Selling Change: How Successful Leaders Use Impact, Influence, and Consistency to Transform Their Organizations

Copyright © 2018 by Robert E. Smith, Ph.D.

Library of Congress Control Number:            2018906705

ISBN:                         Hardcover                            978-1-9845-3370-8

                                  Softcover                              978-1-9845-3371-5

                                  eBook                                     978-1-9845-3372-2

All rights reserved. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the copyright owner.

Any people depicted in stock imagery provided by Getty Images are models, and such images are being used for illustrative purposes only.

Certain stock imagery © Getty Images.

Rev. date: 06/15/2018

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Contents

Praise for Selling Change

Dedication

Introduction

The Power of Organizational Change

Four Trends Changing Organizations and Work

Chapter 1 - Change in the Real World

Change Failures ARE People Failures

Mitigating Change Risks (planning for and pricing real-world change)

Measuring Change Outcomes

Predicting Change-Related Behaviors

Chapter 2 - Faulty Change Assumptions

Faulty Assumption #1: Change Management Models Account for Change Commitment

Faulty Assumption #2: Change Approaches Adequately Address Stakeholder Needs

Faulty Assumption #3: Workers Naturally Resist Change

Chapter 3 - A Research Story (The Making of a Change Commitment Model)

A Time of Silence

The Findings

Making Sense of It All

Two Eyes See (2IsC™)

Making of a Commitment Model

The Impact Factor

Influence Factors

Consistency Factors

Barriers to Highly Engaged Change

Emotional, Mental, and Behavioral Resistance to Change

Chapter 4 - Using Impact and Influence to Sell Change

Change Influence factor #1: Why Change?

Change Influence factor #2: Why Now?

Change Influence factor #3: Why You?

Change Influence factor #4: Why Your Change?

Chapter 5 - 2IsC™ (Impact, Influence, & Consistency) in Action

Transformation Case Study #1 - Boosting Performance Culture, Rankings, and Financial Health at New York University Langone Medical Center

Transformation Case Study #2 - Creating Manufacturing Capacity at Nissan

Transformation Case Study #3 - Building Buy-In at Build-A-Bear

Transformation Case Study #4 - Turning it Around at Chipotle with Trust & Consistency

Transformation Case Study #5 - Transforming a Silicon Valley Operating Model

Chapter 6 - Creating an Outcomes-Focused Change Strategy

Concluding Thoughts

Thinking Differently About Change

Acknowledgements

Notes

Praise for Selling Change

Selling Change is not the typical change management book dedicated to packaging past ideas with new flair. Instead, it admits the shortcoming of prior models in today’s volatile and ever changing business environment. Selling Change finds the best of the past and builds on it while providing practical new approaches backed by research and cross-industry best practices. With the tools this provides you really can put a price on the value of change management. This is a must read for change practitioners and leaders of change programs alike.

—Scott Smith, Senior Director - Talent Management and Organization Development, PepsiCo

Robert’s book is timely and relevant. He takes us on a journey through real-life change in organizations. And he is able to blend theory and research to provide a practical application. The 2IsC™ change path is simple to apply. In the midst of an acquisition, I was able to take tools from this book and apply them real-time. Robert is able to address individual change within the context of organizational change. Previous models of change focus on individual change or organization change, leaving professionals to bridge the gap. The 2IsC™ Model addresses the gap and makes it possible to improve change outcomes.

—Gretchen Thompson, Principle Human Resource Project Manager, C.H. Robinson

"When leading change one needs to bring their team along on the journey. Gone are the days of the change hero, doing it all alone. Selling Change provides an actionable, implementable way to create the buy-in needed for sustained change success. I use these methods and they work!"

- Joe Raasch, Director, Minnesota Office of Continuous Improvement

"As a leader responsible for supporting people processes in a complex organizational setting, one of the biggest lessons from the book is the importance of managing stakeholder expectations and emotions during the early phases of change planning (even before impacted stakeholders decide to commit to the change and demonstrate new ways of working) and throughout each stage of the change process. Robert explores change management through real-world case studies, not just theory. This is important because leaders are starving for examples and tips to effectively lead their change initiatives; not more static templates and tools. The book does a superb job of bringing together all three while avoiding over-complicated analysis which made it simple to read cover to cover in an afternoon. I recommend Selling Change to any leader looking for a fresh perspective on leading change and practical tips in how to make change a reality in their workplace."

—LaTranda Martin, Organization Design and Change Management Director, The Estee Lauder Companies, Inc.

This book provides a practical and useful new change management playbook that addresses how to avoid failures as found in 60% - 70% of organization change initiatives. It is a must read for change agents.

–—Andrew H. Van de Ven, Professor Emeritus, Carlson School of Management, University of Minnesota

"Being ‘born’ from asking the question: ‘How do we get people to commit to organizational changes that could result in the worst possible outcome for them personally—the loss of a job?’ the 2IsC™ Model is thought provoking and challenges conventional change management thinking. In Selling Change, Smith challenges change leaders to communicate the need for organizational change using impact, influence, and consistency. The focus on outcomes-focused organizational change is critical given the rapid pace of change we face every day.

—Ettienne B. Bouwer, Director Human Resources, Gallo Glass Company

Dedication

To those who came before, my parents, Helen and Jerome—the most hard-working, impactful people I know.

To those who come after, my boys—the most consistent early risers I know.

Introduction

We live in an age of near-perpetual organizational change. If your organization has not yet started a new change or transformation effort, it is probably smack in the middle of an existing one or planning for the next big one. Be it a shift to Agile processes, a culture change, opening in a new market, or adapting to digital transformation, organizations of all sizes and types are in the midst of massive transformation. So why another book on leadership and organizational change, you ask? Let’s first consider the very relevant statistic that over half (52%) of Fortune 500 organizations have merged, declared bankruptcy, been acquired, are on the verge of irrelevancy or have simply gone under since 2000.¹ Notable cases include Eastman Kodak, Circuit City, Rhythm in Motion (Blackberry), Radio Shack, Blockbuster, Toshiba, and most recently, Toys R Us. These were all once powerhouse brands whose products and services many reading these words frequented and are (or were) well-established household names. On one hand, it could be said that these organizations had their time yet with the winds of change, technology enhancements, changing customer expectations and strong competition, these institutions lost relevancy to their consumer base. On the other hand, each of these organizations’ stories are sorted and fraught with possibilities and missed opportunities to make different sets of strategic and tactically-focused decisions to turn things around and truly commit themselves to transforming the way they ran. On the government side, the story does not appear to be much better. U.S. states including Illinois, Connecticut, Kentucky, New Jersey, and Massachusetts have been identified as potentially unable to meet their pension and other key financial obligations though few would argue that any of these areas are strangers to business development or historically have had difficulty attracting commerce or property taxes.² Organizations of all types will continue to experience constant and accelerated change and those that fail to adapt and transform will become irrelevant or face extinction. Unfortunately, many organizations are painfully bad at transforming themselves. The pesky statistic that 70% of organizational changes fail persists, suggesting that even when organizational leaders do identify the need for change and attempt to make those changes a reality in their organizations, the vast majority are unsuccessful.³ A deeper look into the causes of change failure does not reveal a lack of resources or poor planning being the primary culprits, but instead, a lack of buy-in to those changes from the people needed to execute organizational change. Simply put, the people involved in attempts to change the organization’s direction were not engaged in or they actively resisted the proposed changes. I believe this is due to the fact that more often than not, organizational change is not sold well. In other words, when leaders propose organizational transformations, they fail to do so in ways that get people to buy-in to the need for the change or transformation efforts. This results in organizations instituting zombie changes in which team members go through the motions of change but do not actually change their behaviors or attitudes in meaningful ways. These change initiatives then limp along, never fully realizing their potential.

[without commitment] … organizations institute ‘zombie’ changes in which organizational members go through the motions of change but do not actually change their behaviors or attitudes in meaningful ways

Selling Change challenges some of the long-standing paradigms of organizational change by introducing commitment into the change management process. Rather than simply following a set of standardized change and communication process steps that focus more on change leader’s actions and their desired goals we instead explore a new, research-based model and stories of successful organizational transformations across a variety of industries from manufacturing, to retail, to healthcare that follow the principles of highly engaged change commitment. This approach is more focused on those who must execute change in their organizations and what they need to successfully buy into and execute change. The research highlighted in this book describes how change leaders at these organizations achieve the most highly engaged levels of commitment to change and do so in ways that provide the information needed for team members to ‘want to’ commit to change.

The rate of change is increasing at an exponential pace with the convergence of changing client demands, new technologies, new ways of working, and changing employee expectations. The organizations that will survive and thrive into the future are those that are led by transformational leaders who can galvanize their teams by articulating the need for and impact of organizational changes needed make their organizations future-ready. In a world where the challenge of widespread, transformational organizational change has become so daunting that prominent organizational researchers have begun proposing the idea of simply creating separate organizations within organizations with their own leadership teams, funding streams, and decision-making models, gaining an understanding of how to get multiple stakeholder groups to commit to transformational change is no small undertaking.⁴ , ⁵ While approaches to transformational organizational change that rely on creating separate organizations within organizations can work and has been tried before, it is a bit of a cynical and defeatist approach. These models harken back to the days of widespread corruption in US cities and police departments that led to the rise of institutions such as the Federal Bureau of Investigation (FBI). Before the establishment of the FBI, local police departments were so corrupt that even leaders who were genuinely committed to making changes in their departments would hit a wall of resistance in the middle layer, stymying them from making any real changes. Internal anti-mob, off-the-record police units were set up like the famous Untouchables to get around the problem of corrupt (and corruptible) officers and lieutenants. These groups became the heroes who served the true missions of these organizations. Is this really the state of large modern-day organizations? To affect change, separate and distinct internal groups need to be set up to serve real and changing consumer needs and demands? Perhaps, but what if there was a different way? What if there was a way to modify existing organizational structures and gain enough buy-in across multiple stakeholder groups -from finance, to product design, to IT- to affect widespread organizational change and achieve change results that are well-above the 30% success rate we see today? High performing change leaders are demonstrating the ability to effectively transform their organizations. My research, along with leading research in the field of organizational change, shows that frequently, the