BUSINESS PROCESS MANAGEMENT

EM2800E
CHAPTER 5 BUSINESS PROCESS IMPROVEMENT

5.1 Overview of Business Process Improvement

5.2 Tools for Business Process Improvement (Lean, 6 Sigma)

5.3 Change Management during Business Process Improvement

5.1 OVERVIEW OF BUSINESS PROCESS IMPROVEMENT
5.1 OVERVIEW OF BUSINESS PROCESS IMPROVEMENT

• Re-design

• Improvement

• Innovation
MOTIVES FOR PROCESS REDESIGN/ IMPROVEMENT

• Positive motive:
• The urge of organizations to innovate

• Reactive motive:
• Fight organizational entropy
5.1 OVERVIEW OF BUSINESS PROCESS IMPROVEMENT

Process redesign/improvement is the process of finding opportunities to

change business processes, optimize results, process efficiency, achieve
best practice standards, or simply improve quality
5.1 OVERVIEW OF BUSINESS PROCESS IMPROVEMENT

Steps to implement business process improvement

• Process analysis: modeling and quantitative analysis of existing processes

• Identify opportunities for improvement: bottlenecks in cost, quality, and time

• Proposing an improvement plan: Re-engineer the process to eliminate wasteful

bottlenecks
• Communication and training on change: Train staff involved in the process on exporting
improvements
• Adjust the change: Improvements are reviewed and adjusted as necessary

• Continuous improvement
5.1 OVERVIEW OF BUSINESS PROCESS IMPROVEMENT
EXERCISE 8.1: ORGANIZATIONAL ENTROPY

Can you identify business processes from your own experience that
were efficient at some stage, but which have become unnecessarily
complex?
EXAMPLES
• A clerk in a warehouse forgets to carry out a quality check for a specific order. The client, who receives the
flawed product, becomes upset. To prevent such a situation from happening again, the firm’s management
decides to add an extra check to the process: A second clerk will verify whether the quality check is properly
performed by the first. This is a good fix, but after some time the initial quality check becomes automated
through the introduction of a new production system. The check-on-the-check has become superfluous, but it
is still part of the process. In this way, it keeps on consuming unnecessary resources and time.

• The marketing department of an organization introduces a special campaign. Each time a customer engages
with this organization, their account manager asks for extra information beyond what is normally asked. By
doing so, the marketing team can make a perfectly customized offer to each customer. Yet, the information
comes on top of the information that the customer needs to provide anyway. After some time, the marketing
campaign came to an end, but the account managers will still ask for the extra information whenever they
interact with the particular kind of customer. It has become an unnecessary and time-consuming step.
• An internal auditing department demands that the monetary value of financial activities should be reported
whenever these are carried out. This causes an extra calculation and an extra reporting step in each of the
business processes that are affected. Over time, the management of the auditing department changes its
priorities and starts looking into other, non-financial information. The reports, nonetheless, keep coming in.
ELEMENTS OF REDESIGN

• The internal or external customers of the business process

• The business process operation view, which relates to how a business process is implemented,
specifically the number of activities that are identified in the process and the nature of each
• The business process behavior view, which relates to the way a business process is executed,
specifically the order in which activities are executed and how these are scheduled and assigned for
execution
• The organization and the participants in the business process, captured at two levels:
• the organization structure (elements: roles, users, groups, departments, etc.)
• The organization population (individuals: agents which can have activities assigned for execution and the
relationships between them)
• The information that the business process uses or creates
• The technology the business process uses
• The external environment the process is situated in
PROCESS REDESIGN

• Is a substantial and intentional change of a business process

• Is primarily concerned with changing the business process itself, covering

both its operational and behavioral view

• Extends to changes that are on the interplay between on the one hand the
process and on the other the organization or the external environment that
the process operates in, the information and technology it employs, as well
as the products it delivers to its customers
THE DEVIL’S QUADRANGLE

“improving a process along one dimension may very well weaken its performance along another”
FLEXIBILITY

• Ability to react to changes in:

• Workload
• Customer demands and expectations
• Resource and business partner availability and performance

• Example: Following natural disasters (e.g. storms), the number of home insurance claims
increases by tenfold

• To address this surge, flexibility is required at:

• Resource level: Staff redeployment, faster performance
• Process level: Performing tasks differently to speed up the front-end
• Management: Relaxing business rules and controls where possible
THE REDESIGN ORBIT
AMBITION

Transactional Methods Transformational Methods

• Seek to identify problems and • Aim to achieve breakthrough

resolve them incrementally, one innovation
step at a time • Put into question the
• Do not challenge the current fundamental assumptions and
process structure principles of the existing process
NATURE

Analytical Methods Creative Methods

• Tend to have a strong • Rely on human creativity and

mathematical and quantitative ingenuity
focus • Embrace group dynamics
• Embrace tools and technology
PERSPECTIVE

Inward-looking Methods Outward-looking Methods

• Consider the process from the • Consider the process from an

perspective of the internal outsider’s perspective
organization • Are driven by external
• Draw from objectives and opportunities and developments
performance measurement
THE REDESIGN ORBIT
HEURISTIC PROCESS REDESIGN

• Uses a fixed list of redesign heuristics to determine potential improvement actions on an existing process.

• For each of the set performance goals, redesign team reflects on relevant heuristics that may be applied: A
redesign heuristic is desirable to apply if it helps to attain the desired performance improvement of the
process under consideration.

• Applicable and desirable redesign heuristics are clustered

• On basis of these clusters, a set of scenarios can be generated, each of which describes which redesign
heuristics are applied in this scenario and, importantly, how this is done.
REDESIGN HEURISTICS
TASK-LEVEL REDESIGN HEURISTICS

1. Task elimination
2. Task composition/decomposition
3. Triage
H1. TASK ELIMINATION

Eliminate non-value-adding steps wherever these can be isolated

• Forward, send, receive, …

Consider reducing manual control steps (checks & approvals) by:

• Skipping them where feasible

• Replacing them with statistical controls

• Skipping them selectively

H1. TASK ELIMINATION

Consider trade-off between the cost of the check and the cost of not doing it
Examples:
• Procure-to-pay process: some types of employees are empowered to trigger
isolated purchases below $500 without supervisor approval
• Order-to-cash process: invoices from trusted suppliers under $1000 are not
checked on a one-by-one basis
• University admission process: authenticity check is very expensive, yet it
leads to only 1% of applications being rejected
H2. TASK COMPOSITION/DECOMPOSITION

• Consider composing two tasks to eliminate transportation and reduce

“context switches”, OR

• Consider splitting a task into two and assign to separate, specialized

resources
H2. TASK COMPOSITION/DECOMPOSITION

Composition example:
• Procure-to-pay process: Merging two checks: “Check necessity of purchase”
and “Check budget”
Decomposition example:
• Make-to-order process: Separate a single thick “prepare quote” task into
“prepare bill of materials”, “prepare production plan” and “estimate costs and
delivery time”
H3. TRIAGE

• Specialize a task: divide a general task into two or more alternative

tasks

• Generalize tasks: integrate two or more alternative tasks into one

general task
H3. TRIAGE

Specialization example:

• Procure-to-pay process: Separate approvals of small purchases, medium

purchases and large purchases

Generalization example:

• Make-to-order process: Integrate quote preparation for two product lines

into one single task
H4. RE-SEQUENCING

Re-order tasks according to their cost/effect ratio to minimize over-processing

• Postpone expensive tasks that may end up not being necessary until the end

• Put knock-out checks first in order to identify problems early

H4. RE-SEQUENCING

Examples:

• Make-to-order process: If “Prepare production plan” is time-consuming, postpone

it until after the quote price has been tentatively accepted by the customer

• Procure-to-pay process: If “Check necessity of purchase” leads to 20% of knock-

outs and “Check budget” leads to 2%, perform “Check necessity of purchase” first

• University admission process: authenticity check (very slow) leads to 1% of

applications being rejected while committee’s check leads to 80% of applications
being rejected. Put committee’s check first
H5. PARALLELISM ENHANCEMENT

Parallelize tasks where possible in order to reduce cycle time

H5. PARALLELISM ENHANCEMENT

Examples:
• Procure-to-pay process: Parallelize “Approve budget” and “Approve necessity of purchase”

• Make-to-order process: After “Prepare bill of materials”, perform “Prepare production

plan” and “Estimate costs” in parallel
H6. PROCESS SPECIALIZATION/STANDARDIZATION

Process specialization

• One process is split into multiple ones: by customer class, by

geographic location, by time period (winter, summer), etc.

• Resources are split accordingly

Process standardization

• Two processes are integrated

• Resources are pooled together

H6. PROCESS SPECIALIZATION & STANDARDIZATION

Specialization example:
• Procure-to-pay process: One process for Direct procurement (e.g. raw materials) and one
for Indirect procurement (MRO - Maintenance, Repair and Operations)

• Claims handling process: One claims handling process for the summer season (stormy
season - peak) and one for the winter season (off-peak)

Standardization example:

• Claims handling process: Integrate claims handling for motor insurance across different
brands of a group
H7. RESOURCE OPTIMIZATION

Use resources of a given type as if they were in one room

• Avoid one group of people overloaded and another (similar) group idle

Let people do work that they are good at

• However, avoid inflexibility as a result of specialization

When allocating work to resources, consider the flexibility in the near future
• Allocate work to specialized resources first

Avoid setups as much as possible

• Chain multiple instances of the same task [sequential]

• Batch multiple instances of the same task [parallel]
H7. RESOURCE OPTIMIZATION

Resource integration example:

• Claims handling process: Share resources across different types of claims
(e.g. motor and personal insurance)
Batching example:
• Claims handling process: Batch all claims for a given geographic area and
assign them to the same resources
• University admission process: Batch all applications and handle them to the
assessment committee
H8. COMMUNICATION OPTIMIZATION

Automate handling, recording and organization of messages

Monitor customer interactions, record exceptions

Optimize

1. Number of interactions with customers and business partners

2. Type of interaction (synchronous vs. asynchronous)

3. Timing of interactions
H8. COMMUNICATION OPTIMIZATION

1. Optimize number of interactions

• Gather sufficient information to get to the next milestone (reduce

external interactions)

2. Optimize type of interaction

• Synchronous interactions effective to resolve minor defects

• Asynchronous to notify, inform, resolve major defects, request

additional information to reach next milestone
H8. COMMUNICATION OPTIMIZATION

3. Optimize timing of interactions:

• Front-loaded process: bulk of information exchange and processing

happens upfront
• Complete-kit concept

• Back-loaded process: bulk of information exchange and processing

happens downstream
• Example: CVS Pharmacy in early 2000s
H8. COMMUNICATION OPTIMIZATION

Complete-Kit Concept: “Work should not begin until all pieces necessary to complete the
job are available”
Boaz Ronen

Principles for complete-kit process design:

• Provide complete and easy-to-follow instructions for those who will initiate the process.
• If a process cannot start, the client should be notified of all defects that could be
reasonably identified at the onset of the process
• Consider the tradeoff between “incomplete-kit” process initiation vs. roundtrip to revise
and resubmit a request
H9. AUTOMATION

Use data sharing (Intranets, packaged enterprise systems) to:

• Increase availability of information to improve visibility and decision-

making (subject to security/privacy requirements)

• Avoid duplicate data entry and transportation

Use network technology to:

• Replace physical flow (e.g. paper documents) with information flow

• Enable self-service via e.g. online forms and Web data services
H9. AUTOMATION

• Use tracking technology to identify and locate materials and resources

• Identification: Bar code, RFID
• Location: GPS, indoor positioning

• Use business rules technology to automate information processing

tasks (including decisions)

• Automate end-to-end processes with a dedicated BPM system or

system with process automation functionality
EXAMPLE: EQUIPMENT RENTAL PROCESS
EXAMPLE: EQUIPMENT RENTAL PROCESS

Heuristic 1: Task elimination

Eliminate “Request for approval” for small equipment

EXAMPLE: EQUIPMENT RENTAL PROCESS

Heuristic 2: Task composition

Merge equipment selection, availability check and rental request creation

EXAMPLE: EQUIPMENT RENTAL PROCESS

Heuristic 6: Process specialisation and standardisation

Separate the process for small versus large equipment and streamline the process
for small equipment
EXAMPLE: EQUIPMENT RENTAL PROCESS

Heuristic 8: Communication optimisation

Inform the site engineer when the equipment is dispatched

EXAMPLE: EQUIPMENT RENTAL PROCESS

Heuristic 8: Communication optimisation

• Inform the site engineer when the equipment is dispatched

• Add interaction to handle extensions

EXAMPLE: EQUIPMENT RENTAL PROCESS

Redesign output: to-be process model

EXAMPLE: EQUIPMENT RENTAL PROCESS

Heuristic 9: Process automation

Use self-service for the equipment search and availability checking

EXAMPLE: EQUIPMENT RENTAL PROCESS

Heuristic 9: Process automation

• Use self-service for the equipment search and availability checking

• Use process automation to coordinate handovers

EXAMPLE: EQUIPMENT RENTAL PROCESS
EXAMPLE: EQUIPMENT RENTAL PROCESS
PRIORITIZING REDESIGN OPTIONS
FULL SET OF REDESIGN HEURISTICS

• Control relocation • Split responsibilities

• Contact reduction • Customer teams
• Integration • Numerical involvement
• Case types • Case manager
• Activity elimination • Extra resources
• Case-based work
• Specialist-generalist
• Triage
• Empower
• Activity composition
• Control addition
• Resequencing
• Parallelism
• Buffering
• Knock-out
• Activity automation
• Exception • Integral technology
• Case assignment • Trusted party
• Flexible assignment • Outsourcing
• Centralization • Interfacing
THE REDESIGN ORBIT
TRANSACTIONAL METHODS

Analytical: employ all kinds of tools, involve statistics, and are strongly rationalized

Inward-looking Outward-looking
• Six Sigma • Benchmarking
• Theory of Constraints • ERP-driven Redesign
• TRIZ • Lean
fundamentally outward-looking by
• Positive Deviance
taking an external perspective on
• Heuristic Process Redesign
process redesign
strongly focus on the existing process in
an organization as a starting point
TRANSACTIONAL METHODS

Creative: Unleashing the creativity of people

Inward-looking Outward-looking
• 7FE • Crowdsourcing
• BPTrends
emphasis on engaging professionals that tapping into the skills and knowledge of
people outside their organizational
already play a role within a targeted borders
business process
7FE

Facilitators:
• Need to ask lots of “what if” and “why this” questions,
• Should not accept what he is or she is told (the first time),
• Must look for the second ‘right’ answer,
• Will regularly change the question and come it at from a different
direction,
• Shall challenge the rules of the process,
• Need to rely on intuition.
TRANSFORMATIONAL METHODS

Creative: unleashing the creativity of people

Design-led Innovation:
• aims to provide organizations with an understanding of the deep emotional
ties that consumers develop with their products.
• Its basic tenet is that people are not only served by the form and function of
a product, but also through the experience its usage invokes.
• Based on this understanding, organizations may pursue innovations that
customers do not expect, but which they eventually grow passionate about.
TRANSFORMATIONAL METHODS

Creative: unleashing the creativity of people

NESTT: Navigate, Expand, Strengthen, and Tune/Take-off.

Its defining feature is how participants in a workshop setting use the spatial
affordances of a dedicated room.
TRANSFORMATIONAL METHODS

Creative: unleashing the creativity of

people

Process Model Canvas: allows firms to

reason about the value proposition
behind their business processes.
THE REDESIGN ORBIT
TRANSFORMATIONAL METHODS

Business Process Reengineering

Michael Hammer collected the following insights:
1) No successful organization relies on piecemeal improvement of what was already
carried out. Rather, strong ambition leads to huge rewards
2) While information technology is a crucial asset in redesigning business processes,
it is necessary to go beyond pure automation of what is already being done
3) Organizations need to break away from a set of ingrained patterns of organizing
work that prevent business processes from being carried out in an integrated, cross-
functional way
TRANSFORMATIONAL METHODS

Business Process Reengineering

Properties:
• The objective is to completely overhaul a process, which puts it in the
transformative sphere.
• It is analytical because it relies on such a set of clearly defined principles, in
contrast to what a group of people comes up with,
• It is mostly inward-looking since it still operates within the scope and
context of the existing process it aims to overhaul.
TRANSFORMATIONAL METHODS

Business Process Reengineering

Redesign principles:

1. Make sure that information is captured fresh, at the moment it is produced, and at the
source by the stakeholder who is producing it..

2. Integrate information processing work, i.e., work that involves capturing or processing
information, with the real work where this information is produced.

3. Let those who have an interest in the output of a process not only participate in it but
drive it all the way.

4. Put every decision point in a process preferably at the place where work is performed.
TRANSFORMATIONAL METHODS

Product-Based Design
Properties:
• The objective is to completely overhaul a process, which puts it in the
transformative sphere.
• It is analytical in nature since it relies on a formal, almost purely algorithmic
way of developing a new business process.
• It is outward-looking because of the artifact that takes center stage in this
method: It is the product that a business process aims to deliver.
TRANSFORMATIONAL METHODS
THE REDESIGN ORBIT
OTHERS
THEORY OF CONSTRAINTS (TOC)

A System’s Capacity is Limited by its Weakest Link

Theory of Constraints (TOC): To improve a system performance, focus

on the constraint
4.2.1 LEAN

• What is Lean?

• History

• Objectives

• Popular tools
4.2.1 LEAN

• Lean is a management system that focuses on minimizing waste

through continuous improvement of work processes. Waste is any
activity that uses resources without creating value

• Lean doesn't mean cutting staff

• Lean is about increasing the capacity of the system by reducing costs

and shortening cycle times

• Lean is about understanding the values that customers value

LEAN’S OBJECTIVE
HOUSE OF LEAN
WORK CELL ARRANGEMENT
WORK CELL ARRANGEMENT
KANBAN
ANDON SYSTEM
POKA YOKE/ FOOL-PROOFING

• is a Japanese term that means error prevention or error prevention

• Poka Yoke helps detect, prevent, and fix errors instantly

JUST-IN-TIME

• “The right product – in the right quantity – at the right place – at the
right time.”

• In Just In Time, processes that do not create added value in the

production or service delivery process must be abolished.

• The system only produces what the customer wants, when the
customer needs it
PULL AND PUSH SYSTEM
STANDARDIZED WORK
VALUE STREAM MAPPING
VALUE STREAM MAPPING/ MIFC
3M PRINCIPLES

• Muda: waste

• Mura: unbalance

• Muri: Overburden
KAIZEN
KAIZEN EYES

• Put yourself in someone else's shoes

• Visit other places
• To take a photo
• Draw a value stream map
• Ask yourself what you should look like
• Measure takt time
• Evaluation of work standards
• Create logic for continuous improvement and validate it
5S AND VISUAL CONTROL
DISCUSSION

• Find improvement opportunities around you

• Find examples of Poka Yoke around you

• Plan to implement 5S in your home

5.2.2 SIX SIGMA

• A Vision and Philosophical commitment to our consumers to offer the

highest quality, lowest cost products

• A Metric that demonstrates quality levels at 99.9997% performance for

products and processs

• A Benchmark of our product and process capability for comparison to ‘best

in class’

• A practical application of statistical Tools and Methods to help us measure,

analyze, improve, and control our process
SIX SIGMA AS A METRIC
3 SIGMA VS. 6 SIGMA
SIX SIGMA AS A METRIC
CULTURE AND PEOPLE SIDE
5.3 CHANGE MANAGEMENT DURING BP IMPROVEMENT

• 5.3.1 Overview of Change Management

• 5.3.2 Change management models

• 5.3.3 Leading change

• 5.3.4 Communication during change

5.3.1 OVERVIEW OF CHANGE MANAGEMENT

• Change management is the process, tools and techniques to manage the

people side of change to achieve the required business outcome

• Everyone thinks of changing the world, but no one thinks of changing

himself - Leo Tolstoy
RESPONSE TO CHANGE
CHANGE MANAGEMENT
CHANGE PROCESS
HUMAN BEINGS ARE NATURALLY PREDISPOSED TO RESIST CHANGE

bản chất cong

Human beings are naturally predisposed to resist change. người luôn
chối bỏ sự thay
Agree reasons: ko quen đổi

• Loss of control lo lắng về năng lực

đáp ứng đc k
• Loss of face

• Surprise, surprise!

• Excess uncertainty.

• Everything seems different

• Concerns about competence

• More work.

• Sometimes the threat is real.

POWER AND RESISTANCE TO CHANGE

• People respond to change in different ways:

• Innovators (20%) – welcome change & frequently create it

• Adaptors (60%) – “Wait and See” attitude, ultimately “get on board”

• Traditionalists (20%) – Actively resist – want things to stay as is

• Resistance is at the heart of the change process

• New approaches:
• People don’t resist change. They resist being changed!

• Resistance = inappropriate approach or procedure

POWER AND RESISTANCE TO CHANGE

• According to Kurt Lewin, organizations are a composition of dynamic and

interactive forces working together in opposite directions

• Force field analysis

POWER AND RESISTANCE TO CHANGE

• Force Field Analysis is a technique that can be used for identifying,

discussing and documenting the factors that support or oppose a
change initiative.

• It was introduced in the 1940s by Kurt Lewin, a social psychologist,

and is usually applied to making go or no-go decisions on potentially
disruptive business changes.
FORCE FIELD ANALYSIS

This technique helps:

• Decide whether or not to propose a change initiative
• Increase the chances of success by promoting the driving forces and
weakening the hindering forces
• Identify areas or new ideas that can be implemented to aid the successful
implementation of the change
• Identify the most important stakeholders and their interest groups
• Identify how to influence each target group
FORCE FIELD ANALYSIS
miêu tả đề xuất
Step 1: Describe Your Plan or Proposal for Change
xác định sự thay
Step 2: Identify Forces For Change (From internal and external) đổi
xác định cái cản
trở sự thay đổi
Step 3: Identify Forces Against Change
chấm điểm cho
Step 4: Assign Scores bước 3 vs 4 xem
cái nào lớn điểm
• score each force, e.g. from, say, one (weak) to five (strong) hơn

• visually represent of the influence that each force

Step 5: Analyze and Apply

• To decide whether or not to move forward with the decision or change.

• To think about which supportive forces you can strengthen and which opposing or resisting forces you can
weaken, and how to make the change more successful.
FORCE FIELD ANALYSIS

kháng lực
FORCE FIELD ANALYSIS

Suggested Solutions:

• Train staff to minimize their fear of technology. The +1 cost of training increases "Cost" to -4 but the -2 benefits reduce

"Staff fearful of new technology" to -1.

• Show staff that change is necessary for business survival. This new, +2 force supports the change.

• Show staff that new machines would introduce variety and interest to their jobs. This new, +1 force also supports the

change.

• Raise wages to reflect new productivity. The +1 cost of raising wages takes "Cost" to -5, but the -2 benefits reduce "Loss of

overtime" to -1.

• Install slightly different machines with filters that eliminate pollution. The -1 benefit of the new machines eliminates "Impact
on environment" as a force against change.

=> These changes would swing the balance from 11:10 (against the plan), to 13:8 (in favor of the plan).
FORCE FIELD ANALYSIS

Questions to define forces:

• What business benefit will the change deliver?

• Who supports the change? Who is against it? Why?

• Do you have the resources to make the change work?

• What costs and risks are involved?

• What business processes will be affected?

It's important to identify as many of the factors that will influence the change
FORCE FIELD ANALYSIS EXAMPLES
FORCE FIELD ANALYSIS EXAMPLES
FORCE FIELD ANALYSIS EXAMPLES
FORCE FIELD ANALYSIS EXAMPLES
FORCE FIELD ANALYSIS EXAMPLES
FORCE FIELD ANALYSIS EXAMPLES
FORCE FIELD ANALYSIS EXAMPLES
POWER DURING ORGANIZATIONAL CHANGE

Power has been defined in many ways:

• ability to influence a target

• capacity to effect (or affect) organizational outcomes

• “potential or dispositional quality of actors”

• “dynamical social process affecting opinions, emotions, and behavior of

interest groups in which inequalities are involved with respect to the
realization of wishes and interests ” (Boonstra and Gravenhorst)
SOURCE OF POWER

• Legitimate Power/ positional power: derived from the position a person holds in an
organization’s hierarchy. An example of legitimate power is that held by a company's CEO.
• Expert power: Knowledge is power. Expert power is derived from possessing knowledge
or expertise in a particular area or their problem solving skills.
• Referent Power: derived from the interpersonal relationships. People possess reference
power when others respect, admire and like them

• Coercive Power: influence others via threats, punishments or sanctions.

• Reward power: arises from the ability of a person to influence the allocation of incentives
in an organization.
SOURCE OF POWER
RESISTANCE DURING CHANGE

• Resistance ~ active or passive responses on the part of a person or

group that militate against a particular change, a program of changes,
or change in general

• Resistance to change consists of any employee behaviors designed to

discredit, delay, or prevent the implementation of a work change
FORMS OF RESISTANCE

• Individual resistance and group resistance

• Logical and rational resistance

• Blind resistance, political resistance, and ideological resistance

• Emotional resistance and rational resistance

• Subtle forms and forceful forms

BLIND, POLITICAL, AND IDEOLOGICAL RESISTANCE
EMOTIONAL RESISTANCE AND RATIONAL RESISTANCE

Rational resistance/ Logical resistance

• occurs when people do not have the proper knowledge or

• information to evaluate the change.

=> providing information (in the form of data, facts, or other types of concrete information)
reduces the resistance
Emotional resistance/ Psychological resistance

• involves the psychological problems of fear, anxiety, suspicion, insecurity, and the like.
• these feelings are evoked because of people’s perception of how the change will affect
them
SOURCES OF INDIVIDUAL RESISTANCE TO CHANGE
VALUE OF RESISTANCE

Contrary to popular opinion, resistance to change is not bad.

Apathy is worse

Resistance can bring some benefits:

• Encourage the management to re-examine its change proposals

• Identify specific problem areas where change is likely to cause difficulties

• Encouraged to do a better job of communicating the change

• Resistance also gives management information about the intensity of employee emotions
on an issue
• Encourage employee to think and talk more about a change
OVERCOMING RESISTANCE TO CHANGE

• Education & Communication

• Participation & Involvement

• Facilitation & Support

• Negotiation & Agreement

• Manipulation & Co-optation

• Explicit & Implicit Coercion

CHANGE IMPACT/ OUTCOME ANALYSIS

• Changes affect performance at the individual, team and organizational level

• A simple change in a single requirement may have a significant effect on the whole system

• Effect of organizational change on performance aspects:

• Employee performance : Mental stress, Loss of loyalty (changes involving cost-saving), Increased
time away from work
• Customers’ satisfaction
• KPI: Revenue, Cost, …

Change impact analysis (IA) is “identifying the potential consequences of a change, or

estimating what needs to be modified to accomplish a change”
PROBLEMS IN ASSESSING ORGANIZATIONAL OUTCOMES

• “change process cannot be evaluated effectively because there are too many
overlapping initiatives running at one time ”

• “how, when, and by whose standard outcomes are assessed”: highly debatable

• Five common problems

• when to assess;
• from whose perspective to make assessments;
• how to assess some types of outcomes;
• correctly attributing causes and effects; and
• potential costs associated with doing genuine assessment.
PROBLEMS IN ASSESSING ORGANIZATIONAL OUTCOMES

• When to assess: Snow shoveling example

• Assume that you live in London, one day in January, you wake up and find an inch or two on the ground. Then,
you need to decide: whether to shovel the driveway or wait and let a few more inches fall before you start
shoveling?

• The longer you wait, the bigger the job. But, by chances, you’ll have to shovel fewer times
• If you shovel at two in the afternoon and the snow stops, you have really good results – cleared driveway!

• If you wait another two hours and another two inches have fallen, your earlier results are completely erased and
now you must shovel again
• if you wait until six inches have fallen and some freezing rain falls on top of that, you may find you cannot
shovel the snow at all – bad results

• The question is at what point during the day do you assess your outcomes?
DISCUSSION

Base on the case of your group assignment

• Identify points for improvement

• Proposing an improvement plan

• Analyze (support) force and resistance when implementing the

improvement plan that you have proposed

• Proposing solutions to successfully implement the above improvement

plan.
5.3.2 CHANGE MANAGEMENT MODELS

1. Lewin’s change management model

2. The McKinsey 7-S model
3. John Kotter’s theory – 8 step model
4. Nudge theory
5. ADKAR
6. Bridges’ transition model
7. Kübler-Ross’ change curve
8. The Satir change management model
LEWIN’S CHANGE MANAGEMENT MODEL
THE MCKINSEY 7-S MODEL

Analyzing seven aspects of your

company and how they affect each
other, to highlight the changes you
need to make to create a united
approach to business:
KOTTER’S THEORY

• John Kotter’s (1996) eight steps to transforming organizations are

based upon analysis of 100 different organizations going through
change.

• His research highlighted eight key lessons which he converted into a

practical eight-step model. Although represented by Kotter in a linear
fashion, experience suggests that it is better to think of the steps as a
continuous cycle to ensure that the momentum of the change is
maintained.
JOHN KOTTER’S THEORY – 8 STEP MODEL
KOTTER’S THEORY
NUDGE THEORY
NUDGE THEORY

The basic principles you need to follow when nudging changes are:

• Clearly define your changes

• Consider changes from your employees’ point of view

• Use evidence to show the best option

• Present the change as a choice

• Listen to feedback

• Limit obstacles
NUDGE THEORY

The good:

• Helping the employee realize the importance of the issue and letting them choose
the solution makes them more motivated to see it through. Giving them that
choice also promotes a stronger bond with yourself and your business, which can
extend into greater loyalty and a lower employee turnover rate.

• Nudge theory also covers the hole many other change management models leave
open – it deals with change on the employee’s side of things and focuses on
encouraging them to adopt it. This makes nudge at least a great supplement to
more formal approaches.
NUDGE THEORY

The bad

• By itself, nudge doesn’t provide a model capable of analyzing, managing, deploying,

and maintaining change, hence why it serves best as a supplement. Also, because
of having to be used alongside another method, the extra time and effort involved
in providing attractive choices for your employees can be staggering and
impractical for larger companies.

• Nudge also suffers a little in terms of its predictability. While you can improve the
landscape for your changes all you want, the choice (or a variation thereof)
ultimately has to lie with your employees, which can make the outcome uncertain.
ADKAR MODEL

• Developed in 1998 by Prosci, after research with more than 300 companies
undergoing major change projects.

• ADKAR is a goal-oriented change management model that allows change

management teams to focus their activities on specific business results.

• The model was initially used as a tool for determining if change management
activities like communications and training were having the desired results
during organizational change.
ADKAR MODEL
ADKAR MODEL
ADKAR MODEL
BRIDGES’ TRANSITION MODEL

The ideas of Bridges(1991) on transition provide a good understanding

of what is going on when an organizational change takes place. He
differentiates between change and transition, according to him:

• Change is a situational and happens without people transitioning and

• transition is psychological and is a three phase process where people

gradually accept the details of the new situation and the changes that
come with it.
BRIDGES’ TRANSITION MODEL
BRIDGES’ TRANSITION MODEL
BRIDGES’ TRANSITION MODEL
KUBLER- ROSS FIVE STAGE MODEL-THE CHANGE CURVE

• The Change Curve is based on a model originally developed in the 1960s by

Elisabeth Kubler-Ross to explain the grieving process.

• She proposed that a terminally ill patient would progress through 5 stages of grief
when informed of their illness.

• By the 1980s, the Change Curve was a firm fixture in change management circles.

• The curve, and its associated emotions, can be used to predict how performance is
likely to be affected by the announcement and subsequent implementation of a
significant change.
KUBLER- ROSS FIVE STAGE MODEL- THE CHANGE CURVE
KUBLER- ROSS FIVE STAGE MODEL- THE CHANGE CURVE
THE SATIR CHANGE MANAGEMENT MODEL

• The Satir change model is fairly similar to Kübler-Ross’, except it applies the
progression through the five stages of grief to a general model of performance
during the change. In this sense, it’s a way of predicting and tracking the effect of
changes on overall performance.
• Satir’s change management model is made up of five stages:
• Late Status Quo
• Resistance
• Chaos
• Integration
• New Status Quo
THE SATIR CHANGE MANAGEMENT MODEL
THE SATIR CHANGE MANAGEMENT MODEL
THE SATIR CHANGE MANAGEMENT MODEL

The good:
• Like Kübler-Ross, the Satir change model can be good for anticipating the impact of a
change before it happens, and even for justifying the change to employees as they go
through the chaos phase. If they can be shown that the turmoil is only natural, they’ll be
more willing to stick out the changes.
• Unlike most other change management models, the Satir model also provides an easy way
to analyze the impact of your changes at a glance (by producing a graph based on your
ongoing performance). Not only that, but it makes it easy to compare the effects of
various changes you have made and provide a measure of your business’ progression.
THE SATIR CHANGE MANAGEMENT MODEL

The bad:
• If you’re trying to predict a change’s outcome with the Satir model it’s easy
to take for granted that a change will increase performance rather than
measuring and checking it. There’s also very little to tell you exactly how to
identify when the last three stages begin and end, and few actionable tips
for guiding employees through the process.
• Finally, the Satir model is only suited for measuring and predicting the affect
of a change, and not for analyzing what changes need to be made (or how to
make them).
EIGHT REASONS TO USE A CHANGE MANAGEMENT MODEL

1. Forecasting: Change models forecast the process change will take and prepare people for this.

2. Measured results: a change model provides baseline objectives against which actual
experience can be measured. This provides valuable data against which to measure results and
create interventions.

3. Accountability: describes and simplifies a process in a way everyone can understand; allows
people to consider their role in the process and holds people accountable for their own
transition.

4. Increased confidence: Change models give people confidence to talk to others about change.
Models of change help people make sense of times that feel chaotic and out of control.
EIGHT REASONS TO USE A CHANGE MANAGEMENT MODEL

5. Reduce resistance: A change model helps to identify potential areas of resistance and implement
strategies designed to reduce or eliminate resistance before the change process starts.

6. Return on Investment: Following a structured change model ensures that investments into the
project are not lost and that budgets are managed. Investments are not only financial but include
people. A change model can assist in ensuring that employees and productivity are maintained.

7. Role clarification: A change management model engages different professional roles and provides
accountability for their role in the success of the change process.

8. Shared approach: In large organizations change models provide a shared approach to managing
change. It provides a focus for all change management activities and helps to align resources within
the organization.
5.3.3 LEADING CHANGE

• Leadership: A process of influence among leaders and followers who

intend real changes that reflect their mutual purposes. (Appleton,
1999)

• “Management is doing things right; leadership is doing the right things”

5.3.3 LEADING CHANGE
5.3.3 LEADING CHANGE
5.3.3 LEADING CHANGE
5.3.3 LEADING CHANGE
FOUR MAJOR FACTORS IN LEADING CHANGE
LEADING CHANGE: COMMON ERRORS IN CHANGE INITIATIVES

• Allowing too much complacency

• Failing to create a sufficiently powerful guiding coalition

• Underestimating the power of vision or under communicating the vision

• Permitting obstacles to obscure the new vision;

• Failing to create short-term wins or declaring victory too soon;

• Neglecting to anchor changes firmly in the corporate culture.

• The problem with failed change initiatives is not only wasted time and other resources, but, more
importantly, the wasted good will of employees

• Failed change creates cynicism, and cynicism acts like a virus in an organization: it spreads rapidly
and makes future change initiatives less likely to be embraced
5.3.4 Communication during change

Role of communications during change

• Explain why change is happening:
• Ensure people understand the rationale for change
• Talk about the benefits / consequences
• Emphasise what’s not changing
• Show people where they are going:
• Map out the process of change
• Identify and recognise key milestones; celebrate success
• Show people how they will get there:
• Break it down into clear, simple steps
• Give practical examples
• Be directional
COMMUNICATION PROCESS

• Communication efforts during a (large) change project attempt to persuade

stakeholders to adopt a new view of the future, clearing the “why,” “what”
and “how” of the change.

• “Employee communication can mean the failure or success of any change

program.” Barret (2002)

• Communication staff should be seen as facilitator of the change and the

change needs to be constantly assessed against clearly defined goals (Barret,
2008)
COMMUNICATION PROCESS

Communication processes involve:

• interaction,

• discourse,

• and interpretation
FORMAL AND INFORMAL COMMUNICATION

Formal communication involves

• use of official channels;

• declarations and policy set down by organizational leaders;

• implementers ’ instructions about the rate, timing, and details of change;

• formal responses of leaders to other stakeholders ’ challenges; and questions about

changes.

For example: one critical part of formal communication is the first official announcement of
change. Often the manner, timing, message, and spokesperson of such announcements can
set a tone that may have implications for the entire implementation effort
FORMAL AND INFORMAL COMMUNICATION

Informal communication

• may play an even larger role in determining outcomes of change. includes

the spontaneous interactions of stakeholders with each other, with
implementers, and with non-stakeholders

• they are undertaken without the force of official authority or access to

official channels, and

• sometimes in a manner that enables participants to deny ownership of what

is shared
FIVE KEY ELEMENTS OF COMMUNICATION DURING CHANGE

• Managers explained why decisions were being made.

“We’re merging with another company because the industry is consolidating, and we won’t be big enough to compete on our
own.”

• Communication occurs in a timely manner.

“I’m handing out copies of the press release, which we’re issuing to the media right now.”

• Direct supervisors explain the specific implications of the change to each level of worker.

“This merger will give us access to the healthcare industry. What this means for themarketing team is that we’ll need to create
new collateral for that market.”

• Important information flows continuously.

“As of now, I’ve told you as much as I know. As soon as more information becomes available, I’ll update you.”

• Employee responses are validated– that is, managers accept the emotions for what they are, not what they should be.

“Joan, I understand that you’re worried about layoffs. Those decisions won’t be made for a while, but I know it’s hard not
knowing what will happen. As soon as I can tell you something, I will. In the meantime, I’ll share your concerns with the
transition team, if that’s okay with you.”
PLANNING YOUR COMMUNICATION

• Establish a clear vision and objectives

• Divide the project into phases

• Confirm key milestones for each phase

• Identify your target audiences

• Select your channels

• Select your spokesperson/people

• Determine resources and timetable

AUDIENCE SEGMENTATION
STEP 1: VISION
STEP 2: PLAN
STEP 3: IMPLEMENTATION
MODEL
COMMUNICATION CHANNELS
CHOOSING COMMUNICATION CHANNELS
PRIMARY CHANNEL

Face-to-face allows you to:

• Articulate the end vision

• Use the appropriate tone

• Gauge reactions

• Check understanding

• Correct misconceptions

• Provide reassurance
SECONDARY CHANNELS

• Website: quick retrieval of information and check facts

• Q&As: tailored information by subject/group

• Email: for short broadcast announcements and updates; not for major
announcements about restructuring

• E-bulletin: regular updates; reminder of key milestones

• Staff newsletter: recognise success; reminder of what has not changed

• Email inbox: allows people to submit questions, concerns and ideas

MONITORING COMMUNICATION PROGRESS

• Did the briefings happen, how many people attended?

• What are people saying?

• What does the rumour mill say?

• Who are people listening to?

• Is there a change in behaviour?

• Do people need more support?

TIPS FOR SUCCESSFUL COMMUNICATION

• Clarify roles and responsibilities in advance, particularly the decision-making and sign-off process

• Reduce uncertainty and instil a sense of control

• Be consistent – maintain tight control over key messages

• Separate facts from reassurance

• Provide as much information and support as you can throughout the change process

• Ensure the structure, tone and content of communications acknowledges people’s emotional and intellectual
needs

• Listen – provide a range of feedback channels

• Use FAQs and keep them current

• Get people involved – make them feel they have a say

POTENTIAL PITFALLS

• Relying on written rather than face-to-face communication

• Confusing information dissemination with communication
• Complicating the message
• Hiding or massaging the truth
• Imposing change rather than involving people
• Underestimating people’s reactions to change, or the time needed for people to absorb
change
• Underestimating the ‘coffee and carparking’ factors
• Delaying communication until every detail is confirmed
• Communicating to affected audiences at different times
• Communicating bad news in different phases
• Not having a communications infrastructure in place
THANK YOU !