Critical Steps in Change Management

May 20th, 2008 at 07:15am David Bush - Iasta

SupplyChainBrain recently ran an article by Paul Dittmann of the University of Tennessee on Four Critical Steps to Managing Change in the Supply Chain that is quite informative.

Supply chain professionals often find themselves at the center of the storm, striving to balance very demanding operational imperatives with the need to satisfy customers and help grow revenue. They must find ways to operate successfully, yet also rapidly improve to be competitive in the future. And, improvement basically means “managing change”. Yet, ironically, supply chain professionals often find themselves ill-equipped to deal with change management, and in fact most have only a vague idea of what it is all about. Yet, studies show that projects fail more due to human and organizational reasons than technical challenges.

Consider the statistics quoted in the article. A recent PMI (Project Management Institute) study found that only 16% of projects are on time, budget and benefit. CSC’s (Computer Science Corporation) Index isn’t much more encouraging, with only 32.1% of projects “successful” (and not
necessarily at the levels originally hoped). It’s clear that good change management is needed.

Paul outlined the following four imperatives:

• Identify Key Stakeholders
  … and design a communication plan specifically for them. Corporate employees are bombarded with calls, faxes, e-mails, presentations and other forms of communication daily. Unless the message precisely targets the key stakeholders, it won’t be heard above the background noise.
• Used Targeted Messaging
  Not only do you need to identify key stakeholders and target your communications at them - but you will need to craft a message specific to each stakeholder in terms of not only why the project is important but how it will specifically help them in their role. Furthermore, it’s important to
  get their feedback and incorporate it into future messages.
• Plan for Resistance
  Resistance to new concepts is normal. Some is good, some is bad. Resistance in the form of open-minded questioning that leads to debates where you can demonstrate the value of the suggested change is good, so be prepared for it. Resistance where people don’t show up to meetings and simply ignore the project is bad. This is where it’s important to have key stakeholders, gained by way of your carefully crafted and targeted messages, on your side to stop the behavior before your project loses credibility.
• Develop a Plan to Sustain Change
  If you simply follow a new initiative until it gets results, and then walk away, there’s a good chance that people will quickly revert back to their pre-project way of doing things and the benefits achieved will quickly dissipate. Consider the example of a durable goods company given in the article which had a 60% forecast error at the SKU location level. A great plan was devised, a project initiated, and forecast error decreased 25% in the first year. Assuming that the project was on the right track, the executive in charge moved on to other projects. Six months later when he checked back, he found that not only had all the improvements vanished, but error rates were even worse!

These are great points, but I’d one more to this list:

• Get Expert Help
  If this is your first time undertaking such a project, bring in an expert to help you craft the right message, the right plan, and the right process to sustain the change and continue to realize the benefits after the initial win. As an on-demand solution provider, we see how well customers do who make extensive use of professional services in initial projects versus those that just license the software believing that they can “take it from there”. Needless to say, those who make use of expert services do much better faster than those who don’t and not only sustain the changes, but actually see increased benefits over time.

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Entry Filed under: General, Supply Management Best Practices