Change Is Easy: Making it work is the hard part

How to keep new processes and technology from magnifying existing problems.

By Debbie Depp

OK. You've re-engineered your company. You've downsized and you've right-sized. You've installed the best technology money can buy. You have the latest 'enterprise' CRM package, a multi-million dollar call center, and an award winning B2B portal. Why, you even have a snappy new mission statement!

But you're still not getting the results you expected...or were promised. Expenses are up but revenue is down, and so is employee morale. Customers are upset and suppliers have turned into adversaries instead of partners.

How could it all go so wrong?

"Easily," says Dan Ross, CEO of Manna Network Technologies, an emerging leader in the on-line personalization market, offering the customized solutions e-marketers need to successfully manage their e-marketing programs and develop relationships between merchant and customers. "Without seasoned managers, constant communication and strong leadership, change is a four-letter word."

CEO As Chief Change Agent
Change used to be a tyrant. Today it's an assassin. If you ask the CEOs of today's fastest growing companies to describe their company they'll tell you - it's constantly changing. They know that in today's rapidly changing world, there are only two kinds of companies...the quick and the lame. If you think that your company can succeed today by just hanging on - you're wrong. If you're not on top of the wave, you'll be swept away by it.

But change poorly implemented can be much worse than no change at all. Successful change requires a vast array of executive skills including leadership, vision and persuasion.

And now, more than ever, the role of senior executives is not just to make changes, but to make change work. And Dan Ross should know. As a change agent at DEC/Compaq, PictureTel and Open Market, he's built a reputation for leading and managing change.

Some executives are naturals when it comes to leading their organizations through a transformation. Ross believes you either lead by example or you don't lead at all. "The strategy," he says, "is to light fires under your people and make sure your management team is aligned around the vision and values. It takes courage and courage is what leadership is all about."

And, as Ross has found, it's often not enough to just manage your own company's change; very often you must help your customers manage theirs as well. Such was the case when Swedish Telco made a decision to buy Manna' software. To ensure a successful implementation, Ross cautioned the CEO that he wouldn't have the authority to make the 'buy decision' because his Board and investors wouldn't truly understand what he was trying to accomplish. Ross worked with him to understand the steps to get buy-in.

"This demonstrates," says Ross, "that even at the highest levels there is an opportunity to help leverage uncertainty, so customers can get the results they're looking for."

The Management Team Must Lead
GE icon Jack Welch has often attributed his success to having the right people in the right positions. "Trying to oversee these diverse businesses in remote locations, I realized - more than ever before - how much my success would depend on the people I hired. From my first days in plastics, I understood the importance of getting the right people. It was clear that when I found someone great, it made all the difference in the world."

Taking a page from Welch's book, Ross hired talented managers with two decades of experience, who understood the roller coaster of change. They recognized that change was happening at a faster rate than anything their experience told them was normal. Combined with young, vigorous, brilliant players, he created his equation for success. Conquering change requires being fluid and making decisions with lightning speed.

Empowerment and autonomy require direction. Top management is responsible for laying the overall game plan and calling the plays. At Manna junior managers with great minds needed guidelines, not because they weren't smart, but because they didn't know the steps in process. They hadn't made the journey, so they were unaware of the detours and roadblocks. When Ross mixed experienced managers with bright, enthusiastic kids, he got results. The management team needs to understand the trade-offs. Balance of inspiration and experience is critical.

One of the great failures of dot-coms is that they didn't partner with experienced companies nor did they hire experienced managers. The seasoned guys won by leveraging their experience and knowledge. What worked in the last job won't necessarily be the same in the new job and might have to change within ninety days. Charles Kettering warned, "If you've always done it that way, it is probably wrong."

People are the most important resource. You can have all the technology, all the procedures and guidelines - everything you want and be operationally prepared. But if you do not train your people, ensure good communication, provide them the right tools to do the job, and keep them informed as to where the organization is going, it is not a good use of financial resources.

Effective Change Requires Constant Communication
It is not always clear what strategic plan is right for your company. But what is clear is that the most productive plan for any company is constant communication. It is critical to reinforce your vision to the players, management, and partners. Ross cautions, "Especially in a large organization, but even in a small company it's easy to misunderstand how people are feeling. Are they paralyzed with fear or looking for another job? In either case, no work is getting done. Don't think as CEO you're unique. If you're thinking about other options, your employees probably are too."

Communication impacts morale. People need to hear the bad news straight, so that when they hear the good news, it means something. To have the proper effect, of course, words must be aligned with actions. If your actions undermine your words, you'll create problems no amount of explaining can fix. Precise communication makes people feel included. Certainly, there are some issues, which are proprietary. For example, to share information prematurely about M&A activity can freeze people, leading to second guessing and high anxiety. Emotions can run high resulting in unpredictability and ambiguity.

But it's important to understand the impact on performance of these emotions. Explain to employees where they fit into change and how they can make a difference. If they lose morale, they lose the ability to understand. Change isn't scary.

What is scary for employees is the unknown impact of change and where they fit in the scheme. So communicate to them their role, no matter what size of company. Otherwise, you'll likely find your organization detouring their efforts in unanticipated directions.

Choice Of Two Mindsets
When dealing with change, individuals have two choices - fear or opportunity. Ross says, "If you're afraid to let go of the vine, you'll never be able to reach out and grab onto new opportunities. You're virtually paralyzed and trapped in a 'same old, same old' mentality." When business is going well, it's easy to seize opportunity.

Ironically, during economic downturns, there are lots of opportunities, if you're willing to dissect the marketplace, hire new people, foster deeper relationships, and make things happen. Seizing the opportunity is what change is all about. You need to adapt that mindset. It's a unique player who both thrives on change and is willing to do something about it.

Without Change There Is No Future
Sometimes, companies and their employees must unlearn many of the principles and techniques that brought them success for so long. They must know how to thrive on ambiguity in an environment of perpetual change. The only real security is the ability to grow, change and adapt. Being adaptable and agreeable enough to thrive in a diverse and ever-changing workplace will be the key to success.

As George Bernard Shaw cautioned us, "Progress is impossible without change, and those who cannot change their minds, cannot change anything."