Change Managment
- This topic has 12 replies, 13 voices, and was last updated 11 months ago by
.
-
Posts
-
Many cautionary tales of failed or problematic acquisitions (or any large change initiative for that matter) typically boil down to change management – or a lack thereof. More specifically, it tends to be issues in communication, merging different company cultures, or managing emotions and expectations that contribute to internal breakdowns and inevitably leads to a decline in customer service.
Do you think this points to a need to focus on training leaders in change management methodologies or would a better approach be to build a change management practice as a dedicated workstream?
Being in the Financial Services, I see many institutions have set-up a dedicated change management practice. This practice helps facilitate all sorts of changes that requires a broader organizational attention. Apart from M&A activity, these changes may be driven by regulatory requirement, product refinement / new product development, specific business transformation initiatives etc.
It definitely depends on the size of the organization, but in general I don’t think change management is a separate workstream. Change management best practices need to be incorporated into all of the workstreams. In general, more communication is always better than less.
@jarrodpatterson, Great point! I believe that the best practice is to establish a dedicated change management team. The team should consist of members for each primary workstream working in tandem to ensure that changes across the program are catalogued, effectively planned, monitored and controlled.
I think the decision depends on two things.
First, it depends on whether the organization has executive leaders who recognize the value of change management, see ROI in creating a change management practice, and are willing to fund it. In my experience as a consultant, we are asked to provide change management on specific projects for companies that have not seen the value in establishing their own internal change management practice for the entire company. Often our role involves educating executive leaders on the benefits and value of change management while educating middle managers on how to be effective change champions for their teams. This is a specialized skill set that requires leaders trained in change management.
Second, I do not think the decision depends on the size of the organization, as others have stated, but rather on the frequency with which the organization encounters and/or initiates major changes. Industries that are heavily regulated by the government, like healthcare and finance, tend to experience more frequent changes influenced by political fluctuations. These companies may benefit more from internal change management practices that know the industry and the politics well enough that they can be proactive in managing fluctuations.Having a background in Change Management my approach is that leaders need to understand how to work through change and a change professional needs to coach and enable leaders to be successful. Having leaders who are selected to manage the integration be the face of change has been successful for me; they are often seen to have respect and garner trust from the organizations they work with. However, if the selected leaders don’t have experience in integration and/or do not hold trust from the organization we will see failure.
I want to also point out that many folks feel that change management is communications; communications is one aspect of managing a change and relying on it too heavily will jeopardize your integration initiative. Change management must focus on leader alignment, stakeholder engagements through several methods, training, communications, addressing cultural differences, etc. to ensure there is a holistic approach.
How you approach your change management activities and staff them will depend on the size of the transaction and the value synergies are to provide. I do not recommend over staffing or trying to follow a methodology that isn’t suited for your initiative – all changes are different and need to be treated as such and are not a check the box activity.
Effective change management is a critical task to maximize the success of any M&A transaction. However, it is often under-resourced, with many of the tasks falling to the IMO. In a perfect world with unlimited budgets, change management should have its own dedicated workstream, focused on communications and engagement for the numerous change impacts that will take place as part of a deal. The change workstream can also measure adoption through the M&A process, and tailor strategies and plans to maximize the chance for success. However, being realistic change management will be completed in a manner that is “good enough” to get through Day 1/100, because it is NOT a critical path task like in Finance or IT. Thus change management activities will tend to get baked into the IMO activities, and be a sub-workstream to the overall management/delivery of the integration itself.
In the dynamic landscape of M&A, effective change management is pivotal. Often under-resourced, the Change Workstream, ideally with dedicated focus and resources, plays a vital role. In an ideal scenario, hydrogenexecutor.app, the game toolkit, can enhance communications and engagement, ensuring seamless transitions. While budget constraints may limit perfection, strategic integration of change management within IMO activities is key for success in the intricate process.
Change management is not only for M&A, but as an ongoing effort to introduce new practices that may complement the business.
Depending on the size of the acquisition and allotted budget and time. I recommend having a dedicated workstream, it allows for a focused approach and execution of the changes. Lot of times change management is considered a after thought and in my experience it is due to not being a dedicated workstream.
I think the Change Management function tends to fail at the Integration Phase of the deal/project. Once the deal is signed/closed, an Integration Management Office and team needs to be setup and work in conjunction with the Communication team work stream to ensure there is a proficient communication plan and process is in place for all of the different work streams to integrate into for success during the integration phase.
- You must be logged in to reply to this topic.
