Monthly Archives: May 2016

Series on Adapting to Change: The Race

The Race, is a simple story about a race. A mirror on business and how change in itself is meaningless if not focused in the right direction.

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Some time ago, a boat race was organized between two competing organizations. One was a Swiss company – let’s name it Cow Co. Ltd, and the other one was Sempuma from Malaysia. Both teams worked very hard to get to top level. When the day finally came where they could measure their strength, both were very optimistic.

But the race was short and came to a surprising end, where the team from Malaysia won by more than one kilometre!

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The morale was low at the Headquarters of Cow & Co in Switzerland. Nobody understood such a huge difference. Top Management decided that the causes MUST be identified. A project team was set up, to identify the cause and to suggest corrective measures if needed

After weeks of discussions, the project team came to the following findings:

• The Malaysian team included seven rowing officers and one steering executive

• In the Swiss team there was one single rowing officer and seven steering executives

The top Management reacted immediately and hired external Consultants to conduct an in-depth analysis on the Swiss team‘s structure

Some months and many Swiss Francs later, the Consultants came to following conclusion:

• Too many team-members had been steering

• Too few of them had been involved in moving the boat

The Top Management reacted in a radical way and restructured the whole team as follows:

• Four steering executives

• Two senior steering managers

• One steering directors

• One rowing officer

Additionally, they implemented a sophisticated Performance evaluation system to motivate the one rower. The top Management said: We must enrich his responsibilities to make his job more interesting and therefore get the best out of him.

The next year came and a second race was organized. The result was cruel. The Asian team won again- this time by TWO Kilometers.

The consequence of such a heavy blow that the top management sacked the one rower because of bad performance! The equipment was all sold and all new related investments were frozen. The Consultants were praised for doing a great job. The money that was not invested was distributed among the top management and the steering committee.

Series on Adapting to Change: Oordee – Delivering Explosive Value Through Change

When one of the richest economy’s decided it wanted change it choose a unique brand identity as the precursor of that change.

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The state of Qatar is the world’s richest economy, per capita. In 2005, its state-owned telecom company Qtel, led by chairman Sheikh Abdullah Bin Mohammed Bin Saud Al Thani, and CEO Dr Nasser Mohammed Marafih, embarked on an ambitious acquisition spree; by 2012, Qtel owned 17 telecoms operators in the Muslim world and had become the world’s fastest growing telecoms operator by revenue.

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And each of the acquired telcos had been left to operate largely as they had done pre-acquisition. In 2012, however, Qtel began to shift its strategy away from growth through acquisition towards growth through integration. Sheik Abdullah and Dr Nasser decided to pull all their diverse telecoms brands into one mega-brand, Ooredoo. This would give them the opportunity to focus on what they actually wanted their international telecom company to deliver – transformational change in the telecom sector.

The change management teams set out to identify what they wanted their brand to stand for. They defined a series of unique branding propositions that would, ultimately, give them standout recognition. They wanted to offer the Muslim world greater freedom of communication and choice and, in particular, they wanted to be seen as helping rural communities and women gain a voice.

They wanted to change their world for the better. In February 2013 the new global brand Ooredoo was launched from a standing start in a matter of weeks in Qatar, with the iconic footballer Lionel Messi introduced by Sheik Abdullah as the global brand ambassador. It was a stunning success, gaining market share within weeks. With a customer base of more than 95 million people in 17 countries, Ooredoo rapidly became a leading international brand. Alignment, clarity of purpose and a ruthless focus on implementation showed the world what Qatar and Qataris can do.

Series on Adapting to Change: Y2K – And Making the Case for Change

In the late-1990s, industries around the world were becoming increasingly alarmed that all software would reset itself on 1 January 2000. Fear spread, and a generation of businesses was set up to address this impending crisis, known as Y2K (Year 2000).

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No CEO worth his or her salt could say they wouldn’t address this change. It was a classic Doomsday scenario, driven by the book Computers in Crisis by Jerome and Marilyn Murray. Following publication in 1984, it was picked up in USENET discussion groups and in the early days of the Internet, and built momentum from there.

In the history of business, no change management programme has galvanized businesses like Y2K. The consequences of inertia were all too clear. In this instance the success of organizational change – supporting the delivery of crucial business strategies – was driven by a common and effective organizational change requirement.

Setting aside the frequent misappropriation and misunderstanding of the term, effective change management enables leadership teams and their organizations to ensure successful growth and swiftly take advantage of opportunities that present themselves. In this instance, the change programme was about avoiding a global disaster.

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The emphasis had to be on rapid implementation, and leaders had to avoid the temptation to try to deliver value from change. This was all about ensuring that solutions were found and implemented in time. Organizations had to be agile enough to act at short notice.

While planes never did fall from the sky at 01/01/00, we’ll never know what might have happened had the clocks stopped. Although an estimated $300bn was spent ensuring that nothing occurred, Y2K was the global mobilization that showed the promise and value of change management.

Series on Adapting to Change: Disruption brings Opportunity

Among leadership teams, there tends to be two views about change. One: change is risky and means disrupting repetitive processes that leaders have been rewarded for improving over time. And two: change is something that can be delegated, like other implementation-based activities such as project management and risk. Actually, change programs are most successful when, as a result of external factors, there’s a shared sense of urgency to deliver tangible change.

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Following the 2008 financial crisis, RBS Group was ordered to sell its insurance business by European Union regulators, as a condition of RBS receiving £45bn in state aid. RBS’s insurance business, led by Paul Geddes, was tasked with separating its operations from RBS Group into a standalone company, in order to be ready for either a trade sale to a competitor, or listing on the stock market.

It’s a testament to Geddes, and the insurance business’s leadership at the time, that they turned the opportunity into a positive exercise and used the separation process to create a viable, standalone, rebranded insurance organisation, now known as Direct Line Group. It took 18 months to separate out every single strand of the business, from customer data, to independent functions and governance. This was very much a case of operating from a burning platform.

The entire approach had to be one of controlled urgency, there was no plan B and the leadership teams embraced the need to shift their people on to the next step as rapidly and as efficiently as possible. Once the separation had been effected, the focus was on creating a new brand and rapidly building the business into a viable standalone operation.

In 2012 the board went for an IPO that turned out to be the biggest and most successful London stock market listing that year. Its success heralded the start of a new, post-crisis IPO era. The Direct Line Group’s share price has continued to climb since it floated. Paul Geddes remains the CEO of the quoted business.

Series on Managing Change: Lean and Six Sigma at Ruukki

While planning for Change initiatives, organizations usually go large informing the entire organization, trying to build consensus etc. However, there is another way that was demonstrated by a manufacturing company which implemented Change via Lean and Six Sigma practices small doses at a time and still found great success.

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The Challenge: With operations in 15 countries, Ruukki is heading into the 21st century with a vision of becoming Europe’s leading supplier of metal-based solutions to the construction and engineering industry. Already a strong market leader with a diverse portfolio of products and services, the company must constantly innovate to stay ahead of the competition. It must also continually adapt to meet the changing needs of its customers.

A key part of Ruukki’s improvement strategy is to increase operational efficiency across its four product lines and varied locations. To achieve its vision, Ruukki needed a business improvement solution that would not only streamline operations but also become a way of doing business that could unite the company along one goal.

The Solution: Ruukki wanted to develop strong change leaders with the ability to facilitate improvement projects that deliver substantial financial gains. To execute its improvement strategy, Ruukki partnered with BMGI to develop an internal team of Lean and Six Sigma practitioners. These two improvement methodologies offered Ruukki a way to quickly reduce waste and improve quality. BMGI’s team of master consultants helped Ruukki develop new problem-solving competencies through education and on-site project identification. In addition, BMGI provided consulting support by coaching practitioners so their projects could deliver better processes and strong cost savings.

Ruukki’s implementation started small, with development limited to one plant in Finland. This initial program was designed to demonstrate results to drive company wide support. Leveraging the early successes, BMGI worked with the deployment team to introduce the Lean and Six Sigma methodologies to the executive team and to plants across Eastern Europe and the Nordic countries.

Building Internal Interest: Utilizing the company intranet, Ruukki promoted its program results through project success stories and press releases. The deployment team also leveraged internal training sessions as opportunities to communicate the impact of Lean and Six Sigma on the company’s operations. Soon after Ruukki’s initial wave of black belt problem solvers completed their projects, other divisions across Europe indicated an interest in launching local initiatives.

As employees are educated on the practice and benefits of Lean and Six Sigma, their enthusiasm for change is making its way across the company. This enthusiasm has filtered up through managers and directors to the executive team, creating a compelling voice for change. Starting small gave Ruukki the opportunity to inspire dedication at the worker level, where changes had real impact. With demonstrated results, the deployment team now plans to expand the program throughout the company.

Business Results: To date, the company has saved over €16 million in operating costs. The company has also identified another €100 million in savings through reduced inventories and improved processes.

Deployment Leader Virta Esa calls the investment in Lean and Six Sigma “…very small when compared to the results we’ve seen and the potential for continued savings.”

Ruukki has developed more than 250 Lean and Six Sigma practitioners, who act as change agents across the company. Their success is now encouraging other business units to embrace the Lean and Six Sigma methodologies.

Series on Adapting to Change: Answering the Call for Change Management

What is the recipe for success for any change management initiative? It can be a combination of many varied factors such as clear communication, transparency, flexibility…

Tom Dalby, Director of Human Resources at Rogers Communications, recently faced a challenge. With his 19 years in HR as an HR Business Partner, Tom knows his function and relationships with his business partners inside and out. However, the climate outside of his function and business proved much less familiar.

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Rising customer demands warranted expanding the capacity of the call center business Tom supported. But, once that business decision surfaced, how would Rogers make the change without unforeseen costs and disengaging staff? They needed to avoid these costs, while still delivering increased capacity and customer service.

The Business Challenge: Maintain a high level of call center customer service at all times, especially during those occasions of high call volume. The Ideal Outcome: Introduce an extended work week strategy to provide the call center business with the capability to increase hours of work as needed.

“We knew we needed to manage this change each step of the way,” Tom recalls. “The last thing we needed was for 5,000 staff to be at odds with the change – which was a very real possibility given often the change would involve more hours for staff to work!”

The Action Plan: Tom and the leaders of the call center business went to great lengths to focus on two priorities: employee receptivity to and understanding of the changes.

Looking back, Tom calls out three key components of their change management program that made the difference on delivering on the outcome – and more:

Communication – Tom made sure the team over-communicated the change: “We announced the program and its components months in advance for current employees; embedded this information within recruiting conversations to set expectations with prospective employees; and prepared managers for having conversations about and advocating for the change.” By focusing on proactive education about the change, the team ensured each individual staff member was comfortable and understood the plan.

Flexibility – Tom and his business partners recognized that big changes don’t come without a few growing pains. To make the change as easy as possible, they provided employees choice on when they could work the additional time and accommodated the vast majority of employee requests. The advanced notice and employee requests that followed allowed Tom and his team to identify the schedule’s areas of strength and greater need ahead of time.

Transparency – “We knew this would be a big change for many, so we focused on being as transparent as possible about the reality of the change.” Tom and his business partners led a pilot week for the new hours so that employees could experience the extended scheduled in real time. The benefit was twofold in increasing employee understanding of and subsequently commitment to the program and enabling the team to fine tune particular program components before the official launch.

The Result: Success! Immediately after the launch of their extended work week, call center staff delivered on – and even exceeded expectation. Despite an 8.5% increase in call volume, the call center business maintained service levels above target. Leadership appreciated this terrific outcome, too – Tom and his business partners were nominated for Rogers Communications’ Customer First Award for their outstanding impact on the business.

Series on Adapting to Change: Shell’s Tough Love

Change is any disruption in routine, and is usually accompanied by resistance. However, more important is the implementation of any change programme that needs the unflinching support, enthusiasm and guidance of the top management from start to finish to ensure its success.

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In 2004 Shell was facing an oil reserves crisis that hammered its share price. The situation was compounded by the abrupt departure of the oil group’s chairman, Sir Philip Watts. The new group chairman, Jeroen Van Der Veer, believed that in order to survive, the corporation had to transform its structure and processes.

A series of global, standardised processes were identified. These, if introduced, would impact more than 80 Shell operating units. While the changes were vital to survival, they proved unpopular in the short term as some countries stood to lose market share. The message was a tough one, and many operating units balked.

However, for a change programme of this scale to be successful, everyone had to adhere to the new systems and processes. The leadership of Shell Downstream-One, as the transformation was known, needed unflinching determination and to focus on gaining adoption from everyone involved. Those leading the change had to ensure that the major players in all their markets knew what was required and why. They needed to be aligned with the change requirement.

From the start, it was recognised that mandating the changes was the only way for them to drive the transformational growth they aimed for. This wasn’t an opt-in situation. The main message of the change team, led by Van Der Veer, was that – simpler, standard processes across all countries and regions that benefited Shell globally trumped local, individual needs. That meant everything from common invoicing and finance systems to bigger more centralised distribution networks. By identifying and rapidly addressing the many areas of resistance that emerged – such as that some influential stakeholders stood to lose control or market share – adoption was accelerated.

The team of experts – made up of senior leaders, in-house subject matter experts, implementation consultants and external change experts – who delivered the change programme were crucial in this phase. They’d been picked because they had both technical understanding and could provide change leadership. They both modelled and drove the new behaviours needed for the change to succeed. They briefed the people who would be impacted by the change; risks and potential problem areas were discussed and mitigated – before any real change was even delivered.

In all major change programmes, there’s always the danger that change management gets delegated; leaders distance themselves from the challenge of implementing the priorities they once championed. That can cause the initiatives to fail. In Shell’s case, however, the change leadership started and finished with Jeroen van der Veer, who never drew back from emphasising how important full implementation of Downstream-One would be.

Shell is in a significantly healthier position than when the transformation started, and by that measure the programme has been deemed a success. And the ramifications of Downstream-One continue to result in ongoing change.

Series on Empathy: Empathy at Panera

Feeling sorry for someone’s predicament is sympathy but to actually make a meaningful difference by moving out of one’s comfort zone, go an extra mile…that is the crux of empathy.

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A 21-year-old college student named Brandon Cook visited his grandmother in the hospital. She was dying of cancer. Brandon loved his grandmother a lot and knew she didn’t have much time to live. Watching her die was hard and he really wanted to make her happy, knowing that doing so will make him happy too.

He knew she hated the hospital food and what she really craved for was clam chowder from Panera. Though Brandon hadn’t eaten his grandma’s hospital food, but he could imagine how bland it tasted. He felt that she deserved better, and wanted to give it to her.

However, Panera only sold their clam chowder on Fridays. Unfortunately, the day Brandon’s grandma wanted clam chowder, wasn’t a Friday. Brandon knew that grandma didn’t have much longer to live. For him that day was what mattered.

Brandon called up the local Panera and asked for the manager. He explained the situation and the manager was very touched by the love Brandon felt for his grandma. The manager could imagine what it feels like to know you’re about to lose someone who means so much and you want to make them happy in the time left. Though the day wasn’t Friday, the manager decided to go out of her way to make the clam chowder. She told Brandon when he could come to pick it up.

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When Brandon arrived at the Panera in Nashua, New Hampshire, the clam chowder was waiting for him. Along with it, the manager gave him a box of cookies. The manager didn’t know Brandon’s grandma and also didn’t know if she liked cookies, but she knew how most people feel about cookies. She could imagine that a free and unexpected box of cookies would make Brandon’s grandma even happier than a cup of on-the-wrong-day clam chowder.

Brandon was so thankful to Panera for helping him deliver clam chowder to his dying grandma. Not only did the manager go out of her way to make the soup for only one customer, she also gave him a box of cookies for free. Brandon imagined that it must have been an inconvenience to make a whole batch of soup on a day they hadn’t planned to. He also imagined that giving away free cookies isn’t commonplace at Panera. He recognized that the manager understood his situation and felt his pain. She not only wanted to fulfill his wish, but surprise him as well. She must have really cared about him and about his grandma. The result of empathy is intrinsic and doesn’t require validation. Empathy is the ability to relate.

Can one person make a difference? Yes, especially when it comes to fostering organizational culture. In this case, the organization had taught its employee to act with compassion and bend the rules when she felt it was appropriate. Those who aren’t treated humanely cease to feel like human beings. Inevitably, it becomes impossible to see others as human beings worthy of being treated humanely. When an organization treats its employees with empathy, they become capable of experiencing and imparting empathy in turn.

Series on Empathy: Keeping Betsy Dry

Sometimes situations are beyond anyone’s control especially when it comes to illness etc. However, it isn’t how much but really the small things that you do by being empathetic towards needs of people around you that becomes all important for them.

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Simon lived in a terraced house with his Mum and Dad, two sisters and a dog called Betsy. She was getting old, poor Betsy. She had seen better days. She hardly had any ‘woof’ left. Betsy didn’t like the rain, or the cold. It was difficult to get her to go outside in bad weather, but of course she had to go, like all dogs do. It was usually Simon’s job to take her outside. He didn’t like the cold and the wet much either.

In the back garden there was a path next to the wall and it led down to the shed where the children had a den, Dad kept his tools and Mum kept the clothes line. Simon would sit in the shed while Betsy wandered round the garden, doing what she had to do. It got harder and harder to get Betsy outdoors. She would put one paw on the ground and if it was wet she would turn round and refuse to go outside. She was quite a tubby dog and very heavy and Simon wasn’t strong enough to push her out. The problem was, if she wasn’t made to go out she would be whining at the door in the next five minutes, then Mum would get cross.

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Simon sat in the den one dry day, thinking about how he could solve the problem. He knew old people didn’t like the wet, and they could choose to stay indoors, but Betsy couldn’t because she was a dog. “What she needs is an outdoor dry place,” he thought.

Simon looked round the shed. There was an old stair carpet in a roll, tied up with a rope. Suddenly Simon had an idea. He removed the rope which was an old washing line and unrolled the carpet. He found some pieces of wood. He balanced the wood on the wall and using the rope and the old carpet, made a tunnel for Betsy to walk through from the kitchen door to the shed. There was an open lean-to for her to sit in to keep out of the rain beside the shed. Simon showed Betsy her new dry path. She seemed to understand. She plodded along on the inside, next to the wall, and wagged her tail gently when she reached the lean to.

“Good dog,” said Simon. The next day it rained. Betsy went straight into her tunnel from the kitchen door to the shed. “Clever girl,” said Simon.

Betsy did not live very long after that. The family were sad when she went, but Simon’s Dad said Simon had really cared for her very well and had tried hard to understand how she was feeling and what she needed. He was so pleased with Simon that they went to choose a new dog from the Dogs’ Home – a dog whose owners were not well enough to look after it and who needed a loving new home.

Dad said he was sure Simon would do his best to make Toby the new dog happy, and he did!