My recent foray into the world of local government and the unprecedented amalgamation of eight Councils across the Auckland region had me contemplating change management and what fundamental elements contribute to a successful change initiative.

The Auckland Council example is a unique one – it was an initiative compelled by central government and there are a significant number of powerful people invested in its success with many eyes (especially those of the less powerful) watching to see how it develops and delivers on its promise.  On a more local, general business scale, change is implemented either in response to shifting market forces or as an exercise in organizational development.  It can be complex (like the Auckland Council example) or more modest (such as implementing new software in your business) but it’s interesting to note that, regardless of the size and scope, the delivery of long-term sustainable change is a relatively rare occurrence.

Many transformations fail because there are crucial elements in the change process that are either disregarded or badly executed. In the main, there are five principal elements which, if ignored, will ensure your change initiative is highly likely to fail. On the other hand, if these elements are carefully attended to, you are more likely to achieve the long-term sustainable (and beneficial) change we are all hoping to see with the Auckland Council and its CCOs.

ELEMENT 1: A widespread perceived need for change

Helping people understand the need for change will ensure that, even though it might be painful in the short term, they recognize the outcomes and benefits will be worthwhile.  ‘Selling’ change rarely works and in general, is not a sustainable strategy.  Sharing the rationale for change is, including sharing the data (or as much objective information as you can) that is driving the need for the change and the positive outcomes you are expecting. 

Visuals are a great way to reinforce the reason for the change and focus employees on the benefits that will come out of it. If there is no compelling information driving the requirement for change, you might want to review whether you’re using energy and resources that would be better utilised elsewhere.

ELEMENT 2: Employee involvement – before, during and after the change project

Before you start anything, consult.  Ask people what they think about what you are proposing.  This will assist in creating the understanding of the need for change.  It will give your employees a chance to comprehend the implications and feasibility of what you think needs to be done and provide you with valuable feedback.  A certain amount of collaboration will create buy-in and enable people to feel they are part (rather than a victim) of the change.

During the change process, ensure you keep employees involved throughout.  Identify ‘change champions’ and involve them in bringing others along the journey.  Strategically assign responsibilities across the project, in particular to the pragmatists – those in the majority who will have a fairly neutral attitude regarding the change.  If you can move this majority toward being supportive, engaged and maybe even energized, your change initiative is more likely to succeed.

After the change project is over, keep people involved in the measuring and reporting of the impact. This will ensure focus and momentum for the change is maintained.  It will also reinforce the benefits and further embed the change into the business.

ELEMENT 3: Full and active executive support

Change must be driven from as high up in the organization as possible, preferably the top.  Leadership supporting the change must be active and visible; both in formal communications, informal conversations with managers and staff, and actions which reinforce the importance of the change initiative.  Employees look to their leaders to gauge how critical the change initiative is and leadership apathy or resistance, as well as actions that are incongruent with the messages, are a sure way to sabotage any long-term sustainable result.

ELEMENT 4: Effective communication.

Communication is the element that – arguably – has the greatest impact on the success of your change initiative.  Communications can convey the level of leadership support, assist with involving employees in the process and can be used to reiterate the need for and benefits of, the change initiative.  It also, critically, keeps people well-informed of progress, successes and next steps throughout the change process.  Initially you should be communicating the Vision and the Journey.  Talk about it, write it up in the company newsletter, post it on the staff notice board.  Repetition is as important as the information being delivered in a clear, concise and straightforward way.  

Communications should be tailored for different groups and should be honest and open, even if the truth is unpleasant.  Leaders caught hiding information or misleading employees will lose credibility very quickly.  On the other hand, when even the difficult messages are open and transparent, credibility is gained and trust and loyalty are strengthened.

In addition, as mentioned previously, communication is more than the written or spoken word.  Communicate your commitment by giving the change initiative the same priority you expect from your employees.

ELEMENT 5: Organisational analysis and planning               

Enormous energy goes in to creating change and then after the change project is completed, it’s assumed everyone is on board and the change will sustain itself.  In fact, this is when a change initiative is most vulnerable to failing.  The project is over, leadership focus shifts to the next thing, project communications cease and general behaviours revert to those pre-project.  The gains made are neutralized and the change initiative falters or fails.

The period after the project is an opportunity to build trust within the organization and resilience for future change.  Measure results of the change early and regularly, and communicate these.  Develop and communicate a program of review for the outcomes and benefits and stick to it.  This will reinforce the value of the change and further embed it into the business.

Incentivise and reward behaviours that support the change.  Launch other projects that will drive the change into the organization.  Continue to communicate the successes resulting from the original change and those of any reinforcing change initiatives.  Create and celebrate milestones and wins along the way.

As ratepayers, we are all hoping the enormous change culminating in Auckland Council will indeed be awash with benefits for the economy of New Zealand, our city, and ourselves as individuals.  While that remains to be seen, as a leader making changes within your own organization, attending to the principal elements of change outlined here will build a strong foundation for long-term sustainable change within your business.

You’ve got a great product or service and you’ve made it through the worst of the recession intact.  You’re confident in the news of New Zealand’s strengthening economy (tipped to grow by 1.8% in 2010 according to the most recent Economic and Risk Outlook Report by Dun and Bradstreet) and expect that soon you’ll be resuming the development of your own business.   Now is the time to do an ‘HR Health Check’; ensuring all your HR fundamentals are in place and you’re ready for that growth in 2010.

Whether you’re planning on recruiting staff or not, it’s business best practice to perform an annual HR check, whether it’s simply to make sure you’re up-to-date and compliant with NZ’s legislative minefield or you want to confirm your systems are working and supporting your business strategy.

DOCUMENTATION 
 
Employment Agreements  All employees must have an employment agreement.  This is a legal requirement and by law there are specific issues the agreement must address.  The agreement needs to be clear enough to prevent misunderstandings of the terms and conditions under which your employee is engaged.  Misunderstandings (or even feigned ignorance) can result in an enormous waste of your time and energy and significant damage to your business.  
   
Job Description These are also a legal requirement and as critical as an employment agreement.  They clarify your expectations with respect to the tasks your employee is engaged in and (in best practice) spell out how you will measure the employee’s performance against those tasks and responsibilities. 
   
Employee Handbook While these are not a legal requirement, it’s best practice to provide your employees with all the basic company information and expectations, and an employee handbook is a simple but effective way to do this.  The handbook should involve, among other things, a brief of the company, housekeeping matters, the company’s health & safety practice and the code of conduct.  It’s a document that adds clarity to the employment relationship and should include a page for the employee to sign, which acknowledges they have read and understood the information.  
   
Policy & Procedures All employees should have access to the company policies.  These clarify in detail the principles and philosophies under which the company is operating and the conduct expected of its employees.  Access can be through the intranet if you have one, but if some of your workforce doesn’t have access to a computer, these should also be available in booklet format.  The booklet should be a controlled document so that any changes can be managed and communicated in a considered and thorough way.
   
SYSTEMS & PROCESSES 
 
Orientation Program When you’ve spent a good deal of time (and money) securing a new employee, you don’t want to blow it by dumping them in their job and letting them struggle through their first few months.  Not only does it detract from the great things your business can offer, it causes unnecessary stress and anxiety and will only encourage a new employee to immediately start looking for a role elsewhere! The aim of an orientation program is to ensure the employee has a positive experience as they come on board and learn the new job.  It ensures all the nuts and bolts are dealt with, so the employee can concentrate on their role, achieving full productivity as soon as possible and wanting to stay in your business. If you’re committed to best practice, your company will also have specific orientation programs developed for employees returning to the workforce after a long absence as well as those moving into new roles within the business.  Using the ‘new start’ orientation as a template, this is easily achieved. 
   
Performance Evaluation This process is straightforward and will have a huge impact on both the engagement of your staff and the performance of your business.  The job description can be used to help guide a two-way discussion with your employees.  Including a rating system will give you information you can use to help with (and justify if necessary) decisions such as annual salary/wage adjustments, and use as a benchmark in performance development. 
   
Learning & Development Performance improvement (and the corresponding increase in business performance) is what you’re aiming for, whether your strategy is to leverage off an employee’s strengths or to simply manage/lift average performance.  The important thing is to commit, to a greater or lesser degree, to the development of the people on your payroll.  This can take the form of simple one-on-one training and/or mentoring within the business, internal workshops developed and delivered by a subject matter expert (internal or external), or investment in more formal training outside the business.  It doesn’t need to break the bank but it does need to be meaningful so it will add value and you’ll see a return on your investment. 
   
Reward & Recognition  Annual wage and salary reviews are standard practice and any increases can be established and justified using information gained from the annual performance evaluation process.  However, you shouldn’t wait for this event to recognize great performance.  Employees need to know you’re noticing and appreciate their efforts.   A simple reward and recognition program can be incredibly cost-effective with things as simple as Employee of the Month, thank you cards, a mention at staff meetings, time off or gift vouchers, and can be as extravagant as a dinner for two or a mystery weekend away.  The important thing is to keep the momentum up during the year and make positive (meaningful) feedback a regular practice. 
   
Exit Again, it’s business best practice to gain feedback from employees exiting the business.  With a sound, structured feedback process, the information gained is generally candid and can be used to understand what will motivate and engage your employees going forward (improving business performance), or what is frustrating or disengaging them so you can address those issues.  The aim is to gather information you can use to benefit your business.
   

 These are just some of the main tools available to manage your relationship with your employees and improve the overall performance of your business.  Employees who lack understanding around terms and conditions or company policy distract managers from the task of managing and growing the business and can have a negative impact on morale and your business culture.  Employee neglect will only ensure disengagement and turnover – and the associated costs impacting your bottom line.  It’s simply good business to ensure fundamental HR documents, processes and systems are in place and working well for you or your managers.  Happy, engaged and focused employees translate to great productivity and happy customers – all good for growing your business in 2010 and beyond.     

If you’d like assistance with your HR Health Check or would simply like to discuss any HR issues within your business, feel free to email business.hr@paradise.net.nz or phone +64 (0)21 165 4541 to arrange a consultation.

There are few organizations who haven’t felt the effects of the recession in one way or another and most have had to take some kind of action over the last couple of years to ensure they’ll be around long enough to see an economic recovery. As a lag indicator unemployment figures are still fairly high but these will begin to change in time and businesses can expect once again to find it difficult to source great talent or to hang on to star employees. While the jury’s still out on whether we’re entering the recovery phase, it’s going to happen at some point and so, while you have a captive audience, now is a good time to look at how connected to your business your employees really are and find out what you can do to improve their engagement and in turn, your business’ ability to respond to an economic recovery.

Bite the Bullet

If you already suspect your staff are not as happy as they could be, it can be a scary prospect finding out exactly what the problems are. Certainly, you have to be prepared to address at least some of their concerns but doing so doesn’t have to cost you your business. Taking action on concerns the business can manage in the short term, will facilitate a sense of trust and value and will begin a solid foundation for employee engagement in the future.

Choose an Approach

There are a number of approaches to measuring staff engagement. Which suits your business will depend on the numbers of staff and your ability or willingness to invest in the process.

  1. Professional survey companies or HR consultancies in general will administer validated surveys and take all the guess-work out of the results for you. You can manage the investment through a menu system of products and services and as long as you’re clear about your budget there shouldn’t be any surprises. The benefit is the high level of expertise, the quality of advice on the survey outcomes and the ability to benchmark your business against your competitors for talent.
  2. Alternatively you can develop, administer and analyze your own survey and there are on-line survey tools which can make this a fairly simple exercise. In taking this approach you should have an experienced HR manager or advisor to ensure you get maximum value from the process. Your HR professional will be able to develop a set of quality questions which will extract information on employee experience of the company and establish which intrinsic and extrinsic drivers are most important to your workforce.
  3. If you don’t have the in-house capability or resources it would be wise to engage an independent HR contractor or consultant. In place of an in-house resource, the HR contractor will add significant value in developing the right questions, analyzing and interpreting results and will usually bring experience of what worked in similar organizations when it comes to addressing the survey outcomes.
 Get it Done

The important thing is to show your employees you care about what they think. Any business owner who is already doing this will know the effort and investment is ultimately well worthwhile. Aside from retaining your best talent when the employment market picks up (and options for alternatives open up for your talented staff), business performance is directly linked to employee engagement through quality client relationships and employee discretionary effort.

Understanding what drives your employees and what areas of the business – or the employment relationship – require attention will enable a manager or business owner to target and leverage off any investments in employees to get the biggest impact, and the return on your investment in finding out what motivates and drives your employees’ performance will be realized many times over.