Transformation Planning and Organizational Change
Definition: Transformation planning is a process of developing a [strategic] plan for modifying an enterprise's business processes through the modification of policies, procedures, and processes to move the organization from an "as is" state to a "to be" state.
Change Management is the process for obtaining the enterprise (or business) intelligence to perform transformation planning by assessing an organization's people and cultures to determine how changes in business strategies, organizational design, organizational structures, processes, and technology systems will impact the enterprise.
Keywords: business transformation, complex systems, lifecycle development, organizational change management, organizational development, organizational strategy, organizational transformation, psychology, social sciences, stakeholder management, systems thinking, trust
MITRE SE Roles & Expectations: MITRE systems engineers (SEs) are expected to be able to assist in formulating the strategy and the plans for transforming a customer's engineering/technical organization, structure, and processes, including the MITRE support to that organization. MITRE SEs are expected to recommend interfaces and interactions with other organizations, lead change, collaborate, build consensus across the MITRE support and other stakeholders for the transformation, and to assist in communicating the changes. To execute these roles and meet these expectations, MITRE system engineers are expected to understand the complex, open-systems nature of how organizations change, and the importance of developing the workforce transformation strategies as a critical, fundamental, and essential activity in framing a project plan. Systems engineers must understand the social processes and other factors (e.g., leadership, culture, structure, strategy, competencies, and psychological contracts) that affect the successful transformation of a complex organizational system.
The objective of organizational change management is to enable organization members and other stakeholders to adapt to a sponsor's new vision, mission, and systems, as well as to identify sources of resistance to the changes and minimize resistance to them. Organizations are almost always in a state of change, whether the change is continuous or episodic. Change creates tension and strain in a sponsor's social system that the sponsor must adapt to so that it can evolve. Transformational planning and organizational change is the coordinated management of change activities affecting users, as imposed by new or altered business processes, policies, or procedures and related systems implemented by the sponsor. The objectives are to effectively transfer knowledge and skills that enable users to adopt the sponsor's new vision, mission, and systems and to identify and minimize sources of resistance to the sponsor's changes.
Best Practices and Lessons Learned
Implementation of a large-scale informational technology (IT) transformation project affects the entire organization. In a technology-based transformation project, an organization often focuses solely on acquiring and installing the right hardware and software. But the people who are going to use the new technologies—and the processes that will guide their use—are even more important. As critical as the new technologies may be, they are only tools for people to use in carrying out the agency's work.
As shown in Figure 1, the discipline of organizational change management (OCM) is intended to help move an organization's people, processes, and technology from the current "as is" state to a desired future "to be" state. To ensure effective, long-term, and sustainable results, there must be a transition during which the required changes are introduced, tested, understood, and accepted. People have to let go of existing behaviors and attitudes and move to new behaviors and attitudes that achieve and sustain the desired business outcomes. That is why OCM is a critical component of any enterprise transformation program: It provides a systematic approach that supports both the organization and the individuals within it as they plan, accept, implement, and transition from the present state to the future state.
Studies have found that the lack of effective OCM in an IT modernization project leads to a higher percentage of failure. According to a 2005 Gartner survey on "The User's View of Why IT Projects Fail," the findings pinned the failure in 31 percent of the cases on an OCM deficiency. This demonstrates the importance of integrating OCM principles into every aspect of an IT modernization or business transformation program.
Navigating the Change Process
MITRE systems engineers need to assess change as a process and work in partnership with our sponsors to develop appraisals and recommendations to identify and resolve complex organizational issues. The change process depicted in Figure 2 is designed to help assess where an organization is in the change process and to determine what it needs to do as it moves through the process.
By defining and completing a change process, an organization can better define and document the activities that must be managed during the transition phase. Moving through these stages will help ensure effective, long-term, and sustainable results. These stages unfold as an organization moves through the transition phase in which the required transformational changes are introduced, tested, understood, and accepted in a manner that enables individuals to let go of their existing behaviors and attitudes and develop any new skills needed to sustain desired business outcomes.
It is very common for organizations to lose focus or create new initiatives without ever completing the change process for a specific program or project. It is critical to the success of a transformation program that the organization recognizes this fact and is prepared to continue through the process and not lose focus as the organizational change initiative is implemented. Commitment to completing the change process is vital to a successful outcome. Information on forming a transition strategy to document and assist with maintaining focus can be found in the SEG article "Formulation of Organizational Transformation Strategies."
Framework for Change
In any enterprise transformation effort, there are a number of variables that exist simultaneously and affect the acceptance of change by an organization. These variables range from Congressional mandates to the organization's culture and leadership to the attitude and behavior of the lowest-ranking employee. At MITRE, social scientists use the Burke-Litwin Model of Organizational Performance and Change, or other approaches in line with the sponsor's environment and culture, to assess readiness and plan to implement change. The Burke-Litwin Model identifies critical transformational and transactional factors that may impact the successful adoption of the planned change. In most government transformation efforts, the external environment (such as Congressional mandates), strategy, leadership, and culture can be the most powerful drivers for creating organizational change. Further information on performing organizational assessments is found in the SEG article "Performing Organizational Assessments."
Most organizations will ultimately follow one of three approaches to transformation. The type of approach is related to the culture and type of organization (e.g., loosely coupled [relaxed bureaucratic organizational cultures] or tightly coupled [strong bureaucratic organizational cultures]):
- Data-driven change strategies emphasize reasoning as a tactic for bringing about a change in a social system. Experts, either internal or external to the sponsor, are contracted to analyze the system with the goal of making it more efficient (leveling costs vs. benefits). Systems science theories are employed to view the social system from a wide-angle perspective and to account for inputs, outputs, and transformation processes.
The effectiveness of a sponsor's data driven change strategy will be dependent upon (a) a well-researched analysis that the transformation is feasible, (b) a demonstration that illustrates how the transformation has been successful in similar situations, and (c) a clear description of the results of the transformation. People will adopt the transform when they understand the results of the transformation and the rationale behind it.
- Participative change strategies assume that change will occur if impacted units and individuals modify their perspective from old behavior patterns in favor of new behaviors and business/work practices. Participative change typically involves not just changes in rationales for action, but changes in the attitudes, values, skills, and percepts of the organization.
For this change strategy to be successful, it is dependent on all impacted organizational units and individuals participating both in the change (including system design, development, and implementation of the change) and their change "re-education." The degree of success is dependent on the extent to which the organizational units, impacted users, and stakeholders are involved in the participative change transition plan.
- Compliance-based change strategies are based on the "leveraging" of power coming from the sponsor's position within the organization to implement the change. The sponsor assumes that the unit or individual will change because they are dependent on those with authority. Typically, the change agent does not attempt to gain insight into possible resistance to the change and does not consult with impacted units or individuals. Change agents simply announce the change and specify what organizational units and impacted personnel must do to implement the change.
The effectiveness of a sponsor's compliance-based change strategy is dependent on the discipline within the sponsor's chain of command, processes, and culture and the capability of directly and indirectly impacted stakeholders to impact sponsor executives. Research demonstrates that compliance-based strategies are the least effective.
Regardless of the extent of the organizational change, it is critical that organizational impact and risk assessments be performed to allow sponsor executives to identify the resources necessary to successfully implement the change effort and to determine the impact of the change on the organization. Further information on change strategies and organizational assessments is found in the SEG article "Performing Organizational Assessments," and in those listed above.
Leadership & Stakeholders
MITRE system engineers need to be cognizant of the distinction between sponsor executives, change agents/leaders, and stakeholders:
- Sponsor executives: Typically, sponsor executives are the individuals within an organization that are accountable to the government. Sponsor executives may or may not be change leaders.
- Change leaders: Typically, the change leader is the sponsor's executive or committee of executives assigned to manage and implement the prescribed change. Change leaders must be empowered to make sponsor business process change decisions, to formulate and transmit the vision for the change, and to resolve resistance issues and concerns.
- Stakeholders: Typically, stakeholders are internal and external entities that may be directly (such as participants) or indirectly impacted by the change. A business unit's dependence on a technology application to meet critical mission requirements is an example of a directly impacted stakeholder. An external (public/private, civil, or federal) entity's dependence on a data interface without direct participation in the change is an example of an indirect stakeholder.
Note: Both directly and indirectly impacted stakeholders can be sources of resistance to a sponsor's transformation plan. Further information on communicating to stakeholders is found in the SEG articles "Stakeholder Assessment and Management" and "Effective Communication and Influence."
Resistance is a critical element of organizational change activities. Resistance may be a unifying organizational force that resolves the tension between conflicts that are occurring as the result of organizational change. Resistance feedback occurs in three dimensions:
- Cognitive resistance occurs as the unit or individual perceives how the change will affect its likelihood of voicing ideas about organizational change. Signals of cognitive resistance may include limited or no willingness to communicate about or participate in change activities (such as those involving planning, resources, or implementation).
- Emotional resistance occurs as the unit or individuals balance emotions during change. Emotions about change are entrenched in an organization's values, beliefs, and symbols of culture. Emotional histories hinder change. Signals of emotional resistance include a low emotional commitment to change leading to inertia or a high emotional commitment leading to chaos.
- Behavior resistance is an integration of cognitive and emotional resistance that is manifested by less visible and more covert actions toward the organizational change. Signals of behavioral resistance are the development of rumors and other informal or routine forms of resistance by units or individuals.
Resistance is often seen as a negative force during transformation projects. However, properly understood, it is a positive and integrative force to be leveraged. It is the catalyst for resolving the converging and diverging currents between change leaders and respondents and creates agreement within an organizational system. Further information on performing organizational assessment and developing feedback and resistance mitigations is found in the SEG articles "Performing Organizational Assessments" and "Effective Communication and Influence."
Creating the Organizational Transition Plan
As discussed in the beginning of this section (see Figure 1), successful support of individuals and organizations through a major transformation effort requires a transition from the current to the future state. Conducting an organizational assessment based on the Burke-Litwin Model provides strategic insights into the complexity of the impact of the change on the organization. Once the nature and the impact of the organizational transformation are understood, the transformation owner or champion will have the critical data needed to create an organizational transition plan.
Typically, the content or focus of the transition plan comes from the insights gained by conducting a "gap" analysis between the current state of the organization (based on the Burke-Litwin assessment) and the future state (defined through the strategy and vision for the transformation program). The transition plan should define how the organization will close the transformational and transactional gaps that are bound to occur during implementation of a transformation project. Change does not occur in a linear manner, but in a series of dynamic but predictable phases that require preparation and planning if they are to be navigated successfully. The transition plan provides the information and activities that allow the organization to manage this "non-linearity" in a timely manner.
It should be noted that large organizational change programs, which affect not only the headquarters location but also geographically dispersed sites, will require site-level transition plans. These plans take into account the specific needs and requirements of each site. Most importantly, they will help "mobilize" the organizational change team at the site and engage the local workforce and leaders in planning for the upcoming transition.
Strategic Organizational Change Communications
A key component of the transition plan should address the strategic communications (see Figure 3) required to support the implementation of the transformation. Open and frequent communication is essential to effective change management. When impacted individuals receive the information (directly and indirectly) they need about the benefits and impact of the change, they will more readily accept and support it. The approach to communication planning needs to be integrated, multi-layered, and iterative. Further information on this subject is found in the SEG article "Effective Communication and Influence."
References & Resources
- Burke, W., 2008, Organizational Change: Theory and Practice. Sage Publications, 2nd edition.
- Burke, W. and G. Litwin, 1992. "A Causal Model of Organizational Performance and Change," Journal of Management, Vol. 18, No. 3.
- Flint, David, 2005, "The User's View of Why IT Projects Fail," Gartner Report.
- Kotter, John P., 1998, "Winning at Change," Leader to Leader, 10 (Fall 1998), 27–33.
- Lawson E. and C. Price, 2003, "The Psychology of Change Management," McKinsey Quarterly.
- Kelman, S., 2005, Unleashing Change: A Study of Organizational Renewal in Government, The Brookings Institute.
- Mergers and Transformations: Lessons Learned from DHS & Other Federal Agencies, November 2002, GAO-03-293SP.
- Ostroff, Frank, May 2006, "Change Management in Government," Harvard Business Review.