Wednesday, July 25, 2012

Do Newton’s three laws of motion apply to Change Management?


Have you ever been in or seen a situation where a change has failed to materialise or even worse the change (or transformation) programme has been successfully launched but failed to stick and eventually your organisation reverted to old ways of doing things. If your answer is “oh yes” or you are gently nodding your head or recollecting that “one” project, you know what I am talking about.
Still wondering what Newton’s 3 laws of motion doing here, read further:

Law 1:
Every object in a state of uniform motion tends to remain in that state of motion unless an external force is applied to it.

All organisations and its people are happy to do the same thing that has brought the organisation success in the past and therefore want to maintain the status quo.  i.e. “If it ain't broke, don't fix it”. However, that is not true in the current world that we live in. Here is where Newton’s first law comes into picture. There are always forces that are constantly applied to any organisation. External forces such as changes to industry, new players, new market or even a new CEO, bring about change(s). These are the triggers or the reasons for the change management.

These forces should be strong enough to propel changes through completely and successfully. Simply, it should be strong enough to do 2 things – one, move the people out of status quo and two, see through the change fruitfully. Otherwise, things will not just revert to the “old ways” but also affect any future change programmes. How? Returning to old ways and the pace at which the changes are rolled back creates a strong impression within the culture of the organisation and it will take a lot more effort to move the organisation away from its steady state of motion.


Law2:
The relationship between an object's mass m, its acceleration a, and the applied force F is F = ma. Acceleration and force are vectors (as indicated by their symbols being displayed in slant bold font); in this law the direction of the force vector is the same as the direction of the acceleration vector.

After all, we want to make change successful and we do need to build momentum. I did mention above that, the forces should be strong enough to finish the marathon called Change. There are two chief requirements for a force though.

  1. Greater the size, the stronger the force is required.  Consider the diagram; there are two components in play here: The sheer size of the change (rock that is pushed up) and the environment (hill) in which the change is carried out and which plays a big part too in change acceleration.  Although I have used this diagram to show a case, this is not representative of all cases.  The situation could vary anywhere from moving small stone in a flat surface to even massive stone up a big mountain.

  2. Acceleration in right direction. To push the rock up the hill, the force or the effort to make the change happen depends on where the effort is applied. Lot of effort will be wasted if the effort is not directly against the lines of gravitation.  Many a times, knowing where the gravitation force is a tough one. And, this is where we need the right people, tools and skills. This gravitation in change management dictionary is called as resistance and that takes us into the next law.

Law 3:
For every action there is an equal and opposite reaction.

As we move along with the change programme, there is always resistance.  The change equation is given by:

D   *   V   *   F  > R
D: Dissatisfaction with the status-quo.  Why I law is applied.
V: Vision of the future
F: First Steps
R: Resistance to change.

While the first steps of the change management prepare the organisation for the change (Change Readiness assessment and factors that influence the success of change), resistance goes beyond the first stage of change management and that is why Newton’s III law is very true. Resistance is not bad. Consider any sports – A player or team has to elevate the level of its/their own game when pitted against a worthy opponent. In the same way, proponents of change should look to use the opportunity provided by resistance to increase the penetration of change. By doing that, there is a twofold advantage: First, change is accepted more widely and two, more importantly resistance is reduced or eliminated. It is better to eliminate resistance otherwise, it can modify the balance of change equation mentioned above to topple the change effort. Once the change effort starts to disintegrate, it is difficult to stop that chain reaction. i.e. equivalent of a rock rolling down the hill.

Now let us put all of these things together. While it is easy to break change management into three parts and analyse, things are not so easy in reality.  Why it is so complex might be the question? It is because of the fact that three laws are happening at the same time and organisations these days are running a few transformation programmes simultaneously, which complicates this problem further.  

Finally, I leave you with one line from Charles Kettering:
“The world hates change but that is the only thing that has brought progress.”

Tuesday, March 6, 2012

Why Business Process Re-engineering (BPR) is very relevant



Is BPR a thing of past? Does it have any value in the highly globalised world of today? Yes, I strongly believe that BPR is all more essential for today’s businesses. There are three significant factors warranting the need for BPR:

1. Evolution of Technology:

   Technology continues to undergo changes at rapid pace. The evolution of cloud computing, virtualisation and on-demand computing are changing the way businesses operate. Technology, to be more specific IT, has gained prominence in CEO’s agenda. Organisations have been investing a lot in replacing the old technologies with the new ones and expect a giant leap in its progress.  There are couple of main reasons behind this change:

• To upend how the business is done

• To develop insights using information gathered

The overarching question, at least from CFO’s point of view, is whether new technology delivers the ROI promised. Can these innovations in technology re-engineer the way the operations of the businesses? There are few caveats here. For one, it can help only in small stepped change if the organisations are just looking for replacement, albeit a better version.

These IT products, both off the shelf and custom, can help in facilitating and managing the processes.  However, in order to get the synergy between the business process and technology, the underlying business processes on which IT is build need a serious look.  This is where BPR is all more essential. BPR focuses not just on governance i.e. managing the process but also on the dynamics of the whole process including the collaboration between business units, hand-offs between core and non-core business processes.


2. Shared Services Phenomena:

   Shared services concept has gained an overwhelming presence in the last decade or so. However, the problem begins post the first phase deployment of shared services. Organisations try hard but struggle to optimise and refine the process further. As a result, the initial business justification for the Shared services operating model becomes weak. One of the fundamental reasons for such roadblock is because Shared Services are deployed using a push strategy. i.e. driven top-down and with that follows an opposite, if not equal, resistance from bottom-up. Using BPR as tool, the Shares services leader can engage the stakeholder to address the drivers instead of resistors and thereby achieving:

•  Increased buy-in from all departments

• Valuable inputs from users of processes

Once the buy-in from stakeholders is obtained, the BPR leaders can work collaboratively working with departments to develop the mindset towards standardisation of the processes. Post which, they can apply divide, conquer and consolidate methodology to target each function and plug in the best practices from Shared services seamlessly. By breaking down by functionality and diving deep within every process, BPR leaders along with key stakeholders can move the shared services model towards operational excellence. Through operational excellence, then organisation can channelise its focus towards providing better customer service.


3. Economic situation:

  With current economic malaise, companies are continuously on the search to identify strategies to re-establish its hold in the market place. The common denominator for such strategy is the core business processes within the organisation.  With employees more receptive to positive change during this time, Organisation can take this opportunity to shake the waste out of its processes and revamp the operating model using BPR.

In my experience, I have heard organisation questioning as to why we need BPR when we follow Total Quality Management (TQM) or Continuous Improvement (CI) techniques. My question is whether that is enough. Whilst TQM and CI have its own benefits, they work on the assumption that the businesses processes are fairly streamlined and strive to provide small improvements.



All these three factors bring a business justification on why BPR is an important leg in current challenging business environment. BPR, done correctly, will not just bring cost reduction and efficiency but also provide transparency and accountability. In addition, BPR can work in tandem with technology to offer right insights about the business operations.

Sunday, November 13, 2011

Shared Services Model – Where is it heading towards?

First of all, what is a shared services model? It is the way in which the operating model of the organisation is designed to achieve the correct balance of centralized & decentralized services and policies. In simple terms, Shared Services means providing a standardized and consolidated way of providing services.

In the last couple of decades or so, the prime focus of shared services model was to achieve the process and operational efficiency – reduce costs through economies of scale.  “Pick the early winners” and focus on reducing the cost through continuous improvement and lean techniques have been the go-to strategy for many shared services deployment. But is that enough to sustain? Yes, would be my answer if I were to live in pre-2000 era. But now, the answer is clear “no” because the shared services center is expected to contribute to the strategy goals of the organisation.

Then, where is it heading? In the last few years, truly mature shared services are planning to cash in on two things:

·         Providing Service Excellence:
                                        From my experience, there was always been a prevailing focus on how to move from just process excellence to actually delivering service excellence.  As a consultant, this question that I come across regularly is how to provide the best in class shared services deployment?   The answer lies in the design of the metrics for the shared services model and of course metrics are not the only factor. Performance measurement is a vital part in the implementation of the shared services model.  By using the insights provided by the metrics as an input to Business Process Management (BPM), Organisation can really take the shared services to next level.

Let me give an example.

Once when I was working with a client and we were examining the Time & Expense (T&E) handling process. At that time, some of the metrics seem to project some bad numbers. By analyzing and diving deep into the process, I realized that the consultants of the client have increased their expense claim by multiple folds. The current process was designed to provide the reimbursements of expenses to the consultants from the local office instead of consultant’s home office. Later, to maintain its books, the local office would charge the expense to the home office.

This process worked fine generally but it started to show problems as the consultants had started to travel very frequently. After we identified the problem, we resolved the problem by re-engineering the T&E process. I was able to spot the problem because of the metrics that were in place otherwise I would not be able to solve the problem for my client. In essence, the metrics should provide the right insights and should be revisited periodically to improve the service offering.

·         Take advantage of new technology advancement:
                                                                When it comes to technology, Cloud computing is the block buster kid in the neighborhood. However, there is a grey cloud of thoughts hanging in everyone’s mind. Can cloud add significant value-addition to a mature shared services implementation? To me, cloud is another form of outsourcing.  In last 5 years or so, we have seen an increasing level of traditional outsourcing in shared services implementation.  But with the prevalent adoption of cloud computing, it remains to be seen whether it will contribute to the success of the shared services let alone increase the boundaries of shared services model.  Cloud is here to stay. Will it help in providing the insights required to provide the service excellence is the question that hangs in the minds of many many CEOs?

Unfortunately, we will have wait and watch but do visit my blog regularly to get latest updates about Shared Service Model.