eyeforpharma Barcelona 2014

Mar 18, 2014 - Mar 20, 2014, Barcelona, Spain

The Future of Pharma

Making Change Personal: Driving Radical Organisational Change

Deirdre Coleman interviews Mikael Nilsson, Director Marketing Excellence, Global Commercial Strategy, Biogen Idec and discusses the critical success factors to implementing a change management process that delivers lasting, sustainable change.

In today’s dynamic and demanding business environment, a company’s ability to adapt its organisation and processes to the demands of its customers is essential in order to achieve business success. Biogen Idec is no stranger to change management, having undergone seismic strategic, operational and organisational changes since 2010. The objective was to radically overhaul business processes to increase focus and efficiency and leverage the company's strengths to provide a solid framework for future growth.

Undertaking transformative change is not a straightforward task. When it comes to making big changes in an organization—implementing a Six Sigma program, optimizing business processes, adopting a new sales strategy—executives know that the wild card in the pack is their employees’ capacity to adapt to a new order. Although the hoped-for benefits of a major initiative can shrink dramatically if employees misunderstand or resist it, success or failure depends as much on how the change is made as on the project itself.

Mikael Nilsson, Director Marketing Excellence, Global Commercial Strategy, Biogen Idec learned firsthand the challenge senior executives face to disseminate changes throughout the organisation and make them stick. He maintains it is often the “soft” skills that ensure the success of a change management process; dealing with the emotional upheaval that change creates and dealing with the fallout of these emotions including the ability to keep managers and workers inspired when they feel overwhelmed, to promote collaboration across organisational boundaries, or to help managers embrace change programs through dialogue, not dictation.

Conventional Change Management Thinking

Surprisingly, the vast majority of change management thinking is remarkably similar. Colin Price and Emily Lawson provided a holistic perspective in their 2003 article “The Psychology of Change Management”, which suggests that four basic conditions have to be met before employees will change their behaviour:

 A. A compelling story: They must see the point of the change and agree with it, at least sufficiently to give it a try

B. Role modelling: They must also see colleagues they admire modelling the desired behaviour

C. Reinforcement systems: Surrounding structures, systems, processes and incentives must be in tune with the new behaviour

D. The skills required for change: They need to have the skills to do what is required of them.

This prescription is well grounded in the field of psychology and is entirely rational. Putting all four of these conditions in place as a part of a dynamic process greatly improves the chances of bringing about lasting changes in the mindsets and behaviours of people in an organization—and thus achieves sustained improvements in business performance. However, McKinsey research into change programs across a range of sectors suggests that the difficulty organisations have in sustaining change can be traced to insufficient attention paid to the attitudes and behaviours of managers and employees. These people-related factors were responsible for poor outcomes more so than the usual suspects—inadequate budgets or badly targeted resources. The reshaping of employee attitudes and behaviors is just as critical to the success of a transformation as the implementation of process changes.

The Inconvenient Truth:

Change management thinking extols the virtues of creating a compelling change story, communicating it to employees and following it up with ongoing communications and involvement. This prescription makes sense, but in practice three inconvenient truths often get in the way of this approach achieving the desired impact.

Inconvenient Truth #1: What motivates you doesn’t motivate (most of) your employees

The inconvenient truth of human nature is that people are irrational in a number of predictable ways.

Mikael Nilsson, Director Marketing Excellence, Global Commercial Strategy, Biogen Idec agrees:  “The human aspect of changing behaviour and adopting new ways of working is frequently under-estimated in terms of seeking to understand the underlying needs of people. Digging deeper into why change programs fail reveals that the vast majority stumble on precisely the thing they are trying to transform: employee attitudes and management behaviour. The inconvenient truth of human nature is that people are irrational in a number of predictable ways. What the leader cares about (and typically bases at least 80 percent of his or her message to others on) does not tap into roughly 80 percent of the workforce’s primary motivators for putting extra energy into the change program. We all have different drivers and motivations (company success, impact on the customer, impact on the working team, impact on the employee personally). The key to a successful change management program is tapping into these different motivations within the team and personalizing the approach to meet the individual’s needs, motivations and drivers. A “one-size-fits-all” approach won’t work as we are all different. But, if you are aware of the diverging needs and motivations before you commence, that’s half the battle”.

As organisations go through change, the simplistic and therefore flawed view is that we commence with our existing activities, behaviours and beliefs; define a new set of activities, behaviours and beliefs; and replace the old with the new. This approach is destined to failure as it neglects the human aspect of changing behaviour. In his book “Managing Transitions”, William Bridges analyzes the transition process and points out that transitions are mostly about the emotional difficulty of letting go of the old (comfortable and familiar) behaviours and learning the new (unknown and unfamiliar) behaviours.

Inconvenient Truth #2: You’re better off letting them write their own story

Well-intentioned leaders invest significant time in communicating their change story – in change management theory it’s called “the burning platform”. Certainly the story needs to get out there, but the inconvenient truth is that much of the energy invested in communicating it would be better spent listening, not telling.

Delivering a strategy statement to a team as a fait accompli is a faster approach but ultimately it is doomed to failure as the employees did not shape it and therefore they do not own it.

"When we choose for ourselves, we are far more committed to the outcome (almost by a factor of five to one). Conventional approaches to change management underestimate this impact. The rational thinker sees it as a waste of time to let others self-discover what he or she already knows—why not just tell them and be done with it? Unfortunately this approach steals from others the energy needed to drive change that comes through a sense of ownership of “the answer”.  Many executives are surprised not only by the ownership and drive for implementation that comes from high- involvement approaches, but also by the improved quality of the answers that emerge. Change that is enforced top down will not work. When everyone has a voice and feels their input contributes to the overall strategy, then they are invested in that process and invested in that strategy. Delivering a strategy statement to a team as a fait accompli is a faster approach but ultimately it is doomed to failure as the employees did not shape it and therefore they do not own it. This decentralized approach is superior as the “ownership” motivates the team and becomes its own driver of change”, confirms Nilsson.

Inconvenient Truth #3: People Don’t Act Rationally but Behaviour Predictably

“The process of transition can be a messy one, fraught with human emotion as people seek to cling on to the old way of doing things. It is often usual for people to adopt a “rose-tinted” perspective on the old ways of doing things when faced with change and upheaval even if rationally the change is for the better. People don’t always behave rationally but behave predictably and the transition process often brings with it the full gamut of human emotion from anxiety, fear, threat, guilt to depression – the “Valley of Despair” as it’s known, and progressively onwards to gradual acceptance and moving forward with the desired behaviour. These emotions can be anticipated and planned for, recognizing where people are at emotionally on that transition curve and providing the emotional support and backup required to progress through to the desired state. This awareness is vital as things often get worse before they can get better and knowing that from the outset can allow you to plan for that and anticipate reactions and fallout and put mechanisms in place to minimize resistance to change by recognizing the objections and being a listening ear and a support. You don’t change processes and approaches, you change people and that is not always clear cut and simple, because people are not simple. Differing personalities mean people experience things in different ways and approach change differently. Once everyone is aligned with the strategy, is invested in it and accepts it, you can progress towards implementing the required tactics”.

Roadmap to Change Management

Organisations that successfully manage change practice four steps to ease the emotional rollercoaster of transition:

1) Communicate the compelling reason to change

“When planning for a major change, an organisation’s leaders need to spend time creating a compelling reason for the change which resonates throughout the organisation. It may be a good idea, the right thing to do, better for everyone but unless you dig down into the specifics of why this change is essential, you will struggle during the hard transition stage. Properly done, the reason for change provides both an ongoing reminder of why you chose to pursue the change and the sense of urgency to start it immediately”, claims Nilsson.

2) Create an inspiring vision of the future

An inspiring vision creates and sustains the excitement and enthusiasm to drive the change through to completion. Effective leaders ensure that the organisation shares the vision. In his book “The Fifth Discipline”, Peter Senge observed that a critical failure of leadership is the inability to turn a personal vision into a shared vision. The key to creating a shared vision is to realize that everyone views the future from a personal perspective. What is inspiring and desirable to one may be confusing and undesirable to another. A shared vision actually can appear differently to each person. Creating an inspiring vision of the future is only truly accomplished if it becomes personal – and that takes work.

3) Create a plan of action

By its very definition, a vision is intangible. It only exists as a concept, an idea, or an expectation. However, while the vision is intangible, the actions to make the vision a reality should not be. Once the vision is created and shared, the immediate question will be “How do we make this happen”. A detailed action plan is not a step you can eliminate. Nor is it a step to start without creating the compelling reason to change and the inspiring vision of the future.

4) Reinforce expectations for new behaviours

“The term reinforcement can unfortunately tend to encourage thoughts of punishment or corrective actions. When reinforcing compliance with new processes, focus plenty of time and attention on those that are doing and trying, even if their early efforts are imperfect. If some individuals are avoiding the new processes, then privately (one-on-one) find out why. Listen honestly without prejudice. Then, in your role as coach, help them. No threats, no “or else,” no judgements – just clarity and support. I’ve worked for a number of different managers, and the ones that take the time to understand my reservations, remove obstacles, and gently but firmly make their expectations clear NEVER have to refer to the consequences of non-compliance”.

How do you know that the first three steps are complete? When the people in your organisation can tell you:

1) Why we are doing this

2) What it will look like

3) What is in it for them

4) What they will be losing/giving up

5) What you expect them to do

“If your people can’t explain each of these to you, then change is going to be an uphill struggle. Your people may understand the changes and even (conceptually) agree with them, but they won’t be equipped to begin the transition – and without the fourth step (reinforcement), they will struggle with sticking to the new ways long enough to become proficient and comfortable enough to sustain the change. Organisational change is a complex endeavour and is much easier to do wrong than right. Planning for the emotional side of change is critical to helping people make the transition from old behaviours to new ones. These four steps are easy to understand, and although significant work is required to accomplish each of them effectively, they can form the foundation for successful organisational change”.

Mikael Nilsson will be speaking at eyeforpharma Barcelona in March. For more information on his presentation, or on other speakers, click here.

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eyeforpharma Barcelona 2014

Mar 18, 2014 - Mar 20, 2014, Barcelona, Spain

The Future of Pharma

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