Procurement transformation is obviously a huge undertaking with
significant risk. Research actually shows
that somewhere between 66% and 85% of organization change efforts fail! Successful efforts require detailed project planning
and a new approach to change management.
Traditional change management focuses on Strategy, Systems, Process and
Structure. While these are important,
they are also insufficient. What
typically sabotages change efforts is the organization’s underlying culture and
status quo behaviors. These underlying
issues need to be addressed as part of any successful change initiative.
Organization change is really the sum of
individual’s behavior changes. Start by
defining how you’ll measure desired results.
For a procurement transformation, measures might include things like spend
under management, contract compliance and technology adoption. Next, you need to identify the vital few
(high-leverage) behaviors that will deliver these results. Vital behaviors can be found by looking at
crucial moments -- the point in time when individuals decide to change, or
not. They can also be uncovered by
studying positive deviance -- situations where there is unexpected success. This might be a specific individual, business
unit, location or company that successfully implemented change where others
failed. Finally, you should examine
culture busters -- behaviors that are currently taboo or punished, or that
challenge cultural norms. For example,
is it acceptable to speak up when management sets a deadline that everyone
knows is impossible? Overcoming this
taboo might be the vital behavior that tips the scale towards success.
After identifying vital behaviors, you’ll need to develop a
comprehensive plan defining how you’ll influence those desired behaviors. According to the New York Times bestseller Influencer,
influence comes from six sources which encompass motivation and ability
from personal, social and structural forces.
Most change initiatives mistakenly look for the “silver bullet”, the one
influence strategy that will drive change.
In reality, we need to overwhelm the challenge by using multiple sources
of influence simultaneously. Employing
all six sources to support vital behaviors can increase success rates tenfold
((http://tinyurl.com/kg3hyjo)!
Below are some examples of the Six Sources of Influence™ that drive
change. Remember, the power comes in
using six sources simultaneously to overwhelm the resistance.
1.
Personal
Motivation
We typically rely on verbal persuasion to
get folks on board with change.
Unfortunately, verbal persuasion is notoriously ineffective. To gain support for a change, we need to tap
into people’s beliefs and values.
Personal and vicarious experiences are useful for this purpose. How can we provide our constituents with an
experience that will instill the desired commitment? Perhaps a benchmarking visit to a
best-in-class company or attending an industry conference to network with peers
would be more impactful.
2.
Personal Ability
Good training targeted towards individual
needs is important when introducing new processes or technology. However, we need to be sure we are really addressing
the right need. When implementing
eSourcing software, we focus on the technology.
How do I create an item? How do I
register suppliers? How do I create an RFQ? However, as compared to traditional sourcing
methods, eSourcing requires a much more methodical and rigorous sourcing
process. Perhaps our users aren’t
skilled in strategic sourcing. Training
on the basic process may be a pre-requisite to technology training.
3.
Social Motivation
Conventional wisdom suggests targeting Innovators
to drive change. However, experience
suggests that Opinion Leaders are better at providing positive peer pressure. Innovators may not have the trust of the
broader organization. They’ll try
anything! Conversely, Opinion Leaders
are independent thinkers. They’re skeptical. That’s why the troops respect them. In any change initiative, Opinion Leaders
will work either for or against you, so you better get them on your side. Solicit their input and listen
carefully. Adjust as appropriate to address
their concerns. Once convinced, these
individuals will become your biggest advocates and grease the skids for adoption
among their reluctant peers.
4.
Social Ability
Do others enable or disable your desired
change? A process map highlighting
potential failure points is useful here.
Who relies on whom, for what, by when?
Perhaps “resistance” is really a matter of someone not getting the
information they need from someone up the line.
It’s ability rather than motivation.
We need to fix the process.
5.
Structural
Motivation
Upper management support is critical. They need to provide the resources to support
the change initiative, and must help to break down barriers encountered along
the way. However, we often depend on
upper management to allocate “carrots and sticks” in order to drive change. Rewards as motivation are tricky. We must be cautious to reward the desired
behavior. For example, if we reward
individual results but want collaboration, we’ll be disappointed. We should also be cautious about incentives
that are too large. Excessive incentives
encourage any means to an end. In
addition, the incentivized behavior will be short-lived. As soon as the reward goes away the desired
behavior will likely disappear.
Structural motivation should be used after Personal and Social
Motivation, and rewards should be used in moderation to avoid pitfalls.
6.
Structural Ability
We discussed training under Personal
Ability. However, training is only a
first step. As a professional trainer,
I’m appalled that only 10% of what I teach is retained! This means that ongoing support is critical
because users will take the path of least resistance when faced with
obstacles. If there are structural
issues (e.g. help and support are constrained due to physical distance, time
zones or language barriers), users will just do what’s familiar and easy. It’s important to consider how the
environment (data, facilities, templates, tools, etc.) support or hinder our
change effort.
Each organization is different as is each change initiative. That means you must tailor the approach for
every situation. Chances are you won’t
get it right the first time. That’s why
it’s important to continuously monitor progress and make appropriate mid-course
corrections. Don’t get discouraged. Remember that disappointments aren’t
disasters, they’re data. We need to
incorporate the learnings and adjust as appropriate.
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Barbara Ardell is VP at Paladin
Associates, Inc. To find out more about their offering
Influencing Change – the solution to Procurement’s change challenges, please
click here.
