Improving Organisation Performance Management using NextGen Change Management (Case Study)

Purpose of Case Study

The purpose of this study is to demonstrate how in todays VUCA environment, the next generation of change management which is based on Unitary Developmental Theory (UDT) and, the practical application of UDT as it underpins The Organization Capability Maturity Framework (OrgCMF™) and its reference models, bodies of knowledge and maturity assessment tools; can be used to enable the '4C's' activities (below) that lead to Performance Transformation, Change and Improvements.

Four Important Applications of UDT.

There are four specific applications of UDT in Organizations that are important challenges to be addressed.

• Establishing consensus on the need for, and the scale of change (Catalyst)

• Providing a robust Change Management and Change-Capability Building Process for today’s VUCA environment. (Change)

• Understanding and Implementing Culture Change that is integrated and consistent with the operational functioning, development and performance for teams. (Culture)

• A Roadmap and Tools for understanding, planning and implementing organization and team transformation interventions to successfully achieve the highest level of functioning and performance as a regenerative ecosystem (Capability)

Why using UDT is important?

• Existing Models for Transformation, Change and Improvement lack the sophistication required for today’s VUCA environment, whereas UDT provides a Standard Integrated Reference Model that equally applies for building Organization & Team:

  • Performance

  • Agility (Change Capability)

  • Resilience

  • Productivity

  • Collaboration

  • Culture

  • Innovation

  • Leadership

  • Digital Business Performance

• Underpinned by Management, Learning, Psychology, Learning and Economic Science

  • Explains the 7 Levels an Organization can reside at (Habituate) for every system element’s level of functioning.

  • Outlines the developmental steps and actions to move from any step to the next improved step applying the UDT rules.

• Three Implementation Reference Models with complete bodies of Knowledge.

  • The Organization Maturity Index (OMI)

  • The Team Maturity Index (TMI)

  • The Digital Maturity Index (DMI)

• Easy to understand and use, with on-line access and Assessment

Introduction

In this case example we present an application of Unitary Developmental Theory (UDT) {Formerly Titled; Dynamic Systems Maturity Theory (DSMT)} as it relates to an organisation, whose performance regressed during the most recent period of disruption; as a result of it failing to recognise that its Performance Management System and Capabilities were at lower maturity levels than its competition.

The Application of Unitary Developmental Theory (UDT) in this example was through OrgCMF™ 'Triage & Diagnostic' Capability Maturity Assessment.

Some UDT Terms & Rules relating to OrgCMF™

• Disintegrative: Where measured maturity is level 4(a) or below, indicating The organisation Dynamic or Construct Capability is unlikely to have adequate capacity at the measured level to absorb change at that level, and sustain that change. The foundation capabilities must be validated and where absent put in place, which requires Development action guidance to start at maturity level 1 guidance (As in this case study)
• Integrative: Where measured maturity is measured at level 4b and above, the Organisation or Model component has sufficient self learning capability to sustain the development/improvement action from that level. That is development actions for the measured level can be absorbed, gain traction, and be sustainable so long as they do not try to skip development levels. Next Step Change is possible

Case Background

The organization has been formally diagnosed as Disintegrative (At maturity Level 3 - Comfort) for Goals and Reward Dynamics and the qualitative data (reasons given by respondents) clustered around structure, process, training, acceptance, discipline, and buy-in.

Following the Assessment the Consultant, HRM and CEO agreed that the Performance-Management system which had not been properly formalized since the start-up days, needed to be subjected to significant update. The goal of the exercise is to raise Performance Management Capability to support the Strategic Goal of re-establishing sustainable Competitive Advantage in an improved marketplace, and recover the Dynamism or Agility that has been lost through the Recession period.

This target Level was designated as Organizational Advantage which is achieved when process, culture, etc., are of a high-enough caliber that they enable sustainable and effective self-organization across the system in e.g., Self-Directed Teams, Self-Organizing Collaborative Initiatives, Innovation Projects, etc., (Note that the latter two types of Self-Organization can progress to the next and highest (Regenerative) Level of the model in Joint Ventures and Spin-Offs, resp.)

Constructs for Goal & Reward Dynamic

Case Guidance Report

In this specific example, guidance starts at level 1(a) as the measured Maturity Level is Disintegrative, the consultant worked with the client team to review each of the phases' guidance and put in place changes and improvements working through the levels of maturity.

Guidance 1a Communicate both the Problem and Opportunity in a manner that people will quickly support dissatisfaction with the status-quo, and causes a sense of a forceful Dilemma that must be taken responsibility for urgently. Thus creating motivation for change and improvement.

Use Financial, Performance, Data, etc., and OrgCMF™ diagnostic graphics, but also present the benefits of an altogether better alternative Vision of how things should be and what’s called a “Change Story”.

Because all you can work with is motivation at this stage, leverage people as they begin to show interest and build them into what is called your Critical Network – a network of people who are representative from across the organization and have sufficient position and/or credibility to effectively champion and positively leverage the process of change through the system.

Management must be involved also, always do a Management Talent Audit in this Phase, and train them accordingly in Performance Management.

NB the level of shock and sense of urgency will address a key reason for Change Management (CM) failure, which is the Motivation behind the Change Initiative.

Guidance 1b Mobilize the emergent Critical Network to make a decisive Disconnect – characterized by an affirmation such as “We are no longer that organization” – from the prevailing situation, and generate agreement amongst them, either separately or collectively to get together promptly and develop a plan to develop Performance Management.

Those managers who do not engage should be given every opportunity, but this Phase is not really complete until all holders of senior Management positions are on board.

NB Ensure to use people who show a level of Total Disconnect, because a major cause of Change Management (CM) failure is lack of Decisiveness around the need for Change.

Guidance 1c Take the final Critical Network and facilitate their generation of a Vision for the Change Outcome, and a concrete Plan to take the Management of the Change through the process of the above Phases.

This planning could take its focus or organizing point as the end Phase i.e., how the organization’s new Performance Management System would operate at is maximum effectiveness, and then work backwards identifying resources needed and available, etc. and how their implementation matches the sequence of the Model Phases for Sustainability of the Change. Then, for each Phase, whether implemented in strict sequence or not, diagnose for gaps in outcome relative to Phase completion and implement remedial action, but ensure that each Phase that might be omitted is implemented as soon as is practicable to support sustainability and optimal effectiveness of the Change.

Planning should be guided by Benefits-Management tactics, e.g.:

1. Carry out a strategic analysis to understand and interpret the business drivers, and revise long-term goals accordingly.

2. Interpret each objective in terms of the benefits that it could produce for different stakeholders and how these benefits can be measured through KPIs

3. Identify the range of changes required to deliver the objectives and the benefits, and position them in the appropriate Phases of the Change Model.

4. Structure support changes by developing other Capabilities that will enable and support Performance Management in achieving the desired outcome of Organizational Advantage.

5. Map and address dependencies between projects, programmes or initiatives such as Performance Tracking, Training, etc., that can let the process down when people are shifting across them.

6. Develop business cases and clearly explain the objectives and benefits to be achieved from Organizational Advantage levels of Performance Management.

Implicit in this advice is the need to establish Tracking Processes for each Change Initiative. NB this Phase addresses a major cause of CM failure poor Planning

Guidance 2a Ensure that the Leadership is seen to take Accountability for the agreed Plan and sells the Vision to the organization. HRM and Leader must agree to instill discipline into the process whereby shortcomings in implementation have negative consequences for people letting the process down.

If possible, Establish a Totem Win for the Change from across the Dynamics, e.g., set and accomplish a visible goal to achieve a new significant Customer, Product, Financier, Supplier Commitment, Sponsor of the Change itself, etc., (the term Totem is used to mean a win that is emblematic of – or emphatically captures – the spirit of good Performance Management for all to see and represent the change as something worthy to aspire to).

NB this Phase addresses a key cause of CM failure which is Leadership Accountability and uses Kotter’s attention to an early win.

Guidance 2b Facilitate transfer of Responsibility for the immediate championing and eventual enactment of the Plan to Critical Network and Managers resp. The Leader’s commitment to discipline the process must come through in this Delegation Phase. This Phase always allows Opportunism, so take advantage of easy wins for the Change through Opportunism to e.g., diversify from the Totem Win.

Management Follow-Through is always a key element of any change process and is dealt with here as foundation for engaging the people in the next Phase.

Guidance 3a Arrange for the Critical Network who are representative of the different divisions of the system to leverage their credibility to lead the On-Boarding of everyone with the new Performance-Management System, through e.g., Workshops, Communications Cycles, etc. that address both rational and emotional issues. Be prepared for Resistance, e.g., at the worst eventuality, some people or constituencies may respond in line with Kubler Ross’s pattern of Grief – Shock, Denial, Anger, Depression, all of which represent the lower 2 Stages of the Unitary Developmental Theory (UDT) model of Learning, and Negotiation should follow the UDT progression of engagement from embedding the underlying problem as Disorienting Dilemma and building the Vision towards the Integrative Win-Win goal to be accepted. Anticipate usual Resistance to Performance-Mgt. Change re. “You are changing my terms and conditions”, etc. Often however, people will simply want to vent emotional baggage attaching to “the old way” which need to be rationalized using same arguments and presentations that worked in the earlier Phases.

Take stock and choose from emergent possible enhancements of the Change from the previous Opportunistic Phase, etc. Phase Specific CMs include Work-Life Balance, EAP, Sports and Social structures, etc. and they should be highlighted as supports.

This Phase addresses a key CM failure of not properly engaging the people in a rounded manner.

Guidance 3b Add champions for improved Performance Management to the Critical Network, who have emerge during the previous Phase; Pilot Implementation of the next Change Phases which relate to Training and Proceduralization. For the Pilot, it is a contingent choice that is ultimately dependent on the maturity of the local and overall system, whether to choose from those people, projects, etc., where the Pilot has a good chance of success, or to choose from those where most will be learned in order to optimally reinforce the change process going forward through the higher Phases; etc.

Given the success of the previous Phase, the Pilot should be part of an effort to challenge people to engage in the process and e.g., organizational goals should be presented as a means of anchoring the process when it comes to establishing personal goals in the new Performance Management process.

Piloting addresses a key CM Failure habit of not learning and adapting as you go through the CM Process and, begin this as early as possible to earn trust with the people, and essentially their permission or Earned the Right to Lead and Challenge them

Guidance 4a Use Pilot results from the previous Phase to shape the implementation of Training and Development for everyone’s roles from the next Phase onwards, and with the entirety of the Developmental Phases in mind from basic assertiveness and awareness of rights re, review, sanction, etc.; to understanding the full process and everyone’s roles, to how stretch and other types of goal-setting can enhance performance and Innovation and satisfaction and reward enhancements, etc. At the end of this Phase, everyone knows their roles in the new process and are competent for them.

Training and Development addresses a key CM failure issue relating to Competence to be successful.

Guidance 4b Embed the necessary Process and Proceduralization (P&P) for the new Performance-Management system, and begin Goal-Setting, Performance Reviews and Reward Allocation, etc., under the new process. Ensure that all such activities are aligned and congruent with the Practices & Procedures of other functions relating to e.g., ERP, Lean Manufacturing, TQM, etc. Monitor and tweak the system until functional requirements around efficiency, quality, reliability, etc., are met. Remember the Organization, Team and Individual Performance Management Systems are aligned and integrated, as are the KPIs'.

Proceduralization guards against so many reasons for CM failure such as reliability, consistency, continuance through personnel changes, etc.

Guidance 5a The Customer focus is both internal and external. Therefore, take feedback from both management and staff on how the process is working and change it accordingly.

Implement the dynamic dimensions of the Change across the organization paying particular attention to frictionless boundaries and Cross-Functional Structures and ensure that all elements of Performance Management including training, career progression, etc., are not hampered by people shifting across the system in cross-functional projects, teams, etc.; Empower energy & enthusiasm by e.g., celebrating success at achieving goals, etc.

Ensure the Performance Management process is managed to facilitate internal competitiveness for human resources, etc. Monitor and adjust the process relative to outcomes that might undermine Competitiveness against peer-organization performance which must be at least matched. People should be rewarded for their effectiveness in functions that drive organizational functioning at this Level, e.g., Environmental Scanning, Customer-Intimacy, etc., and Performance Bonus Schemes could be introduced.

This Phase addresses the key CM failures re. the Internal Customer and getting beyond Bureaucracy of the previous Level to achieve more Agile functioning.

Guidance 5b Review Performance and Embed in process and procedure successful adaptive implementation of the Dynamically Active Performance Management from the previous Phase – mature relationships, internal and external competitiveness, etc., to a degree that they are Cultural in a Customer-Care Culture.

Allow Marketing to take a qualified lead in goal-setting to keep everyone market-oriented; and align all goal setting with market plans.

For Performance Management to drive a Competitive Culture, ensure transparent fairness and discipline of such competition and related Performance Management process is maintained. Also, this must be seen in relation to choosing among competitor people and projects with a view to maximizing Advantage returns in each of the next Phases re. Innovation, Leadership, potential Spin-Offs, etc. Ensure all change is supportive of Customer-Care Culture, Continuous Improvement Programs, Cross-Functional Teams, Customerization, etc.

This Phase applies a more dynamic approach to Refreezing as described by Lewin and engenders Trust in the process which is now systemic and cultural in relation to its scope and embeddedness, and addresses the critical failure point in Change Management (CM) of the mutual re-enforcement from proper engagement with the Market Dynamic.

Guidance 6a The choices and market dynamism focus of people’s behavior, through the above Level should open up people’s minds and behavior for this Phase, and this should be facilitated through the Performance Management processes. Ensure that the Performance Management system is seen to set goals for and Empower and Reward Self-Expression, Autonomy, Innovation, etc. Again, act on feedback to keep it aligned with High-Self-Esteem Expressionist Culture, so that Continuous Improvement is personalized re. Rewards, Career Progression, etc. All the while, continue monitoring and maintaining/improving Capabilities embedded through the lower Levels of the model and change process re. Goal Achievement, Discipline, Quality, Efficiency, etc.

Performance Management should now include the following: Coaching Style of Management, Autonomous Work Design, Innovation-Incentive Schemes, etc.; and as the Phase takes hold, people should be engaged in related processes re. e.g., Emergent Strategy Generation informing the setting of organizational goals, etc.

This Phase is where people take personal ownership of a process and this ensures the highest level of Involvement which is often another critical failure point for CM. This is a totally necessary step to build from optimal Autonomy in Role (Job) Design in this Phase to Autonomous systems in the next Phase.

Guidance 6b Embed process and procedure to support the effective Change-Related outcomes of the previous Phase.

Enhance Performance Management so that it supports, aligns with, enhances, etc., the desired characteristics of Organizational Advantage which include effective Autonomous Organizational Structures setting their own goals such as Self-Directed Teams, Collaborative Communities, SBUs, Portfolio Management of Innovative Projects, etc. which can be the Joint Ventures, Spin-Offs etc., of the next Level.

Self-Organization is a level that allows Leadership in the next Phase to relatively disengage from internal involvement and do what they should be doing which is guiding the organization forward and while all CEOs want this, it is never built into process effectively because of omissions in building Preparation through the earlier Phases, again addressing a critical CM failure point.

Guidance 7a With optimal Self-Organization from the previous Phase, Leadership can remove from functional engagement to lead the organization. Ensure that the Change aligns with all dimensions of Integrative Leadership such as Win-Win orientation with internal and external customers and marketplace; Monitor and adapt effectiveness until Performance Management is contributing to visible levels of Return that internally and externally are seen to signal Leadership in the sector. Also, ensure that Performance Management receives support from a newly-defined Integrative Style of Leadership and Management which represents a more dynamic form of Collegiality with Coaching, etc.

This Phase is focused on internal maximum effectiveness and built upon the rest of the programme, brings a level of Systemic Integrity simply unavailable to other CM approaches that is visible in any Phase-by-Phase comparisons. Ideally, it is only when everything internal is right, can the next Phase of refreshing it and externalizing it begin in a sustainable and Integrative fashion.

Guidance 7b Ensure that Performance Management aligns with and progresses both Internal and External dimensions of Regeneration – both of which effectively perpetuate the above process in ongoing developmental cycles:

1. Internally, ensure that the Performance Management comes under regular review to refresh it through monitoring and amending all Phases starting with sounding out Discontent and activities antagonistic to the process; Disconnecting of any tendencies that might usurp the system; aligning goals etc., with strategic organizational goals and plans, re-positioning Critical Singularities, e.g., re-asserting adequate Leadership Authority and discipline, etc., etc. etc.

2. Externally, be seen to educate best practice in Performance Management to the sector and beyond and perhaps shape related Government policy with a view to mutual best interests. Also, ensure that Performance Management facilitates rather than hinders the development or work of the organization as a Regenerative Eco-System whether that is through Spin-Offs, M&As, Joint Ventures; Cluster Hosting, which are among the features of this Level of Organizational Maturity.

This Phase ensures that internal and external customers have a pride in the organization that is motivational and rewarding to both and attractive to the best prospect recruits. The achievement of Goals and Rewards should Regenerate the Organization to all existing and prospective stakeholders, thereby cementing the change in a manner not even aimed for in typical CM initiatives.

Trial Assessment

Summary

In this example the user organisation identified through an ‘Triage’ Assessment that the key dynamics constraining their performance and performance management process were “Goals” & “Reward” measured at Maturity Level 3 (Comfort). As this level is disintegrative their guidance was to review both level 1 and level 2 to ensure the foundation construct maturities were built to a sustainable level. They carried out a quick ‘Diagnostic’ Assessment on the Goals & Reward Dynamics where they identified some failure mechanisms and put in place remediation and improvements using the OrgCMF™ Diagnostic Assessment Report.

By following this UDT based process, using The OrgCMF™ process and tools this organization planned and executed a series of changes, guided by the Model, which delivered Transformation in the process and performance and prevented the occurance of all the common failure mechanisms that typically occur in Change Management Projects.

They recognised Organisation learning and improvement is a sequential development process and the first phase of their program built the maturity of their Performance Management system to Maturity level 4 ( Operational) which is the level that sustains self-learning and improvement (integrative). They now have 6 month sprints to continually improve their performance management system and related performance which they track by low overhead self-assessment using both ‘Triage’ and ‘Diagnostic’ Assessments, they have already identified that their level 5 sprint should include the ‘Leadership’ Dynamic and the ‘Career Management’ Construct should be included in the next sprint assessment and guidance report.

Finally the key features '4Cs' of NextGen Change Management provided by OrgCMF™ which is underpinned by UDT facilitated the Transformation Change and Improvement.

Catalyst Triage assessment enabled the leaders to call to attention the need for change and engage key stakeholders in coming to a consensus as to where to start and what needs focused attention.

Change Management Process suitable for todays more sophisticated and VUCA environment is embedded in the OrgCMF™ and its three UDT based Reference Models: Organization, Team & Digital.

Culture Change is integrated seamlessly into the CM process and addressed with both the tangible and intangible change elements.

Capability Building Measurement and Development Roadmaps guided in the identification of existing constraints and Performance, and guided the change actions throughout the process.