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R Sankar Country Head,Managing Transformation and Change in Organizations The People Programme - II,May 2, 2003 New Delhi,Mercer Human Resource Consulting,Agenda,The Reality about Change and Transformation Stories from the “Front lines” The Keys to Success,The Reality about Change and Transformation,Mercer Human Resource Consulting,Change makes you better, transformation makes you different,Change is: Incremental Focused on improving performance of existing business Catching up About bottom-line management Examples of change processes: Reengineering Restructuring Benchmarking,Mercer Human Resource Consulting,Change makes you better, transformation makes you different,Transformation is about: Creating a unique future Changing the rules of engagement Top line management Examples: Dell Canon Microsoft,Mercer Human Resource Consulting,Common characteristics of the change and transformation processes,A clear, compelling and shared vision of the future Fixity of purpose and constancy of effort A roadmap Acquisition and creation of new competencies Sensitivity to people issues,Mercer Human Resource Consulting,The Change may not be planned but our reactions to it can be,Anticipatory,Reactive,Incremental,Discontinuous,Tuning,Reorientation,Adaptation,Re-creation,Mercer Human Resource Consulting,How successful are change efforts in organizations ?,Research among 200 global organizations which went through some form of large to medium scale change in the least few years is not very encouraging,Source : Saratoga Institute, 2000,Mercer Human Resource Consulting,Why do Transformation or Change efforts fail ?,Resistance to Change,Source: Information Week, 2001,Limitations of Existing Systems,Lack of Executive Commitment,Lack of Executive Champion,Unrealistic Expectations,Lack of Cross-Functional Team,Inadequate Team and User Skills,Technology Users Not Involved,Project Charter Too Narrow,% age of respondents citing the primary factor,Mercer Human Resource Consulting,A hard look at how the change process works,Degree of Support for Change,Ownership Phase,Buy-in Phase,Internalization,Institutionalization,Adoption,Try-out,Self-Concern,Understanding,Awareness Phase,Unawareness Phase,Time, it takes time and a considered, deliberate approach,Mercer Human Resource Consulting,The Realitycommon errors made by organizations,Not establishing a Great Enough Sense of Urgency Not Creating a Powerful Enough Guiding Coalition Lacking a Vision Under communicating the Vision Not Removing Obstacles for the New Vision Not Planning for Short-term Wins Declaring Victory Too Soon Not Anchoring Changes in the Corporate Culture,Stories from the “Front Lines”,Mercer Human Resource Consulting,“Organization vitality and growth depend on the leaderships ability to craft sustainable strategies, effectively communicate these and build internal capacity (and in doing so balance incremental and discontinuous change)” - Dr David Nadler Partner, Mercer,The difference between winners and losers,Mercer Human Resource Consulting,Implementing a new Performance Management Framework,Multinational Pharma company wished to introduce a new competency based performance management system Management felt there was a perceived lack of technical skills development but was skeptical of success,Situation,Case Example # 1,“People will not accept this. We have tried so many things in the past. Nothing changed !” - CFO,Mercer Human Resource Consulting,Internal Change Champions The best way to reduce resistance,Communication workshops with internal functional team of “Experts” Development of the technical competency model through Expert panel process Detailed and comprehensive training and brainstorming sessions internal functional teams on the applications of the competencies and implementation issues Intense Involved Some lasted for over 10 hours A “dialogue” was created inside the “Informal” organization by the members of the internal functional teams,Case Example # 1,New system under implementation. CFO became first to accept recommendations as he was part of the functional team,Mercer Human Resource Consulting,Restructuring and Downsizing,Indian media organization had gone through a phase of rapid expansion Organization structure and staffing levels needed to be streamlined,Situation,Case Example # 2,“This is an HR initiative. What role can I possibly play ? You are the specialists” - CEO,Mercer Human Resource Consulting,Leadership Support Brings credibility to the change process,Joint project team with CEO as Team Leader Detailed analysis and research backed by continuous communication to all employees Visible support for project in unambiguous terms by the CEO at public/ company forums “Burning Platform” created threat from major competitor,Case Example # 2,Owners and Management Committees accepted all recommendations. Phased implementation going on. No attrition of high performing senior managers,Mercer Human Resource Consulting,Consolidation and Alignment,Mobile Telephony services provider which had expanded rapidly to multiple locations New CEO brought in to consolidate and bring about synergies in the operations,Situation,Case Example # 3,“The level of integration here is dismal. I went to one of the locations to announce an employee award for Rs. 2000 and the Regional Head had already promised Rs. 3000. What next if we cannot do simple things right?” - CEO,Mercer Human Resource Consulting,Removing obstacles to change process Ensures communication of serious intent,Create a unified organization through : A unifying theme Common processes Cross geography/ entity team to address key issues Transfer of key managers across geographies/ entities Formal knowledge transfer mechanism,Case Example # 3,New structure accepted and implementation being undertaken in a phased manner,Mercer Human Resource Consulting,Organizational Renewal,Public sector enterprise facing competition, squeezed profits and problem of large surplus manpower Imperative to bring in productivity focus, customer orientation and innovation in a relatively short time frame,Situation,Case Example # 4,“I hate consultants. How can you tell us what to do with our business ? I am not for this project !” - Project Manager on the Client Team,Mercer Human Resource Consulting,Comprehensive change interventions Using Organizational Learning principles,Demonstration (Action Learning) Incentivisation Process and Organizational Change Institutionalizing Knowledge Management Systems Leadership Development Problem solving through Systems Thinking,Case Example # 4,Project Manager championed the change effort after seeing “quick win” results and implementation was extended for a period of two years,Mercer Human Resource Consulting,Specific Interventions,Demonstration (Action Learning) Presentation of “war stories” and success stories from within Incentivisation Reward and recognition for proactive knowledge sharing and learning Process Change Changes in plant evaluation process and parameters Changes in performance evaluations process for plant heads and managers More frequent rotation of managerial staff across plants Leadership Development Reward and recognition for proactive knowledge sharing and learning,Institutionalizing Knowledge Management Systems Knowledge sharing amongst staff (structured plant visits/ share experience on specific problems) Communication Strong and visible CEO support Creating a sense of a “Burning Platform” (a Shared Vision) Systems Thinking Process view of the organization rather than a compmentalised view Creation of a Mental Operating Model : “Good for Plant but Bad for Company is not acceptable”,Case Example # 4,Mercer Human Resource Consulting,Organizational Effectiveness through technology enhancement,Large, successful diversified private sector conglomerate Senior management felt the need for radical process and organizational change to meet the emerging challenges and to take advantage of IT to (a) reduce cots and improve efficiencies (b) improve customer service,Situation,Case Example # 5,“We have very low IT skill level. Most managers and staff are not even familiar with MS-Word and Excel. And you will face a complacent attitude as we are a successful organization !” - Managing Director,Mercer Human Resource Consulting,Comprehensive change interventions Using Organizational Learning principles,An iterative approach to implementation focusing on building self-learning capabilities was developed Large numbers of staff were involved. This also removed the resistance to change due to IT phobia in their minds. A series of awareness campaigns were launched. Internal Change Champions assisted in this effort. Prototyping was conducted in interactive sessions over two iterations.,Case Example # 5,Successful implementation within time and budget. Clear business gains achieved in first year itself,The Keys to Success,Mercer Human Resource Consulting,Critical Success Criteria in large scale organizational transformations,Visible sponsorship by the leadership team Creating a “Burning Platform” Stable leadership team “Quick Wins” Internal Change Agents Effective communication,Mercer Human Resource Consulting,Typical traits of Internal Change Champions,Some characteristics of an Internal Change Champion : In-depth organizational knowledge Stake in project success Integrity and credibility Past track record of initiating and executing change Proven record of high performance Respected by peer group and trusted by superiors,Mercer Human Resource Consulting,A Planned Approach : Mercers Viewpoint,Mercer Human Resource Consulting,You may not need to use all the components at a time,Enable development of learning capabilities,Mercer Human Resource Consulting,Critical executive challenges,Mercer Group,“How can we ensure that our business creates sustained value?”,“How should we lead and organize to execute our strategy while maintaining flexibility?”,“How can we attract, retain, develop, focus, and motivate the people we need to bring our strategy to life?”,General management consulting firms,Human resources consulting firms,How does Mercer Help : Unique proposition,Mercer Management,Mercer Delta,Mercer HR,Mercer Human Resource Consulting,Mercers Consulting Team Part of a $10 billion enterprise,Mercer Human Resource Consulting,Case studies and illustrat

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