Managing Change in Organisations – Improved HR onboarding process Essay
Managing Change in Organisations – Improved HR onboarding process
The main goal of this change initiative is to improve the financial results of the company by improving the engagement and performance of the new HR employees at Mars, Inc. It’s aimed to be achieved by introducing a new, globally aligned, best-in-class 1-year-long induction process with supporting tools and learning events. The target group of new HR associates1 includes those who joined HR at Mars less than 12 month ago, either from externally (from other company) or internally (from other department).
As Mars,Inc. is a large family-owned business with over 100 years of history and globally well known brands. It has unique and mature company culture which is driven by its 5 principles: Quality, Responsibility, Mutuality, Effectiveness and Freedom. These principles drive the behaviour of the employees at all level of the hierarchy and have been shaping the characteristics of the organisation. Mars, Inc. fits well to ‘elaboration of structure phase’ (Granier 1972) of the organisational life-cycle: the company is led by a team of professional managers and is very much decentralised with a small headquarter. The business units of the countries therefore enjoy a lot of freedom and responsibility to drive the local business effectively.
This approach reflects also in the way they shape the processes within the company: the global process standards are mainly just broadly defined with limited (if any) written documentation about them, which lets the local teams shape it and use it as best fits to their needs. As it has the advantage to allow tailor-made solutions to best assist local business objectives, it also has disadvantages.
It is not uncommon that extra local resources are needed to shape the process, and when the process has changed too much, it becomes difficult to compare the practices and results of different units. It also often happens that local units come up with very similar best practices after investing significant resources locally in process development, which resources could have been reduced if globally – or at least regionally – someone would have co-ordinated these development initiatives.
As part of the company culture, Mars, Inc. refers to employees as associates, therefore in my paper I will use both terms to reflect the same concept.
Realising the potential of this kind of centralisation led the business leaders to setting up global functional centres of expertise, like the Mars University (Mars U) is for learning and development within Mars, Inc. The Mars U is responsible for designing and deploying world-class learning programs, which enable the competency building of employees, so they can achieve their full potential in contributing to the business to achieve its goals.
It has matrix structure and its smaller teams are set up by functions (named “Colleges” of HR, finance, supply, etc.), regions (they coordinate the deployment of functional development programs in a region) and special learning and development related areas (like learning technology). Mars U therefore faces the challenge of balancing between centralisation and decentralisation by providing centrally defined and globally aligned learning solutions in a matrix organisation with decentralised leadership.
That is the same challenge in case of the new induction process initiative. In the near past an introductory training program existed for new HR employees, which was similar in all the regions, but inconsistent in content, so it gave a lot of space for local solutions to flower. Moving from this decentralised approach to a more centralised one may cause push backs from the associates in these local units, thus careful change management is essential.
Nature of change
By assessing the nature of change based on the description above, this change can be categorised with the terms of Ackerman (1997) as ‘transitional’ as the intention is to “achieve (…) a desired state” by setting up a globally aligned world-class induction process for new HR associates, which is a significant difference from the current decentralised approach. One can argue whether it is not defined as ‘transformational change’ as it can result a difference in an organisational process and change in the culture, but as it won’t change fundamentally neither areas, the definition of ‘transitional change’ fits better in this case.
To give a full picture about the nature of change, it need to be emphasised that after finishing this particular change project, the change itself will not stop, it will continue as ‘developmental change’ by continuously improving the set up induction process.
From another perspective, using the categories of Mintzberg and Waters (1985) this change initiative can be identified as ‘determined’ or planned change as the goal, that need to be achieved, is clearly set, as well as the process how to get there. It does not mean though, that ‘emergent’ changes will not come up during the project, as it may happen that a locally designed induction process which works well will have an improving effect on the globally designed process and tools to ensure the
implementation of the best possible practices.
Drivers of the change
This change initiative has mainly internal triggers. First and foremost, improve the productivity of every new HR associates by providing them all the essential knowledge, competencies and network they need in their new role. Improving their engagement level is also an important trigger, as engaged associates have usually better performance and they less likely to leave the business (Buckingham and Coffman, 2005). In case of HR department, better performance of associates, among other things, could lead to better internal and external customer satisfaction or decrease of costs by effective ways of working, while improved retention cut the costs and time invested in recruitment and training of a new employee.
Although the internal triggers are more relevant in this case, the external drivers also need to be mentioned. Mars, Inc. had several acquisitions in the last few years which led to an incoherent culture in the different business segments. To enable exchangeability of human resources and best practices, setting up centrally aligned processes is a key. Also, considering that Mars, Inc. operates in a quickly changing market (FMCG), being innovative and best-in-class in its processes could ensure competitive advantage and retention of employees. Nonetheless, the change needs to be done in a global environment fitting to the expectations of different cultures in different regions.
As in case of most major changes in an organisation, winning the support of top level management is essential. In this case the management means the Global HR Leadership Team of Mars, Inc. who also plays the role of sponsor of the project and expected to play a key role by being role model in using the new induction process. Their influence is very high as they could stop or change this initiative any time. Their attitude toward the change to be expected very positive, still, contracting with them is critical as many priority projects are currently going on in the business so need to ensure proper focus.
Driving the change process requires change agents to ensure smooth implementation: the Mars U associates in the regions and other (local) learning or talent development specialists. As the project aligns well with their general purpose of their roles – to improve associates capabilities, – their attitude is expected to be positive. As they will play the role of connecting the project leaders with associates in their regions or units, their influence is also very high, but mainly only in their area of responsibility.
The communication and deployment of the change will focus mainly on the HR managers as they will be the most affected by the change, as they need to change their ways of working the most. Thus, 5
their attitude can be either positive or negative depending how valuable the new process seems to them. Their influence can be high in the area of their responsibility – so the more senior the manager is the higher is the influence.
Also important stakeholders, but less influential, are the new HR associates. The new process is all about them, but from change management perspective they play a smaller role, as their attitude to be expected very positive. In any case, careful communication toward them needs to be planned to ensure their full involvement in the process and gain feedback from them to identify potential areas for improvements.
There are also some other key stakeholders, like the trainers of the courses, whose contribution to the success can be very important, but as they are interchangeable in the roles, their influence on the process can be categorised as moderate. Furthermore, there are some other subject matter experts (e.g. learning technology or global communication specialists), who will be involved during the design and communication phases, but their influence is rather small and their attitude is expected to be supportive.
To summarise the main objective, the goal is to implement in all business segments and units of Mars, Inc. a newly designed, globally aligned, efficient and engaging functional induction process with its supporting tools (guides and learning modules) for every new HR employees, which supports their development in the first 12 months after joining in their new role and covers the essential Mars specific knowledge and provides network needed for achieving high performance. The new process and tools should be used by mid of 2013 in all business units.
For a successful change project it’s not only important to see where we would like to go, but to be able to define how we will get there, we need a careful and detailed analysis on where we are at the moment. Besides a general process overview in the organisation (e.g. by the support of models like ‘McKinsey 7S’ (Waterman et al. 1980) or ‘Burke-Litwin Causal model’ (Burke & Litwin, 1992)), we also need to understand why do we have the problem in our organisation. For this we may use problem analysis models, like the ‘Fishbone diagram’ or the ‘5 Whys?’ (Taiichi 1988) model.
To better understand the functional induction process, by the ‘Input-Transformation-Output model’ (RDI, 2012a) the main elements can be summarised visually:
This model can support the planning process in several ways. It is easier for the change leaders to identify the key stakeholders (see the detailed stakeholder analysis above), to keep objectives always in mind and focus on the processes which need to be changed in order to be able to achieve the desired output. Furthermore, it gives a great overview about who shall be involved in reviewing and developing the process by providing feedback before, during and after the change. Nonetheless, it is essential to be clear on both the transformed and transforming resources required for the
whole process to avoid disturbance due to the lack of them.
After having a broader overview of the issue, before taking any actions, a thorough problem analysis is a must. Even though having an initial idea about what can improve the current situation, in a complex organisation with a huge overall impact of the topic, the change leader need to ensure addressing the right issues and providing the right solutions based on that. In defining all the relevant causes of a problem can help the Cause-and-Effect Analysis (Ishikawa, 1968) or Fishbone diagram. In case of our described example, the model looks like this:
After defining the list of important causes, the major ones to be selected by the analysing team then the potential actions can be planned. When it’s presented to the management team, their duty is then to decide on which topics to focus on the actions.
In this example case, a globally aligned process with supporting tools and metrics are very much missing. When it’s designed and ready to be deployed, then these should be available to all HR managers to be able to drive the induction processes locally and measure their own efficiency.
Plan the change
After the green light of the management team concerning the project initiative, can start the proper, detailed planning: the development of the change strategy, in which the desired outcome, key actions, milestones, action owners and resources needs are defined. Winning the commitment of the key stakeholders also need to be carefully planned with a supporting communication plan. As unexpected situations are likely to disturb the planned flow of actions, to minimise the potential disturbance, a risk analysis in advance of doing actions can help the project management team to prepare for these scenarios or totally avoid them. Also, a continuous review of the change project is highly recommended to ensure the project execution
is on track to achieve the project goal (see the 8
potential feedback sources in the Input-Output model) – this also can be part of the change strategy plan. The next step is then to execute the plan. When unexpected situations happen, continuous adjustments of the plan may be required to ensure proper improvement and keep the progress to achieve the final goal. After all planned actions are executed, the project leader should control that the project goal has been achieved as defined. If no, the project still continues. If yes, the project shall be formally closed with the involvement of the project sponsors and the success should be feed back to the key stakeholders.
Business Process Transformation
Although Mars, Inc. in this situation chose to go on with a change project concentrating on only one function (HR) to improve its induction process, using the Business Process Transformation (BPT), i.e. Business Process Re-engineering model could have led to better results. By talking generally about the BPT model, one can say that improving the customer engagement and cutting the operational costs by improving and simplifying processes (cross-functional) within the company, is in the heart of this approach (Hammer 1990).
Let use the definition of re-engineering by Hammer and Champy (1993) to show the key characteristics of this model: “… the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical contemporary modern measures of performance, such as cost, quality, service, and speed.” This approach is one of the favourites currently in change management, as it promises “dramatic improvements” in business performance and customer satisfaction, even though it has its own challenges.
The most important is that it requires a holistic view from the business leaders to face the issues within an organisation. It needs broad perspective to be able to come out of functional silos and to view the process as a whole, from the very beginning till the very end. If the change project happens only within a single function, there is high probability of missing some important opportunities of improvement. By using the example of Mars, a cross-functional approach could lead to a different, although very thorough solution – like implementing a standardised, world-class induction experience in every part of the company, during which the new employees can learn the most important functional and business knowledge to best support the customer focused processes.
Based on its holistic view, the BPT approach requires more complexity from change management perspective as well as total alignment and drive from the top management team. The process improvement strategy should be aligned with the vision, mission and business strategy of the company, while the desired behaviours and key performance indicators should be also clearly defined and communicated to support the process and the measure of success (RDI 2012b). The process improvement initiative should start with a company-wide analysis of the current situation, keeping in mind not only how the processes can be simplified, but also what could be the benefits for the customers by the change initiative.
The analysis then will be followed by the definition of the detailed plan: to where and how the company would like to get. To achieve great improvement in company results, increasing the amount of invested efforts and resources and high risk taking is unavoidable – although most probably in mid- and long-term the investment of these extra resources will pay.
All these mentioned characteristics of the model lead to the fact that this model can’t be used without a heavy top down and centralised approach due to its holistic nature and complexity. Starting a process improvement initiative from any other level of the organisation without the full support and involvement of the company top leaders can lead to only a temporary and restricted (to a region or function) solution.
Managing the implementation of the change at Mars, Inc. Although the change project defined by Mars also intends to improve the measures mentioned in the re-engineering definition, the main difference lies in the adjectives used by the authors: dramatic, fundamental and radical. So in this case we can’t really talk about BPT approach, as it would rather mean taking the whole on-boarding and induction process in all functions of the company and use that to work on, even though it could be very beneficial for the company.
Also, without winning the top management support for a holistic change approach, the project leader of this initiative better use a general Change management (RDI 2012c), or preferably, the Total Quality Management (TQM) 2 methodology with using some holistic OD models – like the ‘Burke-Litwin model’ (Burke & Litwin 1992) or the ‘McKinsey 7S model’ (Waterman et al. 1980) – for analysing the potential areas of change interventions.
Definition of TQM by Kanji (1990): “TQM is the way of life of an organization committed to customer satisfaction through continuous improvement. This way of life varies from organisation to organisation and from one country to another but has certain principles which can be implemented to secure market share, increase profits and reduce costs.”
The principles of the TQM approach fits well to the culture of Mars, Inc. by focusing on continuous improvement opportunities, on customer needs and motivating employees at all level of the organisation to take part of this and drive innovations. It also reflects in all of the 5 principles of the company3. The management style also resonates well with the principles of TQM, as it engages the collaborative company culture with empowering and motivating the employees to drive continuous improvement for achieving better quality in everything within the business. Although a lot of things fit well to use this model for the change case at Mars, to fully benefit of the TQM methodology, the project leader and the participants shall be skilled to use all its principles to achieve the best possible result, which is currently not yet the case.
Measure of Success – Processes
There are certain elements of the change process, which we can check and measure during and after the project to evaluate the success. Firstly, it is inevitable to set with involvement and communicate to the key stakeholders a clear vision, a well defined ‘S.M.A.R.T. objective’ (Doran, 1981) and some key performance indicators regarding the desired end result of the change initiative. Additionally, it is also important element of the second success factor, which is the level of commitment to the change of the key stakeholders.
During the implementation phase, the success of the process can be measured at the key milestones: whether they were achieved on time by providing good quality results within the allocated resource limits. In this phase, the ability of flexible to any disturbance and opportunities through the process is also essential, to keep or even improve the result quality of the change, or to use less resources to achieve the original goal. It may be measured by reaction the quickness of the response or the amount of extra resources needed to keep the good progress. In connection to this, reviewing the key challenges and capturing the lessons learnt for the future also shows the efficiency of the process. Last, but not least, a clear project closure can also indicate how well the project went.
Measure of Success – Outcomes
If we have a closer look on the change initiative of Mars, Inc., the desired outcome which we wish to measure lies in the main objective4. The company’s main goal is to improve the efficiency and
Quality, Mutuality, Responsibility, Effectiveness and Freedom For details see the Management Objective paragraph performance of the new HR employees. As HR is a support department with less direct impact on financial results and the quality of end products than other areas in the business, measuring these goals may be difficult, especially if we need to focus on only the new employee. So it’s advised to define other measures, like the individual performance or future career potential of the new employee, which can be measured by the company globally standardized performance evaluation system. Although the improved employee performance is difficult to be described with exact figures, we can also use historical data to compare the past and the present, and measure factors which can influence performance (e.g. the Line Manager’s evaluation of the performance or the engagement level of the new associate).
Besides the employee performance, the efficiency of the new process shall be measured as well (e.g. could we involve everybody we intended to use the new process). Furthermore, as in case of all change projects, defining the return on investment can show the level of success. For example the cost of resource investment of the change project may be compared with the amount of money were saved by better retention of the new associates. By measuring the outcome of a new process we also need to investigate the resource needs of sustaining the process efficiently on long term.
Ackerman, L., 1997, Development, transition or transformation: the question of change in organisations. In: Van Eynde, D., Hoy, J and Van Eynde, D (eds) Organisation Development Classics. San Francisco, Jossey Bass.
Buckingham, M. and Coffman, C., 2005. First, Break All The Rules: What the World’s Great Managers Do Differently. Simon & Schuster.
Burke, W. W. and Litwin, G. H., 1992. A causal model of organizational performance and change. Journal of Management, 18 (3), 523-545.
Doran, G. T., 1981. There’s a S.M.A.R.T. way to write management’s goals and objectives. Management Review, Volume 70, Issue 11, pp. 35-36.