Description
Businesses have always had to deal with change—it may be the only thing about the business world that doesn’t change.
Effecting Change in
Business Enterprises
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Current Trends in Change Management
The Conference Board creates and disseminates knowledge
about management and the marketplace to help businesses
strengthen their performance and better serve society.
Working as a global, independent membership organization in
the public interest, we conduct research, convene conferences,
make forecasts, assess trends, publish information and analysis,
and bring executives together to learn from one another.
The Conference Board is a not-for-profit organization and holds 501 (c) (3) tax-exempt
status in the United States.
about the report
Working in change management has probably never been so important or
so complex as it is today. To help managers navigate, Effecting Change in
Business Enterprises: Current Trends in Change Management presents
current models and methods used based on the collective wisdom and
experience of The Conference Board’s Three Faces of Change Working
Group members, a survey, in-depth interviews, and case studies. Drawing
on these resources, the group sought to examine the “state of the art” in
initiating and effecting change in business enterprises. Its focus was to
study change management at three organizational levels:
1 Organization
2 Department
3 Individual
It is hoped the knowledge gleaned from this research will help
organizations know more about what they need to make change
management work.
to obtain this
research report...
members of The Conference Board can
download electronic versions or order printed
copies from our Members Only Web site:
www.conference-board.org/
effectingchange.htm
or by contacting Customer Service
at 212 339 0345 or via e-mail at
[email protected]
non-members can purchase an electronic
version or printed copies at our public
Web site, www.conference-board.org
or call customer service at 212 339 0345.
¶
Effecting Change in Business Enterprises
Current Trends in Change Management
by Gregory R. Guy and Karen V. Beaman
Interviews by Carole Weinstein
c o n t e n t s
5 Key Findings
6 The Only Business Constant Is Change
8 Change Management as a Business Function
8 Need Expands Change Management’s Presence
9 What Is Driving Change Management
10 What Is Not Driving Change Management
10 Change Initiatives Underway
11 Management Roles
12 Adopting Criteria and Deciding Strategy
14 Preparing for and Effecting Change
15 Implementing Change
16 Implementation Techniques
18 Overcoming Resistance and Sustaining Change
18 Top Challenges
20 Measuring Progress
21 Achieving a Sustainable Plan
22 Achieving Success
22 Alignment
23 Leadership and Organizational Competency
23 Competitive Pressure
24 The Role of HR in Change Management
24 Provide Leadership
25 Act as a Center of Expertise
25 Align HR Systems with Change Objectives
25 Assess and Evaluate
26 The Future of Change Management
26 Some Elements Remain Cloudy
27 Lessons Learned: The Three Faces of Change Management
28 Organizational Competencies
28 Departmental/Group Competencies
28 Individual Competencies
29 Case Studies
30 KeySpan Corporation
33 Motorola, Inc.
35 AT&T Corp.
38 Sprint Corporation
41 The New York Times Company
43 General Motors Corporation
sponsor
acknowledgments
The authors would like to thank Lynne Morton from PI Solutions
for leading the Working Group on Change Management and providing
us with support in this effort. In addition, we’d like to acknowledge
from The Conference Board, Linda Barrington, Research Director, for
sharing her insight and inspiration with us on numerous occasions,
and Henry Silvert, Research Statistician, who reviewed the findings
and statistics provided in this report. Finally, many thanks go to
Lisa Faucher of The Jeitosa Group for her tireless efforts.
Accenture is a global management
consulting, technology services, and
outsourcing company. Committed to
delivering innovation, Accenture
collaborates with its clients to help them become high-performance
businesses and governments.
The Accenture Human Performance practice helps clients address
their most critical people issues through innovative approaches in
the areas of organization strategy, human resources, learning,
knowledge management, performance management, and change
management. With more than 5,500 skilled human performance
professionals, Accenture offers a full range of consulting and
outsourcing solutions to help clients improve the performance
of their workforce and overall business. For more information,
visit www.accenture.com
about the authors
Gregory R. Guy is a professor of linguistics at New York University.
He is an expert on empirical research methodology and quantitative
analysis and developed one of the first personal computer
applications for the statistical analysis of linguistic data. He has
past experience as a journal editor and currently serves on the
editorial boards of three journals.
Dr. Guy has published research on international business models,
global mindsets, and international work experiences. Notable
publications include Towards a Social Science of Language (ed.),
Language Variation and Linguistic Theory, and Análise Quantitativa
em Sociolingüística (Brazil).
Dr. Guy holds a doctoral and master’s degrees in linguistics from
University of Pennsylvania and a B.A. from Boston University. He has
been a lifelong activist for social diversity and human rights, having
served on institutional, municipal, provincial, and national panels
addressing issues of disability, accessibility, and diversity in higher
education and in the workplace.
Karen V. Beaman is the Managing Partner of The Jeitosa Group, a
global business consultancy focused on achieving organizational
effectiveness through transnational leadership. Previously, she held
global responsibility for the sales and delivery of ADP’s professional
services across the Americas, Europe, and Asia/Pacific.
Beaman is an internationally recognized speaker and author, having
published work in the fields of linguistics, humanities, management,
human resources, and information technology. She is the co-founder
and Editor-in-Chief of IHRIM Journal and is editor of the books
Boundaryless HR: Human Capital Management in the Global Economy
and Out of Site: An Inside Look at HR Outsourcing. Her latest book,
Common Cause: Global Shared Services for Human Resources, is
scheduled for release in 2005.
Beaman has a B.A. from Old Dominion University and an M.S. from
Georgetown University and was promoted to Ph.D. candidate in
Sociolinguistics and Historical and Computational Linguistics.
In 2002, she received the IHRIM Summit Award for her lifetime
achievements in HR information management.
Carole Weinstein is currently the Chief Learner at Learning Works,
a human resources organizational effectiveness and learning
consultancy that provides respective customized workplace
solutions. Weinstein is also a senior faculty member with several
graduate and corporate learning university programs including
New York University, Pace University, Webster University (Bermuda),
Capella University, and Manhattanville College. Prior to founding
Learning Works, she served as Vice President, Human Resources,
Work-Life and Diversity, at ABN AMRO.
Weinstein is ABD from Teachers College, Columbia University, and
is an active member of several professional associations, including
Human Resources of NY (HR NY), Society for Human Resources
Management (SHRM), Human Resources Outsourcing Association
(Advisory Board and Executive Committee Member) and Association
of Work Life Professionals (AWLP).
•
Seventy-three percent of companies have achieved
either modest formalization (54 percent) or have
formalized their change management process
“to a great extent” (19 percent).
•
Eighty-two percent of survey respondents
identified change management as a priority
for their company.
•
Ninety-nine percent expect an increased need for
change management over the next three years; of
this group, 62 percent expect the need to increase
to a great extent. But over a third has neither
implemented a change management function
nor plans to do so within the next three years.
•
Almost half the companies surveyed (48 percent)
have already established a change management
function somewhere in their organization, and over
a quarter of the rest expect to launch one within
three years.
•
The change management function is most
commonly located in the HR department
(46 percent), followed by corporate
headquarters (27 percent).
•
Common change initiatives underway include
change in business process (89 percent),
organizational structure (76 percent), and
behavior (68 percent).
•
Criteria most commonly factored in to selecting a
change model or strategy include market demand
(68 percent), availability of budget (52 percent),
availability of other resources (47 percent),
changes in leadership (41 percent), and employee
satisfaction and turnover (37 percent).
•
The top critical factors in effecting change are
planning, communicating, and active participation.
•
The top three key competencies for implementing
change are effective communications, building
trust, and achieving collaboration.
•
The top three implementation techniques
to carry out initiatives are communication,
employee participation, and linking
implementation to individual performance
objectives and compensation.
•
Top challenges to effecting change are
people issues, organizational resistance,
and communication weaknesses.
•
The top two metrics for measuring change are
surveys (70 percent) and scorecards (70 percent).
•
The three main areas contributing to achieving
change management are alignment, competency
of leadership and the organization, and
competitive pressure.
Ef fecti ng Change i n Busi ness Enterpri ses: Current Trends i n Change Management The Conference Board 5
Findings
Key
B
usinesses have always had to deal with
change—it may be the only thing about the
business world that doesn’t change.
Globalization, competition, and accelerated technologi-
cal innovation are creating conditions under which
change itself is changing: It is becoming more complex
and omnipresent, requiring enterprises to develop
focused capabilities for change management.
Instead of being an episodic obligation associated with
the occasional restructuring or market crisis, change
management is increasingly perceived as a permanent
business function that is essential to keeping the organi-
zation agile and adaptable in a continuously changing,
competitive environment. CEOs around the globe seem
to agree: In a survey conducted for The Conference
Board’s 2004 CEO Challenge, 540 CEOs rated Speed,
flexibility, and adaptability to change as one of their
top two business challenges.
1
To further examine the
expanding demands for effective change management,
The Conference Board established the Three Faces of
Change Working Group. Its focus was to study change
management at three organizational levels:
1 Organization
2 Department
3 Individual
The working group researched current change manage-
ment issues and practices through a survey, in-depth
interviews, and case studies. Drawing on these resources,
the group sought to examine the state of the art in initiat-
ing and effecting change in business enterprises.
Results show new directions and increased impact for
change management. There is wider recognition of
change as a constant feature of the business environment
and an increased need for developing expertise in change
management, which is now well-funded, growing, and
considered important enough to be designated as a
department or distinct business function.
It seems working in change management has probably
never been so important or so complex. To help man-
agers navigate, this report presents models and methods
derived from the collective wisdom and experience of
working group members and survey participants. It is
hoped the knowledge gleaned from this research will
help organizations know more about what they need to
make change management work.
6 Ef fecti ng Change i n Busi ness Enterpri ses: Current Trends i n Change Management The Conference Board
Change
Introduction
1
See CEO Challenge: Top 10 Challenges, The Conference Board, Executive
Summary R-1353-04-ES, 2004.
The Only Business Constant Is
Ef fecti ng Change i n Busi ness Enterpri ses: Current Trends i n Change Management The Conference Board 7
Respondent Profile
Seventy-one companies participated in the change management survey,
ranging in size from small to very large as measured by worldwide revenues and
number of employees. They represent a range of industries, operating in the
United States and across a broad spectrum of other countries and regions.
Employees
Less than1,000 15
1,000 -
Businesses have always had to deal with change—it may be the only thing about the business world that doesn’t change.
Effecting Change in
Business Enterprises
r
e
s
e
a
r
c
h
r
e
p
o
r
t
R
-
1
3
7
1
-
0
5
-
R
R
Current Trends in Change Management
The Conference Board creates and disseminates knowledge
about management and the marketplace to help businesses
strengthen their performance and better serve society.
Working as a global, independent membership organization in
the public interest, we conduct research, convene conferences,
make forecasts, assess trends, publish information and analysis,
and bring executives together to learn from one another.
The Conference Board is a not-for-profit organization and holds 501 (c) (3) tax-exempt
status in the United States.
about the report
Working in change management has probably never been so important or
so complex as it is today. To help managers navigate, Effecting Change in
Business Enterprises: Current Trends in Change Management presents
current models and methods used based on the collective wisdom and
experience of The Conference Board’s Three Faces of Change Working
Group members, a survey, in-depth interviews, and case studies. Drawing
on these resources, the group sought to examine the “state of the art” in
initiating and effecting change in business enterprises. Its focus was to
study change management at three organizational levels:
1 Organization
2 Department
3 Individual
It is hoped the knowledge gleaned from this research will help
organizations know more about what they need to make change
management work.
to obtain this
research report...
members of The Conference Board can
download electronic versions or order printed
copies from our Members Only Web site:
www.conference-board.org/
effectingchange.htm
or by contacting Customer Service
at 212 339 0345 or via e-mail at
[email protected]
non-members can purchase an electronic
version or printed copies at our public
Web site, www.conference-board.org
or call customer service at 212 339 0345.
¶
Effecting Change in Business Enterprises
Current Trends in Change Management
by Gregory R. Guy and Karen V. Beaman
Interviews by Carole Weinstein
c o n t e n t s
5 Key Findings
6 The Only Business Constant Is Change
8 Change Management as a Business Function
8 Need Expands Change Management’s Presence
9 What Is Driving Change Management
10 What Is Not Driving Change Management
10 Change Initiatives Underway
11 Management Roles
12 Adopting Criteria and Deciding Strategy
14 Preparing for and Effecting Change
15 Implementing Change
16 Implementation Techniques
18 Overcoming Resistance and Sustaining Change
18 Top Challenges
20 Measuring Progress
21 Achieving a Sustainable Plan
22 Achieving Success
22 Alignment
23 Leadership and Organizational Competency
23 Competitive Pressure
24 The Role of HR in Change Management
24 Provide Leadership
25 Act as a Center of Expertise
25 Align HR Systems with Change Objectives
25 Assess and Evaluate
26 The Future of Change Management
26 Some Elements Remain Cloudy
27 Lessons Learned: The Three Faces of Change Management
28 Organizational Competencies
28 Departmental/Group Competencies
28 Individual Competencies
29 Case Studies
30 KeySpan Corporation
33 Motorola, Inc.
35 AT&T Corp.
38 Sprint Corporation
41 The New York Times Company
43 General Motors Corporation
sponsor
acknowledgments
The authors would like to thank Lynne Morton from PI Solutions
for leading the Working Group on Change Management and providing
us with support in this effort. In addition, we’d like to acknowledge
from The Conference Board, Linda Barrington, Research Director, for
sharing her insight and inspiration with us on numerous occasions,
and Henry Silvert, Research Statistician, who reviewed the findings
and statistics provided in this report. Finally, many thanks go to
Lisa Faucher of The Jeitosa Group for her tireless efforts.
Accenture is a global management
consulting, technology services, and
outsourcing company. Committed to
delivering innovation, Accenture
collaborates with its clients to help them become high-performance
businesses and governments.
The Accenture Human Performance practice helps clients address
their most critical people issues through innovative approaches in
the areas of organization strategy, human resources, learning,
knowledge management, performance management, and change
management. With more than 5,500 skilled human performance
professionals, Accenture offers a full range of consulting and
outsourcing solutions to help clients improve the performance
of their workforce and overall business. For more information,
visit www.accenture.com
about the authors
Gregory R. Guy is a professor of linguistics at New York University.
He is an expert on empirical research methodology and quantitative
analysis and developed one of the first personal computer
applications for the statistical analysis of linguistic data. He has
past experience as a journal editor and currently serves on the
editorial boards of three journals.
Dr. Guy has published research on international business models,
global mindsets, and international work experiences. Notable
publications include Towards a Social Science of Language (ed.),
Language Variation and Linguistic Theory, and Análise Quantitativa
em Sociolingüística (Brazil).
Dr. Guy holds a doctoral and master’s degrees in linguistics from
University of Pennsylvania and a B.A. from Boston University. He has
been a lifelong activist for social diversity and human rights, having
served on institutional, municipal, provincial, and national panels
addressing issues of disability, accessibility, and diversity in higher
education and in the workplace.
Karen V. Beaman is the Managing Partner of The Jeitosa Group, a
global business consultancy focused on achieving organizational
effectiveness through transnational leadership. Previously, she held
global responsibility for the sales and delivery of ADP’s professional
services across the Americas, Europe, and Asia/Pacific.
Beaman is an internationally recognized speaker and author, having
published work in the fields of linguistics, humanities, management,
human resources, and information technology. She is the co-founder
and Editor-in-Chief of IHRIM Journal and is editor of the books
Boundaryless HR: Human Capital Management in the Global Economy
and Out of Site: An Inside Look at HR Outsourcing. Her latest book,
Common Cause: Global Shared Services for Human Resources, is
scheduled for release in 2005.
Beaman has a B.A. from Old Dominion University and an M.S. from
Georgetown University and was promoted to Ph.D. candidate in
Sociolinguistics and Historical and Computational Linguistics.
In 2002, she received the IHRIM Summit Award for her lifetime
achievements in HR information management.
Carole Weinstein is currently the Chief Learner at Learning Works,
a human resources organizational effectiveness and learning
consultancy that provides respective customized workplace
solutions. Weinstein is also a senior faculty member with several
graduate and corporate learning university programs including
New York University, Pace University, Webster University (Bermuda),
Capella University, and Manhattanville College. Prior to founding
Learning Works, she served as Vice President, Human Resources,
Work-Life and Diversity, at ABN AMRO.
Weinstein is ABD from Teachers College, Columbia University, and
is an active member of several professional associations, including
Human Resources of NY (HR NY), Society for Human Resources
Management (SHRM), Human Resources Outsourcing Association
(Advisory Board and Executive Committee Member) and Association
of Work Life Professionals (AWLP).
•
Seventy-three percent of companies have achieved
either modest formalization (54 percent) or have
formalized their change management process
“to a great extent” (19 percent).
•
Eighty-two percent of survey respondents
identified change management as a priority
for their company.
•
Ninety-nine percent expect an increased need for
change management over the next three years; of
this group, 62 percent expect the need to increase
to a great extent. But over a third has neither
implemented a change management function
nor plans to do so within the next three years.
•
Almost half the companies surveyed (48 percent)
have already established a change management
function somewhere in their organization, and over
a quarter of the rest expect to launch one within
three years.
•
The change management function is most
commonly located in the HR department
(46 percent), followed by corporate
headquarters (27 percent).
•
Common change initiatives underway include
change in business process (89 percent),
organizational structure (76 percent), and
behavior (68 percent).
•
Criteria most commonly factored in to selecting a
change model or strategy include market demand
(68 percent), availability of budget (52 percent),
availability of other resources (47 percent),
changes in leadership (41 percent), and employee
satisfaction and turnover (37 percent).
•
The top critical factors in effecting change are
planning, communicating, and active participation.
•
The top three key competencies for implementing
change are effective communications, building
trust, and achieving collaboration.
•
The top three implementation techniques
to carry out initiatives are communication,
employee participation, and linking
implementation to individual performance
objectives and compensation.
•
Top challenges to effecting change are
people issues, organizational resistance,
and communication weaknesses.
•
The top two metrics for measuring change are
surveys (70 percent) and scorecards (70 percent).
•
The three main areas contributing to achieving
change management are alignment, competency
of leadership and the organization, and
competitive pressure.
Ef fecti ng Change i n Busi ness Enterpri ses: Current Trends i n Change Management The Conference Board 5
Findings
Key
B
usinesses have always had to deal with
change—it may be the only thing about the
business world that doesn’t change.
Globalization, competition, and accelerated technologi-
cal innovation are creating conditions under which
change itself is changing: It is becoming more complex
and omnipresent, requiring enterprises to develop
focused capabilities for change management.
Instead of being an episodic obligation associated with
the occasional restructuring or market crisis, change
management is increasingly perceived as a permanent
business function that is essential to keeping the organi-
zation agile and adaptable in a continuously changing,
competitive environment. CEOs around the globe seem
to agree: In a survey conducted for The Conference
Board’s 2004 CEO Challenge, 540 CEOs rated Speed,
flexibility, and adaptability to change as one of their
top two business challenges.
1
To further examine the
expanding demands for effective change management,
The Conference Board established the Three Faces of
Change Working Group. Its focus was to study change
management at three organizational levels:
1 Organization
2 Department
3 Individual
The working group researched current change manage-
ment issues and practices through a survey, in-depth
interviews, and case studies. Drawing on these resources,
the group sought to examine the state of the art in initiat-
ing and effecting change in business enterprises.
Results show new directions and increased impact for
change management. There is wider recognition of
change as a constant feature of the business environment
and an increased need for developing expertise in change
management, which is now well-funded, growing, and
considered important enough to be designated as a
department or distinct business function.
It seems working in change management has probably
never been so important or so complex. To help man-
agers navigate, this report presents models and methods
derived from the collective wisdom and experience of
working group members and survey participants. It is
hoped the knowledge gleaned from this research will
help organizations know more about what they need to
make change management work.
6 Ef fecti ng Change i n Busi ness Enterpri ses: Current Trends i n Change Management The Conference Board
Change
Introduction
1
See CEO Challenge: Top 10 Challenges, The Conference Board, Executive
Summary R-1353-04-ES, 2004.
The Only Business Constant Is
Ef fecti ng Change i n Busi ness Enterpri ses: Current Trends i n Change Management The Conference Board 7
Respondent Profile
Seventy-one companies participated in the change management survey,
ranging in size from small to very large as measured by worldwide revenues and
number of employees. They represent a range of industries, operating in the
United States and across a broad spectrum of other countries and regions.
Employees
Less than1,000 15
1,000 -