CE article

Change is all in the mind New services! New economy! New organization! New everything! The world around us is changing at an everincreasing pace – and Ericsson must change with it. But change is not primarily about new business models; it is mostly about changing minds – giving people a shared vision.

“Who are the people who must carry through change? What are their fears?

What are their expectations? If you don’t have a clear idea about people’s values, attempting to change things will probably fail.” Eva Salomonson, who heads the World Class Provisioning programme, has seen many efforts to change things both succeed and fail.

“Models for promoting change are therefore necessary to provide everyone involved with a shared language and a mutual starting point for discussing the subject. Unfortunately there is no magic formula for successful change!

Our work, which is based on experience from a wide range of product units, does however

provide a few valuable pointers to what is needed to achieve durable change.”

The most common mistake, according to Eva Salomonson, is to try to implement a new business model or organization from the top down.

FIRST-HAND EXPERIENCE. “That’s starting at the wrong end. Change that is forced on people usually fails. It must come from within; it must be the result of some kind of personal experience. For example, say customers complain about not being properly understood. The management reacts by sending a few people on a 2-day charm-the-customer course. They come back and soon forget about it. A better way of tackling the problem would be to send them to work as consultants with the customer. When they come back they’ll have a completely new understanding of the customer’s needs; they’ll have changed from within. At IBM, for example, everyone working in product development must spend a certain amount of time at a customer’s research and development centre,” says Eva Salomonson.

BUILDING CONFIDENCE. “In the World Class Provisioning programme we defined something we called the ‘improvement engine’.

For people to be confident with new duties or goals they need four things. First, the goal must make sense: there must be agreement on why change is necessary. Then people need to know what steps to take. After this they must feel confident that they have the actual skills to execute these steps. And lastly, the necessary infrastructure must be put into place. In short: are we doing the right thing? What am I personally supposed to do? Do I know how to do it? Do I have the right organization, tools and resources?

“In this context, change is like an equation: if the combination of potential and skills is

‘‘The starting point of any change process must be the individual employee,’’ says Eva Salomonson.

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greater than the natural resistance to change, then, and only then, will change take place.”

LEADERS: PAY ATTENTION. A rapid pace of change places a heavy burden of responsibility on leadership. “The leader’s mission must be to make people see things from a new perspective; to change the group’s perception. Such a new vision must be formulated together with the rest of the staff.

“If you look at business supermen like Lou Gerstner from IBM or Jack Welch from General Electric, their success is not based on theories or models. What they have is a very charismatic leadership style. This is very valuable in any leader that has to manage change – but it’s rare. For most managers, bringing about change will take time and require careful attention paid to how people are reacting.

When faced by change it’s quite usual for people to go through a phase of denial and emotional turmoil before acceptance. Leaders must be aware of these quite natural negative reactions and help people overcome them,” says Eva Salomonson.

WHERE DO I FIT IN? Even with a common pur-

pose and values shared by all members of a group, careful attention should be paid to actual practice. “Take customer satisfaction, for example. It’s a well-known goal in GSM Systems. On a general level it means improving the yearly satisfaction ratings from customers on a scale of 1 to 5. Our goal is currently an average satisfaction rate of 3.8. As far as individuals are concerned this is just abstract theory. How can I personally contribute to reaching the goal?

“For someone working in product development the goal could represent 40 per cent fewer faults at a certain testing stage. For someone in marketing it could mean attending two more international exhibitions a year as a product unit representative.

“Fewer faults at the testing stage or attendance at exhibitions may sound a far cry from customer satisfaction, but only by breaking down goals in this way do they make sense to individuals. If you don’t, goals just become fine words and are soon forgotten – and nothing changes.”

Why people hate change “Plans, models and flow charts are all very well, but change starts with people.

Therefore it’s necessary to understand how change affects the mind, and thus our behaviour,” says Stefan Falk, a management consultant with McKinsey & Company.

“Take stress, for instance. Medical research shows that at certain levels of stress humans simply stop being receptive to new information. Stress creates an isolating kind of tunnel vision. Trying to implement change if collaborators are extremely stressed by the idea of change is therefore bound to fail. Leaders must therefore ask themselves a few questions such as what is the mental state of the individuals in the group?

What are the reasons for their negative attitude towards change? And how can I change this attitude?

“Modern physiology also shows that two main impulses drive our behaviour. The first is striving to conserve energy, needed for fleeing danger, and the second is striving to expend energy, needed for sustained efforts like hunting or finding a mate. The first state, conservation, is the most natural and very strong. The second state, expenditure, only comes about as a result of strong stimuli.

“The second state is the one that applies to change processes: for something to happen you need very strong motivation to overcome

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the conservation impulse. Just telling people about new goals and putting a new organization in place is not enough.

“Another interesting result of modern neurological research is how human memory works.

Some 80 per cent of what we remember in life is associated with feelings, not facts. The brain seems to favour bad memories, probably because your chances of survival increase if you remember dangerous incidents. So change must be perceived to be positive and result in good memories.”

Start your own improvement engine • Change must make sense. Make sure everyone understands why change is necessary.

• Find the first achievable steps that will lead to change. People must feel confident that they can reach new goals.

• Does everyone involved have the necessary skills to perform the first steps? If not, change will be perceived as a threat.

• Provide a roadmap that will lead to change. Set up the organization and routines; provide tools and resources.