Discussion Question

Management Services Spring 2015

Sustaining change in manufacturing companies By Bob Lillis and Marek Szwejczewski

W hy do changes stick in some organisations, while in others they peter out and decay? A fter all, for most companies, it is a strategic imperative to

sustain change and its associated performance improvement. Sustainability means th a t the new working practices and the improved performance persist fo r an appropriate period of time. The change has become the norm. It is 'how we do things around here' and is not a one-off or a temporary improvement but is on-going. Unfortunately, the failure rate o f change initiatives is high - 70-90% are believed to fail.

While studies have focused on the factors th at minimise initiative failure and help ensure the successful implementation o f the change, far less is understood about how to sustain the initiative once the initial implementation period is over. For example, research into change initiatives specifically in manufacturing organisations, have tended to cohere around

either how to implement total quality management (TQM) successfully or the success factors affecting the process o f lean production implementation. However, the most comprehensive study into how to sustain any organisation's change initiative once it has been successfully implemented, was th a t carried out by Buchanan et al (2005). Their thorough review of what is known and w ritten about sustaining organisational change identified a set o f 11 common factors. The outline definitions of these factors are shown in Table 1.

For example, the influence o f Leadership is commonly accepted as im portant in successfully sustaining change. This factor would include facets such as, has the senior leadership team established a clear and consistent vision? Is the Leadership also leading the change once the implementation phase is over? Considering the factors in Table 1 and outline definitions at face value, w hat is missing is any understanding o f the

Management Services Spring 2015 41

FACTOR DEFINITION

Leadership Setting the vision, goals and leading the change Individual Employees' individual commitment Managerial Managerial style, approach, and behaviours Financial Balance of costs and benefits Substantial Perceived centrality, scale, fit with organisation Organisational Policies, procedures, system, and structures Cultural Shared belief, norms, and values Political Stakeholder and coalition power and influence

Processual Implementation methods used Contextual External conditions and threats Temporal J Timing and pace of change activities

Table 1: Buchanan et al (2005) factors w ith definitions.

Respondents' Job T itle

N um ber o f Years in Role

N um ber o f Employees A ffe c te d by th e Change Program m e

D u ra tio n o f th e Change Programm e (in years and all o n -goin g)

M a n u fa c tu rin g Sector___ _________

Operations site director human resources director

3.5

5 800 3.5 Food processing

Deputy vice president

5 100 1.5 Engineering

European operations director

3 18,000 1.5 Metals

Production manager 15 80 1.5 Petrochemical Regional operations manager

4 100 2.5 Chemicals (detergents)

Production manager Managing director

2 10

50 3 Chemicals (Coatings)

General Manager 3.5 300 3.5 Semiconductors Head of integration compliance

4.5 200 3.5 Telecommunications

Service director 6 400 3.5 Machinery Global environment manager

4 55,000 4.5 Chemicals (paint/ coatings)

Operations director 4 170 4.5 Cement Plant controller 4.5 200 4.5 Car accessories Managing director 6 50 6.5 | Plastics

Table 2: Respondents' identification and interview sample.

relevance of all 11 factors in different contexts and the respective influence th a t each individual factor may have on encouraging sustainability. For instance, does employees' individual commitment to sustaining the change outweigh the managerial style, approach and its behaviours? Is Leadership more im portant than the Financial factor to sustaining change? In other words, do some factors have more impact than others on successfully sustaining change? In this article, we report preliminary findings from stage one o f a tw o stage research project which sought to answer these questions.

Research study We divided the study into tw o separate but interconnected empirical stages. The first consisted o f in-depth interviews w ith executives from 13 manufacturing companies which had sustained a change initiative in their business. During this stage, we investigated the relevance o f the 11 factors. Several propositions were developed, some o f which are reported here. Stage tw o seeks to test these propositions in three manufacturing companies, one o f which is Maserati in Italy. We w ill be reporting the results o f the second stage in a subsequent issue.

The interviewees in stage one came from a sample of individuals who had attended one o f our courses at Cranfield School of Management. In seeking an interview w ith a particular manufacturing manager or manufacturing director, we knew in advance th at the potential respondent's business had undergone a change initiative, although the length o f the change period was unknown to us at the tim e o f the interview request. Table 2 provides a list o f interviewee job titles, how long the job holder had spent in th at role, the number of employees in the company affected by the change initiative and the manufacturing sector o f the business.

The duration o f the change initiative varied from a minimum o f 1.5 years to 6.5 years and all were still ongoing. We fe lt these periods o f time would be o f an appropriate duration to justify a change initiative being called 'sustained'.

Stage one findings

E xtent o f fa c to r's influence

SUB

Strongly influential throughout Strongly influential at the start becoming less influential as change was sustained Not influential at the start becoming more strongly influential as the change was sustained Did not appear to influence or arise as significant

13 1 4 10 1

7 3

7 6 7

6 3 6

12 13

Findings suggest th at most o f the factors had a role to play in sustaining change, but th eir influence varied depending on the stage o f the change programme. Four types o f influences were gleaned which are shown in Table 3. These were:

i) The factor was strongly present at the start o f the change and throughout the change period.

ii) The factor was strongly present at the start o f the change but its influence waned as the change continued.

iii) The factor was not strongly present at the start o f the change but became more influential as the change continued.

iv) The factor was not seemingly influential at any point in the change or appears not to have arisen.

The research results o f stage one indicated th a t 10 o f the 11 factors identified by Buchanan et al (2005) had an impact on the sustainability o f change initiatives. The analysis o f the interview data indicated th a t the Temporal factor (the tim ing

Table 3: Frequency o f influence o f the 11 factors across the 13 companies.

M anagement Services Spring 2015

and pace o f the change initiative) did not appear to contribute to sustainability in our sample and is therefore not included in Table 3.

The interviews suggested th a t factors differed in when they had most influence. Based on the analyses, several propositions were developed. The fo ur propositions we consider to be of most interest were:

P1 Leadership [setting the vision, purpose, goals, and challenges] remains strongly influential throughout the duration o f a sustained change programme

P2 Political [stakeholder, coalition power and influence] is at its most influential in the early stages o f a sustained change programme

P3 Managerial [managerial style, approach, behaviours] is at its most influential in the later stages o f a sustained change programme

P4 Individual [employee's individual commitment] is at its most influential in the later stages o f a sustained change programme

Our data analyses in stage one also provided some interesting interactions between the various factors. So fo r example, at company 2 in the engineering sector, whose change period at the tim e o f interview had been 1.5 years and affecting 100 employees (Table 2), the factors Substantial, Financial, Leadership, Political, Processual and Contextual were strongly present at the start o f the change programme and had remained so throughout its duration. Four o f the factors namely. Individual, Managerial, Organisational and Cultural were not strongly present at the commencement o f the change but became more influential as the change continued.

In addition, we were also interested in whether the company had replaced its Managing Director or Chief Executive Officer at the commencement o f the change programme. We believed th a t this could have been an im portant factor in sustaining the change. It transpired th a t 7 o f the 13 companies were so affected and on the basis o f these statistics, we consider the impact o f replacing a company's MD or CEO on sustaining a change programme is inconclusive and requires further research.

Conclusions Sustaining change is not a simple procedure. Our research findings suggest th at managers need to put emphasis on different factors at different stages o f the change. It has long been recognised th a t Leadership is im portant at the start o f the implementation process. Our research supports this view but in addition points to just how critical it is later in the life o f the initiative. The leadership cannot afford to reduce its efforts once the change initiative has been successfully launched. If it takes a back-seat and hands over to the management team, such action w ill invariably lead to sustainability failure.

The influence in sustaining change o f the political aspect is often forgotten. It is assumed th at having good Leadership is more important. However, concern w ith the political aspects o f the change initiative is vital if it is to be sustained. In the interviews, most o f the senior managers pointed to the fact that they had obtained obvious and visible support fo r the initiative from various stakeholders at the start o f the implementation.

The research also suggests th a t getting the commitment of

the Individuals in the organisation at the start o f the change process may not be as im portant as some claim. However, to succeed, the Leadership needs to get the commitment from most o f the Individuals once the implementation is complete in order to sustain the change. A successful initiative launched can be achieved w ith o u t the vast m ajority being committed. However, once the implementation phase is over, if the vast majority o f Individuals are not committed then the initiative is likely to peter out and fail. The Managerial factor is also im portant in sustaining the change initiative but only at the later stage o f the process. Managers have an im portant role in helping the leadership team to ensure th a t the new ways o f working introduced by the change initiative are adhered too.

The research is still ongoing in stage two, w ith one case study completed and a further tw o currently being conducted. Therefore, it is too early in the study to categorically state the respective influences of the various 11 factors on sustaining change in manufacturing companies. We hope the research, by indicating which factor to focus on during the various stages o f the change programme, will ultimately prove helpful to those manufacturers keen on making change initiatives in their organisation stick.

References Buchanan, D, Fitzgerald, L, Ketley, D., Gollop, R, Jones, J L, Sharon Saint, L, Neath, A and Whitby, E (2005). 'No going back: A review o f the literature on sustaining organizational change', International Journal o f Management Reviews, Vol 7, No 3, pp 189-205.

A bout the Authors Dr Bob Lillis is senior lecturer in service operations management at Cranfield School of Management, Cranfield University Dr Marek Szwejczewski is professor o f operations strategy at Cranfield School o f Management and Director o f the UK's Best Factory Award Scheme. To find out more about sustaining organisational change, email [email protected]

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