The psychology of change: understanding the guiding principles of effective change management

Most change management models in use today are in the form of a process or set of steps. In fact, the most effective processes or methodologies are based on research and the experiences of change management experts from years of trial and error in the field. However, the underlying lessons and principles that produced these change management processes and tools are not always clear to the practitioner (especially if you are new to the field of change management). In many cases, the guiding principles and lessons-learned are not even discussed as part of the model or tools. The result: you learn the how but not the why. The years of practical experience and knowledge that formed the basis for these processes are not readily available to a person trying to make them work in a specific situation. This new tutorial series goes beyond the activities and tasks of managing change for one simple reason: understanding the why makes you better at doing the how. Change management is not a matter of simply following steps. No two changes are exactly alike, nor are any two organizations. Following a recipe for change management is insufficient to drive business results. The right approach will be specific to the situation. If you do not understand the why behind your actions as a change management practitioner, changes can fail even when reputable change management processes are followed. In this tutorial series, we will examine some common activities and strategies that are used by change management professionals, and uncover why these activities or strategies are used. For example: y y y y y y y Why do business leaders need to communicate directly with employees instead of using the communication cascade or the normal chain of command? Why are change management practitioners not the best people to manage resistance with employees? Why are the designers of the change often the worst at managing the people side of that same change? Why are supervisors and managers preferred communicators, even more so than the project team? Why do background conversations and the rumor mill sometimes carry more weight with employees that the official communications? How do the values of an organization impact the approach to managing change? Why do employees resist change, even when the change is a good idea for everyone?

The net result is this: to be effective at leading change, you will need to customize and scale your change management efforts based on the unique characteristics of the change and the attributes of the impacted organization.

2009

Prosci and Bill Cigliano

The application of change management should never become so automatic and rote that it is akin to a "recipe" of tasks. Cooking, in fact, is a good example of how understanding the "why" makes you better at the "how." The difference between a cook and a chef is really a fundamental understanding of why things are done. When following a recipe, a cook will do exactly as the recipe calls for, and in most cases they produce a predicable result. But, have you ever followed a recipe only to be surprised at the outcome (and not always pleasantly surprised)? Changes in temperature, humidity and elevation can affect the results dramatically. Even small changes in the amount of certain ingredients can throw off a recipe. Since a cook rarely knows "why" the recipe works, they also rarely know why the recipe failed. Following steps is just that, following steps. A chef, on the other hand, understands the chemistry of what is occurring, and knows the "why" behind each element of the recipe. When variables change, chefs can adjust to create the

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outcome they want. Most importantly, a chef can taste the result and tell you what is missing. They have the ability to assess and correct as needed. Change management shares this simple principle. Understanding the "why" makes you better at the "how". When you apply change management tools and techniques to a change, you should strive to be a "chef" in that you are not blindly following a recipe or formula, but you are carefully crafting a change management strategy and approach that meets the needs of your situation. You are able to assess and correct, constantly adjusting your tactics to match the evolving conditions. Managing the people side of change involves one of the most unpredictable variables that you will ever encounter: people. Our ability to understand the foundational elements or the "why" that underlies change management tools and processes will ultimately determine the success of our changes, and our own personal success. This does not mean that we don't need a recipe as a starting point - a methodology based on proven methods combined with understanding the "why" is the most powerful combination. To accomplish this customization, an understanding of the psychology of change and the key guiding principles is vital. You will then be able to work with many change management tools and adjust your approach according to the size and nature of the change, ultimately making your change a success. The guiding principles that will impact your change management activities are shown in Figure 1. The overview of principles and ideas presented here is not intended to be an in-depth psychological analysis. Rather, the focus will be on the key insights from these principles that impact effective application of change management.

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Figure 1 - Seven guiding principles of effectively managing change

In this tutorial series, we will investigate each of the areas and find out how they impact the successful application of change management. Next week we will begin with the concept of Senders and Receivers - addressing why our communications do not always have the impact we desire.

Resistance: understanding a phenomena that is natural to all of us The normal reaction to change is resistance. You may have heard this statement many times before, but do we really know if it is true, and how this simple statement can impact our change management work? Do we really believe that resistance is normal, or are we like many business leaders who are surprised by, and disappointed with, employees who resist change?

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A common mistake made by many business leaders is to assume that by building Awareness of the need for change, they have also created a Desire to engage in that change. The assumption is that one automatically follows the other. Some managers may fall into the trap: If I design a "really good solution to a business problem, my employees will naturally embrace that solution. In both cases, resistance from employees takes these managers by surprise and they find themselves unprepared to manage that resistance.

For example A financial services group wanted to consolidate its call centers across several divisions as a costsavings initiative. A consultant was hired to design the best solution and implement the change. The project just started when rumors began to spread through several departments: This organizational change is not good for the company. Supervisors and key managers were resisting the change. In some cases they would not show up for design reviews or they would simply skip key decision-making meetings. Information requested by the consultant was withheld or half-complete. At breaks and around the coffee pot, employees complained about the consolidation effort. Both employees and managers were distracted from their day-to-day work and productivity suffered. Key managers were rumored to quit if the change was implemented. After several months of difficulties and delays, the consultants finally declared the call center consolidation in jeopardy. With the project at a stand-still, the executive sponsor requested an emergency briefing with his leadership team. They quickly identified a department head in one of the call centers as the focal point for the resistance. Arguments against the consolidation initiated by this manager were spreading throughout the ranks. It turned out that his supervisors were the same people who were resisting the change and presumably threatening to leave the organization. The only recourse at this point was reassignment or termination of this department head. However, both options would have negative fall-out for the company and the affected manager. The executive sponsor was faced with a stalled project and a potentially loselose decision for a long-tenured manager. Resistance to the change was spreading like wildfire. This executive sponsor is not the first or last business leader to be taken by surprise when employees resist change. The underlying principle at work here, as with many changes, is recognizing that resistance is normal, and that our success with change is dependent on how we plan for, recognize and manage resistance.

So why do employees resist change? From personal experience, we all know that change creates anxiety and fear. The current state has tremendous holding power, and the possibility of losing what we have grown accustom to (and comfortable with) creates worry and anxiety. For many employees, the future state of workplace changes is often unknown or ill-defined, and this uncertainly creates fear about what lies ahead. These physical and emotional reactions are powerful enough by themselves to create resistance to change. It is likely that each of us have experienced these reactions in our own lives, whether

at work or at home. But there is more to resistance than our emotional response. From a change management perspective, we must examine the other drivers that influence an employee s resistance to change. A good place to start is the nature of the change itself and how this change is impacting the employee: y y y y y Were they involved with designing the change? Do they know why the change is being made? Do they believe that the reasons for making the change are valid? Do they trust the senders of the change messages within the organization? How will the change impact them and their personal situation?

2009

Prosci and Bill igliano

You can quickly see that on top of the emotional reactions to change, resistance has other influencing factors, not the least of which is an employee s personal situation. This includes all aspects of a person s life including family status, mobility (are they in a position to be flexible in terms of where they live?), financial security, age, health, career aspirations (are they where they expected to be at this point in their life?), relationships at home and at work, educational background, upcoming personal events and past success in this work environment (promotions, recognition, compensation). For example, a person s financial situation or health may cause them to make choices related to a change that on the surface do not appear logical, but when understood make perfect sense. Similarly, a change in a person s relationship with a spouse or significant other can cause a fundamental shift in what is important to that person. To make this personal angle a bit more complex, we should also recognize that an employee s internal value system and view of self also contributes to whether or not he or she will resist a particular change. Without exploring the psychology of human behavior in depth here, we can acknowledge that what motivates a person is unique to that person. We each march to a different drummer and a given change may or may not align with where we

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envision ourselves in the future. Each of us also has an innate ability to assess whether or not we could be successful in the future state should we decide to move forward. This probability of success plays yet another role in our decision to support or to resist a change. Now add the environment or context within which the change is occurring. Employees will consider the organization s success of past changes, how much change is already going on, and the reinforcements or rewards that were part of past change. In short, the organization s culture and history directly impact a person s resistance to new changes. If a company has a history of starting changes and not following through, or if they have a track record of allowing some groups to opt out of a change, then these past events weigh heavily on the willingness of an employee to engage in a new change.

Resistance is a normal and natural reaction You can begin to appreciate why resistance to change is a normal and natural reaction to change. Even when individuals can align a change with their own self-interest and belief system, the uncertainty of success and fear of the unknown can block change and create resistance. The question, therefore, is not if we will encounter resistance to change, but rather how we support our employees through the change process and manage that resistance. We must, at some point, ask the question: How much resistance might we avoid if we would apply change management effectively? In the example with the call center consolidation project, rather than simply designing a great solution to the call center structure and beginning implementation, a proactive change management program could have been put in place to engage and support employees through the transition. Rather than waiting for resistance to happen, or being taken by surprise when key managers resisted the change, the leadership and project team could have assumed that resistance to change is a normal and natural phenomenon. If they had started with this as a basic tenet of change, then their actions and planning would have prevented the project failure and unfortunate consequence to the resistant department head.

What is the key message for you? Consider this basic thought process: If resistance to change is a normal and natural reaction, then resistance should be expected. If resistance is expected, then our planning activities should be designed to mitigate that resistance. If our change management strategies and plans are designed to prevent and manage resistance, then we are not surprised by or unprepared for resistance when it happens. We can manage resistance early and at its source. In many cases we can prevent resistance or greatly reduce it. We also can stop treating resistance as a problem employee or a trouble area. We can understand the many factors that drive resistance, and manage them accordingly, both professionally and with respect for the employees going through change. If we do a really good job at managing change, we will find that change management can shift from preventing and managing resistance to engaging employees and building enthusiasm and passion around the change.

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The three critical and relevant lessons for change management practitioners related to employee resistance are: 1. Do not react to resistance with surprise; expect it and plan for it. Make resistance management a core element of your change management plans and engage employees in the change process as early as possible. 2. Be patient with individuals as they work their way through the change process. Enable business leaders and managers to become effective change leaders and teach them how to manage resistance effectively. At the same time, be watchful for persistent and prolonged resistance from managers or business leaders. This level of resistance is a sign of a weak sponsor coalition and can threaten a project and compromise your success. 3. Assess resistance not only from an individual perspective, but also based on the larger organizational context, including culture, history and how much other change is going on within that person s team or department. Change is equally about the individual as it is the community to which they belong.

Three failure modes that plague Enterprise Change Management efforts

Building organizational change management capability and competency

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Leading organizations are starting to invest the time, energy and resources to build organizational change management capabilities and competencies. While this is certainly still a new endeavor for most, Prosci has been conducting research and development since 2005 to understand how these leading organizations are approaching Enterprise Change Management (ECM) - or said another way - deploying change management throughout the organization. During the course of conducting this research and working with clients, we have witnessed three main failure modes that have plagued these efforts. Below are short descriptions of the three main failure modes and actions steps you can take to avoid: 1. Not treating ECM as a project and a change 2. Not defining the future state 3. Not using a multi-faceted approach

Failure Mode 1: Not treating ECM as a project and a change

While it may seem like common sense, many organizations that are making tremendous progress at applying change management on specific initiatives will never make a breakthrough because they are not treating Enterprise Change Management as a project to be managed and as a change to be managed. They are chipping away, but they have not turned the corner toward the organizational deployment of change management.

Treating Enterprise Change Management as a project and a change means using the full complement of tools available to manage any project or initiative. y y y y y Does Enterprise Change Management have a charter? Does it have objectives? Is there a work breakdown structure? Is there a project plan? Is there a change management plan?

To truly build organizational change management capabilities, the initiative must be addressed and managed as an enterprise effort that requires the necessary design and planning. A second facet here is assigning people to take on the effort. Is there a project leader? A project team? A project manager? The ECM team is not just anyone in the organization who will be doing change management; it is a dedicated and passionate group who works to understand the current state, design the future state and develop tactics for the transition. The team should have, or gain, knowledge on how changes happen and how change management can be made part of the standard operating procedures for the organization. Without a team dedicated to the effort, it will stall and get no traction.

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Finally, when you ask individuals throughout the organization to begin applying change management, you are asking them to make a change. And, just like any other change to one's day-to-day work, change management is needed to ensure faster speed of adoption, higher ultimate utilization and greater proficiency. y y y Are you making a compelling case for why change management is necessary? Are you clearly articulating what people need to be doing to support change management? Are you providing the necessary skills, training and tools to those who will be managing change?

The people side of the change "applying change management" will be as critical as any design decisions the team makes (read a full tutorial about applying change management to change management). Actions steps to avoid failure mode 1: 1. 2. 3. 4. Dedicate a project team Design a solution for deployment Build a project plan Build a change management plan

Failure Mode 2: Not defining the future state

A second major failure mode comes in the form of trying to build the capability without ever defining the goal or what the end state will look like - failing to define the future state of Enterprise Change Management.

While the future state of Enterprise Change Management will look unique for your organization, you still must define what you are trying to achieve. The old saying that "if you do not know where you are going, any road will lead you there" certainly applies to organizations working to deploy change management without a defined future state. If I were to walk through your organization in three years after you have spent the time and energy working to deploy change management, what would I see? What would I be able to observe in the organization to know that you were institutionalizing change management - making "effectively managing change" how your organization operates? The answers to these questions are at the heart of defining the future state of Enterprise Change Management.

Defining a future state requires the deliberate decision that we, as an organization, are taking on Enterprise Change Management. With the deliberate decision, you can start to articulate what the future state would be like and how you would know when you arrived. Action steps for avoiding failure mode 2: 1. Ensure that a deliberate decision is made to pursue ECM 2. Define the future state 3. Know where you are going

Failure Mode 3: Not using a multi-faceted approach

The final failure mode can be best summarized by the old adage: "if you only have a hammer, everything looks like a nail". Some organizations are working to build change management capabilities; but they are not using the full set of tools available to them.

One may have a robust and complete change management curriculum, but no method for attaching change management to projects or initiatives. Another may have a wonderfully integrated methodology incorporating project management and change management, but no offerings to help managers, supervisors and senior leaders build their own personal competencies. Still another might have a formal Change Management Office, but nothing else. A successful Enterprise Change Management deployment approach is comprehensive in nature. It utilizes numerous tactics and approaches for making change management "business as usual" for the organization. Prosci's ECM Strategy Map identifies five main areas where actions are required to build change management capabilities: y y y y y Leadership Project Skill Structure Process

In the absence of a holistic approach, the likelihood of successful and lasting change is minimal. You should always consider your "default" view going into a change management deployment effort. What is meant by a "default" view of change management? If you are a person in the training and development part of the organization, you might think about change management capability from a perspective of building skills and competencies throughout the organization. If you are the director of the Project Management Office, you would likely think of change

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management capability from a perspective of integration with project management and tactics for getting change management on to projects. If you are a senior leader you might be thinking about restructuring and creating a Change Management Office within your Organizational Effectiveness group. There is nothing wrong with having a default perspective, but it is important that you acknowledge yours and expand your planning beyond it. Action steps for avoiding failure mode 3: 1. Understand your default view 2. Use all the tools you have available to make change management part of how the organization views change 3. Collaborate with others in the organization who bring different view points and perspectives

Summary
Becoming a flexible and durable organization - one where "effectively managing the people side of change" permeates how changes take place - is not an easy task. It takes time, energy and people. It requires a deliberate decision and the appropriate authority and sponsorship. While it is not easy, many organizations are beginning to differentiate themselves through their change management capabilities and competencies. If, in your efforts to deploy change management across the organization, you can take these three steps, you will greatly increase the chances that you are successful and truly change how your organization "does change": y y y Treat ECM as a project and a change Define the future state Use a multi-faceted approach

Frequently Asked Questions: Change Management Methodology

Over the past six years, the use of structured methodologies for managing the people side of change has increased dramatically. This tutorial presents some thoughts on change management methodologies in the form of a series of Frequently Asked Questions (FAQs) about change management methodologies.

What is the value of using a methodology to manage change?

A methodology for change management provides structure and intent for managing the people side of change. Change in organization is a reality, as is the fact that these changes ultimately impact how individual employees do their jobs. Given that the success of an organizational effort is tied inextricably to individuals adopting the change, change management provides tools and processes for encouraging and enabling those individual changes. The advantages of using a structured methodology include:

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y y y y y

Provide structure and rigor for the people side of change Enable repeatability Address all of the key components Avoid missing important steps Draw on the lessons learned by others

An important point here: a methodology for change management does not define or prescribe particular changes. Change management does not tell you what changes your organization needs to make. Change management is an overlay; it is applied to changes that are already decided upon to encourage employees to adopt and utilize those changes.

Can I manage the people side of change without a methodology? What are the risks?
Certainly, one could introduce a change without using a methodology or addressing the people side of change. Most projects, whether they are using change management or not, will have some elements of a communication plan and a training plan. The problem is: these communication plans tend to be "telling plans" full of project updates and details, instead of what employees really want to know - namely, why the change is happening and "what's in it for me" (WIIFM). Likewise, training plans in the absence of a change management framework typically do not have the necessary context and foundation to be effective - namely a compelling case for why the change is happening and why someone should be engaged. Have you ever been sent to training without understanding why it was important to be there? It feels like a waste of time and can actually demotivate you. The risks of trying to manage change without a structured approach include: y y y y Not providing the necessary context for your activities Not focusing your actions based on where employees are in the change process Missing key steps or activities Attempting to manage the change without all of the right "actors" being involved (namely, senior leaders as sponsors of change and managers and supervisors coaching their direct reports through the change) Wasting time and energy by "reinventing the wheel"

Some very experienced and expert practitioners may be able to address a change initiative without a structured methodology in place, but the majority of practitioners benefit from having a structured process and set of tools to guide activities. Even experienced practitioners can benefit by having guidelines in place.

Does following a methodology make change management just "boxes to check off" of a plan?
Absolutely not. The foundation of a solid change management methodology is that individuals are the ones who adopt a change. Change is organic and fluid - and it is a very personal experience. However, we can model it and take actions to encourage and support it. Just because we are applying a methodology - following a process and utilizing tools and templates - that does not

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mean we are removing people from the equation. Instead, we are drawing upon research and the experience of others to put ourselves in the best position to succeed.

Is designing the solution part of a change management methodology?

From our perspective, defining the solution is not part of the change management methodology. Change management, like project management, is a discipline and set of tools applied to a particular change. This means that recognizing a need for change and developing a solution take place in a parallel but different work stream. Prosci's taxonomy for scoping change management shows the distinct work streams that support successful change and transformation in an organization (read more about the taxonomy).

What are other practitioners looking for when selecting a methodology?

Study participants in Prosci's change management benchmarking studies have identified the key factors for selecting the methodology they used on their project. The top factors identified by participants included: 1. Easy to use - Overwhelmingly, the top factor for selecting a particular methodology was ease of use. Participants noted: Easy to implement Easy to understand Easy to communicate to others Simple Practical Structured and systematic Logical Comprehensive and holistic 2. Previous experience with a methodology - Many participants cited their own personal experience with a particular methodology as a key factor in selection. 3. Proven to be effective - The methodology chosen was proven and effective, or had been successful when it was applied within the organization previously. 4. Matched the need - The particular methodology met the needs of the change that was being introduced and was applicable to that situation. 5. Flexibility and customization - The methodology could be applied to many different types of change and in many different parts of the organization. It was flexible and could be customized to meet the needs of different change programs. Practitioners are looking for methodologies that are easy to use, above and beyond any other factor. Managing the people side of change is challenging. Although sometimes called the "soft" side of change, in reality, getting employees to adopt a new process or technology, for example, is usually the "harder" side of change. The technical side of change can be complex, but changing employee behaviors is the bigger challenge. This is why practitioners are looking for simple, actionable approaches that deliver results - a methodology that makes sense and can be scaled to meet the particular change at hand without overly complicating the issue.

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What is meant by individual change management and organizational change management?

Prosci's change management methodology is founded on the principle that effective change management requires two perspectives - an individual perspective and an organizational perspective. It is the marriage of individual change management and organizational change management that provides an outcome-orientation with the supporting tools and processes to make a change successful. Individual change management is an understanding of and model for how one person successfully makes a change. Prosci's ADKAR describes the five building blocks of successful change as: Awareness, Desire, Knowledge, Ability, and Reinforcement. Since this resultsoriented model outlines the building blocks of successful change, it is also used to guide change management plans, measure progress and diagnose gaps. Individual change management answers the question: "what are we trying to achieve by applying change management?" Organizational change management, on the other hand, answers the question: "What am I going to do to support individuals through change?" Organizational change management is applied by change management practitioners, project leaders and project team members - with the employee facing actions executed by senior leaders, managers and supervisors throughout the impacted organization. Prosci's organizational change management methodology contains three phases for practitioners to work through: y y y Phase 1 - Preparing for change Phase 2 - Managing change Phase 3 - Reinforcing change TM

Each phase includes activities and tools to support change management application by practitioners. By following the organizational change management process, you create a strategy and full set of plans to move the employees impacted by a change through their own change journey.

Establishing the scope of change management

In a previous tutorial released by Prosci and the Change Management Learning Center, we examined the definition of change management and reviewed the three clauses that make up that definition: 1) the set of tools, processes, skills and principles 2) for managing the people side of change 3) to achieve the required outcomes of the project or change initiative (read the full definition of change management tutorial). This tutorial presents a taxonomy for making sense of the scope of change management - including what is in scope and what falls outside of scope. Creating a working definition and scope for change management enables practitioners to be more successful andwork effectively with others in the organization who are implementing change. This is also a topic for ACMP (Association of Change Management Professionals) that is currently under development. The goal of the ACMP work in this area is to introduce a working framework that can serve as a foundation for discussion on this topic in order to define the boundaries for change management, while at the same time creating an inclusive community for change practitioners.

Introduction - why it is important to establish scope As with any discipline or methodology - it is important to establish the scope of change management.
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Boundaries are important to establish what activities fall under the change management umbrella and what work runs in parallel or conjunction with change management. Benefits of establishing a clear scope include: y y y y Dividing work and avoiding overlap between disciplines Ensuring that all key elements are addressed Showing the relationship between existing techniques and approaches Defining the skills and competencies to perform work effectively in a given area

In addition, there is an inherent risk of not clearly establishing scope. It becomes very easy for one group or function to believe that they are responsible for work that falls under the work responsibilities of another group - resulting in confusion and ineffective work steams. For example, imagine the confusion that would result in developing a new product if there was not a clear distinction between software development, hardware development, physical design and system test. The specific skills and competencies needed to develop software are very different from the skills need to design circuit boards or the physical housing for a product. In the same way, the skills and competencies for project management are specific and very different from change management. Understanding the scope and boundaries enables both functions to work effectively together, and to avoid any overlap of activities that may create conflicts for the project. The boundaries also enable the separation of solution design, development and implementation from the actions required to manage the technical side and people side of that solution's deployment.

Introducing a taxonomy
The schematic below presents a taxonomy that can serve as a discussion framework for the key phases or elements of implementing a change within an organization, beginning with the recognition that a change is needed and ending with the realization of the desired benefits sought by the effort.

Element

Objective

Examples

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Recognizing that a change is needed

To identify the internal or external stimulus resulting in a need for change

y y y y y y y

Internal performance Customer inputs Competitive threats Financial results New business opportunities Regulatory changes Strategic planning

y
To create a solution to improve the performance of the organization based on the recognition that a change is needed

Solution design and development

y y y y y y y

Vision and strategy development Process design / BPR New technology Restructuring Merger/Acquisition OD interventions New product offering New service offering

y y y
Solution implementation To install a solution that meets technical requirements and is adopted and utilized

y y

Pilots and trials Systems and tools deployment New process implementation Transition to new organization structure and job roles Implementation of compensation, appraisal or incentive programs

y y To manage the tasks, resources, budget, time and scope of technical design and implementation y y y y y

Project management

Project planning Schedule development and tracking Resource management Budget development and control Issue tracking Project oversight Project reporting

Change management

To encourage employees to rapidly, completely and proficiently make the required changes to their day-to-day work

y y y

Readiness assessments Change portfolio management Change saturation analysis

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y y y y y y y y y

Employee engagement Change management strategy Change management planning Change sponsorship Communications during change Training new skills and abilities Coaching employees through transitions Resistance management Performance measurement

While some overlap between disciplines is normal and to be expected, this taxonomy will be a starting point for discussions about scoping change management. This framework can assist with internal discussions about "who is doing what" and how can you make sense out of the many elements of successful change - from recognizing the need to developing the solution to managing the technical side and people side of the solution deployment. The goal is to create an inclusive framework that allows the discussion to separate out the many skills that a change practitioner may have (they may be project managers, change managers and contribute to the solution design) from the disciplinesthat are being used to successfully realize change.

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