Title: Since We Know Why Transformation Efforts Fail, Let's Do Something About It
1Since We Know Why Transformation Efforts Fail,
Let's Do Something About It
- Presentation to Northeast Tennessee Section 1106
of ASQ - January, 2006
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8The Global Chemical Business
Chemical Industry
Focus on efficiency productivity Shorter
product life cycles Difficult to sustain
competitive advantages
9Business has changed
- U.S. balance of trade payments (look at first
year that Chemical industry went into negative) - 1970 2.6 B
- 1995 - 96.4 B
- 2005 - 617.6 B
- American Industry has undergone tremendous change
- Toyota is overtaking GM as the largest automobile
manufacturer - Market value of Eastman Kodak
- 26.6 billion in 1996
- 6.7 billion in December 2005
- Market value of Eastman Chemical Company
- 4.3 B in 1996
- 4.5 B in December 2005
10Challenge Pricing Power
The impact of competition on U.S. manufacturing
profits
Prices in the whole economy
Prices for manufacturers
Source U.S. Department of Commerce
11Changes in Chemical Industry - Growth in
Developing Countries
Source CE News, 7/18/2005
12U.S. Benefits Today
- Total Health care costs have increased
significantly since 2000 - Average of 11.5 per year increase
- Annual costs per employee has doubled (4,101 to
8,046) - Projected costs to employees (premiums and out-of
pocket costs) has doubled too (1,370 in 2000 to
3,136 in 2006) - Movement away from defined benefit pension plans
due to escalating costs
Source Hewitt Associates
13Focus of ASQC and Change Management
- Helps identify burning platforms in need of
change - Benchmarking helps us see needed change we might
have missed - Enables us to focus efforts on improvement in the
technical/business areas - Facilitates a systematic and organized approach
to managing change
14EXERCISE
- Imagine a recent significant change youve
experienced. - Describe feelings you had.
- Describe questions you had.
- Describe other thoughts you had (clean them up in
necessarily). - Describe other responses.
15Stages of Change (Grief Process)
- Denial
- Shock, I just cant believe this....
- Anger
- Including rage, envy, and resentment
- Why I am so mad I could....
- Bargaining
- If we could just go back to the old days
or......delay this a little longer or......can I
buy some points toward retirement... - Depression
- Includes sadness, gloominess, pessimism, guilt,
and feelings of worthlessness - Well, I just dont care about anything...
- Acceptance
- not to be equated with happiness
- Intelligent Well, there is nothing I can do
about it... - Emotional I am going to make the best of it
16Managing Response 2 Agent Tactics
7. Acceptance Target Responds to change
realistically Agent Tactics
Acknowledges progress and plans future
3. Anger Target Effort to regain control Agent
Tactics Legitimize/not personalize
Active
4. Bargaining Target Trying to minimize
impact Agent Tactics Confrontive reality
testing
6. Testing Target Beginning to try new
alternatives Agent Tactics Help explore
realistic options
2. Denial Target Defending against unacceptable
reality Agent Tactics Cautious
reality testing
1. Immobilization Target fear, confusion,
overwhelmed Agent Tactics allowing/accepting
5. Depression Target Frustration, sense of loss,
low coping Agent Tactics
Supportive/Encouraging Responsibility
Time
Passive
17- Why Transformation Efforts Fail
- (John P. Kotter)
- Not establishing a great enough sense of urgency.
- Not creating a powerful enough coalition.
- Lacking a vision.
- Undercommunicating the vision by a factor of ten.
- Not removing obstacles to the new vision.
- Not systematically planning for and creating
short-term wins. - Declaring victory too soon.
- Not anchoring changes in the corporations
culture.
18Imagine a major organizational change effort in
which you've been involved
19- Why Assessment of Change EffortAss
- Establishing a great enough sense of urgency.
- 1 2 3 4 5
6 7 8 9 10 - Creating a powerful enough coalition.
- 1 2 3 4 5
6 7 8 9 10 - Defining clear vision.
- 1 2 3 4 5
6 7 8 9 10 - Communicating the vision by a factor of ten.
- 1 2 3 4 5
6 7 8 9 10 - Removing obstacles to the new vision.
- 1 2 3 4 5
6 7 8 9 10 - Systematically planning for and creating
short-term wins. - 1 2 3 4 5
6 7 8 9 10 - Not declaring victory too soon.
- 1 2 3 4 5
6 7 8 9 10 - Anchoring changes in the corporations culture.
- 1 2 3 4 5
6 7 8 9 10
20Successful Unsuccessful
- War in Iraq
- Transformation of Japanese industry in the
1960-80's - Transition of power in South Africa
- Transformation of GE
- Cuban invasion
- Response to quality movement in U.S. industry
- Transition of power in Iraq
- Transformation of Kodak
21Why Change Leadership?
Change Leadership minimizes the length and
breadth of the performance and motivational dip
that most change efforts cause.
- Expect a downturn in
- Productivity
- Attitude
- Minimize the depth of the Valley of Despair
- Minimize the time before benefit realization
occurs
Organizational Performance
Minimize Disruption
Valley of Despair
Time
22Definition Change Management Effectively
managing the dynamics associated with change in a
manner that minimizes resistance and maximizes
the commitment to change in a way that
accelerates the improvements in business results
while enhancing the quality of life.
23- Why Change Management Process
- (Another Alternative)
- Define case for change with sense of urgency.
- Create a powerful enough leadership coalition.
- Define a clear and compelling vision.
- Develop and execute an effective communication
plan. - Remove obstacles to the new vision.
- Plan for and create short-term wins.
- Declare victory when change is successfully
implemented . - Anchor changes in the organizations culture.
24Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
?
Don't Let Up
Make Change Stick
Complacency
Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
?
Increase Urgency
Don't Let Up
Make Change Stick
False Starts, Misalignment
Communicate for Buy-In
Empower Action
Short-Term Wins
?
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Confusion, Misguided Efforts
?
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Inaction, Resistance
Communicate for Buy-In
?
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Frustration, Lack of Action
Communicate for Buy-In
Empower Action
?
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Loss of Momentum, Cynicism
Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
?
Make Change Stick
Sub-optimization
Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
?
Wasted Effort
25Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
?
Don't Let Up
Make Change Stick
Complacency
26Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
?
Increase Urgency
Don't Let Up
Make Change Stick
False Starts, Misalignment
27Communicate for Buy-In
Empower Action
Short-Term Wins
?
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Confusion, Misguided Efforts
28?
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Inaction, Resistance
29Communicate for Buy-In
?
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Frustration, Lack of Action
30Communicate for Buy-In
Empower Action
?
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Loss of Momentum, Cynicism
31Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
?
Make Change Stick
Sub-optimization
32Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
?
Wasted Effort
33Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
?
Don't Let Up
Make Change Stick
Complacency
Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
?
Increase Urgency
Don't Let Up
Make Change Stick
False Starts, Misalignment
Communicate for Buy-In
Empower Action
Short-Term Wins
?
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Confusion, Misguided Efforts
?
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Inaction, Resistance
Communicate for Buy-In
?
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Frustration, Lack of Action
Communicate for Buy-In
Empower Action
?
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
Make Change Stick
Loss of Momentum, Cynicism
Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
?
Make Change Stick
Sub-optimization
Communicate for Buy-In
Empower Action
Short-Term Wins
Get the Vision Right
Build Team
Increase Urgency
Don't Let Up
?
Wasted Effort
34- Principles of Leading Change
- Honor the past.
- Leaders demonstrate commitment to the change.
- Continual communication.
- Minimize ambiguity.
- Maintain and enhance self-esteem.
- Ask for help and encourage involvement.
- Provide support without removing responsibility.
- Commit the necessary resources.
- Listen and respond with empathy.
35Dialogue