Prior to implementing a companywide change, it is important to get stakeholders on board. Organisations take their stakeholders into confidence, just to ensure the smooth transition, since they are the one who will be affected by the change. For an organisation stakeholder can be its employees, customers, suppliers, shareholders, managers, government, local community, creditors etc. n order to achieve this goal, stakeholder analyses are carried out.
The process of identifying those who will be affected by the actions of organisation. It also enables the managers to analyze the attitudes of stakeholders towards the change. In order to carry out these analysis, following steps are taken:
Identify the stakeholders – in stakeholder analysis the first step is to come up with the list of any who will be affected by the organisational actions, this can include an individual, a group or an organisation.
The possible stakeholders for Gill Construction can be:
new Managing Director
lenders / banks
environment protection groups
Prioritize your stakeholders – For organisations the list of stakeholders can be very long, in one case of university 20,000 stakeholders were identified. This doesn’t mean that everyone is very important to the organisation. Hence the next step in stakeholder analysis is to prioritize stakeholders. This can be done using Power / Interest Grid. Using this grid, Gill construction can identify their key stakeholders, which can be:
new Managing Director
lenders / banks
environment protection groups and regulatory bodies
Stakeholder analysis strategy
Understand Your Key Stakeholders – this is the last step in stakeholder analysis. It focuses on understanding the key stakeholders, and defines the way they will be affected. It also highlights the interests stakeholders have with the organisation. It answers the following question:
What financial or emotional interest do they have in the outcome of change? Is it positive or negative?
What motivates them?
What information do they want?
How do they want to receive information? What is the best way of communicating with them?
What is their current opinion? Is it based on good information?
Who influences their opinions generally? Do some of these influencers therefore become important stakeholders in their own right?
If they are not likely to be positive, what will win them around to support change?
How to manage their opposition
How they can influence others by their opinion?
Convergence and Divergence
Another model adopted by management gurus to analyze the stakeholders. It enables the managers to identify the factors which are opposing the stakeholders and which are supporting it.
Divergence – analysis of the factors which are opposing the change for stakeholders.
The first step is to identify the basic change factors which are causing the opposition, these can be beliefs, values, and goals associated with the stake holders. Managers need to answers like
What are their beliefs about change and which have led them to oppose it?
What are the values being transgressed by change actions?
Are their stress values being triggered?
How is the change affecting their career social goals?
Managers also need into their perception of the change, analyzing this can give them huge edge converting their opposition. They need to answer questions like
What do they think about change?
What do they think will happen?
How do they look at other stakeholders?
Convergence – elements which are supporting the change. It is much focused on those who oppose the change.
Managers need to understand who they are dealing with, what they are capabable how and how they can affect them. For-example A regulatory body or HSE will have permission to shut down the work in progress if they find anything in violation of the laws. Also in case of Supply chain, they may also ruin their relationship with the supplier. Banks and Lenders will have their leverage over the organisation since a loan was taken for the purchase of new machinery.
Managers need to look into the following cases:
How the stakeholder will be managed? Do they need any leadership or they will just follow?
What made them follow the leadership
How will they support the change?
How prepared are they for the change?
Evaluate the systems used to involve stakeholders in the planning of change
A tool designed to gain stakeholder commitment and involve the key stakeholders in developing a change management strategy. This cycle has six steps and also known as ‘Six Steps Stakeholders Cycle’
Identify the stakeholders – The first step is to identify the key stakeholders, which can influence and have interest within the organisation.
Prioritize the stake holders – Managers need to identify the key stakeholder using the Power-Interest Grid. For Gill Construction these key stakeholders are :
Map the Profile – next step is to map the profile, how will they be affected, what is in the change for them, how they can be supported, what kind of support we can get from them, what are their culture and values. All the questions will be answered at this point
Engagement strategy – At this point a managers need to decide how they are going to address the issues of stakeholders in order to gain their commitment and support. New MD of Gill Construction need to hold a meeting with management of the company. Clearly define what He wants to achieve and what his goals are. Since his goal is to improve the quality of the work done and also expand the business.
It will be then the job of Management to directly contact their respective staff members and explain the situation to them. Ideas for improvement will be taken. Meeting and Presentations will be held with suppliers and explain your objective to them. Also Management will seek advice from regulatory bodies to assists them in improving the H & S at workplace. Banks and Lenders will also be taken into confidence. A clear business plan will be presented to them.
Optimise their Support – next step in this cycle is to optimise the support from stakeholders. Managers need to be very clear and specific about their objective to the stakeholder and try to get most out of them. They need to keep good relationships with their lenders/ banks and suppliers.
Monitor – the last and final stage is to monitor the strategy. They need to keep going back to their stakeholders and ensure their support is still with them. If they have any kind of doubts they need to clear them out.
Develop a change management strategy with stakeholders
A strategy will be formed which will help management at Gill Construction to gain commitment from their stakeholders. A general change management strategy involves three steps:
Situational awareness – before a companywide change is implemented, everyone will be made aware of the change and what is going to happen in result of this change. A vision will be created Stakeholders will be informed that how this will effect. Suppliers will be notified about what will be expected of them. Employees will be taken into confidence to avoid panic.
Supporting structures – second step is to structure teams and sponsor coalition. They will be debriefed about who is going to do what. If they will be let go off, they will be informed at this stage. They will be informed that they need to trained to operate the new machinery. Bank or Lender will be informed about new purchases and equipment. New policy about H & S will be sent to HSE and they will be informed about it. Suppliers will be contacted and new terms regarding JIT will be set, also material price will be revisited.
Strategy analysis – this stage involves risk analysis to be carried out. what degree of risk is involved in this change. What will happen if this strategy fails. In case there is no progress even after this change, what will we do, what if lenders refuse to pass a load. In case of resistance from stakeholders a resistance to change strategy will be required. Management will give their best to negotiate on good terms with the suppliers and use the bargaining power. Management also need to convince the bank and lenders to pass the load and take them into confidence.
Create a strategy for managing resistance to change
It is in human nature that whenever they are asked to move out of their comfort zone or change, they resist it. When organisations go under change it is very obvious that stakeholders will be afraid of its outcome. Hence it is very important to manage this resistance because this resistance can raise the risk factor during the change or transition process.
Passive versus Active Resistance
A framework adopted from
Agreeing verbally but not following through
failing to implement change
Appealing to fear
Procrastinating or dragging one feet
Using facts selectively
Blaming or accusing
Withholding information, suggestion, help or support
Intimidating or threatening
Standing by or allowing change to fail
Before a change is implemented it is very important for managers to either eliminate resistance completely or bring it down to a very lower level such that it has a very minor effect. There can be number of ways for managing this resistance. Some of the ways adopted by Gill Construction can be:
Communication – everyone within the organisation should be made aware of the situation. Managers need to communicate openly with all the stakeholders and discuss the issues with them. Even if they are supporting the change management need to check with them back to back to ensure the full commitment. Management need to hold meetings, brainstorming session with the staff and communicate with them. Suggestions will be taken from the staff and their participation will be encouraged.
Training – staff will be provided with appropriate training to build up their skills so that they can operate the new machinery. This will help to eliminate the resistance put up by the operational workforce. Also work-shops will be held with other staff to ensure that they are not left behind. They will be provided with the information and steps involved in this transition will be explained to them.
Feedback – Taking feedback or suggestions from the stakeholders is always the best way to gain their commitment. This shows to them that management is still listening to them and they hold a value to them. Taking feedback about the training is also good to monitor the staff performance.