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July 2001 FAQ
Q: What are some of the
most important reasons why our big change initiatives don't
work?
 The
short answer is a lack of comprehensive and detailed up-front
planning. Lack of planning simply means that the firm goes into
the Big change without simple, coordinated road maps for employees
to follow. But why a lack of planning? Isn't planning a strong
suit of business today? How would investors and board members
allow a firm to go forward without an adequate plan?
The answer is that firms do plan prior to Big changes, but
in most cases, it is the wrong kind of planning. The planning
we see has a number of shortcomings that can be fatal in critical
change situations. Our observation is that most change planning
is
- short of facts,
- long on assumptions, and
- general rather than detailed.
In addition, most change planning that we see focuses on the
numbers or goals that are to be met after the Big change is
complete and not on the detailed steps needed to get the desired
change results.
For example, we recently reviewed a planning package for a
major food company that focused almost entirely on explaining
how great the market share of the new company would be after
the merger was complete. Totally missing from the package were
- the key steps that would need to be taken to pull off the
merger in the targeted time frame and
- the risks that would need to be mitigated for effective
combination of the two firms.
Fortunately, an alert senior executive in the acquiring company
heeded good advice to look in detail at the steps and risks
only to conclude that the cultures of the two companies were
so radically different that a merger was probably a very bad
idea. At the time of this writing, the company behind the acquisition
is still looking for a more suitable target.
What kind of up-front planning is needed for a Big change?
Effective change planning needs huge doses of facts about the
specific business situation and the nature of the change maneuver
itself to feed into a detailed planning process.
It is critical to have the proper basis for planning: facts
and not assumptions. The way to those facts is through hard-nosed
research, including:
- Due Diligence - the
systematic examination of the business situation, the merger
partner, the processes to be reengineered, the systems to
be implemented and so on.
- Validation - the use
of primary, "go there, see that" kind of research
rather than relying on someone else's view.
- Best Practices - the
critical review of the experience of others who have successfully
and unsuccessfully gone through the specific Big change about
to be undertaken.
Along with the proper basis for up-front planning, managers
must go to the detailed level of planning needed to make visible
all of the critical steps needed for completion of the Big change,
including:
- Focus on Means - the
identification of the organization's attributes that must
be changed for the Big change to be completed.
- Multiple Scenarios -
conducting the planning assuming at least three scenarios:
the best, worst, and most likely business situation during
the maneuver.
- Risk Management - specifically
identifying those situations that might occur and have negative
impacts on the speed and/or effectiveness of the maneuver.
Managers who base their planning on facts but who keep that
planning at a general level will generate a planning "veneer"
that looks good on the surface but that lacks the specificity
needed for proper preparation for change. Executives who base
their planning on assumptions and then keep that planning at
the generic level come up with what amounts to a planning "sham,"
a simple-minded approach that can look good but that will surely
set the company off on the wrong course. Executives who allow
planning to go all the way to the detailed level without verifying
the facts enable planning "fiction." None of these
are good enough for effective planning of big change! What's
needed is a detailed plan based on the facts. Good luck!!
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Dutch Holland, CEO of HDI, has worked as a management
consultant for 30 years, helping organizations and leaders
manage and implement change successfully. If you enjoyed
this short article on communicating change and want to learn
more, contact Dutch at 713.877.8130. |
If you have a question you would like to have addressed
in the coming months, please give us your suggestions or comments
on our guestbook.
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