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Developing Stakeholders for Improved Change Execution

  • How will enterprises ration, orchestrate and manage change to improve strategy execution?

  • How will enterprises develop an understanding of their current capacity for change?

Assumption
Fewer than 35 percent of change management initiatives will include strategies for explicitly managing change resistors or leveraging early change adopters, effectively and unnecessarily constraining the organization's overall change capacity.

Stakeholders vary in their capacity to accept change and their power to effect it. We provide a model for segmenting, targeting and managing stakeholders to accelerate change adoption.

Within a group, individual behavioral and emotional responses to a given stimulus will typically follow the form of a bell curve (see Figure 1). Responses to organizational change initiatives are no different. In the beginning stages of a change initiative, a small percentage of individuals will become early adopters eager to participate because they hail the change as a breakthrough that will lead to better conditions. The majority of people affected by a change initiative will be far less enthusiastic than the early adopters, but over time they will eventually accept the new condition and adapt to it. Finally, there will be a group of highly resistant individuals, many of whom will never adapt to the instituted change. This range of behaviors follows a normal distribution. This is a natural phenomenon intuitively grasped by most change managers. Unfortunately, although they may subconsciously understand the phenomenon, these managers often fail to employ that understanding to orchestrate more-effective change.

Figure 1
Change Adoption Distribution

The Stakeholder Segmentation Model (see Figure 2 and Note 1) is a tool for applying the insights derived from the normal distribution to the unique cultural dynamics of individual organizations. Each cell in the model represents distinct stakeholder attributes. The change team populates the cells with the names of individuals and groups that share the given profile. The individuals or groups reflected in the cells are then targeted for one of four strategies: to be leveraged, engaged, contained or outplaced.

Leverage strategies are applied to early adopters with significant influence. The goal is to develop their support and consciously utilize their influence to accelerate change among the reluctant majority. It is important to understand that influence does not necessarily translate into hierarchical position. Influencers are natural leaders and respected functional experts who are well-connected. They are hubs in the enterprise's social, political and communication network, and their sphere of influence extends beyond their native organizational domain. To the extent that such influencers illustrate their support for the change initiative, they are a far more powerful marketing tool than any message delivered through the change management office.

Figure 2
Stakeholder Segmentation Model

 

Note 1
Explanation of Stakeholder Segmentation Model


The horizontal access of the Stakeholder Segmentation Model represents the normal distribution. The vertical access represents a logical segmentation of stakeholders that can vary by change initiative or organization. Where the effects of change are contained exclusively within the native enterprise, the vertical axis will most commonly represent a spectrum of stakeholder power or influence as shown here. Other logical segmentations might represent organizational hierarchies, such as executives, middle managers and line staff, or of business relationships such as clients, suppliers and strategic partners. The focus of the leverage, engagement, containment and outplacement strategies should be adjusted to remain consistent with the vertical segmentation.
The strategy for each cell will potentially require a different communication, marketing and management approach, as well as the utilization of different levers for achieving change. Such levers include, but are not limited to, changes in processes, organization, people practices, physical infrastructure, technologies and products and services. The specific portfolio of techniques employed to encourage change must be based on the profiles of those affected, or ineffectiveness and waste will result.

Engagement strategies are primarily applied to the reluctant majority. In the case of high or moderate influencers, the goal is to turn them into early adopters and leverage their influence among those with trailing interest or commitment. For those who cannot be pulled forward or those of low influence, the goal is to accelerate their rate of adaptation by helping them better understand and prepare for the effects of change. Engagement strategies are also applied early in the change process in an attempt to draw resistant laggards into the reluctant majority.

Containment strategies are pre-emptive strikes against inertia. They target those resistant laggards who are unable to adapt, yet who, because of their unique combinations of knowledge, skills or abilities, still contribute in an important way. Containment strategies maintain the productive capacity of these groups or individuals while consciously diminishing their sphere of influence.

Outplacement strategies presume that at least some individuals will be unwilling or unable to adapt to change. Particularly virulent and influential resistant laggards are prime candidates for outplacement. They are given an early opportunity to demonstrate their acceptance and compliance with the change but, failing that, they face unambiguous consequences. Outplacement strategies are fair, deliberate and strategically timed. They ensure that particularly destructive behaviors are identified, contained and removed early enough in the change process to preclude serious undermining of objectives, and to demonstrate that the change initiative is real.

In Summary

Understanding who a change initiative will affect, how it will affect them, and what their reactions are likely to be is pivotal to a successful change strategy. Without such knowledge, negative responses cannot be addressed, nor can positive responses be leveraged. Specifically classifying stakeholders according to important variables such as influence, power and change-readiness is a prerequisite for developing a comprehensive change strategy.

 

 

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