After two weeks since the last post of this series, we're coming back to our look at the theories of John Kotter, Change Management Guru. In each article, I first expand a little on Kotter's general background before diving into the War Story proper.
Did you know that Kotter also has a view on distinguishing between leadership and management? According to Kotter, leaders focus on the future where managers focus on the present. Leaders create change and managers manage change. Leaders look at the long-term big picture and managers focus more on the here and now. Where effective leaders motivate team members, the effective manager directs the daily activities of assigned team members.
In the change management industry we know the power of inspiration for motivating the changes we're working on. We know good leadership is essential for materialising change.
I think for this reason, many change managers would rather be seen as a change leader, because then they are a figure of inspiration rather than of tools or process. But the truth is, both roles are essential. And "managers" can show leadership qualities; and vice versa. If you're responsible for managing a change, you need to be taking on the day to day, here and now organisation and direction of change activities. For more on this, have a look at: Change Management: the clue is in the name.
Kotter's 8-Step Process for Leading Change, is one way to ensure a rounded approach to the change you're managing, as well as helping you ensure change leadership is in place; albeit it will someone else's responsibility to perform the leadership role.
Today's War Story is about generating short term wins.
From the website https://www.kotterinc.com/methodology.
A major Australian bank had seen the light. It had seen the potential in Lean as a tool to eliminate waste in the provision of banking services to clients. In Lean theory, waste refers to any activity that does not add value from the customer’s perspective. In other words, it includes actions that consume resources, increase costs, but contribute zero value to the customer. These non-value-adding activities should be eliminated to enhance efficiency and effectiveness.
The first step to eliminating waste is identify and define value. This involves understanding what customers really want, what they are willing to pay for, and what they perceive as valuable. By focusing on customer needs, the bank was hoping to distinguish between value-adding steps and wasteful activities in its processes.
During this internal examination, the bank had to face some hard truths from recent activity with customers. Many banks in the 1980s were foreclosing on loans that became unpayable for customers due to soaring interest rates. The banks took their rights literally and repossessed family homes, farms and properties alike. Naturally the memory of this was strong in the minds of both customers and the bankers that administered the forced sales.
Generate Short Term Wins: Recognise, collect, and communicate small victories early and often. These wins energise volunteers and track progress.
To move past its wobbly public relations profile to a Lean banking service, the bank had a long way to go. It had to firstly introduce its staff to the concept of customer value; the equivalent of a 180 degree about-face for some.
To do this the bank may have taken a leaf directly from Kotter's book as it tackled the problem by generating short term wins. It initiated a series of short term projects that could demonstrate success or progress to staff and management in bite-sized chunks. It started with education. Key people were sent on Lean courses, site visits to observe and learn from other Lean environments and pilot programs were initiated that targeted specific areas of the business with conversations about customer value and waste.
This initial round of Short Term Wins yielded a refined understanding of customer value, that came unavoidably with a sense of remorse for the irreversible wrongs the bank had perpetrated during it's high foreclosure era. By admitting that it had been wrong to foreclose at such a high rate, management was able to initiate a program of change.
Building on this, the bank next created a Change Agent Network. This was quite a formal network with Change Agents being lead and organised by a central team, formal nominations to join and participate, set meetings and expectations. Next, the bank conducted workshops from which teams defined a set of Lean tools that would help translate the concepts of Lean Production into a services environment.
The Lean tools had been piloted once by the time I joined the change program as a Lean Coach. The role of the Lean Coach was to work with leaders within a selected team to rollout the next generation of a suite of tools, including visual boards for management of the business, transparent personal operating models so colleagues knew what their team members were working on, and a shared tracking tool for the deal pipeline.
Conclusion on Kotter's Step: Generate Short Term Wins
Many bankers accepted the new way of working and trialled the new tools with interest. And some resisted the change. Some people reported feeling like they were being de-skilled into a production-line style of working. These were people who saw financial sales in a more elevated way, and for some it felt undignified to increase transparency into their processes.
However, the resistance was far less than it would have been without the gradual winning of short term gains that lead up to the second wave of pilot sites.
Once there are short term wins in place, whatever comes next builds on previous successes, helping to cement a track record. People respond well to this because it provides evidence of reliability. When something has a proven history of positive outcomes, it instills confidence and trust. In the bank, it demonstrated consistency, competence, and resonated with those motivated to deliver a better customer experience than before. Demonstrating short term wins is a great way to help people understand that the change program is serious about delivering.
Arrange a free introduction to Agencia Change to find out how we can help you create effective change.
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