Is it necessary to improve the current approach to change management of the Management and Change department of IG&H Management Consultants and if so,

Is it necessary to improve the current approach to change management of the Management and Change department of IG&H Management Consultants and if so,

how can this be done?

Master thesis, Msc BA, specialization Change Management University of Groningen, Faculty of Management and Organization

E.C.A. HORDIJK Student number: 1306685

Brugakker 10-15 3704 KV ZEIST THE NETHERLANDS Phone number: 0(031)6-47691860 E-mail: carine_hordijk@hotmail.com

Faculty supervisors:

Ben Emans, RijksUniversiteit Groningen Janita Vos, RijksUniversiteit Groningen

Company supervisor:

Erik ter Velde, IG&H Management Consultants, Woerden

Acknowledgements

First of all I would like to thank Erik ter Velde, Ben Emans and Janita Vos for their excellent

and professional advice and the inspiring and fun conversations we had during the process of

writing this thesis. Furthermore I want to thank the 17 consultants that have participated in the

research as well as all the other great employees of IG&H Management Consultants that have

made this such a great experience. And last but not least I want to thank my family and

friends for their love and support.

ABSTRACT

This paper investigates various approaches to change management. The first goal of this research is to find possibilities for improving the change approach of the Management and Change department of IG&H Management Consultants. This is done by identifying blind spots within the change approach that is currently used and propose a way to fill in these underdeveloped areas. The second goal of this research is to add innovative research results to the current documented theory on change management. A classification of the documented approaches to change management is given by presenting the E approach –top down, planned and with a focus on formal structures and systems- and the O approach –bottom up, emergent and with a focus on the development of the organization’s human capability-. 17 consultants of IG&H Management Consultants have participated in this research to investigate if they work according to either the E approach or the O approach. The results show that the Management and Change department realizes change mainly from the top down, although much attention is paid to participation of organizational members. Furthermore, the consultants work in a planned way, although most of them consider the importance of emergent events. Finally, most consultants start with a focus on structural change, but also pay much attention to the cultural implications. In this paper it is recommended that the consultants should move more towards the O approach, because this leads to less resistance among lower employee levels, a more realistic diagnosis and change plan and therefore more sustainable and effective change results. Furthermore, it is recommended that the impact of the personal preference of the manager and the consultant is elaborated in further research, as the practice of IG&H shows that this is a major reason for following the E approach.

Key Words: Change, change approaches, E and O approach, participation, sustainability

INTRODUCTION

In this research paper we discuss the different approaches to change management and we try to identify blind spots in the change approach of the Management and Change department of IG&H Management Consultants. This is done according to a classification that is represented by the E and the O approach (Beer and Nohria, 2000). We identify how these approaches are concretized in practice and what the reasons are for using either approach. As both the E and the O approach have their pros and cons, we look for an optimization of integrating both approaches into the change approach of the Management and Change department of IG&H Management Consultants. We believe that this optimization leads to more effective change results, which will lead to bigger satisfaction among both consultants as well as managers and lower level employees within client organizations. The aim of this study is to make the Management and Change consultants aware of the blind spots within their change approach.

The results of this research help to identify these blind spots. In the discussion section of this paper we give a number of suggestions to develop these underdeveloped areas and realizing more effective change. Furthermore we identify some topics that should be investigated more profoundly in further research.

IG&H Management Consultants: The cause of the study

IG&H Management Consultants (hereafter: IG&H) is a consultancy agency that has two divisions: one is specialized in insurance and banking and the other in supply chain and operations. IG&H employs 130 employees of whom 100 are consultants and 30 are supporting staff. Within the insurance and banking division of IG&H there is a specific department that works with organizational change: ‘Management and Change (hereafter:

M&C)’. This department consists of eleven consultants and one secretary. M&C performs

very well financially and has a very high occupancy. However, the director as well as the

consultants of the department believe that the performance of M&C depends largely on the

individual expertise of the consultants. The consultants have different backgrounds and most

of them have developed their own way of working within their experience in banking and

insurance. Currently, M&C is trying to make this expertise explicit into one collective

framework, because they want to make a firm and clear statement to the internal and external

market about what the department actually stands for. One of the issues is that it should be

investigated if there is a collective approach to change management that the consultants use

and if so, if this needs improvement. The identification of a collective approach can provide

insight into the way of working of the M&C consultants. This is useful for the internal market as it helps colleagues that are willing to work together in knowing what to ask a M&C consultant for. Furthermore it is useful for the external market as it can make expectations more clear and realistic.

Research Questions

The main goal of the research presented in this paper is the identification of the possibilities for improving the collective approach to change management of M&C by diagnosing the current approaches of M&C and match them with the documented theory. The second goal of this research is to generate additions to the documented theory by analyzing the day to day practice of M&C. Therefore, the main research question is

Is it necessary to improve the current approach to change management of the Management and Change department of IG&H Management Consultants and if so,

how can this be done?

In order to answer this question, the research questions are:

1. Which approaches to change management are presented in the documented theory on change management and what are the corresponding reasons for favoring one approach over the other?

2. Which approaches to change management are used by the M&C consultants and what are the corresponding reasons for favoring one approach over the other?

3. What are the discrepancies between the change approaches and corresponding reasons the documented theory presents and the change approaches and corresponding reasons used by M&C?

4. Which recommendations can be given concerning the discrepancies mentioned in the third research question?

In the next section we elaborate the first research question by describing different approaches

to change management. The second research question is dealt with in the results section. The

third and fourth research questions are dealt with in the discussion section of this research

paper.

CHANGE APPROACH: WHAT WORKS WHEN?

In this section we classify the existing approaches to change management by using the theory of the E approach and the O approach (Beer and Nohria, 2000). These two opposite approaches represent most of the theories within change management, although we acknowledge that they neither do nor can capture all the existing theory. However, we have chosen this because we believe it provides a clear and understandable classification of the change management approaches.

Change Management from the E Approach or from the O Approach

Beer and Nohria (2000) try to unlock the understanding of organizational change by presenting a conceptual framework that puts diverse theories and practices in perspective.

This perspective is given by two opposite approaches. The first is based on the creation of economic value (Theory E), which focuses on formal structures and systems and sees change as planned and programmatic and initiated at the top. The second is based on building organizational capabilities for the long run (Theory O), which focuses on the development of the organization’s human capability to implement strategy and to learn from actions taken about the effectiveness of changes made. Change is seen as emergent instead of planned and initiated by the bottom of the organization (Beer and Nohria, 2000). Maybe and Mayon-White (1993) say that there is a change in change thinking, namely that there is a movement from the E approach to the O approach. Not surprisingly, often a combination of both is necessary for ensuring effective change.

In this section we discuss the three main sub themes of the E and the O approach: (1) change initiated and implemented in a top down manner versus change initiated and implemented in a bottom up manner, (2) planned change versus emergent change en (3) the change focus on structure versus the change focus on culture. Each sub theme is dealt with in the following way: a more detailed description of the theme is given followed by three groups of reasons that the literature gives for choosing one or the other approach. The first group contains general reasons for the E approach that hold true in every situation, the second contains general reasons for the O approach that hold true in every situation and the third group contains reasons that function as a contingency, meaning that it depends on the situation if change should be realized by means of the E or the O approach. In fact, it is not a contingent reason but more a contingent factor. Still, we use the term ‘contingent reason’ instead of

‘contingent factor’ to remain consistent concerning the word ‘reason’.

Top down or Bottom up

In this sub section we discuss the first sub theme of the E and O approach: top down versus bottom up. Beer and Nohria (2000) define a top down approach as change that is initiated by the top. This is explained by managers who do not involve lower employee levels or unions in discussing and arriving at consensus about goals and means. Top down change can be recognized by only downward communication. Bottom up change is characterized by high levels of involvement and collaboration. Employees are involved in identifying problems and solving them (Beer and Nohria, 2000). An example of operating in a bottom up way is to make use of a project team. A mistake that is often made, according to Mayon-White (1993), is that the wrong people are chosen as members of a project team. Instead of putting forward individuals who are imaginative and open in their attitudes, individuals who defend a department’s interests at all costs are chosen. A manager or a consultant should use the right person in the client organization to prevent this from happening (Mayon-White, 1993).

General reasons for a top down approach

• Conger (2000) states that a top down approach is necessary in practically any change process, because only managers have a helicopter view.

• Conger (2000) furthermore states that only managers are in the position of allocating capital, resources and power.

• Last but not least, Conger (2000) states that the implications of the decisions that have to be made are too profound for lower employee levels.

General reasons for a bottom up approach

• Bennis (2000) says that involvement is essential for building the partnership, trust, and commitment thought to be vital for long term performance improvements.

• Furthermore, Bennis (2000) states that the lower employee levels are closer to the market place.

• It is argued that lower employee levels are closer to the inner workings of the organization, so these are the people that know what both should and can change (Bennis 2000; French and Bell, 1990; Weick, 2000).

• The diagnosis is said to be more realistic when all employee levels participate (Bouma

and Emans, 2005).

Contingent reasons for either a top down approach or a bottom up approach

• Conger (2000) states that when there is high urgency, a top down approach is called for.

• When the sustainability of a change effort is important, a bottom up approach should be chosen. With ‘sustainability’ we mean the time that a change result lasts. In his book about educational learning, Rogers (1973) explains that changes in the education can, and should, be brought about by individuals themselves, as that is what will make this change actually lasting.

• When the focus of the change process is on the organizational culture, a bottom up approach is called for. Edgar Schein (1984, 1985) is critical of a cultural change that is top down and management-led. Managers often try, but many overrate themselves regarding the outcomes of their change efforts.

• Beer and Nohria (2000) make a distinction between where the opinion comes from.

When the choice is made by academics, the focus is on organizational behavior and high employee involvement, so a bottom up approach is chosen. When on the other hand consultants have to choose, they advise that the client’s management must be involved in analyzing the problem and in deciding on what has to change, so a top down approach is chosen (Beer and Nohria, 2000).

• When the implicit assumption is held by the management of an organization that the energy to change should be distributed top down, a top down approach is likely to be chosen (Ofman, 1997).

However, the last two contingent reasons are not actual reasons for choosing either approach, but rather reflect the probability that a certain approach will be chosen. This actually lies beyond the scope of this research, but as we believe it is a relevant detail and it might stimulate someone to think ‘out of the box’, we mention it here.

Planned or Emergent

In this sub section we discuss the second theme of the E and O approach: planned change

versus emergent change. This sub theme represents two different schools of thought within

the scientific world. The difference between planned and emergent change lies in the presence

or absence of pre-specified goals. Within planned change the goals are specified in advance

and also the path to get there is described. Whereas within emergent change the goals and

path to get there are more flexible and the people involved have more influence to specify both the goals and the path. This will be described in more detail hereafter.

The origins of planned change in organizational life can be found in the 60s. The reaction to planned change came in the 80s and was named emergent change. It is widely agreed upon that Kurt Lewin is the intellectual father of planned change (Burnes, 2004; Cummings and Worley, 2001). Burnes (2004) explains that the original purpose of Lewin was to resolve social conflict in society, including conflict in organizations. One of the theories that Lewin developed is the three-step-model, which proposes a planned approach of unfreeze-move- refreeze to change management. It must be recognized that Lewin never saw planned change as being applicable to all situations, and that it was not meant to be used in situations where rapid, coercive, and/or system wide change was required. However, as others, such as Bullock and Batten (1985), elaborated the three-step-model, the focus shifted from the individual and the team to the entire organization and the planned approach became less participative and more directive (Burnes, 2004). Beer and Nohria (2000) define planned change as a process of getting from an old state to a new state that is defined in advance and following a pre- specified route to get to that state. Examples of interventions that are used for getting to this new state are project planning methods.

Orlikowski (1996) defines emergent change as change that consists of ongoing accommodations, adaptations, and alterations that produce fundamental change without a priori intentions to do so. Harris and Ogbonna (2002) prove that these unexpected or unintended accommodations, adaptations, and alterations resulting from interactions throughout the system have a very large impact. Weick (2000) says that emergent change occurs when people re-accomplish routines and when they deal with contingencies, breakdowns, and opportunities in everyday work. Much of this change goes unnoticed, because small changes are neither heroic nor plausible ways to make strategy (Weick, 2000).

General reasons for planned change

• Goshal and Bartlett (2000) make the case for a planned approach by stating that one of the main success factors of a change effort is following a carefully phased approach.

• Furthermore, the process of change cannot be left to evolve on its own accord as there is only a limited amount of possible routes to a certain goal (Goshal and Bartlett, 2000)

General reasons for emergent change

• Weick (2000) states that emergent change is necessary as it provides the flexibility that is needed in today’s dynamic world. However, it is only more effective when the culture of the organization makes it clear that people are valued when they experiment with job descriptions, implement a directive strategy in a novel manner, rewrite requirements that no longer fit the environment, and speak up when things are not working.

• Secondly, organizations are constantly evolving, so it is better to amplify what exists than to impose from without (Weick, 2000).

Contingent reasons for either planned or emergent change

• Pettigrew (2000) says that when the demands placed by the external environment are urgent, planned change is favored over emergent change. When time is not a critical constraint, the change process should be emergent (Pettigrew, 2000).

• When the demands placed by the external environment require system wide change, a planned approach should be chosen (Pettigrew, 2000).

• When the challenge is to enhance performance by building capability, one should choose an emergent approach (Pettigrew, 2000).

• Weick (2000) says that when a change plan is likely to be rejected by the political processes within an organization, an emergent approach is better. This is explained by the fact that in this case, a carefully planned approach will not be accepted by the employees, and then the change effort is a waste of time and money.

• Last but not least, when role clarity is desired, planned change is recommended.

Burnes (2004) states that the benefit of planned change is that it offers a blueprint for the behavior of the consultant.

Beer and Nohria (2000) explain that it is best to combine both approaches for developing sustained competitive advantage, but when this is not possible, it is best to start with planned change and let it be followed by emergent change.

Structure or Culture

In this sub section we discuss the third sub theme of the E and O approach: change with a

focus on structure versus change with a focus on culture. Many definitions of structure and

culture exist. De Leeuw (1994) defines structure as the total pattern or collection of

relationships, relationships being between two or more objects that have the power to

influence each other. Fritz (1994) describes it as how the parts of anything relate to each other and to the whole. Hofstede (1993) defines culture as a four-layered hierarchical model which ranges from values at the deepest level through rituals, heroes, to symbols at the surface level.

Schein (1985) presents a similar three-level model, which ranges from basic assumptions at the deepest level, through beliefs, values, and attitudes, to artifacts at the surface level.

Cummings and Huse (1989) combine these models into a four-level model that goes from basic assumptions, to values, to norms, and ends with artifacts shared by organizational members. These all represent a different level of awareness: Artifacts are the highest level and are the symbols of the deeper levels, they include observable behavior. Norms are the level below that and guide how members should behave in a particular situation. Values come next and tell people what is important in the organization. The basic assumptions represent the taken-for-granted ideas about how organizational problems should be solved. When it comes to organizational change these different levels are not equally easy to change. Artifacts are relatively easy to change but the basic assumptions are almost impossible to change as they are deeply rooted in people’s mental systems. Therefore there is much scepsis about the possibility of changing the culture of an organization (De Leeuw, 1994; Schein, 1984,1985).

Structural change is in general much easier to realize, at least when the relationships do not involve people. However, often a structural change does involve people, as it has an effect on people’s jobs. Ofman (1997) states that often managers try to change the structure of their organization in order to allocate people and resources as efficiently as possible. There are many proponents of changing structure and culture at the same time. Wierdsma and Swieringa (2002) say that all organizational change, structural as well as cultural, implies a certain behavioral change. Leavitt (1965) states that one does not produce real change by only changing one mean. Effective change requires changing a combination of policies, or all of them, to create a new and integrated design. And all of the policies must be aligned or mutually reinforcing.

General reasons for focusing on the structure

There are no general reasons found for focusing on the structure. Sometimes a reason found in the documented theory seems to be a general reason, but when analyzed it turns out to be a contingent reason.

General reasons for focusing on the culture

There are also no general reasons found for focusing on the culture. Again sometimes a reason found in the documented theory seems like a general reason, but in fact is a contingent reason.

Contingent reasons for either focusing on the structure or on the culture

• When fundamental shifts in strategic direction are involved, the focus should be on structure (Fritz, 1994; Galbraith, 2000)

• Cohen (2000) states that the focus of the change should be on structure when change depends on a reallocation of human and financial resources, when change requires a new set of players and when structure alters formal power and reduces the necessity of contact with others.

• Cohen (2000) says the focus should be on culture when the change depends on new behavior, for example when a bureaucratic organization is changed into an entrepreneurial one. Furthermore, the focus should be on culture when people in new roles do not have the technical skills, relational skills or prior connections needed to make good decisions in their new roles, and when the decision makers in the new structure depend on organizational members who do not understand or accept the new structure (Cohen, 2000).

• Burnes (2004) says that a cultural change is needed when the existing culture is inappropriate to their competitive needs.

• Wierdsma and Swieringa (2002) explain that when an organization wants to become a learning organization, that organizational change should begin with changing its culture. They define a learning organization by an organization that has the ability to transform and stay the same at the same time.

Cohen (2000) states that the structure and culture deserve equal attention when complex

new behavior is needed in combination with a high dependency on goodwill of

organizational members.

RESEARCH METHODS

In this section we describe how we have set up the research that we have executed in order to answer the research questions that were introduced in the introduction section. The goal of the research was to investigate which change approach the M&C consultants use in their attempt to realize change and which reasons they have for choosing either approach. This was done by giving a description of the E and O approach and then asking about their personal preference and experience. The classification of E and O continues to be useful as it provides us with the possibility of the identification of blind spots, as both the E as well as the O approach have their pros and cons and therefore have to be integrated in an optimal way.

Data Collection

In order to answer the research questions we have followed a number of steps, which can be found in figure 1. We have chosen to perform our research through a combination of a survey and interviews. First, the participants of the research were chosen. The ten consultants of the Management and Change department automatically participated in the research, as it was initiated by the director of the department. Furthermore, seven consultants that are related to the department participated as well. Three of them used to work for M&C until recently. The other four are partners of IG&H Management Consultants, so they have a major role in the strategy formulation of IG&H.

Step 1: Engage participants Step 2: Pre-interview survey Step 3: Interviews

Figure 1 Study journey

Second, a pre-interview survey was conducted. The survey questions were based on the interview model that is discussed hereafter. The answers to the pre-interview survey made it possible to use the time of the interview more effectively.

Third, the respondents were interviewed. The goal of these interviews was to get a specific

picture of the change approach of each consultant and the reasons he has for choosing either

approach. In order to do that an interview model (figure 3) was presented that was filled in

during the interviews. The interviews had a semi-structured nature and can be divided into

two parts. In the first part the three sub themes were explained: top down versus bottom up,

planned versus emergent and structural change versus cultural change. For each sub theme the

consultants were asked for an example of the E view and the O view from their experience as

a consultant (an example of a change project that was realized in a top down way, and one of a change project that was realized in a bottom up way, etc.). Then it was asked what their reasons were for choosing the E approach in the one situation, and the O approach in the other situation. In the second part of the interview the interview model (figure 3) was presented and the consultants were asked per phase of the change project to specify all the interventions they usually use and the reasons for using them. As IG&H is a consultancy firm, change is always intentional and planned, at least on milestones. Therefore we have used the phases from the general model of planned change (figure 2; Cummings and Worley, 2001) that provided us with a framework for categorizing the change management instruments along a time line that enabled us to present a chronological overview of how the consultants realize change.

Figure 2 General model of planned change (Cummings and Worley, 2001)

These reasons were then combined with the reasons that had been gathered in the first half of the interview and put into the interview model (figure 3) to describe the specific intervention in terms of one or more of the sub themes. The combination of the general model of planned change (Cummings and Worley, 2001) and the E and the O approach (Beer and Nohria, 2000) makes it possible to make the change approach of any consultant concrete.

Data analysis

Prior to the interview, the interview model was filled in as much as possible based on the answers to the pre-interview survey. During the interviews the interview models were completed. Together the pre-interview survey and the interviews resulted in seventeen filled- in interview models. These were combined into one integrated model which gave an overview of the tools that the consultants use in each phase, and the reasons they have for choosing a certain change approach. However, as this model turned out to be quite incomprehensive, six models were deducted from this combined interview model; one per phase. Furthermore, a table was made that compares the literature with M&C regarding the reasons for choosing a certain approach. These models and table can be found in the folding papers and will be dealt with in the results section.

Phase 1:

Entry and Contracting

Phase 2:

Diagnosing Phase 3:

Planning and Implementing

Phase 4:

Evaluating and

Institutionalizing

Interview model

Phases Top down Bottom up Planned Emergent Structure Culture Entry en Contracting

Intervention Reason Reason Reason Reason Reason Reason

Intervention Reason Reason Etc.

Diagnosing

Intervention Reason Etc.

Intervention Etc.

Action Planning

Intervention

Intervention

Implementing

Intervention

Intervention

Evaluating

Intervention

Intervention

Institutionalizing

Intervention

Intervention

Figure 3 Interview model

In this model the interventions that are used in each phase of a change project can be filled in. Based on the way

each intervention is used, it reflects a certain change approach. The various reasons or factors that play a role

for choosing this change approach are then linked with the intervention and can be filled in as well.

RESULTS

In this section the results of the research are presented. As they are quite comprehensive, we start with an abstract of the results. When we refer to the M&C consultants or to the respondents of this study, we mean the participants as described in the research methods section. When we refer to the principal within a change process, we mean the manager within the client organization that the M&C consultant has to rapport to.

Summary of results

We have seen that the M&C consultants tend to realize change mainly in a top down, planned way with a focus on the structure of the organization, although every consultant pays attention to the participation of employees, emergent events and the culture of the organization.

However, when we summarize the research results we see that the O approach is present, but the E approach predominates. This is shown in folding paper 1 and elaborated in detail in the following sub sections.

Introduction

In this section the findings from this study are presented. We use the same sequence as we used in the literature section. We discuss the three sub themes of the E and O approach and for each theme we describe how the M&C consultants choose between these opposites. We do this per phase and we name the tools that are used in each phase. We present a visualization of the tools per phase in six graphs. These graphs plot the tools per phase on two axes, the vertical axis goes from a top down and planned approach to a bottom up and emergent approach and the horizontal axis goes from a focus on the structure to a focus on the culture.

The combination of the two sub themes ‘top down versus botom up’ and ‘planned versus

emergent’ is justified, as the M&C consultants put forward that these strongly relate to each

other. Moreover, their reasons for choosing one or the other approach appeared to be very

alike as well. The six models are part of the results section and can be found in folding paper

one. In the models the tools represent one, two or three dimensions. However, in the written

part of this section we mention most tools only once, so for each tool we have chosen which

sub theme it represents most and therefore named it in the corresponding subsection. Many of

the interviewed consultants note that the phases are much more intertwined in practice then

the model of Cummings and Worley (2001) assumes. However, we try to separate the phases

as much as possible.

Apart from the description of the tools that are used per phase, we present an overview of the reasons the M&C consultants have for choosing the E or the O approach at the end of each subsection. We discuss them in the same way as we did in the literature section. First a group of general reasons for the E approach is presented, followed by a group of general reasons for the O approach and we end with the contingent reasons, meaning that it depends on the situation whether it leads to an E approach or an O approach. An overview of the reasons that the M&C consultants have mentioned can be found in folding paper two.

Top Down or Bottom Up

The M&C consultants realize change mainly from the top down. One of the main reasons for this is the fact that they are hired by top or middle management. The consultants pay attention to the participation of lower employee levels, but often remain responsible for the change effort and are therefore leading in the decision making process.

Top down or bottom up: Phases and tools

Entry and contracting phase

When we look at the different phases within a (planned) change process, we see that in the entry and contracting phase the consultants focus on the top level for the initial assessment of the problem. Eleven consultants name networking as an important tool for getting access to potential assignments. The more experience a consultant has, the more he is concerned with acquiring his own assignments. Five consultants organize a meeting with the management team to be sure the top is committed to the intended change. Fourteen consultants interview and organize workshops or work conferences with relevant organizational members. These can be from lower levels in the organization, but usually they are with top or middle management. One consultant believes that IG&H should pay more attention to talking to all the relevant levels in the entry and contracting phase. Thus, the change is initiated at the top.

Diagnosing phase

In the diagnosing phase the consultants have a more bottom up, or participative, approach.

They consult lower echelons to get a realistic image of the problem. Often these employees

have knowledge of the organization that the consultant, and also the management, lacks. By

letting these people participate in the diagnosis of the problem, they feel part of the change

process and they start feeling responsible. One of the interviewees explicitly states that

participation in this phase is one of the key success factors for the realization of the change

process. Examples of tools that reflect a participative approach are a department visit, interviews, workshops, work conferences and the installation of a project team and a steering group. However, the consultants themselves are eventually the ones who decide about the final diagnose. They decide what, in their opinion, the problem is and what needs to happen to solve this problem. Therefore twelve respondents also use tools that reflect a more top down approach, such as a quick scan or a 9-square matrix.

Planning phase

In the planning phase most consultants have a top down approach. This is not surprising as IG&H Management Consultants is known for tight control and fast results and this is part of the reason why they are hired. Moreover, in most cases the top down approach answers to their personal preference as they prefer to keep the responsibility and control to themselves.

Ten consultants say they have a meeting with the management team to keep them committed to the project and to make sure there are enough resources available. Opinions of organizational members do play a role which is reflected by the use of interviews. Moreover, planning is usually done on milestones, so employees are responsible for the details of their part of the project. To facilitate this, thirteen consultants organize workshops or work conferences.

Implementation phase

In the implementation phase there is more variety between the consultants regarding top down or bottom up. Let us look again at the definitions of these terms. A top down change approach means that change flows from the top down. A bottom up change approach means letting change start at the lower levels in an organization, in practice this means being participative.

So, here we use a bottom up approach in the implementation phase in the sense of the ability

of employees to fill in and adjust to the planning during the implementation phase. At IG&H

the consultants vary in their way of working. On the one end there is a strong top down

emphasis; there are the consultants that call implementation unroll management. They believe

that a decent diagnosis and detailed planning leads to the tight execution of the planned

activities which is controlled by the consultant or management itself. Tools that represent this

top down approach are action lists, progress reports and progress meetings, although these are

used by all consultants, also the ones that are less top down in their way of working. On the

other end we find the bottom up approach. These consultants make others responsible for task

elements and enable them to fill in the route to get to the agreed upon results. This will lead to

a feeling of ownership of the change among employees. Tools that are used are workshops, work conferences, the use of a project team, a steering group and a sounding group. These are also used by consultants that have a more top down way of working, but the difference is the degree of employee participation within the decision-making.

Evaluation phase

In the evaluation phase we have to look again at the implication of the terms top down and bottom up in this context. The definition that we used in the above seems quite irrelevant here, so we decided to discuss the organizational level (top or bottom) that the evaluation is focused on. As we explained before, IG&H is hired by top or middle management, so in the evaluation phase the principal fills in an evaluation form and there always is an evaluation meeting or dinner with the principal, which means the management. This is done to cash the results but also to acquire new assignments. Ten consultants include lower levels in the evaluation, by interviewing organizational members from different levels to get a more complete picture of the opinions about the change project. Others organize a workshop or work conference and they see this as an extra aid to anchor the new behavior patterns of the employees.

Institutionalizing phase

In the institutionalizing phase the same holds true for the definitions of top down and bottom up. An important note here is that most consultants do not see this as a separate phase, as they believe that the anchoring of new patterns and behavior already should happen in the implementation phase. However, ten consultants provide some sort of after care, like feedback sessions, workshops, or coaching with management or lower levels, to discuss the lessons learnt and to anchor the new structure and the corresponding behavior in the organization.

One consultant notes that it would be good to incorporate into the IG&H way of working a certain workshop three to six months after termination of the project to investigate if the change is indeed institutionalized. Another effect of this workshop is to evaluate the IG&H way of working in general. It was not said if this should happen with higher or lower levels.

Top down or bottom up: Reasons for choosing either approach

As we have seen, in general the consultants of IG&H realize change from the top down, but

they also leave room for ideas or participation from lower levels. We now present the three

groups of reasons, explained in the beginning of this section, which the consultants put

forward for choosing one or the other approach.

General reasons for a top down approach

• The first general reason for a top down approach is that the consultants are hired by top or middle management with a question or matter on management level.

• The second reason is closely related to the first one; it is in the nature of IG&H Management Consultants to work on management level, as the name already indicates: ‘Management Consultants’.

• The third reason is that it reflects the personal preference of most consultants.

• The fourth reason is that it reflects the personal preference of most principals.

• The fifth reason is the fact that the consultants have much knowledge of the market and of the external image of the client organization.

General reasons for a bottom up approach

• The first general reason of the fact that some consultants work bottom up is that the diagnosis is more realistic when all levels have contributed.

• The second general reason is that a bottom up approach reflects the personal preference of some consultants. These consultants believe that the change result will eventually be more effective when people are given a role and responsibility in a change process. To a certain extent, all consultants believe this and act accordingly, but for most consultants this reason only influences a part of the change process.

Contingent reasons for either a top down approach or a bottom up approach

• The first contingent reason is that when there is high urgency, working purely top down is considered more efficient and therefore preferred.

• The second is that when the consultant and management lack information, they work more bottom up.

• The third is that a bottom up approach is chosen when it is necessary that people feel owner of and responsible for the change, for example when the change influences the jobs of people.

• The fourth is that when it is important that the change is sustainable, more attention is

paid to the participation of lower employee levels. However, this last contingency

does not reflect the opinion of all consultants as not all pay as much attention to

sustainability as others.

Planned or Emergent

Regarding a planned or an emergent approach all consultants have been very clear in the interviews. IG&H is famous for fast results. This is realized through different methods, but mainly project planning methods in combination with a good understanding of the financial industry. Many consultants use Prince II, others use other methods, but they all use them to set goals and milestones. This helps in the communication with all stakeholders to show what has been realized and what still has to be done. First we look back at how we defined the terms planned and emergent in the literature section. Planned change refers to change that is an intended movement from A to B. Emergent change refers to a more open-ended approach in the sense that people will develop new ways of working themselves instead of it being pushed down from the top. Now we will look at each phase to see if it has a planned or an emergent nature. If necessary, we will differentiate between planning the process, the activities, and planning the content, the subject of these activities.

Planned or emergent: Phases and tools

Entry and contracting phase

In the entry and contracting phase the main goals are set. All consultants present a proposal that contains a planning on milestones that refer to content and process.

Diagnosing phase

In the diagnosing phase the activities that are done are partly planned. Six consultants use a pilot as a planned activity. All consultants know in advance that they will execute a number of analyses, for example an analysis of management information, a Porter analysis, a risk and issue analysis, an impact analysis or an analysis of the organizational culture. The content of these analyses is planned on headlines as these have been set in the entry and contracting phase based on the initial problems of the principal. However, the detailed content depends on what comes up. So, the process is planned, but the content is emergent.

Planning phase

In the planning phase it is a bit strange to speak of a planned or emergent approach, as the

goals of this phase is producing a planning. We have already dealt with this in the previous

subsection. When we speak of the way the planning is produced, it is a planned one. The

consultant knows in advance that he will make a planning, alone or together with a project

team. Tools that all consultants use are project and program management methods, such as

Prince II, MSP, plateau planning, conduct systems, an implementation monitor, Gantt charts, a dependency matrix, risk and issue planning, budget planning and quick wins and high impact interventions.

Implementation phase

In the implementation phase most of the activities are planned in advance. Some consultants work in a very planned way in this phase. In the previous subsection we discussed unroll management. We will discuss the difference between structural and cultural interventions in the next subsection, but here we already see a difference between the structural interventions, that have a more planned nature, and the cultural interventions, that more often take place ‘on the job’. Examples of activities are performance reports, project team meetings, workshops and training sessions, and also communication and coaching are often planned. However, for most consultants emergent events play a very important role. They can influence the planning when it appears that things cannot be realized in time or that more things need to be done. It has also been explained in the previous subsection that employees can fill in the details of a planning that is made on milestones. Here top down versus bottom up and planned versus emergent go hand in hand.

Evaluation phase

The activities in the evaluation phase have a planned nature. The principal fills out forms and meetings are organized to cash the results. The content is more or less planned as the goals that were set in the entry and contracting phase are being evaluated and of course the process of getting there. Three respondents use an implementation audit. In the previous subsection a potential workshop was already discussed in which also the way of working of the consultant, or IG&H in general, could be evaluated.

Institutionalizing phase

If there is a separate institutionalizing phase it is a planned one. Then a consultant agrees to provide after-care by continuing as a coach or trainer and will make appointments about where and when this will happen. The content will be less planned as the consultant cannot always foresee which problems the manager or employees will meet after the change project.

Planned or emergent: Reasons for choosing either approach

We now present the groups of reasons in the same way as in the previous subsection.

General reasons for a planned approach

• The first general reason for a planned approach is that is responds to the wish of the principal.

• The second is that it is in the nature of IG&H Management Consultants.

• The third is that it reflects the personal preference of most consultants.

General reasons for an emergent approach

None of the interviewees named general reasons for an emergent approach, which makes sense, as they say to have very few experience with emergent processes, as they all have gained much experience within project and interim management.

Contingent reasons for either a planned or an emergent approach

• The first contingent reason is that a planned approach is preferred when there is high urgency.

• The second reason is that a planned approach is preferred when the principal requires clarity at all times.

• The third is that a planned approach is preferred when the principal wants to hold the consultant accountable.

• The fourth reason is that an emergent approach is preferred when the assignment is not specified in advance.

• The fifth contingent reason is that an emergent approach is preferred when it is not clear what needs to be done to solve the problem.

Although this is mentioned by most interviewees, the last two reasons are quite hypothetical, as it is not very common in the IG&H projects, as most assignments are quite well-described already in the entry and contracting phase.

Focus on Structure or Culture

IG&H Management Consultants is almost exclusively hired to improve business results. In general this means efficiency improvements in systems and processes and cost-cutting.

Examples of pure cultural changes are few. However, some of the respondents highlighted the

importance of the strategy-structure-culture triangle being in balance. For IG&H Management

Consultants this means that usually it can be said that a change process starts with bringing

structure in line with strategy. Attention to culture is paid, but for the majority of the

consultants this is a necessity to make the new structure work. Some even say that they do not believe in a pure cultural change effort. Only few have examples of cultural changes, which mostly deal with changing employee behavior in order to improve customer satisfaction.

Focus on structure or culture: Phases and tools

We will use the same sequence as before to discuss how the consultants deal with this dilemma during an actual change project.

Entry and contracting phase

In the entry and contracting phase we see that goals are set. These goals almost exclusively comprise business goals, that is, improving systems and processes, cost cutting etc. because this is what the principal asks for. Culture is an indispensable variable, but only three consultants actually include this in the proposal and contract and only if employee behavior is one of the key issues that need to be changed. The tools that nine consultants use in this phase are interviews; five also mention desk research, testimonials and workshops.

Diagnosing phase

In the diagnosing phase all consultants focus on determining the actual problem, or as many

like to say, the question behind the question. This can relate to structural issues as well as

cultural issues. Starting with the last, often the consultants discover that employees show

ineffective behavior, which does not fit the desired culture. Or there is a leadership problem in

the sense that the manager is not managing his department well. Again, when the culture does

not fit the strategy or the structure, a company is not functioning in an optimal way. Seven

consultants use specific tools for diagnosing the culture. These are the cultural diagnose

method by Quinn (OCAI), the change readiness diagnose, the can-want matrix and the color

theory by De Caluwé. Then there are eight consultants who use tools for diagnosing the

culture as well as for starting a coaching process. These tools are the Myers Briggs Type

Indicator (MBTI), the core qualities of Ofman, and the team roles of Belbin. But there are also

structural issues, such as inefficient processes, a bad functioning ICT system or payment

structure. Twelve consultants use tools that are specifically for structural diagnosis. These are

desk research, which contains studying management information and financial and risk

analysis, market research, benchmarking, system design methods, logistic methods and a

balanced scorecard. It depends on the situation if the consultant focuses on structural or

cultural changes but all consultants pay attention to both in the diagnosing phase.

Planning phase

In the planning phase the focus is usually on the structural goals. This is because these are easier to define and measure than cultural goals. Moreover, the principal often feels comfortable with easily identifiable goals so that the consultant can also be held accountable for them. The tools that are used in this phase have been discussed in the previous subsections.

Implementing phase

In the implementing phase the focus is on structural as well as cultural goals. Structural goals are being pursued by all consultants through replacement or outplacement of people, changes in the payment structure, descriptions of competences and instructions, quick wins and high impact interventions, performance management, logistic methods, and risk and issue management. These tools are used by all consultants because they produce measurable results.

This follows their personal preference but it is also the wish of the principal. As we have seen before, the culture often needs to change according to the structural changes. This is being realized through team building, feedback on behavior and other forms of implicit or explicit coaching, such as management+, shadowing and counseling. Methods that are used are MBTI, core qualities by Ofman, team roles by Belbin, the line of change by Kubler Ross, reflected best self method by Quinn, other theories of Quinn, the situational leadership theory by Hersey-Blanchard, the color theory by De Caluwé. This is done in order to change individual or group behavior. All consultants pay attention to changing behavior implicitly, but only eleven of them use the explicit tools mentioned above. All consultants use different kinds of communication, such as the kick off, breakfast sessions, project drinks, events, or simply having a coffee etc. Apart from connecting with changing circumstances this is done to inspire people to follow the intended change. In other words, this is done to stimulate employees to adapt their behavior to the intended culture. Training is placed in the middle of the framework, as the subject can be a new ICT system without implications for employee behavior, but it can also mean a major behavioral change regarding serviceability.

Evaluation phase

In the evaluation phase the focus depends on the issue that was set in the entry and

contracting phase. All principals have to fill in an evaluation form and based on this the

consultants have an evaluation meeting with the principal. We have seen that often the main

goal is a structural change, so in the evaluation form and meeting the focus is on the effect of

the new structure.

Institutionalizing phase

Concerning the institutionalizing phase we mention again that all consultants believe that the anchoring of the new patterns and behaviors already starts in the implementing phase or even earlier. Ten consultants pay attention to institutionalizing in a separate phase, but only marginally. The tools they use are partly to anchor the new culture, such as feedback sessions, workshops, work conferences and coaching, and partly to anchor the new structure, like a dashboard and performance scorecards.

Focus on structure or culture: Reasons for choosing either approach

We started this subsection with explaining that IG&H Management Consultants is usually hired to improve business results, which is done by efficiency improvements in systems and processes and cost-cutting. Attention to culture is paid, but for the majority of the consultants a new culture is a necessity to make a new structure work. We discuss the reasons in the same way as before.

General reasons for focusing on the structure

• The first and most important general reason for focusing on the structure is that the principal asks for structural changes.

• The second reason is that for half of the interviewees it reflects their personal preference. One consultant mentions that these two reasons also sometimes reinforce each other.

General reasons for focusing on the culture

• The first general reason for focusing on the culture is when a principal asks for a change in the culture. However, this is seldom the case.

• The second general reason is the fact that this reflects the personal preference of the other half of the consultants.

Contingent reasons for either focusing on the structure or the culture

• The first contingent reason is that structural goals are preferred when visible and

measurable results are required. Structural change can, more easily than cultural

change, be identified, quantified and therefore measured. This gives consultants and

managers a feeling of certainty, a clear direction and control, although one interviewee mentions that this is only superficial, as the success of the change effort eventually depends on the combination with the cultural change.

• The second reason is that structural goals are preferred when there is high urgency.

Many consultants said that they believe structural change to be more efficient and more effective than cultural change so the goals will be achieved faster. In some cases the M&C consultants pay attention to changing the culture of an organization. We say

‘pay attention to’ instead of ‘focusing on’ on purpose, because for sixteen out of seventeen consultants the cultural change is almost always secondary to, and deducted from, the structural change.

• The third is that the focus is on structural change when the consultant is tied to a tight budget because they believe structural change to be more efficient. Also, in the case of a culture change it harder to define the costs that have to be made.

• The fourth contingent reason is that the culture needs to change when the change has an effect on tasks or jobs of employees. Then it is necessary that they are aware of this effect to overcome resistance and create commitment. In general this is done by straightforward communication.

• The fifth reason is that culture needs to be changed when it is necessary that the employees have a feeling of ‘there is no way back’ or a ‘sense of urgency’. In order to achieve this, some consultants say they first have to cause a feeling of pain.

• The sixth is that the culture needs to change when employees must feel responsible for and owner of the change; this is necessary to make the change anchor in the organization, also when the consultant leaves.

• The seventh contingent reason is that when sustainability is important, the focus

should be on culture. Some consultants state that only this will lead a truly effective

change. Again, when we look at the reasons for changing the culture these all mark the

importance of making the new structure work. There is one consultant who says he

realizes change only through cultural change. He states that an organization will

improve their processes and therefore business results through more effective

behavior. He does believe that, in quantitative terms, more can be realized through

structural change, but in qualitative terms, more can be realized through cultural

change.

DISCUSSION

In this section we discuss the answers of the research questions that were presented in the introduction section of this paper. The first two research questions have been discussed already, so the focus of this section is on the third research question.

1. Which approaches to change management are presented in the documented theory on change management and what are the corresponding reasons for favoring one approach over the other?

2. Which approaches to change management are used by the M&C consultants and what are the corresponding reasons for favoring one approach over the other?

The first research question is answered in the literature section of this research paper. We saw that the approaches to change management can be structured by dividing them into the E approach –top down, planned and with a focus on structural change- and the O approach – bottom up, emergent and with a focus on cultural change-.

The second research question is answered in the results section of this research paper. Here we saw how and why the consultants of M&C choose for the E approach, the O approach or a combination of the two. We refer to folding paper one for a presentation of the tools they use.

We refer to folding paper two for the corresponding reasons for choosing either approach.

3. What are the discrepancies between the change approaches and corresponding reasons the documented theory presents and the change approaches and reasons used by M&C?

4. Which recommendations can be given concerning the discrepancies mentioned in the third research question?

The third and fourth research questions are discussed in this section. Indeed we found a

number of discrepancies regarding the corresponding reasons for using the E or the O

approach between the documented theory and the M&C consultants. This leads to the

identification of a number of blind spots within the change approach of M&C, and therefore,

to the possibility of a further optimization by developing the areas that are currently

underdeveloped. Apart from the discrepancies, there is an important difference in the impact

of these reasons on the change approach. We saw that the documented theory has a strong

preference for the O approach, whereas the M&C consultants tend to realize change by

following the E approach. The first conclusion is that the E approach is very developed within

M&C -so M&C benefits from the positive effects of the E approach- but that the O approach is still underdeveloped. This leads to blind spots and possible improvements in the change approach of M&C on the one hand and to possible additions to the documented theory on change management on the other hand. Per sub theme (top down-bottom up, planned- emergent and structure-culture) we present the conclusions and the recommendations of this research for the change approach of M&C and for the documented theory.

Top Down or Bottom Up: Conclusions & Recommendations

Top down or bottom up: Conclusions

The results show that the Management and Change department tends to realize change from the top down, although often much attention is paid to the participation of organizational members. We saw a preference for a bottom up approach over a top down approach in the documented theory when sustainability, a realistic diagnosis and change plan and ownership among employees is important. Within IG&H Management Consultants, many consultants agree with this statement and act accordingly. However, the research results show that when the M&C consultants let employees participate, these employees usually work at management level rather than at lower employee levels. Furthermore, eventually the consultant or manager is the one who makes the decisions. This leads to the conclusion that change is usually initiated at the top at IG&H. Based on the documented theory we can say that this leads to a potential suboptimal change process. We can conclude that a greater deal of sustainability, a more realistic change plan and more ownership among employees might be realized through a more profound manner of participation of lower employee levels.

Top down or bottom up: Recommendations for M&C

We recommend that M&C works more bottom up through explicitly letting lower employee

levels participate in all phases of a change project in order to improve the sustainability of the

change project, to make the diagnosis and plan more realistic and to expand the feeling of

ownership among employees throughout the whole change process. To a certain degree, this

means a change in the mental model of most, if not all, of the M&C consultants. Already in

the entry and contracting phase a consultant should let lower employee levels participate

before formulating a contract, for example in a workshop. Also during the next phases

(diagnosing, planning, implementation, evaluation, and institutionalizing), it remains

important to let these employees play an important role. Not only does this lead to a lower

level of resistance, it is also a starting point for these employees to critically evaluate their own work processes and therefore the first step in a bottom up change approach. The consultant should in many situations move towards the role of a facilitator and away from the role of a manager (Pool and Larsen, 2006).

If this is done properly, it will lead to more satisfied principals because there will be less resistance among lower employee levels and the change results will be more sustainable.

Top down or bottom up: Recommendations for further research

What we have not found in the documented theory are research results in which the influence of the personal preference of the manager and also the influence of the personal preference of the consultant is acknowledged. As the practice of IG&H shows that this is a major reason for a top down approach, we recommend that the influence of the personal preferences of these important players in a change process is elaborated in further research.

Planned or Emergent: Conclusions & Recommendations

Planned or emergent: Conclusions

The results furthermore show that the M&C consultants usually in a planned way, although most of them take into account the importance of emergent events. The main reasons for this are the wish of the principal and the fact that it reflects their personal preference. Another reason, which is also acknowledged by the literature, is the urgency of change. We have also seen in the literature section that the dynamic environments of today require flexibility that can only be realized with an emergent approach. This seems somewhat twofold and is dealt with by the M&C consultants by a carefully planned approach with much room for adaptations.

As Weick (2000) states, if leaders take notice of emergent change they can be more selective in their use of planned change. This is an important commend, as it is quite impossible for any consultant not to plan at all. Planning is an easy and logical way to realize specific results and this must not be underestimated. The value of emergent change lies in the explicit choice to stimulate people to be innovative and make use of unintended events.

Planned or emergent: Recommendations for M&C

We recommend that the M&C consultants make the explicit choice to develop the emergent

approach within their change approach. For a large part this is already done through the use of