.
New information are blinded out . E.g. introduction of a new QM-System