In my previous article I briefly touched upon the 2 components of Value Based Management i.e. Change Management and Improvement Processes. Both components of VBM need to work together to ensure the desired outcome is achieved. A well defined solution and implementation plan without the right change environment or vise versa will not result in increased value. Let us explore the change management piece in more detail in this article.
Whenever organizations take on initiates to improve performance, there is a human element that needs to be considered. People by nature resist change for a number of reasons. Some are comfortable with the status quo and are wary of the unknown, some resist because they are afraid their performance might be judged, others may resist change because they don’t like being told what to do, still others may be concerned for their jobs. Typically, organizational change initiatives tend to raise questions, concerns and apprehension. More so, if employees have a negative perception or experience with them in the past.
The onus is on upper management to address some of these concerns at the earliest, to communicate the purpose, expected objectives, the reasons behind the decisions and to let them know that this is not just a paper exercise. If the employees don’t understand why the change is happening or how it will improve process performance, it will be hard for them to embrace the changes which will invariably cause the initiates to fail. This is where the team implementing VBM plays a key role. They are responsible to foster this kind of change mindset and culture of trust, support and collaboration. This involves a lot of coaching and training and use of change agents to help communicate the why, how and when across all organization levels and throughout the various stages of the methodology.
Ranjay Gulati in his HBR article “Structure That’s Not Stifling”, talks about how most people want some form of choice and voice in what they do at work and how this can spark greater commitment and improve performance at work. We have actually seen this with VBM, because unlike most other consultants who work behind closed doors, all secretive and hush hush, VBM’s success comes from focusing on both a top down as well as a bottom up approach. Change management in VBM works to create an environment where the broad experience of the team implementing VBM is combined with the collective experience and wisdom of the organization, harnessed across departments, business units and teams, from the leaders to the frontline workers. Taking into consideration everyone’s voice, inputs, ideas and suggestions not only legitimizes the results in the employee’s eyes but also encourages them to take accountability of the findings, analysis, solutions, implementation plan and outcomes.
This is especially important, because without the buy-in or adoption of the changes or implementation of the solution by the work force, the expected value improvement will never be realized. On the flip side, when the employees responsible for driving and implementing the new changes, understand the rational behind them, the potential impact and benefits, they will not only push to incorporate the necessary changes but will also become champions of change within the organization. By engaging the workforce from the very beginning, a sense of ownership is created, which motivates the rank and file to be involved in the implementation, outcome and success of the improvement process. This then become true change management because change cannot happen in isolation.
Change management is an important part and plays a continuous role in any value improvement methodology or performance improvement strategy such as Value Based Management. Change management is needed to ensure the right support and preparation is provided to help facilitate change, so that organizations can achieve the desired value outcomes at all stages.