Change Management - how to create a high-performance workplace through change

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Leadership and Change Management. How to Create a High-Performance Workplace Through Change By Christine Corelli, the "Sales-Service Excellence" Expert (for Construction Financial Management Association)

You've just completed checking over a new subcontractor's construction expenditures on a large hospital project. You had reservations about using a new subcontractor on such a visible project, but the construction manager was able to persuade the CEO about the firm's capabilities. Now, you're beginning to see cost overruns that you will need to nip in the bud if you are to deliver the project within budget. You get up from your desk to pour yourself another cup of coffee before tackling the next task. There's still a huge amount of work you need to get done before the end of the day, but you pour the steamy brew and pause for a few moments to gaze at the people around you.

You observe that most people look productive but seem to be stressed. Like you, they are obviously feeling the pressure from the demands placed upon them. The company has been growing rapidly. In fact, three months ago, your company recently acquired a competitor, and the CEO has asked you to consolidate the two companies' accounting and finance operations into a cohesive unit. Creating an organizational structure is not your forte, but as the financial manager, the department is your responsibility. What was once a smooth organization now is on edge. To further complicate matters, you have decided to adopt the accounting software package of the acquired competitor, and your original employees are having difficulty adapting to the new system. So, why half your workers are still wondering if "consolidation" is another word for "layoff," the other half spends much of the day complaining about the new accounting software. People are doing their work, but seem to be merely "going through the motions."

In addition, you know many employees are disgruntled by all the changes involved with new procedures the CEO has recently adopted to face the rapid growth: revising the executive bonus structure, tightening controls on subcontractors, and reviewing cost estimates with clients. At a recent meeting, he explained to you and the rest of the senior staff that the changes are necessary if the company is to move forward. He wants a "big push" to dramatically improve performance, productivity, and profitability throughout the company.

You know that some people have been resistant because they've grown comfortable doing things the same way for a long time. Now they have more to do and have been told they have to do it in less time, yet with greater quality. They've expressed uncertainty as to whether the expectations that have been placed upon them may be too great.

You also think about the project managers and supervisors in the field who must now learn a vast number of new skills in order to achieve new goals and job requirements. Through it all, they must keep people happy, get the job done right, and complete construction on time. You wonder how everyone can achieve "high-performance" when they are feeling so overwhelmed with responsibility and under pressure to perform.

You've been working long hours, and because of the changes that have been made, you are now wearing many hats and have more people to respond to than before. You have more responsibility and accountability and your days have been filled with constantly shifting priorities: one minute it's meeting with your insurance carrier to discuss rising workers compensation premiums, the next minute it's trying to understand a software vendor as she explains how the Y2K problem will affect your project planning software, the next minute it's negotiating with an arrogant city official putting roadblocks in the tax incentive deal you've been working on for months. You've been feeling the stress on a daily basis and are about to reach "burn-out." It seems like it has been "chaos for breakfast, chaos for lunch and indigestion at dinnertime."

You wish you knew some methods to help yourself and your people adapt to these new procedures and overwhelming demands. You would like to be more supportive of the workers in your department, but you are so consumed with your own urgent responsibilities you lack the time to do anything about it. You walk back to your desk and tackle the next project, thinking you really need to do something about it one of these days. Sound familiar?

Calls from construction company owners and executives to increase productivity, improve performance, and embrace major change can result in increased stress, resistance, and in some people passively "going through the motions." Underneath it all, the pressure is intense. If not properly managed, it can adversely affect individual and organizational performance in your construction operation and can lead to "job-burnout" in your people.

When an organization has instituted change, a decrease in performance and increase in stress can be the result. To be able to manage the transition process it is helpful to understand the five behavioral phases most people experience in adapting to it.

Stage 1: Resistance
The chameleon adapts easily to its environment. Unfortunately, for human beings it's not always easy. Most people are basically creatures of habit. They may resist change because it can mean coming out of their comfort zone and perhaps risking failure. You can recognize resistance easily as people will criticize, complain, withdraw, or become unsupportive of others. There may be loud vocal protests, or, they will appear to "do what they have to do" to keep their job, but they will not do more than is required.

For instance, take the case of Rick, one of your accounts receivable representatives. He was part of your original staff before the acquisition. In fact, he was part of the team that selected the former accounting software. Now he has been struggling to learn the new system. You often hear him saying things like, "This new software can't handle accrual-based accounting," "I can't believe how small the fields are," or "It doesn't even use industry terminology."

Or you can take the case of Nancy, one of your other accounts receivable representatives who came over from the acquired company. You had heard that she was "whiz-bang" with the new system, often processing four large accounts a day. She has never adjusted to the new system, but doesn't complain. Both Rick and Nancy are in the Resistance stage-one actively; the other passively. While this stage can be very frustrating, you need to be aware that it's part of the normal process people go through in order to cope with change.

Stage 2: Uncertainty
Most individuals will be uncertain about their ability to do what has been asked of them. They may be concerned with whether they will be able to produce and deliver and may be having difficulty with new skills they must learn. Worse, they will suspect that perhaps their jobs may be on the line. Some will express negativity as to whether the changes that have been made will really benefit the company. They may wonder "What's in it for me?"

Rick and Nancy, for example, both begin to feel uncertain about the accounting department consolidation and the software system. Rick begins to think, "Nancy understands the system better than I do. I just can't seem to get the hang of it. It's only a matter of time until they let me go." Nancy begins to think, "Rick has been here a lot longer than I have. Once he learns the system, they will have no use for me...and they expect me to train him! It's only a matter of time until they let me go."

This is the most uncomfortable phase. During this stage, people can be confused and bewildered. They may feel unconnected to what is happening around them. They may be experiencing stress symptoms - physical, emotional or mental that are attributed to change. If not managed, it can lead to job-burnout.

Stage 3: Assimilation
As people begin to move from resistance to assimilation they begin to gradually implement change. Slowly, they begin to try. They cease complaining, and begin to adjust to what is required. Unfortunately, moving from resistance and uncertainty to assimilation does not occur overnight. The one factor that often is overlooked when implementing change is the time needed to learn. All change takes time.

In your department, Rick has been practicing with the new system. His proficiency has gradually improved, and comments like, "I can't believe the slow processing speed of this package" have been replaced by "It's 11:00. Time to generate the 'late pay' report." Nancy has begun to feel more confident that the company is serious about keeping her, and has now begun to process here usual four accounts a day. She is still a little leery, but helps out Rick when he gets frustrated by the system.

Stage 4: Integration
Integration occurs when people have begun to accept the changes. Confidence builds while learning and adjustments have taken place. They may have become advocates of change instead of resistors.

Rick has begun to talk about the benefits of the new accounting system and how it allows for more flexibility in organizing report criteria. Instead of helping Rick when he has problems with the system, Nancy has developed some job aids for him on some of the key functions.

Stage 5: Acceptance
Acceptance is the final stage of adaptation to change. You will be able to see that when people have reached the acceptance stage, they appear less stressed and become more supportive. They may feel they have conquered a new challenge. This empowers people and increases their self-esteem.

Rick and Nancy have now teamed up and are excited about a new report they were able to create with the "Customized Report" feature. They have both come in early for the past week, designing the layout for the new report. You often seem them scribbling on napkins during their lunch break.

While the stages of the change cycle are natural and normal, you shouldn't assume that any problems employees have will work themselves out over time. Moving from Resistance to Acceptance may often be neither a smooth process nor always a given. People may take an inordinate amount of time moving from one stage to the next, reducing productivity and quality along the way. Or worse, employees can get stuck in resistance or uncertainty and never even make it to assimilation. It is critical, therefore, to create structures to help people cope with change and avoid job-burnout. Here are some ways to help your people manage transition and the demands placed upon them during the process:

• Be sure everyone understands the vision of where the company is going and why.

NFL hockey great, Wayne Gretzky once said:
"It's not where the puck is, it's where the puck is going."
Financial people know better than anyone why change may be necessary. Explain to people that the changes you are going through are necessary to be able to remain competitive and to continue to grow. Communicate management goals and direction into every level.

Remember the CEO who explained to the senior staff the need for changes to help move the company forward? Has anyone bothered to explain it to the rest of the employees? Furthermore, you know that the CEO's push to improve productivity and quality means that the consolidation in your department does not mean job layoff, but, if anything, you may need to increase staff. You made the mistake of taking this for granted, but the employees never did. You could have said, "With the acquisition, I know our department has doubled in size, but the overall number of accounts has not. The CEO, though, is looking to aggressively grow the company by 25% this year, and there's definitely a place for everyone here. For those of you who are unfamiliar with the accounting package, I know it's very different from what you're used to. It will take time to get everybody up to speed, but I'm counting on those of you who do know it to help train the others. When we're all proficient on the new software, I know we'll be able to show the CEO that our department can handle much more than a 25% growth rate. We've got the best Finance department in the industry here!"

Be in tune to the difficulties some individuals may be experiencing in adapting to change. Recognize that most people fear change but it affects each one differently. Rick and Nancy each reacted uniquely when they thought they might lose their job. Some will be more adaptable than others. The high performer will want to make themselves valuable to their job and will do all they can to make things work and help others. They may even enjoy being stretched beyond their present comfort zone. Many other individuals, though, need security and don't like taking risks. They will always opt for the known and familiar path. They may work halfheartedly, thus pulling down the morale of those around them. Some may never move beyond resistance and may doggedly continue to resist change long after it has become a reality. They will take the initiative only when motivated by others. Teamwork and leadership is needed to handle change, because most people can't do it alone. You need to let people know you understand the challenges they face and part of your job as their leader is to help them through it.
Encourage acceptance and help others see positive opportunities at the onset of change. Communicate that people have a choice to be an advocate or a resistor to change and that together, they can accomplish their goals. Help them to see that negativity and resistance will only hold everyone back. Emphasize having pride and a strong feeling for the company and each other - that you're all in this together, and encourage support. Make them feel like team players who will be growing in effectiveness all the time, and experiencing a sense of excitement about themselves, and the company as you grow together. Maybe you've instituted new cost estimating procedures that have reduced productivity during the learning curve. You notice that several employees begin to revert back to the old methods. You need to acknowledge the difficulty they have with the new procedures, but explain to them that once they are comfortable with change, it will become easier and will enable the company to cost out projects more profitably-and that benefits everyone. Establish an atmosphere of open communication and include them in on what's going on. In a changing environment, people lose their motivation if they are not kept informed about what is going on around them. The less they know about what is going on the more negative impact it will have on their performance. Without open communication, we run the risk of disharmony among people. When you focus on communication, you help build trust between yourself and your employees. You should be prepared to answer questions like:
- Why are we changing and what happens if we don't change?
- Why rock the boat? We're already profitable.
- What will the changes look like?
- How long do we have?
- How does this change fit in with all the other changes?
- What will you do to help us through the change?
- What's my role?
Clearly communicate those things you know about the future. For instance, don't just say, "We will provide the best customer service." Instead, say, "We will provide detailed, itemized invoices to customers and personally call each major customer within one week after invoices are mailed." In addition, as uncomfortable as it sounds, communicate what is not known about the future. Failing to address the difficult questions-questions people are already asking each other and their peers--does not make the issues go away. If you are not sure that you can keep the entire staff of project managers if sales don't increase by 15%, say so. If you cannot predict the impact of your competitor's ability to bid lower than you, say so. If you don't know how a subcontractor's financial instability will affect a project, say so. People will not see you as weak; they will respect you more for your honesty.
Ask for their input. Give yours. People tend to promote what they help to create. Ask them for ideas on how you can support each other and work together in accomplishing your goals. Remember Rick and Nancy working together to create a new report? Once they had a personal stake in the game, acceptance of the new accounting software came more quickly. Be sure to involve people in the field as well. When a field manager of a large construction company was asked his opinion on how to improve operations he responded with...

"Ask for our feedback. Great ideas are not developed by one person. Great ideas are generally the collaboration of many ideas, generated by many people. There are great ideas by people in the field, but the company won't know unless it asks for our input and ideas."
Many construction companies are guilty of underutilizing the ideas and our employees' suggestions and ideas and are not taking full advantage of them. They won't feel part of the change; they'll feel more like a victim of change.

Ask how people are doing, listen, and encourage cooperation and open honesty. Talk to that person who is coming to work with a chip on her shoulder. Ask what you can do to help. Encourage upward feedback of employees on attitudes, concerns, issues and frustrations.
Set goals and make people accountable.

Change is a journey, and without a destination in mind, you'll be lucky to end up where you intended. Goals help define that destination. Make sure employees have goals to get where you want them to go, and even involve employees in defining the goals. Then, hold people accountable for achieving them. A high-performance workplace is one where people are accountable. Make sure your goals are realistic and reasonable. At the same time, you don't have to lower your standards, either.

Rather than asking Nancy, for instance, to make sure the other employees understand the new system, ask her if she could put together a short training package by the end of the month, and you'll give her some time off her regular duties to work on it.

Don't ask people to be accountable only for their actions and job performances, but just as importantly, ask them to be accountable to each other for maintaining high morale. By placing an equal value on teamwork, professional behavior, job performance, and accountability, you will be able to provide better service to both customers and to each other.
Encourage others to be solutions-focused, not problems-focused.

This goes hand in hand with setting goals and establishing accountability. When new procedures are instituted and problems arise, people may wait for someone else to fix them. As you let people know that they are accountable, let people know you expect them to come in not only with their problems, but also with possible solutions. Add your input, too. Changes rarely occur without glitches, so be prepared to brainstorm ways to solve problems and get them out of the way to help people achieve high performance.
Take the time to train your people. By its very definition, "change" suggests that you are attempting something new and different. To create that high performing work place during change, you need to ensure your people have the necessary skills to succeed in the new environment. Education and training must be seen as a top priority. The time you invest in training will eventually payoff in increased productivity as well as product and service quality. As you look at the changes you plan to implement, you should ask yourself these training-related questions:
What is the person's needed level of competence to support the change?

What training will be needed to bring them up to that level of competence?

How will the employees balance their workload with the time needed for training?

What skills and knowledge do you need to support the change?

We've already talked about Rick's need for training on the new accounting software, but what about Nancy? She may know that system, but remember, she was part of the company you acquired. Is she familiar with your organizational structure? Does she know your key suppliers? Your firm specializes in constructing hospitals. Does she understand the special needs of health care facilities?

Don't treat training like getting a cold: if they hang around long enough, maybe they'll catch it.
Plan rewards and reinforcements. Abandoning old ways of working in favor of new ones does not come easily. People need incentives to make change. As you gradually make the changes to transform your company to a high performing workplace, celebrate the successes along the way. Too often, rewards are overlooked. As people begin to adopt change, find opportunities to recognize people: gift certificates for video rentals, a personalized thank you note from the CEO, a box of candy, gift certificates to dinner. Use your imagination. As you think about rewards and reinforcements, ask yourself these questions:

• What are the key milestones in the change?

• How will those milestones be celebrated?

• How will individual behaviors be reinforced?

• How will success be celebrated?

Planning for recognition will help alleviate the stress common during change. It lets employees know that you do appreciate their efforts as you create a faster, more efficient, more effective workplace.
Alleviate job pressure. Creating a high-performance workplace through change requires managing job pressure for yourself and others. Laugh a little! It's okay to mix pleasure with business. Work might be serious, but that doesn't mean we always have to take ourselves seriously. People who have fun at work are more productive and less anxious through change. Encourage a relaxed and casual atmosphere.

Keep your own life in balance so that you don't burn out. Maintain a positive attitude. What are you doing to recharge your mental and physical batteries these days? Do you exercise? Do you practice any relaxation techniques? Are you involved with activities outside of work even when your workload is swamped? The amount of overtime you and your staff spend at work will naturally increase your stress level, so having fun is paramount.

You've heard the old adage before, "The only constant is change." Yes, change is inevitable, but it doesn't have to be agonizing. If you recognize the five stages that people go through to assimilate change, you can help facilitate the process. Sure, the time it may take to move from one stage to another may vary, but if you make a conscious effort to help employees through change and implement strategies to ease the transition, you can avoid job burnout and help build the high performance workplace required for success in the construction industry...and after you've helped employees through the current change, then you'll be ready to help them through the next one.

© Copyright 2003-2008 Christine Corelli, all rights reserved.

Leadership and Change Management. How to Create a High-Performance Workplace Through Change By Christine Corelli, the "Sales-Service Excellence" Expert (for Construction Financial Management Association)

Leadership and Change Management.
How to Create a High-Performance Workplace Through Change
By Christine Corelli, the "Sales-Service Excellence" Expert
(for Construction Financial Management Association)