Sustaining Change

Dr John Walsh, Mekong Institute & Shinawatra International University, November 2009

Why Do Change Efforts Fail?

Insufficient advocacy for the change or failure to understand responsibilities in the change initiative

Insufficient attention to the complexity of the change itself and the potential risks introduced by the change initiative

Inadequate engagement of critical stakeholders affected by the change initiative

Inadequate understanding of the organizational culture in the leaders' own organization as well as in the organizations networked in the change effort

Inadequate understanding of the organizational capacity needed to implement and sustain the change.

Transformational Stewardship Attributes

Outlook Mindset Interpersonal Ability

Ethical, reflective, learning oriented

empathetic, visionary, creative, innovative

Public interest oriented, mission driven, accountable, transparent, integrative, meticulous, comfortable with ambiguity

Trust inspiring, empowering, democratic, participatory, delegating, coalition building

Strategies for Leading Change

(1) diagnosing change risk and organizational capacity

(2) strategizing and making the case for change

(3) implementing and sustaining change, and

(4) reinforcing change by creating a change-centric, learning organization

Risk Factors in Change: Complexity

Factor Description Risk

Magnitude Overall size, extent, and influence of the change in relation to the organization

The more people and organizational entities are affected, the greater the risk

Scope Impact on the organization’s current culture, structures, policies, strategies, and processes

The deeper the impact is on organizational culture, structures, policies, strategies, and processes, the greater the risk.

Fluidity Adaptability of the change initiative to the changing nature of the environment

The less adaptable the change initiative is to the environment, the greater the risk.

Risk Factors in Change: Stakeholders

Factor Description Risk

Perceptions Gain or loss seen by internal and external stakeholders and the intensity of those perceptions

The more intensely stakeholders perceive their potential loss, the greater the risk

Diversity Range of conceptualizations of organizational mission, orientation, and worldview as a function of the size and variety of organizational units and purposes

The more diverse the organizational viewpoints and perspectives are, the greater the risk

Risk Factors in Change: Sociopolitical EnvironmentFactor Description Risk

Legal and policy mandates

Laws and regulations imposing changes or constraining changes in operations

The more rigid the regulatory constraints are, the greater the risk

Economic trends Resources to support change initiatives from budgets or taxes

The more vulnerable the funding is, the greater the risk

Interface with external environment

Citizen trust or demands for or against change

The greater the public interest in the change is, the greater (or lower) the risk

Developing Organizational Capacity

Organizational leadership, at the top and throughout the organization

An organizational culture that values and supports change initiatives, reinforcing change-centric behaviour

Change implementation mechanisms— strategies, policies, procedures, structures, and systems—that support and are aligned with a change initiative

Performance measurement—the use of performance data to inform key stakeholders about why and where change is needed, to focus on aspects of programmatic performance likely to be affected by the change, and to reinforce and reward intended outcomes of change efforts.

Elements of Organizational CapacityElement Description Risk

Leadership Leadership throughout the organization relative to the change

The more change-centric leadership throughout the organization is, the lower the risk. Ineffective leadership increases risk

Culture Norms and routines exhibited by people who work in the organization, which signal to employees what they should do, how they should feel, and what they should think about change

The more the organization’s culture supports innovation and change, the lower the risk. The more resistant the culture is to change, the greater the risk

Change Mechanisms

Strategies, processes, policies, and structures to initiate, accommodate, and support the change

The use of strategic management and explicit change structures to facilitate change reduces risk. The lack of such structures increases risk

Performance Measurement

Strategic use of performance measurement to facilitate change

The more widespread the use of performance metrics is, the lower the risk. Lack of a performance measurement system increases risk

Strategies for Changing Employee Habits: For the Heart Inspire: create high expectations; develop a

shared vision for change; model high ethical standards and work ethic; walk the talk—model the desired behaviour

Involve: involve employees and other stakeholders in creating the shared vision and in planning for the change; create democratic structures to facilitate change

Empower: exercise power with (joint power) not power over; encourage individual initiative; make the necessary resources available; unleash (but harness) the change vanguard

Celebrate: share the victories; create small wins and momentum for change; recognize individual and team contributions

Serve: enable others to do their jobs; protect employees from outside interference; be patient—commit for the long haul

For the Head

Provide information: inform employees of the situation; be transparent in decision making; help people reach across divisions and dividing lines

Clarify purpose: Simplify complex and ambiguous responsibilities; make goals and objectives clear

Encourage risk taking: reward innovation and risk taking; drive out fear; celebrate successes and failures (as good tries)

Align incentives: create a reward structure that supports the change; communicate

Require accountability: determine what is important to measure for the change; measure results; provide timely feedback

Key Components of New Public Management Disaggregation

Purchaser-provider separation X Agencification X Decoupling policy systems X Growth of quasi-government agencies X Separation out of micro-local agencies X Chunking up privatized industries X Corporatization and strong single organization management X De-professionalization X Competition by comparison - Improved performance measurement O League tables of agency performance O

Competition Quasi-markets X Voucher schemes X Outsourcing - Compulsory market testing - Intragovernment contracting - Public/private sectoral polarization - Product market liberalization - Deregulation - Consumer-tagged financing O User control O

Incentivization Respecifying property rights X Light touch regulation X Capital market involvement in projects X Privatizing asset ownership - Anti-rent-seeking measures - De-privileging professions - Performance-related pay - PFI (private finance initiative) - Public-private partnerships - Unified rate of return and discounting O Development of charging technologies O Valuing public sector equity O Mandatory efficiency dividends O

X Trend has been wholly or partly reversed. In some cases the change has been linked to policy mistakes or disasters and has been rolled back.

- Trend has substantially stalled. Even advocates no longer expect it to engender significant improvements in government effectiveness.

O Trend is still spreading, and its usefulness has not been seriously questioned.

Key Components of Digital Era Governance

Reintegration Rollback of agencification Joined-up governance (JUG) Re-governmentalization Reinstating central processes Radically squeezing production costs Reengineering back-office functions Procurement concentration and specialization Network simplification

Needs-Based Holism Client-based or needs-based reorganization One-stop provision Interactive and ‘‘ask once’’ information-seeking Data warehousing End-to-end service reengineering Agile government processes

Digitization Processes Electronic service delivery New forms of automated processes—zero

touch technologies (ZTT) Radical disintermediation Active channel streaming Facilitating isocratic administration and co-

production Moving toward open-book government

The End

References: Why Do Change Efforts Fail? James Edwin Kee, Kathryn E Newcomer.

Public Manager. Potomac: Fall 2008. Vol. 37, Iss. 3; pg. 5, 8 pgs Senge, Peter. The Fifth Discipline: The Art and Practice of the Learning

Organization (New York: Doubleday, 1990). New Public Management Is Dead--Long Live Digital-Era Governance,

Patrick Dunleavy, Helen Margetts, Simon Bastow, Jane Tinkler. Journal of Public Administration Research and Theory. Lawrence: Jul 2006. Vol. 16, Iss. 3; pg. 467.