Change Project Management - The Next Step
Change is simple. just like losing weight is simple! It takes hard work. Change project management skills and activities, added to the traditional science of project management, ensure the successful implementation of change initiatives.
This paper will discuss the definition of change projects, the components of a change project and how they relate to the science of project management, and the skill sets necessary to successfully manage change projects.
Many of the ideas and concepts presented in this paper were developed in the field. The author's experiences in managing large system implementations in the financial industry serve as the basis for these ideas. Examples from these system implementation projects will be used throughout. Note that although examples of technology projects are used in this paper, the principles can be applied to any type of change project.
What is a Change Project?
We are increasingly more project-oriented in today's business climate. As defined in the Project Management Institutes' A Guide To The Project Management Body of Knowledge (PMI Standards Committee, 1996), a project is a "temporary endeavor undertaken to create a unique product or service."
Paul Dinsmore provides another definition of projects and project management: "A project is a unique venture with a beginning and an end, conducted by people to meet established goals within parameters of cost, schedule, and quality. Project management is the mixture of people, systems, and techniques required to carry the project to successful completion." (Dinsmore)
Change projects encompass all of the characteristics of projects as defined above. The main distinction is that change projects impact the lives of individuals in a significant way.
Examples of projects include a quarterly marketing mailing, an executive speaking tour for financial analysts, or accounting audits. Examples of change projects include reengineering efforts to change departmental processes, implementation of a mission critical computer system, or a shift in organizational structure from a centralized to a decentralized environment.
- Quarterly Mailing
- Executive Tour
- Accounting Audit
- Reengineering Effort
- Mission Critical Computer System Installation
- Move from Centralized to Decentralized Environment
Each of these examples meets the criteria of a project and can take advantage of all project management techniques. These projects are temporary, have a defined delivery date, require multiple resources, and are complex enough for project planning and other professional project management methodologies to be necessary for successful completion. The major distinction of change projects is they have a significant impact on people's work lives. In the case of a reengineering project the job functions and interactions for each member of the department--and sometimes even outside departments--will change. Implementation of a mission critical computer system will also have a significant impact on the job functionality of individuals using the new system. In many cases all aspects of the person's job will change. Not only will procedures be different but also accessibility to important data, revised perceptions of service levels, and many other intangible factors will change. A shift in strategy from a centralized to a decentralized environment (or vice-versa) brings up a number of significant questions in the minds of employees. These concerns affect an individual's future, their comfort level about their livelihood, as well as implications regarding their self-worth.
On the other hand, projects such as quarterly mailings, executive tour logistics, an accounting audit, and sometimes even new product development are part of the core business and accepted as business as usual. Therefore, there is less of a human impact with these projects than with change projects.
Another distinction relative to change projects is that they frequently require multi-dimensional change. For example, the implementation of a new computer system often implies a change of work process, a revised ongoing training curriculum, different levels of authority and security, and a revised performance measurement and compensation program.
The Components of Organizational Change Projects
In this section, individual change projects will be discussed from the perspective of preparation for the change project and the execution of the project itself. This section concludes with an analysis of leveraging change which deals with the complexity of multiple, competing change projects, and the implications for the executive suite in integrating change projects to successfully meet goals.
Preparing for Change
Take time at the start of a change project to consider the way the organization operates today and to envision how things will be different when the change you are charged with leading is successfully implemented. In evaluating this vision, focus on the gap between the present and the imagined future. Six "levers of change" (Price Waterhouse, 1995) serve as a filter for this analysis:
- Markets and Customers - How do we view and segment our markets and customer base?
- Products and Services - Must the scope and variety of our products and services be different? Are revised strategic alliances and partnerships necessary?
- Business Processes - How will changes in business processes impact performance requirements at the various levels of the organization?
- People and Reward Systems - What kinds of people will the new environment require? How will the culture need to adapt to support the new way?
- Structure and Facilities - Will the organizational structure require changes? Are new or updated facilities required?
- Technologies - Does the current information-based technology support the new vision?
Development of this vision will help answer the questions: What is the scope of the change project? How far can we go? How many of the "levers of change" can the project team impact? If you define a very limited scope and reach it, success may not make a difference. If you stretch beyond the sphere of influence for the project, failure is probable.
Confront reality when defining the projects' scope and implementing the change project. There may be realities that provide a challenge and can be overcome. There will be realities that must be planned for and there are realities that will be cause for not embarking on the change project at all. Address these issues as early as possible. A large system implementation project designed to convert from a service bureau to an in-house system, although technically successful, was reversed after two years because the organization was simply not comfortable with the responsibility of maintaining the system. This reversal came at an enormous cost in dollars, lost time, and impact on people.
Another key is to focus on a strategic context and integrate the change project with management objectives. It is critical to the success of any change project to establish support for the change from the executive level down to the supervisory levels. This support is difficult to create and sustain. Support is more easily obtained when the change is in line with the strategic goals of the organization. There are incentives to meet these strategic objectives and aligning a change project to these strategic objectives allows the change project to benefit from this external incentive.
When managing large change projects we seldom encounter resistance that is unjustified. The most effective means of dealing with resistance is to solve the underlying problem that is the basis for the resistance. The solution, coupled with effective communication usually offsets the resistance, and many times completely reverses the individual from a resistor to a staunch supporter.
The difficulty however, is identifying the resistance in the first place. The most dangerous resistance is unknown and not dealt with. Some resistance is overt, but most resistance is hidden below the surface. The successful change project is structured to identify this resistance early and put a plan in place to deal with it.
Rick Maur in his book Beyond The Wall Of Resistance, lists the following signs of resistance (Maur):
- Immediate Criticism
- Malicious Compliance
- Easy Agreement
- In-Your-Face Criticism
Perception is just as important as reality in identifying resistance. As resistance is identified, a plan must be developed to mitigate the effects of this resistance. Most importantly the tasks of this plan should be integrated into the overall project plan. The same level of importance should be assigned to resistance mitigation as to any task in the project.
An effective change project management team must be representative of all constituencies impacted by the project and must possess the capabilities necessary to lead the change effort. Required skills of the successful change leader are discussed later in this document. These skills, along with certain fundamentals of transition management, must be represented on the team.
These fundamentals include:
- Sales and Marketing
It is critical when selecting a change project team that these fundamentals are represented on the team. Each team is different. In some cases one individual is the go-to person for a number of characteristics. In other teams a certain characteristic is so important that many individuals on the team require the particular expertise. If the skills are not available the team should be supplemented with outside consultants that possess the skills. For example, most project teams we encounter tend to be overloaded with technical skills and lack communication skills. However, take care that outsiders do not dominate the team make-up. Too many outside resources may be divisive when attempting to build coalitions.
In any significant change project the team will evolve and grow. The effective change leader will have mechanisms in place to allow new team members to be successfully integrated in the existing team. A deep bond develops very quickly within a project team. Although this is a powerful tool, it can hinder acceptance of sorely needed resources at critical points in the project.
Infrastructure for the change project team must also be addressed. In many cases it is advisable to establish a communication infrastructure that is segmented from the mainstream communication tools used in the organization. With the advent of Intranet technology, segregated project communication is easily facilitated (Canterucci, 1997).
With the exception of small pilot projects, successful change projects cross organizational boundaries. Determine the boundaries for a change project and if the project team has the ability to impact these boundaries. If limitations exist, the project may have no chance of success unless these limitations are considered when defining the scope of the project.
For example, if it is obvious the reward system supports the old way and not the proposed new way of operating, and the reward system cannot be changed, there is no point in moving forward with the project. The first step would be to obtain approval for changes in the reward system before embarking on the originally intended change initiative.
Most change project failures are organizational in nature. Identify the infrastructure issues that will ensure continued success of the change initiative. As organizational impacts are identified, tasks should be added to the project plan to address these issues. Areas to review include:
- Reward systems
- Job responsibilities
- Organization structure
- Policies and procedures
- Human resources
Change Project Planning/Monitoring Workshop
To properly lay the foundation for change, each change project should begin with a Change Project Planning/Monitoring Workshop. This workshop should be conducted regularly throughout the life of the project to ensure that the project leadership team maintains an appropriate view of the project. The workshop is structured to address the following issues:
- What areas of resistance to the change project exist?
- What are the capabilities of the change project management team?
- What impacts on the organization result from the change project?
This workshop helps identify areas that require attention, create an awareness of organizational issues, and identifies information that will be the basis for the change project plan.
The key to this workshop is the development of tasks that are integrated into the project plan. The capture and management of these tasks related to the change side of change project management are critical to success and are often the tasks that are overlooked or addressed outside the project management process.
Foundation for Change
It is critical to lay a foundation for change and through open communication, reinforce this foundation throughout the change project. One common mistake--change leaders assume the reasons for change are obvious. Once we have convinced ourselves, it is easy to assume that everyone we come into contact with on the project has the same information and has had the luxury of digesting this information to come to the same conclusions we have. This obviously is not the case.
Earlier, the levers of change or different dimensions of thinking about change were presented. Many people will intuitively understand a few of these dimensions but seldom will they comprehend the impact of all aspects of the change project. Successful change leaders will summarize the vision of the enhanced environment and the effort it will take to get there so constituents can "catch-up" as quickly as possible.
Execution of the Change Project
As described above, the human aspects of a change project should be treated in the same way as the mechanical or technical aspects of the project from a planning perspective. Building a coalition within a user area so the new computer system is used effectively is just as important as converting the data. If the data is converted successfully and the new system is not used or organizational problems are created as a result of this new system, did we achieve success? The following human aspects of a change project should be considered in this way.
Approaches to dealing with resistance--which includes solving the underlying problems and concerns causing the resistance as well as a detailed communication plan--should be incorporated into the project plan. It is sometimes helpful to assign a project team member to "work" a specific resistor. As a project manager, it is easy to overlook these sometimes time consuming tasks the project team member has been assigned. Without incorporating these activities into the project plan, problems can emerge in managing the project team resources effectively.
With any project it is necessary for the project plan to be broken into easily definable phases. Everyone involved in the project should be fully aware of which phase they are currently in. In change projects of significant size these phases overlap and it can be very confusing. It is natural for project team members to temporarily shut down, especially if the previous phase was late and a final push for completion was necessary. The goal of the change project manager is to use communication, leadership, and human resource management skills to avoid the normal downtime between project phases.
During each of fourteen similar large change projects in different financial institutions, each project was disrupted by an acquisition. This type of major organizational change impacts a project with a general temporary paralysis. Additionally, this type of outside influence may have a more tactical effect that has an even greater impact on the project.
In one example, executive management determined that it would be advantageous to convert the smaller, acquired company to the new system first. The thinking was that it was lower risk and would serve as a practice run. This approach obviously had little regard for the people in the newly acquired organization. In this example, although the new company successfully converted on time, the change in direction and focus caused the larger, acquiring organization's conversion to be delayed by six months at a cost of approximately $600,000 per month.
Other outside influences include reorganizations, management changes, downsizing, negative public relations, and other organization initiatives.
The key for dealing with outside influencing factors is simply sound change project planning techniques that anticipate shifts in corporate focus and incorporate contingencies into the planning process. Ultimately, some outside influences can't be anticipated and flexibility and quick revision of plans is necessary.
It is very easy for the change project leader to be extremely focused on their project. We have discussed previously the outside influence of other change initiatives within the organization. The change project manager must be aware of all change projects within the organization and how their project blends with the other initiatives. It is the responsibility of the change project leader to be informed and up to date on all initiatives that can have an impact on their project.
Change by definition is a variable process in which we don't know all of the facts. There is a proverb that states "You can't leap a twenty-foot chasm in two ten-foot jumps." This proverb may be interpreted as recommending a big bang approach to change--the idea that we really can't start a change effort until we know all of the facts. A better interpretation is that we should not embark on a change project unless we can make a case for the change that paints a vivid picture of the process for those being impacted. In fact, we can cross a twenty-foot chasm with multiple leaps if we can clearly see the stepping stones to the other side.
Some keys for the executive suite in leveraging multiple change efforts within the organization:
- Believe change is possible and necessary.
- Find the balance between stretching the organization and asking the impossible.
- Ensure organizational performance measurement techniques support change.
- Reward innovation.
- Benchmark for best practices--inside and outside your industry.
Change Project Management Skill Sets
Project planning is both an art and a science. Without reiterating all of the published techniques for good project planning there is one concept that may be unique to change projects. The nature of change projects is that human beings are impacted, sometimes deeply. By definition change project participants can become very emotional. The stakes are higher. Approaches that are only glints of an idea can quickly become marching orders. Control can be lost quickly. The change project team leader does not have the luxury of taking a great deal of time to analyze the implications of proposed changes to the plan.
For example, in our large system implementation projects it was always preferable to convert to the new system on a three-day weekend as large volumes of invested client assets could be at risk if there were delays in the process. It was also preferable to convert the data at the end of a reporting period. This posed a planning problem due to the lack of three-day weekends that fell at the end of a month. As the projects entered their final phases and the inherent panic concerning completion set in, high level executives would usually suggest a switch to a year-end conversion. Their argument was that it was less risky, and client confusion would be reduced since there would be a clean break at year-end. Additionally, the project team would receive added time to complete the final implementation tasks.
Invariably this was not a good idea because of the volume of year-end work that large financial institutions must perform. This work involves the computers as well as the people, many of which were on the project team. There were other technical arguments against this approach as well. If the change project manager was not prepared with these arguments, this approach (suggested by a top-level executive) at an emotionally charged time could put the change project in jeopardy.
The change project leader must have a vision of the project plan and all of its complexities available for recall at any time. Similar to the heads-up display of a fighter pilot, the change project leader must be able to instantly see the implications of proposals or compromises and be able to argue the validity of the proposed actions relative to the scope and goals of the change project. It is also important to anticipate these "brainstorms." This is possible if the change leader knows their constituencies and what their underlying goals and motivations are at any point in the project.
"Project Time" Management
"Project time" is different from regular work time. In our regular jobs, the goal is to have enough work left over on Friday evening so there is a reason to come back to work on Monday! The concept of not getting everything done is built into the process.
Project time requires that we get everything done as soon as possible because there is a defined completion date. Also, given the nature of change projects, unanticipated tasks will come up that must be completed without revising the deadline. Communicating this fact of life is a top priority for change project leaders, especially with an inexperienced, temporary project team.
It is unlikely that too much time can be budgeted for the important act of coalition building and representing the views of all constituents on the change project management team. The change leader can expect to spend at least half their time on this task. Coalition building is done at breakfast meetings, in the hallways, and as meeting attendees are gathering their papers. Cooperation of constituents representing many different viewpoints is necessary for successful change implementation. The job of the change leader is to anticipate the actions and reactions of important constituents, possibly influencing these actions and reactions. Like the general population it is dangerous to stereotype change constituents. Individuals change their viewpoints as new information is obtained and evaluated. Keeping ahead of this curve is the challenge. Change project leaders however do have control of the information communicated concerning the change project to these constituents. Clear, concise, communication in terms that are relative to the audience serves as the best way to build effective coalitions that can pay large dividends at critical points in the project.
The best decision-makers are the most experienced decision-makers. Many change project teams are staffed with up and coming, though relatively inexperienced employees. The change leader should study decision making theory in order to assist the project team in making decisions that usually have a much greater impact than any they have been forced to make in their assigned jobs. It's difficult for these employees to have a cross-boundary view of the organization and therefore may miss important implications of their decisions. Some keys for the change leader (Kaye):
- Place the decision in context.
- Organize the important information.
- Formulate the decision as a problem.
- Structure the problem to cut it down to size.
- Transform the problem into a goal.
Change projects are by nature emotional undertakings. Change project leaders are very busy people. The skill of active listening, which is important for any leader, is hypercritical in a change project. Many times the change project leader is temporarily responsible for the careers of members of the project team. With little background information, in a volatile situation, the project manager must effectively deal with the matrix management environment. Listening is key.
Listening for the subtle nuances of the corporate political process can save a great deal of time and effort and possibly the project. The unsuccessful change leader, while having many of the expected project interactions, misses the important information due to a lack of listening skills.
The change leader will be faced with numerous meetings. Meetings will range from informal to very formal. A change project leader's calendar can contain meetings with the lowest grade employees and the highest level corporate executives within the same day. Meeting leadership skills can sell ideas, build coalitions, obtain additional resources, facilitate decision-making, obtain objective status reports, communicate the project status, resolve project issues, in other words, facilitate the tasks of change project management.
A communication plan is critical for the success of the change project. This plan starts with building the foundation for change, sustains enthusiasm and momentum throughout the project, and praises all involved as success is realized. Communication has to be honest. Trusting the constituents to handle this honesty builds credibility. Communication is required often, even if all of the facts aren't available. Perception is important. Any communication should be simple and straightforward, presented in terms of the business reasons for the change.
Change is simple, but it does require a great deal of effort and a unique combination of leadership skills for success. The change management techniques and skills outlined in this paper, coupled with the techniques and skills of traditional project management, together allow organizations to reach their goals.
Jim Canterucci, founder of Transition Management Advisors, is an executive advisor and professional speaker on the subjects of change project management and innovation. He can be reached at 614.899.9044 or on the web at www.corpchange.com
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