Puzzle 5a. What are smart ways to harness change and transformation dynamics despite complexity? (Re)Setting the Game Plan for Change

This article series -- What do Sudoku, Upstream Oil and Gas, and Successful Transformation Have in Common? -- explores the interdependencies of success in digital transformation and success in business performance. This fifth chapter of the series focuses on the puzzle of What are smart ways to harness change and transformation dynamics despite complexity? with a deep look at (Re)Setting the Game Plan for Change. Overall, seven enticing puzzles are portrayed to offer leaders in both camps additional perspectives about each other, and to stimulate ideas of new moves, executed in partnership, for achieving greater and durable progress.

Early during my pivot from business leadership to specialize in change, I asked a Chief HR Officer his thoughts about the change management discipline and its practitioners. His answer was thoughtful but quick…and disdainful. Paraphrasing, change management consultants show up, charge a fortune, leave, and never deliver the changes promised. This was quite a gift for me that prompted plenty of thought over the words “change” and “management”, as well as the unfortunate precedent set for me, with a proven reputation for successfully delivering exactly that and with durability. The connotation of change management and its practitioners is still commonly negative or shallow. And outdated.

Game rules can and do get changed. In 1954, the NBA (National Basketball Association) introduced the 24-second shot clock. In 1979, they put in a stripe that, when shot behind, would count for three points. In the 2019 Rules of Golf, the process for dropping a ball back in play was revamped: instead of letting go from shoulder height, players will drop from around their knee.[1] Check your own favorite game. You get left behind when you don’t keep up with the rules.

The Change Management game has also changed over the past decade…A LOT. Three of these changes stand out: Caliber of Practice; Clarity on Roles; and Contribution of Business Value. Following is a brief on each, with an invitation for you to explore them (and others) further.

Caliber of Practice. What is change management? You have your experiences and opinions; I have mine. This is the perfect place to begin: Change Management is “the practice of applying a structured approach to transition an organization from a current state to a future state to achieve expected benefits”.[2]

The illustration below is helpful in positioning today’s change management discipline[3]:

Yes, Change Management is a solid discipline with great depth of research and proven methodologies.

The change management discipline has a Standard for Change Management, produced in 2014 by the worldwide professional organization, Association of Change Management Professionals (ACMP). It can be thought of like Project Management Institute’s (PMI) Project Management Book of Knowledge (PMBOK) in that it is “a reference for professional knowledge and understanding” of the discipline. ACMP’s Standard for Change Management is methodology-neutral. It helps practitioners capitalize on and adhere to proven best practices for success. In addition, it serves as a bridge between practitioners and those they serve by documenting practices consumers may rightly expect from practitioners.

Change practitioners who meet experience criteria and knowledge testing may earn Certified Change Management Professional (CCMP) designation, a certification developed in accordance with ISO 17024. Produced by ACMP, it ensures alignment with the Standard for Change Management and The Code of Ethics and Professional Conduct. It can be thought of like PMI’s Project Management Professional (PMP).

One other very meaningful certification for change practitioners is earned by mastering Prosci’s specific methodology, ADKAR. Prosci, Inc., is the highly respected global leader in change management solutions, offering research, methodology and tools produced by teams of change experts and advocates with widespread customer success. ADKAR is an acronym for Prosci’s change methodology for producing the five tangible and concrete outcomes that people need to achieve for lasting change: awareness, desire, knowledge, ability and reinforcement.

While change management certification may not be a requirement when engaging a change practitioner, their portfolio of successful deliveries should be, as with any subject-matter expert.

Clarity on Roles. Who practices change management? 

A professional’s change management competency may be either primary or secondary. There are certainly plenty of job titles that include some variation of “Change Manager”. Today, though, there are also many job titles, including Engineer, that identify change management as a required or desired competency.

Consider that many engineers pursue project management certification because this additional, complementary competency enables them to perform better, though it’s not required to earn an engineering diploma. A growing number are earning CCMP or Prosci certification. The result? While assumed to be exclusive to the HR function (eg, Training and Development, Talent Development), certified change practitioners are now being ( and should be ) embedded in IT, Supply Chain, and even Product Marketing, R&D, and Operations, just as project managers are.

Returning to professionals whose primary focus is change management, with titles to match, we find that they specialize much the way engineers or geologists do. By analogy, when identifying, developing and producing oil and gas reservoirs, there are many related engineering roles engaged in executing the process. Though these professionals are all engineers, their titles are not “Engineer”; they are specialized as Petroleum Engineer, Reservoir Engineer, Drilling Engineer, etc. The same holds true in Change Management. Familiar change titles may be Communication, Training, and Facilitation, but there are also Change Strategists as well as Digital Transformation and Organizational Effectiveness leaders. Some specialize by industry (Healthcare, O&G) or function (HR, IT, Operations).

The variety of engineering job titles gives a puzzle clue about successful execution of change.

Business Change is a team sport. Generalizing from team sport today [with apologies in advance], there’s a manager/head coach who leads a team of players of various strengths, with assistance from a group of specialty coaches/trainers. Strong change teams follow a similar arrangement:

• Change Sponsor
• Stakeholders
• Project Manager
• Change Management Lead
• Change Agents

It’s my pleasure to introduce them to you.

Change doesn’t have to start at the top, but sustained change does require active and sustained sponsorship at top levels. Meet the Change Sponsor: “The individual or group in the organization accountable for the realization of the benefits of a change.”[4] This leader defines and champions the overall change goals, scope, and definition of success. They make it their priority to influence peers and other senior leaders to gain support and provide leadership to achieve the stated vision. “This role has ultimate decision-making and funding authority and provides constant visibility to the change effort.”[5]

The people whose efforts are affected by change are the Stakeholders. They “can be numerous and range from internal stakeholders like employees whose jobs are impacted by the changes to external stakeholders like customers or clients who might see or experience something differently because of the changes.”[6]

Returning to the team play analogy, the manager/head coach delegates the myriad activities to enable the players’ strong performance to specialty coaches. These are leaders highly capable at this enablement, such as offense and defense, or specialized skills like place-kicking. On change programs, the Change Sponsor’s most common specialty coach is a project manager. The Project Manager focuses primarily on the organization and management of resources and activities to complete projects for delivering the planned change (e.g., new systems, new processes, new resources) in a structured way within the required scope, time, cost, and quality parameters. [7]

An interesting dilemma is known to occur when business executives and leaders, Change Sponsors, are offered or asked to include “specialty coaching staff” in Change Management. These business leaders take their role in defining and championing the overall change quite seriously and, in that context, see no need for assistance doing their job of steering the ship. Here is where the words get in the way and context counts. Business leaders do indeed decide on and prioritize strategic changes for their organizations. Change Managers help execute those changes. Thus, “Change leadership is deciding where we need to go as an organization and how we want to get there. Change management is the structured discipline for how to help our people get there too. Different form and function.” [8]

Meet the Change Management Lead, the individual accountable and responsible for the change strategy, who assesses the change, outlines a change plan, and implements change management. This individual has direct day-to-day control over the change management team, the change project schedule, associated budgets, and resources. The Change Management Lead is the primary liaison to the change sponsor, project manager, leadership, overall project team, and stakeholders.

The Change Management Team is a group of individuals who work together facilitating change management activities to enable the organization to own and effectively drive adoption, usage, and proficiency. Team members ensure activities are completed, feedback is gathered, training is conducted, and communications are delivered in various formats.” [9]

Pay close attention to the words here: to enable the organization to own. This is goes to the heart of a common and important misunderstanding of change management practitioners’ role; these are specialty coaches, not the players. These SMEs craft is to set things up for success; the Sponsor and business leadership are accountable for delivering the Stakeholders’ engagement. This is a clue to some external change consultants’ “failures” (but certainly not all).

There’s one more highly critical role that needs introduction. They’re magic at facilitating the Change Sponsor’s mission, yet they have no title or authority to do that. And they’re found everywhere in an organization. These stakeholders are Change Agents. Change Agents are functional or social leaders, middle management, and subject matter experts from different areas in the organization who are trusted for their insight into and understanding of the organization. These individuals may be selected for their (informal, non-hierarchical) network and influence (without authority) over other individuals or groups. They model the required behaviors in their areas, provide constructive feedback on change activities, and actively engage with others around change activities.[10] These people are the grease and the glue for stakeholder adoption.

Summarizing then, here are the key players on the Change Team and how they collaborate for success:

Change pursuits that do succeed are differentiated in that 1) all change roles show up to play and all roles connect with all others, and 2) strong cooperation and connection exists between project management and change management.

Both the ACMP and Prosci emphasize the importance of how this connection operates. They acknowledge that project management and change management are complementary yet distinct disciplines that may overlap during change delivery, and are often interdependent when delivering value to the organization. The degree of overlap and interdependency can vary between organizations. Each discipline uniquely contributes to the realization of benefits. Project management delivers the planned change and change management ensures that the delivered change is implemented and.”[11] [12]

The figure below can be helpful in understanding the leadership dynamic on successful change pursuits.[13]

While there can be a number of roles at play on change and transformation programs, there is no one size fits all when it comes to populating a team for success. Just as with oil and gas projects, each change undertaking is unique. Sometimes a leader will wear multiple hats; sometimes roles are filled internally, sometimes externally by specialists.

There is, however, a third distinguishing factor on successful change programs: real commitment is made to the people-side of the effort. When that is absent, durable success is usually futile. A project plan with a nod to communication and training is not enough.

Business Value Contribution. Speaking of durable success delivering change, how do you know when you’ve achieved that? As with most important business pursuits, success is measured against results promised via a business case. Business cases are a compelling way to identify the value of meeting a business need. This applies to change pursuits as well.

For decades, vast sums of money and time have been spent in the name of delivering large-scale change. The good news is that this has provided a great deal of data on performance and success that has been analyzed and reported by numerous experts, including John Kotter in 1996[14], Martin E. Smith in 2002[15] and Keller & Schaninger in 2011[16] and 2019[17]. Interestingly, the findings on change performance remained consistent over that period. The bad news is that over this 20+ year period only 30% of change succeeded in meeting its promised objective. That is, 70% of change programs fail to launch, fail to complete, or else complete over budget, over schedule, and short on results. This is despite intensive market drivers and application of the most expert project management.

As suggested earlier in the article, the rules of the Change Management game have been shifting. Until recently, familiarity and understanding of the business case for Change was not widespread among change management leaders, much less business leaders. Today, a greater appreciation of the need for a Change Management business case has arrived. Prosci, Inc. has contributed enormously in this extremely important arena. Tim Creasey, Chief Innovation Officer, is a prolific source of clear and helpful insights.

For example, what is the value of allocating/prioritizing program funds for change management expertise? One interesting perspective they’ve offered relates to the importance of identifying and managing potential risks in the project business case. The fundamental question is, “How much does this project’s success depend on a substantial change in people’s behaviors to adopt new practices?”

When you’re deploying an upgrade to Microsoft Office 365, perhaps “behavior change risk” is not that substantial, say 5-10%?, and basic communication and training may suffice for success. Alternatively, when you’re introducing data-driven decision-making with significant AI/ML and process automation, then “behavior change risk” becomes real and substantial, say 40%?, depending on your company’s culture and experience. This high degree of risk stemming from adoption of new practices deserves visibility and warrants mitigation efforts. Spending on programs deemed important to business success needs to better align with the risk expected.

In the Digital Energy arena, a rule of thumb has been suggested that unless 20% or more of the budget is being spent on change, the project is likely to fail. There are plenty of examples of success and failure in the digital solutions programs that lay the foundation for this recommendation. Leaders including Franz Van Den Berg, who ran CWE (collaborative work environment) program for Shell for many years, said that on average the change spend in Shell was 19% per project. Tony Edwards, who ran CWE for BP, offered that BP used a 20% rule during his tenure.

Agree or disagree with these spending levels, but if you paused to think about this then I’ve succeeded. Look further into change business cases. If it’s worth doing, it’s worth doing a business case of some kind.

Meaty stuff. New rules. Better puzzle moves.

In conclusion, different methods must be applied to unlock the puzzle of change management success. Especially in 2020 and beyond. A significant clue resides in the workforce, the people, who must execute under changed conditions. This is the differentiator I have witnessed repeatedly over decades on the receiving end of change programs as well as leading and delivering them.

Here’s the way I frame it: Would you drill a well [substitute your project] without involving some petroleum engineer [substitute your expert] that has some track record of success? It’s accepted that their expertise (and even licensure) makes a material difference in the success of that effort. Then how do you expect to succeed at change and transformation without involving a proven change management leader?

Just as upstream projects struggle when best practices aren’t used, so to with business change pursuits. We oil and gas professionals will be better served when we capitalize on smart change approaches.

Puzzle: What are smart ways to harness change and transformation dynamics despite complexity?

Puzzle move: Reset the game plan for change by capitalizing on change management best practices and establishing smart expectations for change success.

Could change management best practices be strategic in turning the tide on outdated practices that compound operational debt?

Could change management best practices help activate a more interconnected, high-performance culture?

[1] https://www.golfdigest.com/story/nine-changes-in-the-new-rules-of-golf-you-absolutely-need-to-know-for-2019

[2] Standard for Change Management. ACMP. p 9.

[3] https://www.dhirubhai.net/posts/timcreasey_change-management-is-is-not-document-activity-6629091555259097088-xiik

[4] Standard for Change Management. ACMP. p 10.

[5] Standard for Change Management. ACMP. p 18.

[6] Standard for Change Management. ACMP. p 43.

[7] Standard for Change Management. ACMP. p 18.

[8] https://www.dhirubhai.net/feed/update/urn:li:activity:6506657950772400131/

[9] Standard for Change Management. ACMP. p 10.

[10] Standard for Change Management. ACMP. p 18.

[11] Standard for Change Management. ACMP. p 16.

[12] https://blog.prosci.com/change-management-and-project-management-comparison

[13] https://www.prosci.com/resources/articles/project-change-triangle-3-corners

[14] Kotter, J. Leading Change. Harvard Business School Press. 1996.

[15] Smith, M.E. “Success Rates for Different Types of Organizational Change,” Performance Improvement 41, no. 1 (2002): 26-33.

[16] Keller, S. and Schaninger, B. Beyond Performance. John Wiley and Sons, New Jersey. 2011.

[17] Keller, S. and Schaninger, B. Beyond Performance 2.0. John Wiley and Sons, New Jersey. 2019.