CONTENTS

S.no Title of the Article Author Page Nos

Editorial Comments 4
The Concept and Process of Organizational Change
1 Organizational Change Indira J Parikh 5
2 Organizational Change Management: Why? What ? How? Simon Wallace 10
3 Leading Wholesome Change in Integral Way Ashish Pandey 18
4 Change Management: Some Practical Considerations Bhawana Mishra 24
5 Fundamental Change in Education Quality Dileep Ranjeker 28
6 How HR Can Ignite ‘Hot Spots’ Yogi Sriram 33
Change Leaders and Change Agents
7 Bringing Change to the Change Agents: Mustafa Moochhala
A Look at Indian NGOs and Tejinder Singh Bhogal 37
8 Defining Change Agents Sandeep K Krishnan 43
9 In Praise of India’s Most Seasoned Change Managers Ganesh Chella 48
10 The Enduring Skills of Change Leaders Rosabeth Moss Kanter 53
11 Core Tasks for Successful Change Management S.Ramnarayan 60
Critical Factors in Organizational Change
12 Driving Organizational Change Leena Nair & Ankush Punj 65
13 Measuring Organizational Culture and Change Rajeev Kumar 70
14 Management of Change: Critical Factors Tarun Sheth 74
15 Organizational Change: The Formidable XI Rajeev Dubey 78
16 Communication Effectiveness, Justice Perceptions and
Employee Commitment during Organizational Change Ranjeet Nambudiri 81
17 Managing People in Mergers and Acquisitions D Prasanth Nair 86
18 HR: An Evolving Function D Harish 92
19 One Reason for Failure of Change Interventions PVR Murthy 95
- Abilene Paradox
20 IPO: A Powerful Intervention in Organizational Change Ravi Virmani 97
Case Studies of Organizational Change
21 From a Sapling to a Forest Udai Pareek and TV Rao 100
22 Challenge of Managing Organizational
Preparedness - ICICI K Ram Kumar 107
23 Bringing about Organizational Change - Philips India Vineet Kaul 112
24 Organizational Change - Maruti Suzuki S Y Siddique 117
25 It Will Be Done, I Have to Do It: A Story of PCBL Ashok Goyal 122
Book Reviews
Management of Organisational Change: Leveraging
Transformation By K.Harigopal B.V.L.Narayana 128
Competing Through Knowledge: Building a Learning
Organization Madhukar Shukla Ramendra Singh
 EDITORIAL COMMENTS
It is an exciting experience to witness the changes that are happening around
us. Our country is experiencing new challenges and with it comes enormous
changes that are linked to growth. We have the opportunity to witness the
beauty of fast organizational changes. Various themes are related to these
changes which include growth, turnaround, mergers and acquisitions,
global market exposures, labour market turbulence, and institution building.
Arvind Agrawal It was an enriching experience for us to anchor this issue of NHRD journal
(Guest Editor) that addresses the theme of organizational change. It is the biggest
An IIT Kharagpur
and IIM (A) management challenge to enact and establish a change process. This issue
alumnus. Held brings out insights that are well thought out by professionals who are experts
Senior Positions in the field of human resource management and organizational
with Escorts, Xerox
development. We thank this fraternity who obliged to our request for writing
and is currently
President – on their experience and knowledge despite their busy schedule.
Corporate
Development and We structured the articles in four major sections. The first section looks at
Group HR in RPG the concepts and processes of organizational change. Here the authors
Group. drive upon the factors and processes from both theoretical and practical
angles. A carefully planned change would involve efforts from change
agents drawing up understanding the context of change, gathering support
from various corners, linking up to the need of the time, using the best of
methods and techniques, and ensuring buy-in and commitment in the end.
Second section explores the role, and characteristics of change agents. In
the third section we draw upon the factors that contribute to successful
change and its management. In the last section, we have interesting case
studies that give real life experience sharing of organizational change. As
you traverse through this edition we hope you will be able to experience a
holistic view of organizational change drawing from conceptual
understanding of factors and processes to real life sharing of experience.
Change can be defined and understood from a very technical point of view
but bringing out one is a story of courage, emotions, understanding, and
sheer perseverance. As Abraham Lincoln puts it, "I shall do less whenever I
shall believe what I am doing hurts the cause and I shall do more whenever
I shall believe doing more will help the cause. I shall try to correct errors when
shown to be errors and I shall adopt new views so fast as they shall appear to
be true views." We should be open to the change and should have the ability
to adopt and adapt to it. Those organizations and individuals who could
make a successful change make a mark in their life and of many others.

Arvind Agrawal (Guest Editor) PVR Murthy

Aquil Busrai PallabBandyopadyaya

4 November 2007 NHRD Journal

 ORGANIZATIONAL CHANGE
INDIRA J PARIKH

Abstract
This paper is based on the author's experience of working as a consultant in diverse
organizations. This paper reflects the comprehensive diagnostic studies of numerous
organizations. The global business scenario, the country's business and economic environment
and the organizational internal environment of today is highly nebulous. Significant changes in
technology, economic models of growth, emergence of new sectors of business and a new
collectivity of young entrants to the working stream have dramatically changed the national and
global scenario. Given these changes, the directions and choices of the organization, its unique
configuration and unfolding may contribute to a healthy transformation of the organization or
contribute to the scatter, disarray and disintegration of the organization.

The External Environment togetherness. Memories of what

The external environment of the
organization with its globalization
and increasingly border less but
complex and competitive world are
creating unsettling conditions for
the Indian organizations. The
Prof. Indira J Parikh is impact of the external business
President of environment confronts the
Foundation for Liberal
organization to go beyond the many
And Management
assumptions they have made of
Education, Pune,
India. Prof. J Parikh business and governing the
was faculty member business. As such, organizations
at IIMA for over 30
years and Dean from confront many opportunities as
2002 to 2005. She has well as challenges to manage both
also taught at the internal as well as external
INSEAD,
Fontainebleau (France) environment of the organizations.
and Texas A&M
The Internal Environment
University. She
received the Lifetime The internal environment of the
Achievement Award organization gets impacted by the
for Best Teacher in
Management in the external environment and creates
World HRD Congress. turbulence within the organization.
Years of work culture seeped in the
ethos of slow and steady
incremental growth overnight is
experienced as obsolete and
ancient, relationships become
professional interfaces across roles,
functions and levels and take away
the sense of belonging and shared
once haunt the employees and
puzzlement of what now is, creates
drift in the direction of the
organizations. However there are
also some organizations,
individuals and collectivities that
thrive in these uncertain and
turbulent conditions. They respond
to the pressure of here and now and
achieve, succeed and grow. In this
emerging work culture of today
there is no time or space to pause,
reflect and watch the grass grow.
There is also no time and space to
visualize beyond the horizon to
explore, experience and discover.
There is largely a frenzy of over
engagement and to keep making
choices under tremendous pressure.
Organization Growth
At the entrepreneurial or project
phase of organizations there is a
drive, fuelled by dreams, aspirations
and ambitions, of one individual or
a group of individuals. At the
consolidation phase of the
organization, often times there are
formalization, strategic choices for
businesses restructuring and

November 2007 NHRD Journal 5

redesigning of the organization. When this
starts to happen the existing employees feel
bereft of personal contact with the roles in the
higher authority and ownership. As there is an
increasing sense of urgency in the
organizations, collectives and individuals to
reach the mileposts and destinations of growth
the human values to govern the organization
are often marginalized. In such a process of
dramatic change organizations require a pause
to explore and ask many a difficult question as
to the nature of change, directionality of change
and shaping of change.
Organization Identity
Many organizations at such a point of time like
to ask themselves the questions as to what is
their identity. Organizational identity consists
of the history of growth, the evolution of
underlying philosophy, the individuals in
leadership roles, the values of governance, the
existing and new employees and the overall
work culture of the organization. Over time this
work culture gets stabilized and then becomes
frozen. A comfort zone gets created where
organizations tend to hold on its created
meanings and work roles. It is at this point of
time the organization's identity with its deeply
embedded meanings finds it difficult to respond
to change by adding new dimensions and new
ways of working. Organizations get caught with
the anxiety of losing the techniques of success
and fail to find freedom to discover their internal
strengths to ever renew it.
Organization Structure
Structure designs and determines the
directionality, degree of autonomy of each task,
role and function, boundary and the inter-
linkage space in the organization; so that an
order, clarity and a policy frame for results get
created. The structure also allocates
responsibilities, authority and accountability at
all levels of the organization. Individuals,
groups, organization structure and their inter-
6 November 2007 NHRD Journal
play with each other create its own dynamics.
In the designed structure of the organization
and its operationalization, some tasks and
functions get centralised, acquire significance
and visibility and are perceived as having more
favoured and strategic status with the top or
the senior management. While some other tasks
and functions are marginalised and feel a "taken
for granted" status. How this dynamics is
translated into managerial behaviour
determines the quality of energy available to the
organization through using the spaces to
interlink and take functional and
organizational responsibility and decisions.
Simultaneously, the leader needs to foster
membership and belonging of the employees.
The institutional a sense of culture may or may
not receive energy from an organization
structure depending upon the role played by
the leadership and the internal dynamics of the
organization. Similarly, the organization
structure gets operationalized through direction
from the leader or multiple pulls and pushes
from the various groups in the organization.
The non emergence and operationalization of a
formal organization structure generates stress
and power and politics in the organization
leading to dissipation of energy across all levels
of management and employees. In such a
situation the role of the leader is to initiate those
processes which will mobilise the
organizational structural energy for the
organization and its employees. This change is
brought about through inclusive processes
where employees experience openness and
accessibility and fair and just systems.
Organization Culture
The organization culture evolves over a period
of time and is connected with the history of
growth of the organization and the interplay of
various internal and external dynamics of
interfaces across the organization. The roles, the
membership and leaders and their inter-play
give subtle shape to the organization culture.
The change required is from lack of energy,
apathy and sources of de-motivation of the past
and present to the future of the organization
which is kaleidoscopic and requiring alertness
to ever shifting realities.
The culture of the organization is either task-
focused anchored in a work culture or
personality and people-focused, anchored in
the socio-cultural context of the country. If the
organization needs to be changed and
energized in the work culture, the tasks need to
anchor themselves in setting the standards of
productivity and excellence. The functions need
to come alive with shared understanding and
clarity of goals, targets and objectives of the
organization. The organization comes alive
through participation in policy and strategy and
shared understanding of organization mission.
Similarly, the organization culture of tomorrow
needs to foster a work ethos anchored in vision,
values and philosophy of life space to generate
enthusiasm and energy for the organization and
the institution of corporate social responsibility.
The energy of the organization is dynamic when
the integration of culture and the institution
takes place with the organization's concern for
the life space of employees and their well being.
Encountering Critical Issues of Organization
The forces of tomorrow's external environment
are going to overwhelm Indian organizations.
The energy of the cross currents and pulls and
pushes of contradictory forces are going to
attempt to push the frontiers of Indian
organization never visualised before. However,
the resilience of the Indian spirit can be fostered
through a critical but hard reality appraisal of
the internal dynamics of the organization vested
in the human resources and potentials. The HR
role of organizations and the CEO s would have
to squarely identify the critical issues of managers
and organizations and design processes to deal
with them. These processes are:
• Appraise the strengths and limitations of
the organization.
• Differentiate the performers and non
performers and identify star performers.
• Assess the star performers and the mediocre.
Support the star performers and invest in
those who are mediocre for their growth and
subsequent contribution.
• Realistic assessment of human potential so
that creativity and innovativeness may
flourish.
• Design organization structures of small sub
systems which may flourish and grow
simultaneously in the larger context of the
organization.
• Give emphasis on quality of life space of
each employee so that he/she may live and
work with dignity and respect of self, others
and the system.
• Provide space so that employees may
wholesomely integrate family and work
systems where they find freedom to play
multiple roles in multiple systems.
• An individual and an organization can own
up its own uniqueness of existence and
identity and give meanings to the process of
living and enlivening of the self, others and
the system.
• When this internal energy of the
organization begins to flow at the
individual, collective organizational and
institutional level then a momentous energy
will be released which can then be
channelized to create a space to grow, a
rhythm of relatedness for goals and
objectives and create wisdom for
organizations to flourish as well as compete
in a complex and competitive global
business environment.
November 2007 NHRD Journal 7
Organizational Spaces for Tomorrow
The frenzied life space, the milling crowds, the
restlessness of the environment and the
aspirations and ambitions of people require
organizations to create multiple spaces where
an employee can go into that space for renewal
and rejuvenation.
Spaces for solitude These are spaces for
reflection and spaces for silent expression of
themselves. These spaces would then provide
a rhythm of stability as well as preparedness
for connectivity with the work and positive
relatedness with the organization. These are
essentially spaces for spiritual communion with
oneself so that an individual employee
experiences tranquility and peace. The
employee then can emerge with accepting the
complex realities of life and be able to deal with
day to day stresses and give shape to his life.
Spaces for related interactions These are task
and functional related spaces. Today's
organizations are meeting-based cultures.
Organizations are designed for sunrise
meetings, sunset meetings, standing meetings,
cross functional meetings, intra and inter
departmental, functional and divisional
meetings. However these meetings start out
with good intentions but finally turn into non
productive and non decisive conclusions. Most
managers believe these meetings are waste of
time. Organizations can create spaces which
are task related and facilitate a mindset to get
work done and decisions taken. This
contributes to action initiatives which are linked
to responsibility and accountability. These are
linked to achievement, success and excellence
which are then linked to affirmation, valuing
and anchoring in the organizations. These
spaces are also socially engaging wherein there
is an element of fun and celebration of success.
Spaces for dialogues These spaces are designed
for dialogue across levels of organization about
the concerns of the organization. This is a retreat
8 November 2007 NHRD Journal
space to explore and review the philosophy,
values, work culture and relationships across
the organization. In any organization there are
always spaces for sharing secrets, creating
groups and cliques and public spaces for
gossips, where myths are generated about
people and the organization. Then there are
spaces of the organization which are formal
spaces created for dialogues. Both spaces put
together create a unique quality as it fosters a
co-holding of the organization and co creating
a work environment. In this space a small or a
large space is owned by every employee and
stakeholder of the organization. This ownership
and co-holding creates a shared meaning, a
shared significance of belonging and shared
valuing of each other and the organization.
Spaces for the creation and brightening of a
working environment Any organization has
walls, corners and cubicles which are blank, often
dreary and empty. An organization can transform
these for putting display of each individual's
personal, emotional memory. Most
organizations do not have public display of
individual employees contribution of expression
of creativity. Almost no organization displays
employee's arts and crafts which are the
employee's personal creation. Organization has
immense wall spaces which can be adorned with
employees, expression of arts, paintings, crafts
or similar such creative expressions.
Organization needs to create spaces wherein
employee's larger meanings and life can be
brought to the organization. Organizations can
have a painting day, art day, crafts day a
collective collage, photographs put on display
on the walls of the plant or the organization and
ambience thus created is bright and cheerful.
Spaces for celebration Most organizations have
a very serious and somber face to the world inside
and the world outside. The meaning given to
this serious face is professionalism. However,
professionalism has good and desirable needs
to be tempered by a sense of humor, a sense of joy In growing of an organization, each individual
and celebration. These spaces then release the brings his/her own story, each group bring their
cumulative negative energy and give birth to stories and each organization has its own story
positive energy which leads to celebration. This with individuals and collectivity enacting their
celebration and togetherness creates goodwill roles. Each will enact their roles, each will
and generosity with oneself in bringing connect or part and each will add to the
commitment and mobilization of oneself to give emerging new collage of growth and success.
more to the work culture. This work culture The role of HRM in this unfolding scenario of
facilitates co construction and creation of a work organizations is emerging as strategic.
dynamic work environment. However, the role of HRM is to emerge as
These are some of the landscape of change shaping organization identity, its myth and
which organizations need to design and shape. folklore which can be sung by the bards of the
The role of HRM in this new landscape of the organizations creating its landmarks and
organization employees and the environment leaving its footprints in the sands of industrial,
is to focus on the growth of the employee, growth technological and national unfolding in the
of collectivities of employees and growth of the context of a larger globalization of the universe.
organization. References
A word of caution. In the process of such a Parikh Indira J. 1997. A Diagnostic Study of
change the HRM needs to be sensitive that all Mahindra and Mahindra Tractor Division.
cannot make the transition. That needs to be Unpublished.
accepted with grace and dignity. There has to
be space for some to do work at their pace. Here • 1998. Paradigms of Organizational
the focus is on the present emergent identity of Leadership. Self Organized Criticality: The
the working employee in the organization. To Avalanche Effect. Working Paper, IIMA.
some the work space, the work meaning and • 1999. Challenges of Indian Organization in
work status is extremely significant and the Twenty First Century. Working Paper,
important. To some a slow steady pace is IIMA.
acceptable. To some young employees, they are
• 2001. Transforming of Organizations
in a hurry and want to run. The HRM needs to
through Enhancing Free Energy of
create and design a work environment which
Individuals, Collectivity and the
provides spaces to all and yet keeps the
Organization. Working Paper, IIMA.
momentum and vibrancy of the organization-
human interface scenario surfacing with • 2001. A Diagnostic Study of Bajaj Tempo
breathtaking results. Limited. Unpublished.
Acknowledgement from Editors
• Our thanks are to all the contributors of articles for sharing their thoughts and experiences.
• We appreciate the spontaneous gesture by Rosabeth Moss Kanter and Simon Wallace in permitting us to reprint their articles.
• It was a great pleasure and learning opportunity to work with Arvind Agrawal, guest editor for this issue in designing theissue,
identifying potential contributors, inviting them to share their thoughts and in finally editing the issue. Thank you Arvind.
• We are grateful to Dr. Udai Pareek for the guidance.
• We are also thankful to Nokia and BGEPIL for their support in bringing this issue.
• Our thanks are to Dr. Sandeep Krishnan for playing a critical role like a sub editor.
• Finally our profound thanks to Prof. SS Rao, former Editor of Vikalpa and a Prof. IIM Ahmedabad for his expert suggestions
and guidance.

November 2007 NHRD Journal 9

 ORGANIZATIONAL CHANGE MANAGEMENT
WHY, WHAT, HOW?
SIMON WALLACE

Almost all people are nervous about There are two related aspects of
change. Many will resist it -- organizational change that are
consciously or subconsciously. often confused. In organizational
Sometimes those fears are well Change Management we are
founded -- the change really will concerned with winning the hearts
have a negative impact for them. In and minds of the participants and
many cases, however, the target the target population to bring about
population for the change will come changed behaviour and culture.
Simon Wallace has 29
years experience of to realize that the change was for The key skills required are founded
project management and the better. in business psychology and require
solutions delivery. He "people" people.
has managed or advised
in the management of Contrast this to organizational
around 50 business Design where the roles, skills, job
solution and IT projects.
The largest programme descriptions and structure of the
had a budget of around workforce may be re-designed.
UK£500 Million. Typically that is a more analytical
In 21 years as a The pace of change is ever and directive activity, suited to
management consultant,
increasing - particularly with the tough-skinned HR professionals. It
Simon has achieved
senior status as Head of advent of the Internet and the rapid is not a topic for the ePMbook.
Management deployment of new technologies, organizational Design may be a
Consultancy for a UK new ways of doing business and
firm, a Director and specific objective of the project, for
Council Member of the new ways of conducting one's life. example where there is to be a
Management organizational Change reduction in the workforce, or it
Consultancies Management seeks to understand
Association, and a may just be a consequence of the
member of the global
the sentiments of the target changed business processes and
management team for a population and work with them to technology.
world-wide consulting promote efficient delivery of the
firm.
change and enthusiastic support organizational Change
Simon had global for its results. Management issues are often under-
responsibility for best- estimated or ignored entirely. In fact,
practice approaches to
technology-driven
people issues collectively account
business change, for the majority of project failures.
including methods,
techniques and tools.
This survey looked at disastrous
projects. One of the questions asked
for the prime cause of the failure.

10 November 2007 NHRD Journal

Although the result did not spell out "people"
as the cause, it is interesting to note that many
of the causes were to do with the behaviour
and skills of the participants. Arguably all but
the "technical issues" were related to the
capabilities, attitudes and behaviour of people.
What Caused The Project To Fail?
Lack of
Inexperience in Communication
Scope and 20%
Complexity
17%
Technical
issues
14%
Project
Management
Problems
32%
A different study examined whether package
implementation projects' benefits had been
achieved. Where they had not been delivered,
the question "why?" was asked. Top of the list
was "organizational resistance to change".
Organization resistance to change
Unstable requirements
Lack of business owner ship
Significant Cost Over-runs
Significant schedule Over-runs
Package did not meet expections
Technical problems
Poor project management
0 2 4 6
Again, several other causes were related to
people, their skills and their behaviour. "Lack
of business ownership" is a major
responsibility of the organizational Change
Management work. Such things as "unstable
requirements", "not meeting expectations", and
"poor project management" would also be
partly due to behaviours and skills.
Organizational Change Management is a vital
aspect of almost any project. It should be seen
as a discrete and specialised work stream. Why
then, you might ask, do we discuss it as part of
the Project Management work. Unfortunately,
it is common to find that the human component
of the project is not recognised as a separate
element of the work. The project management
team frequently have to do their best to ensure
that a technological change is successfully
implanted into the business. In the worst-case
scenario, the project leadership do not see this
as part of their responsibility either and blame
the organization's line management when their
superb new technical solution is not fully
Failure to
successful when put to use.
define
objectives Organizational Change Management at
17%
Project Start-up
Many organizational Change Management
issues need to be clear at the start of the project
Source: KPMG so that appropriate activities can be included
in the plans, and so that appropriate roles and
responsibilities can be established. Here are
some of the key issues:
• Is there a compelling "Case for Change" that
all participants will buy in to?
• Who are the owners and sponsors of this
change? Will they actively promote the
change and apply pressure as needed?
• What are the populations involved, eg the
overall leadership of the organization,
project participants, sub-contractors, end-
users, other departmental managers, other
8 10 12 14 16
Source: KPMG
members of the workforce, suppliers,
customers etc? For each population (or
subset by role, function, etc) what will their
attitude be? Will they resist the change?
How can we encourage them to act in a way
which will support the project's objectives?
• What style of participation will work best?
Should we involve a broad section of the
target population or keep everything secret
until the change is forced upon them?
• How can we communicate these messages
to the target population?
November 2007 NHRD Journal 11
The Case for Change
• As part of the project definition, there should
be a compelling "Case for Change" which
can convince all participants and, in due
course, the target population. If everyone
agrees that the project has good and
necessary objectives, they should be far
more supportive of the changes.
This is not the same as the project's main
business benefit case. The business case is
likely to be founded on business strategy and
financial results - often not a compelling
argument for the individuals in the workforce.
In a "Case for Change", it should be clear that
there are better ways of doing things - better for
the organization, better for the workforce, better
for customers and (maybe) better for suppliers.
Sponsorship
The Project Sponsor is usually the person who
saw a need for change and had the authority to
make something happen. There may be several
sponsors who collectively have this role.
The precise ownership of the project is more a
matter for the Project Definition work. What
counts from an organizational Change
Management perspective is not the actual
ownership and rationale for the project so
much as the perceived sponsorship and
purpose. For example, the project might exist
because the Finance Director wants to cut costs,
but it could be a better message that the Chief
Executive wants to build a slick organization
that can beat the competition.
The original Project Sponsor will often have
the power and status to create and deliver the
project and may be able to deliver the change
messages to the areas of the organization
directly involved. In many cases, however, the
change is broader than the immediate influence
of the Project Sponsor. Other supporting
sponsors may be required to promote the project
in other areas of the organization.
12 November 2007 NHRD Journal
Make a Sponsorship Map - initially to show
who is involved and what support they are
offering. Use this to identify who else needs to
participate and what they need to do.
In major change programs many parts of the
organization will be involved, for example:
• The line business unit that houses the
changed process,
• Other departments involved in the process
chain,
• Senior management and general
management of the organization who will
be critical judges of this initiative's success,
• The IT department who build and operate
the technology
• The finance department where the financial
implications will be seen,
• Customer-facing staff who will reflect the
changes when dealing with the clients.
A significant project will require a cascade of
sponsorship, such that all affected parts of the
organization hear strong support from their
leadership. If the message is delivered from the
top and reinforced by the immediate
management, staff are far more likely to believe
in the case for change and to act in support of
the changes.
For critical business change programmes the
message should come from the very top. Get
the Project Sponsor to engage the Chief
Executive as the prime source of sponsorship
messages. (You may find yourself writing the
words for the Project Sponsor to give to the Chief
Executive - but the key thing is that it is then
seen as the Chief Executive's personal message.)
Not everyone listens attentively to their Chief
Executive, so it is important that these messages
are cascaded down to all parts of the
organization, with local management echoing
and supporting the party line.
Case Study
A large, multi-divisional professional services
firm was changing its time sheet system -
affecting every member of the organization.
They recognised the need for acceptance and
compliance from everyone so they built an all-
encompassing sponsorship cascade.
When the team was finalised it was apparent
that the sponsorship team was considerably
larger than the project team building the new
system.
Resistance to Change
By definition, people are affected by change. A
few will comfortably accommodate any degree
of change, but most people have a change
journey to undertake.
Part of the art of organizational Change
Management is to:
understand what journey you want which
populations to take (it may not be the same
for everyone),
assess what their attitude is likely to be, and
use that knowledge to guide them in the
right direction.
Many people will hide their negative feelings.
It is not wise to be openly critical of your bosses
and their new ideas. Some people will not even
be aware of their own resistance which,
nevertheless, affects their behaviour sub-
consciously. Understanding their position
requires more than listening to what they say.
organizational Change Management
specialists use an array of diagnostic tools to
uncover the true characteristics and attitudes
of the target populations.
The most common response to impending
change is a negative response where, initially
at least, the target population sees the change
as a bad or threatening thing. Psychologists
have researched these "bad news" responses
and found that there is a common emotional
response. This chart shows how the
individuals oscillate between inactivity and
high emotion. Assuming the final outcome can
represent a good thing from their perspective,
the goal is to leave them in favour of the change
and highly motivated to make it work.
Here are some thoughts that might be expressed
by someone passing through the "bad news"
curve:
Oh no!
It can't be true!
You cannot be serious!!!
Can we sort this out some other way?
That's it - after 20 years of service they want me
to...
Am I going to be part of this?
Yes, I can live with this - it's not bad really.
The "Good News" Curve
A different emotional curve may occur where
individuals are initially in favour of the change.
November 2007 NHRD Journal 13
In the "good news" curve, the risk is that they
will be disappointed by the reality of the change
or the effort it will take to achieve it.
In these cases, you should recognise the
likelihood of disappointment during the
change process. Be ready to lift them out of the
trough in time to benefit from their enthusiasm.
Resistance to change is normal. The Project
Manager should expect to encounter it and deal
with it. The worst time to encounter resistance
is during the cut over to the new solution.
Transition is usually a busy, critical, high-risk
period when the last thing you need is a lack of
co-operation from the target population.
Try to surface issues and resistance earlier in
the project so that there is time to get the target
population engaged before any damage is
caused. Some organizational Change
Management experts suggest that you should
deliberately upset the target population early
in the project so that you can guide them
through the emotional curve and change their
14 November 2007 NHRD Journal
attitude. That may be taking the principle too
far - but, if there is going to be resistance, try to
deal with it early.
Using the Right Change Style
The design of the project's approach should
take into account the optimum style of
addressing organizational change issues. In
general, the target population will be more
supportive of the changes if they have been part
of the change process. The cynical view is that
you should make them feel part of the process
even if you prefer to ignore what they have to
say. In fact, their active participation is likely
to add to the quality of the solution - it should
be taken seriously. Conversely, if they feel their
views were sought then ignored they are likely
to become more resistant.
Working with a broad selection of the target
population adds time and cost to the project.
The degree to which you involve them will
depend on the magnitude of the change. A
straightforward non-controversial change may
require no previous contact. If, for example, you
are simply introducing a new set of expense
codes you can publish the message "with effect
from 1st April, new codes must be used as per
the attached book". Conversely, if you are
making huge changes to the job and lifestyle of
the target population you will need to work
with them to gain their co-operation, for
example, if you wish them to re-locate
voluntarily and re-train for substantially altered
jobs.
Here are some change styles that may be
appropriate:
• Collaborative - The target population are
engaged in the change process, typically
through cascading workshops or meetings.
They will be kept up to date on the issues.
Their views will be actively sought and
acted upon. Feedback will demonstrate how
their input has been acted upon.
• Consultative - The target population is
informed about the changes and their views
are sought.
• Directive - The workforce is informed about
the changes and why those changes are
important.
• Coercive - The workforce is told that they
must obey the new instructions.
Case Study
A computer hardware and services supplier
needed to restructure the workforce to achieve
dramatic cost savings. They decided upon a
fully collaborative approach where all
employees were invited to a series of
workshops to examine the case for change,
analyse the problems and define solutions.
By the end of the process, not only were the
employees fully backing the restructuring, but
individuals were even recognising that they
themselves would be redundant and
volunteering to leave.
Case Study
An organizational Change Management expert
was addressing an audience at a conference.
After some time, a senior member of the armed
forces was feeling highly frustrated. He stood
up and asked for an explanation. "I don't see
the point of all this", he said. "I give an order
and my people carry it out."
Who was right? Why should the workforce
not just do as they are told?
Communication
One of the main tools for promoting change is
communication. Early in the project an initial
approach to communication will be formulated.
It has two main purposes:
• to convey important information that the
audience needs to know, and
• to promote organizational change.
Messages supporting the project's change
objectives should be carefully constructed. The
best media should be identified to convey the
right messages to the right people at the right
time. During the project, these messages and
methods will be refined based upon
achievements, feedback and the changing
circumstances of the project.
Organizational Change Management at
Phase Start
For each phase the change management plan
will be prepared in detail. Input and feedback
from previous phases will inevitably lead to
modifications to the overall approach.
Update the Sponsorship Map to show who is
involved at this stage and what is required of
them. As part of the launch activities for the
new phase, sponsors should be informed,
briefed and reanimated. Their continuing
support should be ensured.
Often a new phase means new team members
and new participants from the business. Make
sure there is a good process to capture their
support and enthusiasm.
Organizational Change Management During
the Project
Organizational Change Management
techniques fall into two main types:
• input - analysing the problem, and
• output - inducing organizational change.
It may also be appropriate to couple these
organizational issues and needs with the
November 2007 NHRD Journal 15
mainstream design work of the project, so that
certain issues could be solved by the way the
solution is designed. It may be easier to make
the solution fit the people rather than the
people fit the solution.
The input activities are essentially forms of fact-
finding and analysis. Organizational Change
Management experts have many specialised
tools to:
• identify a population,
• assess that population's capabilities,
attitude, behavior, culture,
• define the change goals, and
• determine what is required to bring about
that change.
In the absence of an expert you would fall back
on basic fact finding and analysis, coupled
with common sense and experience.
Output activities tend to be various forms of
communication, for example:
• communicating messages
• coaching
• setting up sponsorship cascades
• collaborative workshops.
Although the change management analysis,
design and planning may be specialist tasks,
much of the change output can be applied by
other project team members. All team members
will have opportunities to spread the right
message. In many cases, the way they
approach a given activity might have a
significant affect on the target population -
increasing or decreasing resistance.
Non-specialist team members should be given
the basic skills and understanding to promote
organizational change. They should also be
guided by the specialists (if any) and by the
project's change management approach and
planning.
16 November 2007 NHRD Journal
Case Study
A Project Management expert was hired to
coach the IT project managers of
telecommunications service provider. In a
"collaborative" style, he led a conversation
about the relationship with the business,
trying to draw out a consensus that the
business and its end users were essential
players in building a successful IT solution.
But the project managers were unanimous.
One summed it up - "what we need is a big
brick wall to keep the users away from us".
That is a problem with a collaborative
approach - what do you do when the
population turns in the wrong direction?
Organizational Change Management at
Phase End
The end of a phase is always a good time to
review progress. Many organizational change
activities are imprecise in their effect. It can be
hard to measure whether the target population
has now become sufficiently supportive for the
project to succeed.
Take a fresh look at the organizational issues:
• did we really understand the barriers?
• how effective were the actions taken?
• what more do we need to achieve?
The conclusions will be fed into the planning
for the next phase of work.
Organizational Change Management at
Project End
The test of change management is whether the
new business solution can be launched
successfully in as efficient and pain-free a
manner as possible. The lead up to the
transition is often the most intense period. In
many cases it is the first time the affected
populations really become aware of the
changes (although, as you saw above, it is not
wise to tackle change issues late in the project).
Now they are confronted with changed jobs,
new procedures, new skill requirements,
training courses, and maybe even physical re-
location.
In some projects not all the current workforce
will be required for the new solution. Dealing
with the painful process of redundancy is
normally left to the HR and line management
functions.
There are, however, two big issues for the Project
Manager:
• The redundant staff will be required to
operate the current systems and processes
until the new solution is ready - and maybe
for some period of parallel running. Since it
is a legal or contractual requirement in most
countries to announce potential
redundancies well in advance and to give
individuals notice before their departure
date, the question is how to ensure they give
good service and do no damage to the
organization or the new systems.
• There may also be implications for the
survivors - those people who you are relying
upon to deliver the new solution. They may
be affected by the bad news concerning their
Reprinted with permission from the author.
• http://www.epmbook.com/orgchange.htm
colleagues. They may even go through a
period of uncertainty when they do not
know whether or not they themselves will
be retained. What needs to be done to
maintain their support and enthusiasm?
Bear in mind that the same issues could
confront project team members as well as
the target population.
By this stage in a major change, there needs to
be a substantial support mechanism for the
target population. As the key messages are
communicated, the project team needs to be
ready to help and prepared for the inevitable
issues. By this time, the sponsorship cascade
should be complete and solid - often extending
down to local champions carefully placed in
the users' teams. Support mechanisms will ease
the users' troubles, for example with
appropriate training at the right time, desk-side
coaching, good help desk/call center support.
Organizational Change Management should
not stop with the end of the project. During the
Benefit Realisation stage of the life cycle,
continuing emphasis will be needed to
encourage the community to adapt to the new
ways of working and get the most from the
change.
November 2007 NHRD Journal 17
 LEADING WHOLESOME CHANGE IN INTEGRAL WAY
ASHISH PANDEY
Abstract
The article proposes an integral view of organization and leading change based on literature and
real life examples. Integral view is based on four quadrants of reality given by Ken Wilber and
effectively integrates the diverse perspectives about organizations and organizational change.
Introduction
Change is the reality. In Sanskrit
language 'world' is translated as
'vishwa'. Etymologically it comes
from the root word 'vish' meaning
spreading, that which is never same
at two different points of time.
Change is not an occurrence but the
Ashish Pandey is a
consultant and leading way of existence. But 'leading and
the Research and managing change' has become a
Development function at
matter of systematic enquiry in last
Pragati Leadership
Institute, Pune, India. He
two-three decades. Particularly last
two decades have seen dramatic
has been FPM Scholar at
Management changes in the corporate world
Development Institute, characterized by richness in
Gurgaon, and has knowledge, unprecedented levels of
received best paper
business operations: monetarily
awards from different
national and and geographically, unprecedented
international forums - at level of diversity, and turbulence.
I.I.Sc., Banglore, I.I.M. These are the major triggers of
Indore and Infosys organizational change. The way HR
Leadership Institute,
professionals along with business
Mysore. His research
works are included in leaders deal with these issues is
journals like Journal of going to drive the practice as well
Business Ethics, Journal as the theoretical development in the
of European Industrial discipline of leading change.
Training, Global Business
Models and Approaches of
Review, Psychological
Studies, and Indian Change Management
Journal of Training and
Development. Various models and theories are
proposed by consultants and
academics for effectively managing
and leading change. Higgs and
Rowland (2005) gave a useful
typology of the change models.
18 November 2007 NHRD Journal
Looking at the change management
literature we come across two
predominant types of the models.
On the basis of the basic
assumption being followed change
models can be put on a continuum.
One end of the continuum
represents deterministic models in
which change is considered as
predictable phenomenon.
Ontologically organizational
change is considered to be step by
step process which can be designed
and consciously implemented by
the leaders. Lewins three steps
model and John Kotter's model are
the most widely referred models in
this category.
Another end of the continuum
represents the change models and
approaches in which change is
considered to a complex
phenomenon. Most of the models
in this category draw hugely from
the systems approach. Some of the
basic tenets of these notions are that
organizations are living systems.
Like any other living system
organizations also shows the
characteristics of emergence, delay
and feed back and cannot be
change deterministically. Notions
of Whetley (1992), Senge et al. (1999)
etc. are some of the predominant
voices in this category.
A living system can never be directed, only
disturbed (Kellner-Roger, 1998). Therefore
leaders should not believe that the careful
crafting of an organizational message will be
understood uniformly across organizational
layers or that memorized value statements
create shared meaning. The interpretation of
message and reactions to it will be dependent
on selective perception and interpretation of
individuals who receive it. That's why it is
important to explore the diversity in the
organization (instead of adopting uniform
approach of change as assumed in
deterministic models) to develop a more
coherent understanding, a shared sense of
what is significant.
Deterministic and systemic views represent the
two equally powerful ways of thinking situated
at two ends of the continuum in their purest
form. We perhaps cannot getaway with either
of the approaches. My submission in this article
is that integral view of the organization and
wholesome way of change can bring new
insights to integrate both the views for leading
the change process effectively. Integral view of
change is based on Wilber's (2002) four
quadrant approach of reality. This approach
facilitates the social event to be analyzed in
terms of its multilevel nature, i.e. its micro, meso
and macro forms thus can be used in the field
of organization development, leadership,
change management etc.
Integral View of Organization
Integral approach proposes that any
phenomenon has two fundamental dimensions
of existence. These are the interior-exterior
dimension and the individual-collective
dimension. The interior-exterior dimension
refers to the relationship between the intangible
world of subjective experience and the tangible
world of observable behaviors. The individual-
collective dimension refers to the relationship
between the individual experience and
collective world. The interaction of these
dimensions produces the fundamental
domains or quadrants of reality.
The domain of individual-subjective, i.e. 'I'
quadrant represents the personal experience and
meaning. Domain of individual exteriors is the
behavioral quadrant. Domain of collective
interiors is the cultural quadrant and the domain
of collective exteriors quadrant represents the
tangible social system and processes.
As shown in figure 1 organization can also be
understood in this frame. 'I' quadrant of the
organization represents the personal meaning
and values of the people working in the
organization. While working in the
organizations, people also subscribe to their
personal aspirations, goals and sense making.
Organizations are the places where individual
meaning of the members is created and shaped
(Fineman, 1993). Upper right (IT) quadrant
represents the observable behavior of the people
working in the organization. Code of conduct,
dress codes, and other behavioral norms are
represented by this quadrant.
Both the lower quadrants represent the
collective system of the organization. Left lower
(ITS) quadrants represent tangible processes,
structures and observable aspects of social
system of the organization. Formal
organizational design, production process,
information technology related processes are
some of the representative components of ITS
quadrant. Right-lower (WE) quadrant
Figure 1: Four Quadrants of Organizational Reality
(adapted from Wilber, 2002)
November 2007 NHRD Journal 19
represents the culture of the organization.
Organization culture is resultant of shared
meaning, values and beliefs of the organization.
An organization is combination of all these
quadrants. Organization is so much of
individual experience and behavior as much it
is systems, processes and culture. Integral
approach suggests that all the four quadrants
are equally important. Wholesome change and
development of the organization is the result
of sustained efforts and appropriate inputs on
all the quadrants. Over or under emphasis on
one or two quadrants at the cost of others is
reflected in the poor organizational
performance in the long run.
Types of Change: An Integral View
Literature on organizational change
distinguishes between two general types of
change: organizational transition or
improvement and organizational
transformation. As the more traditional
approach, organizational transition or
improvement is relatively well defined and
circumscribed in terms of its process and
technologies. Generally speaking
organizational transition focuses on the change
process as a bottom-up and more of process
based phenomenon. More importantly for this
discussion, it represents the more traditional
deterministic management perspective. Looking
from the integral perspective organizational
Figure 2: Foci of Different Kinds of Organizational Change
20 November 2007 NHRD
transition and improvement related change
efforts are more focused on right quadrants
representing observable individual behavior
and organizational systems, processes and
design aspects. Whereas Organizational
Transformation is more a holistic pursuit
focused on deeper involvement of individuals
and cultural transformation. Case studies of
major organizational transformations which
had also been sustained over a period time (e.g.
Tata Steel, GE, Toyoto etc.) suggest the
importance of focusing on upper and lower left
quadrant. Figure 2 summarizes this point.
Different Foci of Change Interventions
If we go deeper and examine the different
interventions to bring change in the
organizations, we can observe that most of these
interventions focus on some specific quadrants
of organizational reality as depicted in figure 3.
For example T-group training focuses on 'I'
quadrant and most of the behavioral training
are largely focused on 'IT' quadrant. ERP
(Enterprise Resource Planning) or re engineering
are the interventions largely focus on 'ITS'
quadrant. Whereas interventions related to team
building and cultural integration etc focus on
'WE' quadrant of the organization.
Submission here is that key to successfully
leading the change is not trying one intervention
after another but in right balance of appropriate
and well aligned interventions in different
quadrants. I have studied a research and
development organization where state of art
Knowledge Management (KM) system was
installed (ITS quadrant) but its impact on 'WE'
quadrant is not consciously traced and
designed. No one was sure that whether the KM
system have any incremental value on real time
collaboration amongst the scientists for
knowledge creation and dissemination.
Similarly I have also observed an organization
where culture of open communication and great
deal of authenticity (I and WE quadrants) exist
Journal
but in absence of formal process of knowledge
sharing and documentation the positive culture
does not result in overall knowledge creation
and organizational learning and eventually
plausible business benefits.
Figure 3: Different Foci of Varied Change Interventions
Utility of Integrative View in Leading Change
More than 70 percent change initiatives does
not achieve the intended results. Even ruthless
cost cutting and downsizing (rightsizing as it is
mentioned) doesn't guarantee business impact
in the long run (Bleakley, 1993, Henkoff, 1994).
On the other hand building organizational
capabilities by focusing on personal and shared
meaning ('I' and 'WE' quadrants) may not result
in creating market value of the firm (Nohria and
Beer, 2000). Many times whole organizations are
sent to change programs in diversity, creativity,
time management, personal effectiveness etc.
Many individuals profoundly changed by these
programs but many a time their personal change
doesn't translate into organizational change.
Research shows similar findings about specific
interventions like ERP, KM, Behavioral training
etc. The business value of ERP implementations
has been extensively debated in trade
periodicals and research is throwing diverse
conclusions (Hitt, Wu and Xiaoge, 2002). HR
professionals and trainers are struggling to
measure the return on investment in attitudinal
and behavioral training.
My submission is that intervention in one
quadrant also needs helpful mechanisms being
designed and implemented in other quadrants
of organizational reality for sustainable result.
In the form of scientific management, TQM,
Knowledge Management, re engineering or core
competence the field of management has been
over enthusiastic about one or other
management technique or approach. Over-
reliance on any approach confines the
organization efforts in one or two quadrants and
do not make change wholesome, sustainable
and joyful. This notion is further substantiated
if we closely examine the most successful and
profound changes being led or managed in
modern time. Two examples of such kinds of
changes are briefly described to further explain
the integral approach of wholesome change.
Two Examples of Integrative and Wholesome
Change
First example is of organizational
transformation of General Electrical (GE). 25
lessons by Jack Welch summarize his approach
of organizational transformation being applied
in GE during 18 years of his leadership. Closer
examinations of these lessons suggest that they
implicitly cover the four quadrants of
organizational reality. His statement that
leaders are wanted in the organization that can
energize, excite and inspire rather than enervate,
depress, and control indicates the importance
of 'I' quadrant. Along with the global presence,
he emphasized to behave like a small company
in term of open communication, informality and
maximum involvement of the people. This
notion covers the 'IT' quadrant of organization.
Six Sigma had been institutionalized as
signature process in GE. This reflects the
streamlining and appropriate emphasis on 'ITS'
quadrant of the organization. His statement that
numbers aren't the vision; numbers are the
products. Focus more on the softer values of
building a team, sharing ideas, exciting others
and emphasize and organizational
transformation agenda.
November 2007 NHRD Journal 21
Second example of the change in integral and
wholesome way is of Indian freedom struggle.
In terms of scale, impact and most importantly
'purity of means' this is one of the rarest of rare
examples of 'change'. Objective here is to see
the change initiatives introduced by Mahatma
Gandhi and how they were so effectively
covering all four quadrants of reality. The most
important contribution of Mahatma Gandhi in
the Indian freedom struggle was to generate a
mass movement for independence. He was able
to create personal meaning for Indian freedom
amongst common man in India across different
strata of society. This was the success in 'I'
quadrant. 'I' quadrant success was largely
based on movement for Swadeshi, spinning the
wheel etc. Using swadeshi (indigenous) goods,
burning the videshi cloth, Namak Satyagrah,
and spinning wheel etc. represents the 'IT'
quadrant. Though these were seemingly small
activities but of great value in spreading of
awareness. These seemingly small activities
were able to create personal meaning amongst
the fellow citizens. In the 'ITS' quadrant based
on his own moral authority, clear thinking and
guidance many social catalysts were prepared
who became nodal centers for freedom
movement and other social activities. In 'WE'
quadrant he could create shared vision of
independence and shared values of democracy,
References
Bleakley, F.R., (1993), ‘Many companies try management fads, only to see them flop’, Wall Street Journal, 6 July 1993, pp. A1, A8.
Fineman, S. (1993), in S. Fineman (edi), Emotion in organizations, Sage, Newbury Park, CA.
Henkoff, R. (1994), Getting beyond downsizing”, Fortune, 10 January, pp. 58-64.
22 November 2007 NHRD
social harmony and secularism to great extent.
Eventually these values continued to be ideals
for the independent India.
Two examples briefly described above indicate
the utility of integral view for leading change
wholesome change in organization. It doesn't
mean that management had been totally
oblivion to different aspects of organizational
life. Nocols (1994) talked about increasing
importance of creating meaning at work.
Wakhlu (2000) talked about engagement at the
level of heart and spirit for wholesome life of
the organization. Utility of this framework is
in its simplicity and power of
comprehensiveness to juxtapose the seemingly
diverse nature of organizational reality.
A natural outcome of this discourse and
examples quoted here is the importance of
wholesome leadership for implementing
wholesome change. Ability of a leader to apply
the integral or wholesome approach of change
in the organization is inevitably linked to his
or her own personal view of reality. Leaders
with integral view are the prerequisites of
integral or wholesome change process. Perhaps
teaching of Lao-tzu is valuable in this regards
when he says "the way to do is to be". The
message is not different from what Mahatma
Gandhi said "One must be the change which he
wants to see in the world".
Journal
Higgs, M. and Rowland, D. (2005), ‘All changes great and small: Exploring approaches to change and its leadership’, Journal of Change
Management, vol. 5, iss. 2, pp. 121-151.
Hitt, Lorin M., Wu, D. J. and Xiaoge Zhou (2002), ‘Investment in enterprise resource planning: Business impact and productivity
measure’, Journal of Management Information Systems, vol. 19, iss. 1, pp. 71-98.
Kellner Roger, M. (1998). ‘Changing the way we change’, Perspectives.
Kotter, J. (1996), Leading Change, HBS Press, Boston.
Nichols, M. (1994). ‘Does new age business have a message for managers?’, Harvard Business Review, vol. 72, iss. 2, pp. 52-60.
Nohria, N. and Beer, M. (2000), ‘Cracking the code of change’, Harvard Business Review, vol. 78, iss. 3, 133-141.
Senge, P.M. (1997), ‘Communities of leaders and learners’, Harvard Business Review, vol. 75, iss. 5, pp. 30-2.
Wilber, K. (2002), Spectrum of consciousness, Pub. Motilal Bavarsidas, New Delhi.
Wheatley, M. J. (1992), Leadership and the new science, Berrett-Koehler, San Francisco.

Endnotes 1
Earlier draft of the paper was presented in Global OD Summit, 2006 at Mysore and was adjudged the Best Paper in Future Focus
Stream. Valuable inputs of Prof. Rajen Gupta of M.D.I., Gurgaon, and Arun Wakhlu, Pragati Leadership Institute, Pune, are
gratefully acknowledged.
i Lewin's model change is the most widely referred by practitioners and in the academics alike. It talks about three phases of change
process. First phase of the change is dissatisfaction with the status quo. Second stage is about identifying and mobilizing the
resources required effecting the change. Third stage is embedding the new ways of working in the fabric of the organization.
Kotter's model gives eight steps of change starting from creating urgency to institutionalization of change.
ii Like any living systems organizations also display capacity for sophisticated, coordinated behaviors. Yet these behaviors are never
the result of directive leadership, strategic plans, or engineered solutions. They arise as if by magic, surprising even the members of
the system, through a process called emergence. Emergence is the capacity of the system that resides only in the system not in the
individuals. Surprise of emergent capacity confronts most of our trusted beliefs about how to create change in any organization.
iii Interestingly Prof. J.K. Jain of Management Development Institute, Gurgaon, teaches management lessons based on Gandhian
way in a reputed institute in France. Author is not aware about the systematic teaching explicitly based on Gandhian principles being
imparted in any business school in India.

November 2007 NHRD Journal 23

 CHANGE MANAGEMENT: SOME PRACTICAL
CONSIDERATIONS
BHAWANA MISHRA

Abstract
This article takes a practical view on change management in the every day lives of HR and
business managers. Implementable ideas have been presented for dealing with obstacles to
change before it occurs, managing change during the process and coping with poorly planned
change. In order to keep the emphasis on practical considerations, there is a deliberate absence of
reference to the vast body of academic work and research in the area of change management.

Introduction to address those concerns and offer

As I started to structure my thoughts
on this article, I decided to run a
Google search on change
management, to understand the
current thinking on the subject. At
the least, the results were
Bhawana is the Business astounding. Google returned 574
Director of SHL India. million links in 0.05 seconds for a
An Applied Psychologist generic search on 'change
by training, she worked
with leading consulting
management'. So I got specific in my
firms search: 'change management
PricewaterhouseCoopers definition' resulted in 41.2 million
and Arthur Andersen, links, 'change management models'
prior to joining SHL six
years back. in 49.8 million links and 'change
management process' led to 168
million links!
The message to me was very clear
and only confirmed my thinking
that enough has been said and
written on this subject. So my
question on what I could say that
was new and relevant, still
remained. Then I started to think of
the concerns and experiences my
clients have shared with me over
the years when implementing
various initiatives -- a performance
management system, a career
planning initiative, processes such
as Development Centres, 360
feedback and so on. So I felt that
this was a good opportunity for me
some practical and implementable
ideas to deal with change.
Accordingly, I have structured this
article in three parts:
• Preparing for change:
Understanding the five most
commonly faced obstacles in
implementing effective and
lasting change;
• Managing change: A synthesis
of best practices that successful
change programs have
followed; and
• Coping with poorly planned
change: Ideas for damage
control if a change initiative is
on the verge of failure.
Preparing for Change:
Understanding Obstacles
Even before we start to introduce a
change, however big or small that
may be, we should be conscious of
existing practices, processes and
cultures that may become
hindrances in success. The
obstacles are often unique for
companies and not planning for
them in advance leads to interim
and incomplete solutions that are
deployed to deal with them at the
last minute.

24 November 2007 NHRD Journal

• Organization Structure
Rigid hierarchical structures may be restrictive
in implementing new initiatives. For example,
if the aim is to introduce an ERP system for
Purchase, the individual level accountability
that it promotes will not succeed if people are
used to having everything signed by the
functional head.
• Cultural Norms
The most common HR example of this is if line
managers have been used to being responsible
for staff progressions and methods such as
Assessment Centres are suddenly introduced.
There is bound to be resistance in the form of
"we have always done it this way" if this is not
addressed prior to the change being initiated.
• Performance Metrics
Early thought has to be given to whether the
current performance management system may
hinder implementation of the new initiative.
For example, introducing a new CRM system
will remain another 'initiative' if performance
assessment of sales staff only assesses revenues
generated and not customer satisfaction or
related metrics.
• Senior Management's Behaviours
A company was trying to bring about greater
customer orientation in its people. But survey
after survey revealed that this was not
successful. Consolidation of 360 feedback data
on the senior management revealed that they
were consistently driving systems and process
orientation and not speaking the customer
language. Naturally, employees knew what the
bosses were looking for.
• Communication
Communication begins well before the
initiative itself. An announcement that a new
initiative in a couple of weeks will impact how
people are paid or promoted is bound to cause
resentment, however fair it might be. Likewise,
what is communicated is often not true or only
the partial truth. There are innumerable
companies that have communicated to
employees that a certain assessment
programme is for identifying development
needs, and then gone ahead and used it for
career progressions. People understand such
things and an experience like this undermines
the credibility of the senior management and
HR for a long time to come.
Managing Change
Several models have been developed over the
years to help manage change and deal with it
most effectively. However, as is often true of
academic and research work, a lot of them are
not easy to remember or implement in a real
organizational context. Based on the review of
some of the available literature, and my own
experiences in working with clients, I have
developed the 'Iceberg Approach to Managing
Change', which I hope will serve as a ready
reckoner for dealing with change projects. At
the top of the Iceberg are surface issues such as
understanding the pain area that requires
change to be brought about and building
acceptance amongst people about the need for
change. As we go deeper, the issues are also
more evolved, but if dealt with successfully, will
lead to a lasting and effective change
programme.
The Iceberg approach to managing change
I dentify the need
C ommunicate objectives and processes
E ngage People
B uild change communities
E valuate and measure success
R einforce positive change behaviours
G row and develop during change
To elaborate :
• Identify the need
It is critical to determine whether the need is a
November 2007 NHRD Journal 25
true requirement of the company or a good-to-
do thing because it appears to be 'best practice'.
Also, what is the impact that it is expected to
make. A diagnosis of the current state is critical
to understand the extent and nature of change
that can be introduced. For example, 360
feedback cannot be introduced in a company
that has never done assessments seriously.
Incremental steps are always long lasting than
wide-scale change introduced in a hurry.
• Communicate objectives and change
process
Communication is not only about informing
people about the initiatives, but targeting the
communication to the audience, thinking
through channels of communication and
building feedback mechanisms to ensure that
the messages have been understood.
Communication is most credible when there is
active participation of the project sponsors, in
particular, the top management.
• Engage people
If people feel that it is an organization-wide
initiative and everyone has a role to play, their
participation and ownership is that much more
real and involved.
• Build change communities
All organizations have people forming informal
cohorts and support groups. These are
particularly useful in a change program, as they
can be used to spread formal and informal
messages and also build acceptance.
organizations can also orchestrate these by
creating self-help teams that work on making
the new initiative work and seeing people
through it.
• Evaluate and measure success
Often companies assess achievement of change
objectives after they are completed. This aspect
actually needs to be considered before the
change programme is introduced.
Measurement should take place through the
programme to ensure it is working and course
correction should be made based on feedback
26 November 2007 NHRD Journal
received. Pilot projects for large initiatives are
often very useful for collecting early feedback
on what are likely to be the key issues.
• Reinforce positive change behaviours
It's a simple Pavlovian principle. No change
will last if there is no incentive to make it long
lasting. So reward and recognition mechanisms
that reinforce the changed behaviours are
critical to any change programme. For example,
a line manager may enjoy giving employee
feedback once in a while, but s/he will make
employee development planning a regimen if
it also impacts his or her success.
• Grow and develop during change
Finally, most often, change involves acquiring
some new skill sets or using new processes or
methods. People should get the desired
training, coaching and technology support to
adopt change faster and effectively. Training
also gives employees the confidence of having
acquired newer skill sets, thereby building a
positive attitude to the change initiative.
• Coping with Poorly Planned Change
Having said all of this, we don't always have the
luxury to plan things or be in control of the
circumstances. Typically, this happens when a
mangers joins an organization while some
programme has been or is being implemented.
Several HR managers will recount the nightmares
they experienced when they joined and had to
grapple with the impact of an ERP solution
introduced in a hurry or a 360 programme
launched without a plan for follow up action.
Often, they would also have been blamed for
everything that went wrong! However painful it
may be, we cannot avoid dealing with this form
of change as well; one that we were not
instrumental in introducing, but nevertheless
have to deal with. So where do we begin?
• Seek Feedback
The first way of building credibility is to seek
feedback on what has worked and what has not.
This instils confidence in people that you would
like to do something about it. Depending on the
magnitude of the programme, you can use to the organization's success, re-visit the
formal surveys or informal grapevine and other reward and recognition mechanisms that have
sources of information to seek this feedback. A been put in place. Ensure that there is a direct
word of caution: do not do this if you have the linkage between change behavior and reward.
slightest doubt on whether you will be able to As importantly, ensure that this is
action some of the issues that come up. communicated and understood by people.
• Recognise and Accept Individual Coach and Develop
Differences
Resistance usually stems from a fear of the
It is important to understand that people react unknown. This can be dealt with information
differently to the same circumstances. Spread the and equipping people to deal with it. Everyone
message across that it is alright to do so. The is more comfortable when they know what to
ADKAR® model (Hiatt, 2006) can help you plan expect and are prepared to deal with it. An
effectively for a new change or diagnose why a absence of either can cause disruption. So it is
current change is failing. In some cases, corrective never too late to provide the relevant coaching
action can be taken and the change successfully and training to help people cope with change.
implemented. The five elements of ADKAR are:
Identify Agents
• Awareness of the need for change.
Because some of the change has already
• Desire to make the change happen. occurred, there must be some people who have
• Knowledge about how to change. benefited from it or feel that it is for the good of
• Ability to implement new skills and the organization. Identify and use such people
behaviours. to spread the message to the rest of the
• Reinforcement to retain the change once organization. However, ensure that these
it has been made. people are seen to be unbiased and not blind
supporters of the management.
• Rebuild Sponsorship
Identify Add-on Benefits of Change
Often you will find that if an initiative has
prolonged for a length of time, the commitment Chances are there has already been much
of the project sponsors also vanes. Ensure communication on what are the benefits an
renewed commitment from the project sponsors, initiative will bring about. If this is the case, try
in particularly the top management, for their two to identify add-on benefits that were not
key roles in the change process - visible already communicated. They can bring about
participation and communication. Employees renewed vigour if they can be demonstrated to
do what reflects them in a positive light - setting be relevant to specific groups of people.
this expectation from the management reinforces The issues and ideas discussed here are by no
organizational commitment. means exhaustive. However, I hope that I have
Strengthen Reinforcements provided a few reference points that HR and line
managers alike will find of use in implementing
If the initiative has been identified to be critical any change initiative in their organizations.
Bibliography
Hiatt, Jeffrey M. (2006). ADKAR: a model for change in business, government and our community. Prosci Research, Loveland, USA
Kotter, J P. (1996). Leading Change. Harvard Business School Press. Boston, Massachusetts.
Kotter, J P and Cohen, D S. (2002). The Heart of Change. Harvard Business School Press. Boston, Massachusetts.
Mark Large, DLTP Delivery Support Manager. (2006). Change: How to do it and Make it Work, Tools and Techniques for Managing
Change. Retrieved on 29th Oct 2007 at www.ams.mod.uk/content/docs/change_mgt/handbook.pdf
Partridge, L. (1999). Managing People, Book One. Financial Times Management. London.

November 2007 NHRD Journal 27

 FUNDAMENTAL CHANGE IN EDUCATION QUALITY
DILEEP RANJEKAR
Experts often dish out the cliché -
"the only thing constant in life is
change". We find more people
around us telling others to change
and explaining the importance of
change in something or the other.
Before my marriage I knew there
were significant differences in the
Dileep Ranjekar, the
Chief Executive Officer
views and culture of my wife and I.
of Azim Premji However, I was confident that I
Foundation, is a science would be able to change her - and
Graduate and has a Post am still struggling to change her
Graduate Diploma of
Business Management as after 27 years. Leaders tell their
well as Master's degree in team members to change their
Personnel Management methods or attitudes. Parents tell
and Industrial Relations
their children to change their habits
from Tata Institute of
Social Sciences, Mumbai. and attitudes. And the children in
He joined Wipro from turn tell their parents to understand
campus and became the the change that is happening in
Corporate Executive Vice
President Human society and adapt to the same. And
Resources. As CEO of yet, one constant is that most people
Azim Premji find it difficult to change.
Foundation,he is leading
over 250 professionals Scale of Change
and several hundred
volunteers working When you discuss "management of
towards realizing change" at "national level", the
foundation's vision dynamics of change becomes even
through the Foundation's
current engagement with
more complex. The imponderables
over 16,000 schools that and non-controllable s increase
have 50,000 teachers and geometrically.
2.7 Million children with
a missionary zeal. At Azim Premji Foundation since
we are essentially seeking to
contribute to a systemic change in
the quality of education in India we
often debate and explore what
would have the highest potential
to create a possibility of such
change. I discuss with other
organizations with similar goals
just one question - what would
create the required change?
Especially so, since we have a
28 November 2007 NHRD Journal
National Education Policy that
articulated the goals of education,
the thrust areas and a way to
achieve the goals way back in 1986.
Every state in India has a fair
amount of clarity on what should
happen in their schools. They are
clear that all children must be in
the school, attending regularly and
most importantly learning as per
the expected goals of the
curriculum or of the National
Education Policy.
Nature and Size of the Problem
However, after 60 years of
independence, here is the
performance of India in key aspects
of quality of elementary education:
• India accounts for 16% of the
global population but
contributes to just about 1.16%
of world's GDP
• Close to 20 million children are
still outside the school.
• Attendance of the children and
completion of education cycle is
a major challenge. For instance,
if 100 children get enrolled in
the First standard, only about 52
complete education cycle up to
Eighth standard and only about
31%.
• Over 33% of the children are
unable to read or write in class
V.
• Our literacy level is 65% vs.
world average literacy level of
80%.
• Only about 8% children pursue
higher education.
• In only about 10% of the school - over 60%
children achieve the expected learning
competencies.
Needless to say, India has not succeeded in
bringing about the change at national level. And
this is not only true for education but also in
other development areas such as health,
nutrition and poverty. In elementary education,
we are referring to a system that consists of 200
mln children in the age group of 6-14 years in
1.3 million schools.
What Induces a Large Scale Change?
There is very little understanding on this issue. If
you analyse the circumstance in which major
changes have happened across the world, you
will realize that it has been either a major attack
from outside or a major external challenge that
jeopardized the national pride or national
security. So the science teaching campaign in the
US was a result of the challenge that was created
by the USSR by successfully launching the space
program before the US did. Or the maths teaching
revolution in Japan was a result of major
challenge from China. In our own country, the
war of China and Pakistan in the 1960s had a
major uniting effect on the country and a lot of
territorial and religious barriers broke down when
the national security was under attack.
The interesting thing about education is that
the purpose of education itself is to create or
contribute to "social change". However, more
often than not, education is being used to
simply maintain status quo and to create a
replica of existing society.
Our Analysis of Issues in Education
After over 6 years of grass root work, we at Azim
Premji Foundation have had a some critical
insights in the domain of education.
Significant improvement in access: Since over
85% of the elementary education happens in
the Government schools, the state holds the key
on the supply or access side. During the past
10 years, some of the basic access issues have
been by and large resolved. For over 95% of the
habitations in the country there is a primary
school within 1 km and a higher primary school
within 3 kms. There are several other changes
that have happened. The teacher pupil ratio
has improved to 1:42 (though still not sufficient
and we still have over 75% schools engaged in
an unplanned multigrade teaching where one
teacher reaches several grades together). Mid-
day meal program has been introduced in
majority of the schools (though the quality
needs improvement), classrooms have
increased, budgets for teacher training are
available etc.
Quality of learning - the biggest issue: The
single most important aspect that we have not
been able to change in the schools is the quality
of education. The biggest problem being
education is equated to ability to "rote
memorize". The education system has forgotten
the education goals that are articulated by the
National Education Policy. The entire system
has become a drill to remember the text books
than understand, comprehend, apply, analyse,
innovate that are so critical to building a
knowledge society.
Need to break myths:
There have been several aspects that need
change and several myths need to be broken.
The key among them are:
• Mindset # 1: Children when they enter the
schools are deficient and need to fixed.
Reality: Even before the children arrive in
the schools, they have huge potential and
that needs to be realized.
• Mindset # 2: Learning takes place in the
head and not in the body as a whole.
Reality: Learning and abilities reside in
various parts of the body and mind.
• Mindset # 3: Everyone learns or should
learn in the same way.
November 2007 NHRD Journal 29
 Reality: Various individuals learn at
different pace at different times
• Mindset # 4: Learning takes place in the
classroom and not outside the classroom.
Reality: Every life experience contributes to
learning anywhere.
• Mindset # 5: There are smart kids and dumb
kids.
Reality: Each child is uniquely gifted and
possesses talents in multiple areas.
It is absolutely mind boggling to observe how
the entire elementary education system, that
consists of 5.5 Mln teachers, 1 Mln education
functionaries and spends over Rs. 1,40,000
crore engages most of the time on issues that
are not related to achieving the quality of
education in the classroom. There is a lot of
talk on appointing teachers, transferring
teachers, building classrooms, getting reports
from the schools, enrolment, attendance so on
and so forth…. but very little discussion on
quality of what happens in the classroom.
Some Enablers of Change
The National Curriculum Framework has
attempted to define the process that could achieve
the goals of education. However, in addition to
the difficulties and lack of guidance on converting
the curriculum into classroom processes,
probably the biggest challenge is its awareness
among the teacher educators and the teachers.
In our analysis, the most important change
agents that could bring about the required
change in the quality of education are:
• Teachers
• Education Administrators
• Parents and community that can exert
pressure on the schools
• Examination reforms
Irrespective of what happens in the rest of the
education system and what people keep
30 November 2007 NHRD Journal
harping on--the crucible of learning in a formal
and structured education system is the
classroom. And this is where the teacher has
the most pivotal role in influencing the learners.
The teacher exists in a total system of education
delivery that is needed to be supported by the
education administrators - who among other
things are also responsible for appointing,
inducting, training, preparing and
academically supporting the teachers.
It is the parents that are most affected by the
poor quality of education since it deprives their
children from becoming responsible and
effective citizens and bread-winners for the
family.
The current driver for change - the
Examinations: The process that drives the
behavior of almost the entire education system
currently is the "Examination System".
Examinations serve similar purpose as of the
performance management system in the
corporate organizations. In absolute terms
there is nothing wrong - except that the current
examination system is almost entirely focussed
on testing the "rote memorization" of the
students. Thus at the primary education level,
in a story of "Hare and Tortoise" the questions
that are asked are what did the hare say to
tortoise or something similar - wherein the
student has to remember who said what.
Instead, the question should be "why did the
tortoise win the race"? Unless the student has
understood the story, there is no way the student
would be able to answer the question. Similarly,
in history subject, the focus tends to be on
chronology of events and the years in which
certain historical events happened. Instead the
focus should be on the characters, their
patriotism, their diplomacy, the failures of the
society to recognize certain events, bravery,
valor etc.
It is important to understand that because the
examinations focus excessively on rote
memorization, the focus of the teaching
learning tends to be preparing the child for the
narrow list of questions at the end of the lessons
and not on the broader issues of education
goals to be achieved through the subject.
The basic beliefs in the National Curriculum
Framework are:
• Learning as a process is unique to each
individual
• Teaching with a 'prepared logical
sequence' decided by teacher or others
may result in little learning, that too, rote
learning
• Pedagogy is but a process for mediation
of resources in the form of meaningful
experiences catering to varied learning
needs of learners
The essential focus of the curriculum is:
• Learner centric, not teacher centric
• The focus is learning - not teaching
• Processes that
• recognize the diversity, flexibility and
varied learning needs of the learners
• Is culture and context sensitive
• Forward looking
• Life related
The above reforms require radical change among
the teachers, the process and the paradigm of
all involved in the delivery of education. The
fundamental difference in an assembly line
approach to education and the child centric
approach is that here the learner is capable of
contributing to herself/himself. That the learner
is able to learn through the exposure to
experiences. That the learner is able to construct
her/his own knowledge based on experience.
This would force the education system to re-
look at several issues radically differently. Some
of these would be:
• What kind of people become teachers?
• Is the profession viewed respectable and
rewarding enough to attract the best?
• Is the teacher education curriculum relevant,
experiential, teacher centric?
• How is the process of appointment of
teachers conducted?
• Are we from time to time defining and re-
defining the teacher competencies to meet
the challenges of the 21st century?
• How is the in-service training of teachers
carried out?
• Who educates and ensures the quality of
teacher educators?
• How do we reach every rupee of the
education budget to improve the quality of
learning?
• Are the examinations driving a classroom
culture and process that is consistent with
the National Curriculum Framework?
• How are we enabling the teachers to use
their freedom in the classroom - more
meaningfully?
• How do we address the issue of teacher
absenteeism?
• How do we create much higher
performance consciousness among
teachers?
• How do we make parents aware of their
responsibility in their children's education?
• How do we educate the parents on what to
expect as a result of education?
Political Will to Change - Critical in a
Democratic Set up
Many of the above changes need enormous
"Political Will" among the policy makers.
The political masters must get themselves
educated on relevant issues for quality
education. The most critical issues are:
November 2007 NHRD Journal 31
• Accord Highest Priority: Place the issue of
education at par with the other three
priorities - electricity (Bijilee), Roads (Sadak),
and Water (Paani). Accept that education
quality is fundamental to India's status as a
developed nation. We ought to be
knowledge creators and not mere
knowledge receivers.
• Allocation of Required Resources:
Including financial budgets. For too long we
have been speaking of allocating budgets
that are equal to 6% of the GDP vs current
allocation of about 3%.
• Accountability for Quality Education: We
need an attitude of catching the bull by the
horn when it comes to performance of the
delivery system. Illustratively, if almost 50%
students fail in the board examinations, who
is made accountable? Is it the education
minister? The education secretary? The
district or block education officer? The
teacher? Or the hapless student or even more
hapless parents? We have to fix the
accountability suitably.
• Measurement and Review: Review the
status of quality of education at the highest
level of political system: what gets reviewed
and measured also gets prioritized by the
system.
• Enabling Policy Changes: quality
improvement systems are often interlinked
and need a holistic approach. Illustratively,
32 November 2007 NHRD Journal
mere appointing of good teachers would not
help. You need to revamp the academic
support and training system, address
competence issues as well as motivation
issues. And that requires fundamental
policy changes in the risk reward system -
which is currently completely absent.
One of the ministers with whom I was
discussing the education quality issue told me
that you need to make an all round and
multidimensional effort if quality of education
has to be impacted. You need to 'for instance'
educate and influence the policy makers as well
as law interpreters.
Though the principles of "managing change"
might be common, the way it works at the
national level change is significantly different.
Especially in a system where the subject is both
a central as well as a state subject. Since the
change implementers are fragmented, you need
a greater advocacy thrust at a broader level and
an equally powerful demonstration of change
at the grass root level. And for this you need
education activists at the grass root level who
have the broader perspective of education.
Thus, a strategy of achieving macro level
change through series of "micro level"
demonstrations of change as "proof of concept"
is likely to work to raise the quality of education
at a national level.
 HOW HR CAN IGNITE 'HOT SPOTS'
YOGI SRIRAM

Abstract
The 6th National HRM Summit, organized under the auspices of All India Management
Association(AIMA) was held on 19th & 20th October 2007. It brought together the author of HOT
SPOTS - Lynda Gratton (LBS) and other eminent speakers from the Corporate World who spoke
on four themes to discover how HR can ignite HOT SPOTS. In compiling the various ideas from
speakers, the article tries to bring out how change can be brought through HR and leadership to
create and sustain hot spots. The article thus heavily drives on the ideas of the book and the
content of the summit.

Context innovative and winning

The biggest challenge facing the organizations where people are
HR function today is to create and self-propelled and feel like giving
sustain an innovative work culture. their best, and sometimes even
With the Indian economy surging beyond.
ahead and the Sensex surprising us Prof. Lynda Gratton from London
each day with unexpected highs, Business School , has explained in
Yogi Sriram is currently the expectations from HR has her book the people implications
at Larsen & Toubro increased many fold. The shortage on strategy. Her book "Hot Spots:
Limited as Executive
Vice President (Human of talent is being seen as the only Why Some Teams, Workplaces, and
Resources & big challenge in surfing this big Organizations Buzz with Energy - and
Administrative Services)
for the E&C division. He
wave of growth. HR has an Others Don't", is an international
had earlier rich opportunity, like never before, to bestseller
experience with, Taj attract, develop and retain this
Group (Hotel arm of the Inspired by her work, the Summit
TATA's) , Asea Brown scarce and precious talent. But the focused on "How HR can ignite 'Hot
Boveri , Dabur India, new Gen Y that is represented by Spots'" with sharing of experiences
British Petroleum as the young faces at the work place,
H.R. Director (Africa, and HR best practices and through
Middle East, Turkey & are the real opportunity for dialogue at the Summit, that lead to
South Asia) covering 3 unleashing potential and triggering new ideas on how to create
continents and 41
countries.He has a quantum growth. We need excited excitement in the Work place.
Honours degree in people with passion for
Economics from Shriram collaborating and innovating. HR This Summit was designed to focus
College of Commerce, the attention of business leaders on
Masters in Personnel has an opportunity to find ways to
Management & IR from trigger this passion and creating Hot Spots that are the key
the Tata Institute of
commitment for innovation and to the success of human endeavour
Social Sciences, LL.B.
from the University of excellence. Within organizations, within an organization, group and
Delhi and M.B.A. in there are periods when innovation team. There were also deliberations
Organization Behaviour on competencies that HR
from the Faculty of and creativity flows unhindered
Management Studies and the resulting activity and professionals should develop to
(FMS), University of
positive energy create unexpected ignite these Hot Spots.
Delhi. He has been
admitted as Fellow of results. These condensed periods The Take way of the Summit
the All India are called "Hot Spots". These can
Management The Summit triggered plenty of
Association. be ignited and sustained to create ideas to ignite Hot Spots that

November 2007 NHRD Journal 33

should create a collaborative and innovative
work culture, since this culture is the key to
attracting and retaining talent for building
business in organizations.
The Content
Presentations and dialogue at the Summit
covered examples of the HR function creating
Hot Spots in organizations in various Sectors
of business. The programme covered initiatives
implemented, outlining the stories of success,
challenges and failures in igniting Hot Spots
The deliberations covered the skills that are
required to execute such HR initiatives and
how HR communities propose to build these
skills quickly while organizations are restless
for rapid talent build up. The Summit provided
opportunities for learning through sharing of
experiences of delegates who have championed
HR innovations to achieve and sustain growth
through Hot Spots. The Summit made the
Coffee and Refreshment Breaks equally
stimulating with opportunities to learn.
Some Glimpses from the Summit Speeches
Yogi Sriram - Executive Vice President (HR &
Administrative Services) E&C L&T Ltd., who
was also the summit director, shared some
statistics about the Indian economy.
Household income will triple in the coming 20
yrs and India will be the largest consumer
economy by 2025. In terms of private spending
India would be the same as the US by 2025.
The Labor Force in India will dramatically
increase as compared to countries like France,
Australia etc.
K Venkataraman, Member of the Board &
President L&T Ltd. shared that old economy
companies have the largest growth potential of
market capitalization. They are the leading value
creators in the market. These are the Engineering,
Construction & Manufacturing sectors.
Ira Bindra- Director HR- GE shared insights
on how GE, a 116 billion dollar company is
34 November 2007 NHRD Journal
leveraging HR to create HOT SPOTS. She
shared that GE was focusing on energizing
partners and employees, attraction and
retention of talent. She said that HR can reach
new levels of excellence by earning the trust of
the leadership team, through disciplined HR
processes.
Rajiv Narang, focused on orbit shifting
innovation through generating escape velocity.
For organizations to see Hot Spots, leaders
should be aware of the organization's potential
Hot Spots.
A cooperative mindset is a mix of 3 elements,
namely, intellectual mindset, social mindset,
emotional mindset and a 4th addition by
Akhouri was a financial mind set. According
Akhouri of Hero Honda there are certain pre
requisites for hot spots. These are created by
the action of a leader and they are created by a
sense of urgency.
Yasho Verma of LG Electronics said his
Company focused on 3 types of quality -
Environmental Quality, Transactional Quality,
Process Quality.
Ishan Raina- of OOH believed that Boundary
Spanning meant redefining a category.
According to him HR plays a very important
role in combining ideas. These days' boundaries
are getting demolished by various
communication break thorough innovations
like internet. Companies are shifting the focus
from product to production. He talked about
how companies can become talent magnets by
investing time and money, identifying
promising leaders, by encouraging feedback
and support, developing teams and not
individuals.
Puneet Jetli- General Manager Mindtree
Consulting said HR has to play 3 roles in
boundary spanning - Individual, Team &
Organization.
P Dwarkanath- Director MAX India Ltd high
pointed the prerequisites of change which were
a winning attitude, strategic communication,
and aligning behaviour with strategy.
Arvind Agrawal- President RPG Enterprises
discussed the best practices and signature
practices of RPG and he told the audience
about the differences between them. Best
practices are like cut and paste practices but
signature practices evolve from a company.
Signature practices in long run become best
practices.
Shantanu Banerjee from XANSA emphasised
the importance of creating a climate of excellence
and that there should be a linkage between
human performance and financial outcome.
The summit highlight was the session by Lynda
Gratton. The focus of her session was to draw
attention of the business leaders on creating
Hot Spots that are the key to the success of
human endeavor within the organization.
Elements for Creating Hot Spots….some
extracts from Lynda's presentation and book
You always know when you are in a Hot Spot.
You feel energized and vibrantly alive. Your
brain is buzzing with ideas, and the people
around you share your joy and excitement. The
energy is palpable, bright, shining. These are
times when what you and others have always
known becomes clearer, when adding value
becomes more possible. Times when the ideas
and insights from others miraculously combine
with your own in a process of synthesis from
which spring novelty, new ideas, and
innovation. Times when you explore together
what previously seemed opaque and distant.
We can all remember being in Hot Spots, when
working with other people was never more
exciting and exhilarating and when you knew
deep in your heart that what you were jointly
achieving was important and purposeful. On
such occasions, time seems to rush by as you
and those around you are "in the flow."1 Time
even seems to stand still. We enjoy being part
of a Hot Spot, and we are healthier, happier
people as a result.
When Hot Spots arise in and between
companies, they provide energy for exploiting
and applying knowledge that is already known
and genuinely exploring what was previously
unknown. As a consequence, Hot Spots are
marvelous creators of value for organizations
and wonderful, life-enhancing phenomena for
each of us.
Yet life is not always about being in a Hot Spot,
and organizations are not always about
generating Hot Spots. How often have you
faced a situation when you knew in your heart
you could have achieved more? These are times
when your energy has drained, when the Big
Freeze takes over. There are many times, in
many companies, when Hot Spots fail to emerge.
Over 80 percent of the anticipated value from
mergers and acquisitions typically fails to
materialize. Three out of four joint ventures fall
apart after the honeymoon period. Many
executives report that they struggle to deliver
products to increasing discerning consumers.
Hoped-for innovation never materializes as the
marketing function fights with the sales
function about internal costing issues.3 The Big
Freeze also has a human toll. An overly
competitive working environment where
friendships fail to develop is one of the major
sources of stress at work and one of the key
reasons why talented employees leave
company.
These are very different problems with very
similar underlying reasons. As you will see, at
the heart of successful managers and
acquisitions, of well-functioning joint ventures,
of the launch of global products and the
creation of new products are Hot Spots. These
are the occasions when we are willing and able
to work skillfully and cooperatively within and
across the boundaries of the company, when
November 2007 NHRD Journal 35
our energy and excitement are inflamed
through an igniting question or a vision of the
future, times when positive relationships with
work colleagues are a real source of deep
satisfaction and a key reason why we decide to
stay with a company.
Why and when do Hot Spots emerge? What is
it about some people that supported the
emergence of Hot Spots, and what role did the
leaders of their company play? Why do some
Hot Spots flourish while others fail?
The answer can be found in the formula for
Hot Spots:
Hot Spots = (Cooperative Mindset × Boundary
Spanning ×
Igniting Purpose) Productive Capacity

References
Lynda Gratton, Hot Spots: Why Some Companies Buzz with Energy and Innovation - and Others Don’t.
Financial Times Prentice Hall, 2000.

36 November 2007 NHRD Journal

 BRINGING CHANGE TO THE CHANGE AGENTS -
A LOOK AT INDIAN NGOs
MUSTAFA MOOCHHALA AND TEJINDER SINGH BHOGAL
Introducing Indian NGOs
According to various estimates
there are anywhere between 1-2
million Non Governmental
Organizations (NGOs) in India.
About 20 million people work in
these NGOs, perhaps 85% as
volunteers - the other being paid
Mustafa Moochhala
finished from XLRI and employees.
worked initially with
Modi Xerox. He moved The World Bank defines NGOs as
to work in Pradan, an
"private organizations that pursue
NGO, and was based in
Madhya Pradesh and activities to relieve suffering,
then in Chennai. He promote the interests of the poor,
focuses on HR
Consulting, Organization protect the environment, provide
Development and basic social services, or undertake
Training. He presently
community development". If we
divides his time between
Consulting as part of Ma were to draw a simple picture of the
Foi and with NGOs. usual NGO we would say that it is
an informal organization, of, say,
20 people, working to improve the
lives of the community the NGO is
situated in. This organization
would work for altruistic (i.e. non-
commercial as well as non-
political) reasons, working for the
simple reason that its members or
Tejinder S. Bhogal has employees want to improve the
over 22 years experience quality of living of their community.
after graduating from
IRMA. His initial thirteen
This article focuses on these
years were of working in organizations.
NGOs. He has
implemented rural How NGOs Have Become
development projects in Increasingly Important
the villages of Gujarat
and Chattisgarh. For the In the past decade NGOs have
last nine years he has become increasingly important.
worked as a Consultant
and Trainer on OD and Many of these organizations have
HR issues with a range done tremendous work in creating
of NGOs in the country.
He is based in Delhi. new ways of working with
November
communities and local
technologies. They have been
creative and courageous; and have
built trust in the communities they
serve. As a result they have built
credibility for themselves and the sector
as a whole which has led to their being
accepted as a legitimate and important
part of civil society.
A large number of government
programs are now mandated to be
run by NGOs. Multilateral
agencies such as the World Bank
want the Government to use NGOs;
so does the Planning Commission
of the Government of India.
Consequently, NGOs that have
performed find that they are able to
attract funding for more work: they
work in larger areas, and are
expected to employ a larger number
of people than before.
The Nature of NGOs Work
The work of NGOs is distinct.
NGOs provide a range of services
(both directly and indirectly) to
various communities. Unlike
customers of business
organizations, these communities,
however, do not pay for these
services. These services, instead,
are paid for either by the
Government, or by independent
donor agencies (both Indian and
foreign).
Though NGOs do a range of work,
a common factor for a large number
2007 NHRD Journal 37
of these NGOs is the fact that they work directly
with the community. They talk to communities,
understand their needs, and help develop and
implement programs that benefit these
communities.
A couple of decades back a large number of
NGOs worked on programs that did not require
complex technical or managerial competencies.
This, however, is no longer the case. A very
large number of the programs being
implemented by NGOs now require a
reasonable level of technical and managerial
competence.
Though a large number of NGOs are growing
in size, they are still small: most employ about
10-25 people working for them. A typical small
NGO with, say 20 people, would have three
kinds of personnel: leaders, field workers and
support staff. us, there might be 1-2 people in a
leadership position, 1-2 persons as the support
staff (handling accounts and office jobs) and
the balance 16-18 would be field workers.
The Challenges Faced by NGOs
While there are many challenges that NGOs
typically face (Funding uncertainty,
governance, relations with the communities,
accountability and effectiveness, etc), we focus
here on those which are organizational and
people related.
These are:
• External
• Scale up - There is a strong pressure on
performing NGOs to scale up. This is felt
in discussions with their funding
partners, the Government and other
partners. There is a push to grow more,
do more. Funding houses and NGOs
themselves seem to be dissatisfied with
the current rate of growth and progress.
Organic growth is typically slow, so
scaling up requires an enormous amount
of energy and focus.
38 November 2007 NHRD Journal
• Energy spent on arranging for Funds - While
funding for NGOs has increased overall, it
has hardly kept pace with the need and the
expansion in the sector. Almost all NGOs
seek funds project to project. This has meant
that the people in Leadership positions have
to spend much of their time in this activity -
meeting funders, orienting their programs
towards their funding partner needs,
networking for fund flows etc. This takes
away from investing adequate time in their
organization capability building, grooming
individuals, building sustainable networks
(which do not give them funding) etc.
• Internal
• Skill development of field workers - With
leaders spending less time in the field,
they spend less time guiding and
coaching their field workers. This leads
to relatively untrained people interacting
with the community. As a result, the
quality of work of the NGO starts to suffer.
• Load on the support staff - The support staff
consisting of people working on accounts,
administration etc feel the increasing load
and pressure without having the requisite
skills to cope.
• Need for technical plus managerial abilities
- With the increase in the complexity of the
programs (see previous section) it is
important to have technically trained
manpower. However, just acquiring such
manpower (say Irrigation Engineers) is not
good enough as such personnel need to be
oriented and trained extensively to deal with
community related issues. This requires
investment of time and resources to help
them adapt and learn.
• Mindset of frugality - In many NGOs history
also prevents them from paying new recruits
adequately. Most of these NGOs were set up
when NGOs heavily valued frugality. Costs
 were low, people lived simply and salaries
reflected this. Though salaries have
increased over time, the fact is that NGO
salaries - as well as those of its leadership
are a fraction of what one gets offered in
other sectors - Government and the
Corporate sector.
• Attrition - There is large attrition in many
NGOs. This attrition is particularly true for
those who join in the Middle Line. For one,
there are far many more NGOs present now
than they were ten years back. Thus, when
people are dis-satisfied with the NGO they
are working in, they attempt to find another.
Secondly, they are attracted to the donor
agencies - many of them international. These
donors typically offer much larger pay and
greater visibility. These donors act as magnets
for a large number of people who join the
middle management. Donors on their part too
are looking for people who have some 'field
experience' - i.e., those who have worked with
the community. Consequently, many NGOs
who have succeeded in acquiring and training
such people end up by losing them to donors.
Thirdly, the expanding Corporate sector
attracts many in the NGO sector, especially
those who interact with community on retail
services or financial products.
Mintzberg and the Structure of Organizations:
A Theoretical Interlude
Henry Mintzberg is a Canadian management
thinker who is known as someone apart from
the mainstream (of management thinking) able
to analyze basic assumptions about managerial
behavior. In his seminal work, The Structuring
of Organizations, this is what he has to say about
organizational structure.
• Organizations can be seen divided into five
parts.
• At the base of the organization is the
Operating Core. These are the people who
are actually doing the work. In the context
of Indian NGOs, these would be the persons
working directly with the Community: the
so called Field Workers.
• At the hierarchical top of the organization
is the Strategic Apex - the managers who
have the overall responsibility for the
organization; the ones who take strategic
decisions and provide direction to the
organization. In the context of Indian NGOs
these usually consist of people who have
started the organization: the original
Leaders of the organization.
• The Middle Line is a chain of managers that
implement the decision by supervising
subordinates (the Operating Core), and
reporting to their supervisors (the Strategic
Apex). These are people who make tactical
decisions and lead programs. Interestingly
- and we will find out why this happens -
most Indian NGOs have little or nothing in
the form of this middle line.
Figure 1 – Visual depiction of Mintzberg’s
structure components
• The fourth part of the organization is the
Techno-Structure. This part serves to
analyze and organize the work. In the
context of NGOs these can refer to people
who have a technical background in the
specific work area (irrigation, health,
November 2007 NHRD Journal 39
 education). In reality, most NGOs do not
have people who can belong to this part.
• The fifth and last part is the Support Staff:
all those who provide indirect support of
work. In the context of NGOs this can include
Accountants, Drivers, and Office
Administrators.
Mintzberg's Structure and Indian NGOs
As indicated above, most Indian NGOs operate
with just three parts of the organization: the
Strategic Apex, the Operating Core and the
Support Staff. Mintzberg terms this as the
'Simple structure' where work is done through
direct supervision, without a prominent middle
line. The major implications of having just three
parts to NGOs are as follows:
The Strategic Apex is forced to play the role
of the Middle Line too. In other words, the
Leaders of the organization spend time
directly working with the Field Workers:
guiding, controlling and training them. In
addition they perform roles of fund raiser,
net worker, strategist and overall monitor.
The lack of Techno-Structure means that the
NGO is limited in the kinds of projects it is
able to handle; or there is a lot of trial and
experimentation. Interestingly, many NGOs
try to solve the problem of a missing Techno
Structure and a Middle Line by hiring
individuals who are both technical, and can
play the middle management role. This works
+ the sector. This can lead to fresh thinking.
Figure 2 - Structure of a typical Indian NGO
40 November 2007 NHRD
for small organizations, but as they grow
there is substantive pressure to grow both.
The shortage of enough number of Support
Staff means that the NGO is usually delayed
in completing its audit, and sending its
reports to donors. This in turn delays (and
over time, reduces) the availability of funds
to these NGOs.
The Path Ahead
In a growing India, NGOs need to meet the key
challenges. We would like to suggest 2 sets of
key interventions needed for this:
• Build and strengthen the 'Middle Line' - This
is a key area that needs to be constructed
right. It can be done in the following way:
• Strengthen institutions and
organizations that educate, train and
groom caders that become the Middle
Line - Premier institutions like IRMA that
were supposed to focus on NGOs and
Cooperatives have not lived up to their
promise. Students from there tend to opt
for corporate sector jobs. There is a need
to encourage many institutions to have
programs in NGO management, so that
there is a broadening of the channels to
get talented people into this sector.
Ex: IFMR, Chennai and Banyan
Academy of Leadership in Mental Health
have tied up for offering an MBA
specialization in this. Bringing in a larger
number of fresh recruits in the sector will
also challenge traditional beliefs held by
• NGOs have a focused program to train
young graduates/post graduates - Pradan,
a Delhi based NGO working at the village
level have had a successful Associateship
program, similar to the 'management
Trainee ship' running for two decades now.
Dhan, a Madurai based NGO, has set up a
Journal
 'People Academy' that seeks to foster
knowledge and understanding through
Diplomas and shorter training programs.
Funders and even Indian Corporates need
to partner with the larger NGOs to run these
programs to build strong cadres for the
future.
• Exchange programs with Corporates - There
is a need to create a program which
establishes an exchange between
Corporates, NGOs (and the Government
later). This would allow, middle managers
from both sectors to work on the other side
and build a deeper understanding and
skills required to work in this ever
expanding world. Many corporate
organizations seek to know how to work
with communities; many NGOs seek to
understand how to focus on 'execution' and
efficiency. This program would go a
considerable way in doing that. This should
be a program of mutuality, rather than a one-
way exchange. Over a period of time, we
should have enough leaders in Corporates
and NGOs who have had experience in
working in the 'other' sector, so that
collaboration is seen as natural rather than
as a special activity presently put down
under 'Corporate Social Responsibility'.
• Build different models for collaboration in
setting up stronger Support and Technical
services - This can be done in the following
way:
• Shared services houses - Build
organizations which offer services to
many NGOs. This would be in the
nature of shared services, and perhaps
even outsourced services. Accounting
firms, HR firms, Recruitment agencies
and Administration firms need to be
encouraged to enter this space and offer
services to NGOs. This would lower
cost for the latter and ensure access to
professional services. ICICI
Foundation along with Murray
Culshaw Consulting is doing some
work towards this. There needs to a
network of organizations that offer
different support services to NGOs
leaving them free to focus on their key
strengths, ie. Working with the
communities.
• Collaboration on technical services - India
is rich in its technical services. Some NGOs
have tied up with these institutions to
collaborate in specific areas (ex: Rural
Innovations Network collaborates with IIT,
Chennai in a program - L-ramp to make
innovations made in rural India robust
technically). These have been sporadic and
short term. There is a need to grow this and
establish strong linkages which would
allow the key parts of the techno-structure
to be outsourced to these institutions.
Putting in some of these interventions is likely
to strengthen the Middle Line, who would take
on tasks of guiding, monitoring, coaching the
Operating Core. This group of leaders/
managers would head units, build tactics for
their immediate community actions,
experiment at the field level; thus freeing
Leadership time at the Strategic Apex to focus
on networking, raising of Funds, Strategy
formation and building of this Middle cader.
As seen in examples, some forward looking
NGOs have worked very thoughtfully and in a
deliberate manner over time to create suitable
solutions to some of the issues faced by them.
These need to be picked up by other NGOs,
adapted and expanded for their own use, if
growth and scale are important to them.
November 2007 NHRD Journal 41
In Conclusion
It is time that the sector as a whole (and not just
individual NGOs) looked at issues of
organization and people. The Civil Society,
Corporate organizations and the Government
need to consciously devise strategies to support
this movement, which is likely to make the NGO
sector vibrant and sustainable.

Endnotes
1. Quoted in Indianngos.com in http://www.indianngos.com/ngosection/newcomers/whatisanngo.htm downloaded on October 23,
2007.
2. PRIA, Invisible but Widespread: The Non-Profit Sector in India.
3. NGOs can be more complex; they can also be situated far from the community. But this picture given here represents a large
majority of the present day ‘secular’ NGOs.
4. It is important to point out that many NGOs do not work directly with communities: the nature of their work is thus subtly different
from those who have been described as a typical modern day Indian NGO. A separate article is required to deal with the change
issues of such NGOs.
5. Programs include that of Education, Health, Legal Aid, Awareness of Rights, and programs that help to improve the income of poor
communities.
6. In particular the Gandhian ones.
7. This has come about as NGOs are beginning to implement technically complex programs such as on Health Prevention, Providing
Quality Education, designing and constructing watershed and irrigation programs etc.
8. http:// www2.winchester.ac.uk/bm/courses/bs3933/Mintzberg.doc. Also look up http://www.henrymintzberg.org/. Read Mintzberg,
1979
9. Pearson, 2007.
10. http://pradan.net/
11. http://www.dhan.org/
12. http://news.moneycontrol.com/mccode/news/article/news_article.php?autono=310198. See also http://www.icicicommunities.org/
interaction.html
13. http://www.indianngos.com/governence/murrayculshaw/fullinterview.htm
14. http://www.rinovations.org/Services

42 November 2007 NHRD Journal

 DEFINING CHANGE AGENTS
SANDEEP K. KRISHNAN
Abstract
This article tries to define a change agent. Drawing extensively from the literature the paper
tries to examine who a change agent is, what a change agent does, what makes a change
agent, and how we can groom change agents. The interesting aspect here would be the link
up of the change process models with the change agent and finally how an organization can
enable change agents.
Introduction
Organizations are facing
tremendous internal and external
pressures to change. With this
being the trend, being a change
agent has become a universal
competency for most of
professionals. This, on one side,
Sandeep K. Krishnan is a
Fellow of the Indian opens up tremendous
Institute of Management,
Ahmedabad. He opportunities for individuals to
currently works with the apply their knowledge and skills
RPG - Group Human
for the betterment of the
Resources. He has
presented papers on organizations but also exposes the
employee intention to individual to be either becoming
quit in forums like the
open to change or becoming the
Academy of
Management, USA. He change agent. However, the change
has published several agent has a challenging role with
papers and is passionate
about his work in the respect to not just being an active
area of talent partner adapting to change but
management.
initiating, driving, and
institutionalizing change. This is in
line with the Kurt Lewin's three
stage process of change where
there is unfreezing of the current
state, implementing change, and
institutionalizing new systems
(refreezing) (French and Bell, 2003).
Who is a Change Agent?
Cohen (2006), drawing up the high
linkage of the change process and
the change agent states four
important aspects of being a change
agent. This includes initiating/
leading a project that changes the
November
way in which things are done,
define how the change should be,
understands the reality of the
change, is able to take up the
resources for the change, and stick
on to the agreed change process
and face challenge on course. This
description of what a change agent
needs multiple skills. Linking up
Cohen's definition of change agent
and Kurt Lewin's model of change,
we can see that a change agent is a
person who unfreezes the current
situations, who introduces the
change in terms of new practices,
and finally ensures that new world
is established and runs efficiently.
What a Change Agent Does
In each of the stages i.e unfreezing,
moving, and refreezing a change
agent should be specific activities
that enable the change. In the
unfreezing stage, the action is to
develop a need for change and
point out why things should
change from the way in which
things are done around. Here we
are also assuming that we are
speaking of internal change agents
rather than external OD
consultants or management
consultants and hence the
complexity is more pronounced
and interesting. Based on Caldwell
2007 NHRD Journal 43
(2003) model of managers as change agents,
one of the major reasons that a change might
be initiated would be a change in the strategic
vision provided by leadership that drives
managers for implementing the same. Other
such reasons could be the changes that a
manager himself initiates through his
empowerment for decision making with the
need for efficiency, changing market demands,
internal issues, etc. In the case of a planned
change the objectives are very strongly defined
and driven. For example quoting the case of
Siemens Nixdorf as in Dover (2002) the culture
change was driven for enhancing performance
through better customer care and operational
efficiency. Similar example in case of RPG, one
of the India's largest conglomerates, would be
the case of KEC. KEC underwent a major
change in terms of culture to meet project
management and client needs. The change
agents here were primarily the top management
team and driven from the vision of the leader.
Caldwell (2003), quoting Beckhard (1969) notes
that the typical role of a change agent in a
planned effort is to provide consultative,
technical or specialist advice in the
management of change. Thus it is taken as
granted that a change agent in most of the cases
is driving the already agreed path of change.
However, when change process when linked
with leadership creates a whole new dimension
to what a change agent does. It is this change
agent leader who creates an inspiring vision,
motivates people to walk with him, inspire
confidence and then creates systems and
processes for change.
A broader role of a change agent can thus be
defined as someone who identifies a need for
change, envisages a better future based on the
change, inspires people to walk with the
change, and finally makes change a way of life.
44 November 2007 NHRD Journal
A Change Agent Model
The model given above is simplistic in terms of
the role of a change agent. Fullan, Cuttress, and
Kilcher (2005) give an interesting description
that helps us to connect to the various processes
behind it. Author points out eight steps/roles
that can be connected to the model. The
initiating change involves engaging moral
purpose, and building capacity. This clearly
involves the crux of beginning of selling the
change to various stakeholders. The second
step would ensure that you have the processes,
people, and resources that will help in making
change happen. The third step would
understand the change process. This is a critical
part in making things happen. The clarity on
how change should be and creating ownership
of different parts of it is what makes the change
a reality. Fourth would be creating a learning
culture. Change creates new situations and
critical part here would be to ensure that
learning and institutionalizing them are part
of life. Fifth is to put evaluation of the change
process in place. Unless clarity is there on where
we stand on different aspects of the change, it
is unlikely that we will get the needed results.
Sixth is the factor that cuts across all the process
- leadership. What makes a change agent is
critical here. This enables whatever other steps
are brought forward in the change process.
Seventh would be making the change an
integral part of the entire system. An interesting
example from the RPG Group would be the
implementation of Balanced Scorecard a few
years back. Balanced business scorecard now
links up the entire process of strategy
formulation, strategy to performance measures,
performance evaluation, and associated
human resource process like leadership
development, employee feedback and
development. Any change that is implemented
without this aspect in place may have a high
chance of dying out in the due process.
Challenge of the change agent(s) here would
be create collaboration, involvement, and buy-
in from as many critical stakeholders as possible
in enabling success. The final step that would
be crux of institutionalizing change would be
to understand the transformational outcomes
of change.
What Makes a Change Agent?
It is widely quoted in literature that certain
skills and personality traits make a person a
change agent. Driving change is a difficult
socio political process than a pure rational one.
Some of the basic characteristics that are
mentioned in the literature are the courage,
patience, ability to motivate, adapting to
change, ability to neutralize resistance, and
ability to come back from setbacks. Furnhan
(2002) states that to be part of the change
process the manager should have the courage
to fail. They should also use this to deliver bad
news and confronting people who are poor
performers. Also in case of a change there are
chances of chaos and the author puts it rightly
that the managers should have the moral
courage to confront ethical dilemmas. The
critical element here would be the ability and
the skill to take people along. That is to
encourage people who support change and
ensure that others are given the right inputs to
be motivated to be part of change.
Santos and Garcia (2006) have found another
interesting aspect on how managers become
part of organizational change. They found that
mental models with which managers operate
can determine how they pursue organizational
change. An understanding of the real time
events and whether they can create
organizational change make the manager
participate in the change process. Interestingly
study by Grimm and Smith (2001) have found
that young managers who have less experience
are more participative and take initiative in the
change process. This study was also of
considerable interest because it could link a
positive impact of people with MBA degree to
organizational change. It was postulated that
younger managers were more likely to have an
MBA degree and they were more ready and
inclined towards change that are strategic in
nature.
As Cohen (2006) puts it together, some of the
basic characteristics of change agents are
courage to make the change, flexibility to adapt
as the change, ability to welcome resistance,
respectful treatment of staff, willingness to
learn, humor as you go through change,
humility to accept when things are not going
well, and critical thinking to recognize when
things are not working. Rosabeth Moss Kanter,
a well-known change expert puts an interest
perspective to one of the most relevant action of
a leader as a change agent. It is always easy to
ride on a success and when everything is
positive. However, the striking challenge is
when it is a losing streak. The critical job of a
change agent here would be to restore
accountability in the process of change, and
bring in teamwork and collaboration to the new
initiatives (Moss Kanter, 2005). Interestingly
what makes a change agent can be quoted from
Furnham (2002) as "the courage to fail is the
courage to be first, to try something new, to be
ahead of your time, to trust your instincts, to be
creative - knowing it could all go very wrong
with very significant consequences for the
manager and who they manage."
How Can We Groom Change Agents?
As discussed in earlier sections, a change agent
should basically have the understanding of the
context, ability to motivate and lead, have the
competence to adapt and respond to change
November 2007 NHRD Journal 45
and cope up with pressure and setback. Hence,
some of them come up with experience of
"knowing the organization" and some comes
from "knowing what is best" and rest comes
from the ability to know both and use it to bring
the best in terms of the change.
The various characteristics of change agents come
from different dispositions. Some are personality
characteristics. While equating change agents
with leaders, we look at some of the basic
personality characteristics like charisma.
Research as a whole, has defied most of these
aspects that we attribute to leaders and as such
to change agents. Colin (2001) for example has
found that exceptional leaders are the ones who
are high on humility and put themselves as the
background runners to make long-term impact.
As one of the critical aspect of change agent is to
have the courage of failure it is ironical that we
expect people who have narcissist tendencies or
want to rely on their charisma more than anything
else can bring out transformations. It thus
depends on the organizations to build on
evidences of change to give responsibilities to
groom future leaders and change agents rather
than going by perceptions.
Training interventions that are carefully chosen
to develop competencies that are identified to be
critical for change management can be effectively
done. Outbound training that focuses on
altering mental blocks on change can be used
effectively for creating an atmosphere for change.
However, it has been reported by experts that
outbound as a mechanism can do very less on
the organizational context but it can be effectively
used to make the individual a better person. The
second aspect would be coaching. Coaching on
specific characteristics based on role model
change agents can be effective. Hand holding
and creating confidence and courage can go a
long way in making a mindset of change.
However, a critical organizational context that
can aid any change agent and change process
46 November 2007 NHRD Journal
as Argyris (1997) is based on two critical factors
- first is to make previously un discussable
problems discussable. This enables unearthing
of critical issues and making change possible.
A change agent should ensure that people are
put at non-threatening stance to make this
happen. Second critical factor would be
enabling learning and information sharing in
the best possible way.
In the context of every day working in the
organization, change agents can be nurtured
only if we have tolerance to failure and
experimentation is allowed. This requires a
culture of allowing taking risks and
empowerment. Quite certainly this boils down
to how managers empower their employees
and support mechanisms are provided for
making the change.
Conclusion
This paper attempted to bring across what is
the role of a change agent, what makes a change
agent, and how we can groom a change agent.
A change agent model is an inspirational one.
However, one can be a change agent only if
he/she has the necessary competencies that are
essentially strategic to complement traits like
courage and confidence. As John Kotter states
"Leaders establish the vision for the future and
set the strategy for getting there; they cause
change1. They motivate and inspire others to
go in the right direction and they, along with
everyone else, sacrifice to get there." This is no
different for a change agent who takes the
leadership of the situation on him/herself and
rides towards the goal. It is the ability of the
organization to set up a culture that supports/
tolerates change that is the biggest enabler of a
change agent.
References
Chris Argyris, Initiating change that perseveres”, The American behavioral scientist, 40 (1997)
Shelly Cohen, “Change agents bolster new practices in the workplace”, Nursing Management, 16 (June 2006)
Raymond Caldwell, “Models of change agency: a fourfold classification”, British Journal of Management, 14 (2003)
Philip A Dover, “Change agents at work: Lesson from Siemens Nixdorf”, Journal of Change Management, 3 (2003)
Adrian Furnham, “Managers as change agents”, Journal of Change Management, 3 (2002)
Michael Fullan, Claudia Cuttress, and Ann Kilcher, “8 Forces for leaders of change”, Journal of Staff Development, 26 (Fall 2005)
MA Valle Santos, and MA Teresa Garcia, “Organizational Change: Role of Managers’ Mental Models”, Journal of Change Management,
6 (2006).
Curtis M. Grimm, and Ken G. Smith, “Management and organizational change: A note on the rail road industry”, Strategic Management
Journal, 12 (Oct 1991)
Rosabeth Moss Kanter, “How Leaders Gain and Lose Confidence”, Leader to Leader, 35 (2005)
Wendell L. French, and Cecil H. Bell Jr, Organization Development, Prentice Hall of India (2003)

November 2007 NHRD Journal 47

 IN PRAISE OF INDIA'S MOST SEASONED
CHANGE MANAGERS
GANESH CHELLA

Arul has just closed the call. He looks consultants with business and
at his watch and realizes that it is behavioral credentials and the
9.30 pm and there is a lot more in ability to deploy multiple tools,
store for him in the evening. He has technologies and techniques you
to send out a couple of mails, de- are quite off the mark. The most
brief his manager about this call and seasoned change managers are
also find time for small things like actually the hundreds of project
and asking his little daughter how managers who work round the
Ganesh Chella is a
product of XLRI and has she fared in her first quarterly clock to deliver value and keep the
over 16 years of industry exams in the new school. These are engines of growth alive.
experience in leading
Indian and multinational 'however' not the things that are This article is meant to recognize
companies including going to keep him awake that night. their efforts in making change
Cadburys, TVS, Citibank Not his daughter's disappointment,
and RPG and over seven management an integral part of the
years of consulting not the significant changes in the way they live their lives. This
experience. Deeply client's specifications. He was to special issue on Change
committed to the
development of the
have convinced the client to release Management would in many ways
Human Resources two of his more senior resources be incomplete if we did not
profession, Ganesh from the project to help staff other
teaches, writes and recognize and honor their efforts on
engages in research. His needs and more importantly to the ground. Obviously, it is not that
current consulting conform to the new staffing mix they know it all and do it the best
practice provides him
with immense
norms established by the way but they certainly "DO IT!"
opportunity to make organization in the interest of project
significant contribution profitability. This did not happen In writing this article I have relied
to the profession and to on my insights gained from
his client organizations. since the client turned down the
It also provides him with request. He will now need to try interactions and discussions with
the opportunity to learn, again. Being a seasoned Project hundreds of project managers and
experiment and grow as other leaders in the IT services
a professional. manager in this large software
services company, Arul has seen it Organizations I have had to
He is the founder & CEO
of totus consulting and all. He has now evolved a very opportunity to work with across
the co-founder of the
effective coping strategy - he just several OD and HR consulting
Executive & Business
Coaching foundation does not think about the big picture engagements.
India Limited. Totus is a and worry himself about all the IT is all about change
strategic HR consulting
firm that partners with future changes and accompanying Every mature profession in the
organizations across challenges. He takes one ball at a world helps its aspiring members
industries to design and
implement Human
time and manages to field it well. to imbibe and demonstrate the key
Resource and Welcome to the everyday life of a behavioral requirements of the
organization
Development solutions project manager in a software profession even before they
that meet their unique company. If you thought the best commence work. Some call this pre-
business needs.
change managers in India are OD socialization. For example, no one

48 November 2007 NHRD Journal

needs to tell a trained nurse about the
importance of good bed side manners. No one
ever needs to tell a trained hospitality
professional about the need for demonstrating
courtesy with guests. No one needs to tell a
counselor about the importance of empathy. All
of them have been pre-socialized to the key
behavioral demands of their roles.
No one needs to tell a project manager that
change is a part of his job. He understood this
even before he starts his career in the industry.
Diagram 1: Drawn by Varsha.
He knows that the IT industry is synonymous
with change. He learns that everything about
the industry, its business model, its technology,
its processes, its products and its people keeps
changing and evolving constantly.
In fact the Software Engineering Institutes now
universally acclaimed CMM model specifies
five levels of maturity of the processes of a
software organization. CMM offers a
framework for evolutionary process
improvement. Originally applied to software
development (SE-CMM), it has been expanded
to cover other areas including Human
Resources (P-CMM) and Software Acquisition.
Level 5 of this model is all about Optimising -
Continuous Improvement - Process Change
Management, Technology Change
Management and Defect Prevention.
In fact the evolution of P- CMM a is recognition
of the critical role of people in securing quality
and some of strategic objectives of this model
include workforce development, reduction of
individual dependencies, people motivation
and retention.
In reality however, despite the best of processes,
much seems to depend on the abilities of the
project manager who seems to play a pivotal
role in managing all this change.
So, what really are the dimensions of change
in a project manager's life? What does he do
well and what is he struggling with? What are
the competencies he could get better at? These
are some of the questions we will address in
this article.
The Seven Dimensions of Change
In my assessment, an average project manager
has to contend with seven critical dimensions
of change in his every day work. These
dimensions are obviously of varying levels of
complexity and ease of management as
depicted in the diagram. I have therefore
classified these dimensions into three levels of
complexity.
Diagram 2: Ganesh Chella model of Seven
Dimensions of Change
Level One Change Management Challenges
• Client Requirements
Most project managers seem extremely
proficient in accepting this element of change.
November 2007 NHRD Journal 49
They realize that clients may not be clear about
what they want or may not articulate it clearly
and that they may also change their minds at
any time.
This seems to be a non issue today.
• Technology
Project managers of today have seen several
technological transitions. They have been part
of transitioning their clients from one platform
to another. They have also understood the
impact of technological changes on team
preferences, employee costs and availability.
This too seems a non issue.
I am therefore not dwelling much on these level
one dimensions.
Level Two Change Management Challenges
• Client Environment
Many clients keep undergoing radical changes
in many ways - the sponsors of the engagement
might change, there could be structural
realignments, there could be an M&A or even
worse, the company could lose the client on
account of a variety of problems. While these
aspects are typically handled at a level higher
than the project manager, the PM is ultimately
responsible for managing its impact on the team
in terms of communication and morale.
It is in this area that the good project managers
begin to get separated from the great ones.
The great ones are able to predict and sense
these developments and assess their potential
impact on the project and even the relationship.
They are also able to share these insights within
the organization at appropriate levels. They are
also able to come up with contingency plans.
They may even alert their team members and
do what they can to mitigate risks.
The average ones may not do enough connect
across multiple levels in the client organization
and may therefore not be able to acquire these
insights despite doing a good job of delivering
50 November 2007 NHRD Journal
on their particular project.
• Team
One of the biggest challenges for a project
manager is the transience in his team
membership and relationship. I call it transience
because it is now beyond change. It is a
continuous onslaught of a series of everyday
changes in his team, many of which he is unable
to understand, appreciate and even manage.
This constant state of transience is a great source
of stress for any project manager.
First, there is a fair amount of attrition that
changes his team composition and terminates
the team life ever so often. Second, is the
pressure to release trained people and induct
fresh people to keep the costs low, calling for
constant efforts in training, socialization and
team building efforts.
I am still placing this in the second level because
managers seem to be learning quickly to manage
this dimension and many will no longer
complain about this being an impossible task.
The great managers tend to be better at building
trust and relationships ever so quickly within the
team. They also build informal networks within
the organization and are less reliant on HR and
more reliant on these networks to find the people
they want and staff their teams quickly.
Most importantly, they are able to use their
relationships to get some heads up about what
is on their team members' mind, when they plan
to ask for a change or leave and when they need
to start taking actions.
The average ones end up feeling helpless and
constrained and blame the system and the
younger generation for all the chaos they have
to deal with.
Level Three Change Management Challenges
• Organization Changes
The organization constantly keeps making
changes to its policies and processes in
response to changes in the external
environment as well as client needs and
internal pressures. These include changes in
hiring policies, the structure of the hiring
function, the resource allocation system, pay
policies, campus hiring policies, release
policies, staffing mix policies, career
development policies, reward policies, on-site
assignment policies, training policies, and a
whole host of other workforce management
policies right down to things like dress code!
At another level, organizations themselves go
through structural changes, ownership
changes and strategic changes.
While it is all fine to make out a policy
communication or announcement, the onus for
explaining it, selling it and making it work rests
with the project manager. Depending on the
depth of the HR function and the
organization's culture this is either shared by
HR or is often placed solely on the shoulders
of the project managers.
Given their own inability to understand the big
picture and the lack of training and preparation,
many do a bad job of managing this. Some
rationalize by taking the view that their life ends
with the project and anything beyond that is
not their problem. Some others believe that it is
"management's" job to handle the change. Most
seem themselves as victims of the system.
This is where the maturity of organizational
processes makes a huge difference. Where
organizations are sensitive to the implications of
the change, they limit the burden on the project
manager and lead the change from the front.
Weak Organizations just dump it on the PM.
• External Environment
Given the truly global character of the IT
industry anything that happens anywhere in
the world can have a huge impact on the
business. This is the vulnerability with which
firms operate.
The September 11 attack, the rupee
appreciation, the visa restrictions, the anti-
outsourcing protests, the spirally wage costs
and so on can all impact the industry. These
and other environmental changes almost
always have implications on costs and margins,
risks, business continuity and so on. The final
hard actions always rest with the project
manager for implementation.
While most project managers are generally well
informed about these developments thanks to
an over-active media, few are able to appreciate
its direct impact on their work or what they
need to do to manage it.
• Competency Expectations
The competencies expected of project managers
have gone up significantly over the years. His
job is today much more complex than it was in
the early days. From being back-end
coordinators they are now expected to
understand the client's business and add value
at a much higher and deeper level. They have
to contend with much larger spans of control,
far larger number of inexperienced team
members and take a far greater responsibility
for the profitability of their projects and for
retaining and growing the account.
Are project managers aware of these changing
expectations and are they doing enough to
equip themselves to respond to these changes?
Well, I must say the situation is far from
satisfactory. While many Organizations are
constantly investing in the retooling and
development of project managers, the problem
is with the project managers' ability to wake
up and smell the coffee. Many do not wake up
to the need for re-skilling themselves early
enough till they realize that they are not meeting
the demands of the new order.
The Competencies to Manage Change
What then are the competencies of a project
manager who is capable of managing change
November 2007 NHRD Journal 51
well? In other words, what separates the great
project managers who are adept at managing
change from the rest?
• Dual Focus (bird's eye and worm's eye view at
the same time)
Project managers seem to be very good at seeing
what is front of them but quite often poor at
seeing what is ahead. While their worm's eye
view is great, their bird's eye view is not. While
many believe that it is this blinkered vision that
keeps them focused and helps them deliver
every day, this blinkered vision also inhibits
their ability to predict, develop insights,
synthesize and see the big picture.
• Learning Propensity
A lot of resistance to change emanates from
fears about its consequences and about one's
belief that one will not be comfortable with the
changed situation. Those with a greater
propensity to learn tend to have greater comfort
around change. Don't your kids know more
about your mobile phone than you do?
• Rallying the Troops
The buck stops with the Project manager. He or
she is responsible for converting the visions
and strategies into tangible actions and
instructions for the troops. He also needs to be
52 November 2007 NHRD Journal
able to create excitement and comfort around
the change with the team.
• Positive Image of the Future
Managers with a positive image of the future
and a high sense of optimism seem to be better
at embracing change compared to those who
are always skeptical and are easy to point out
all the potential problems with the future.
To a large extent this positive image of the future
also emanates from a positive image one has of
oneself, one's abilities and potential.
In closing
Despite all the focus on process, it is the Aruls
of the IT world who finally make the difference.
They are the new generation of seasoned
change managers with a basic level of comfort
around change and that is good news.
The Aruls can become great if the organization
does its bit in terms of development,
communication and support. In the days to
come project managers are likely to be subjected
to increasing pressures and changes.
Organizations that nurture these managers will
not only succeed but also help the likes of Arul
get a good night's sleep and that is extremely
important!
 THE ENDURING SKILLS OF CHANGE LEADERS
ROSABETH MOSS KANTER
Rosabeth Moss Kanter holds the Ernest L. Arbuckle
Professorship at Harvard Business School, where she
specializes in strategy, innovation, and leadership for
change. Her strategic and practical insights have
guided leaders of large and small organizations
worldwide for over 25 years, through teaching,
writing, and direct consultation to major corporations
and governments. The former Editor of Harvard
Business Review (1989-1992), Professor Kanter has
been named to lists of the "50 most powerful women
in the world" (Times of London), and the "50 most
influential business thinkers in the world" (Accenture
and Thinkers 50 research). In 2001, she received the
Academy of Management's Distinguished Career
Award for her scholarly contributions to management
knowledge, and in 2002 was named "Intelligent
Community Visionary of the Year" by the World
Teleport Association.
Professor Kanter is the author or co-author of 17
books, which have been translated into 17 languages.
Her latest book, America the Principled: 6
Opportunities for Becoming a Can-Do Nation Once
Again (published on October 23, 2007), offers a
positive agenda for the nation, focused on innovation
and education, a new workplace social contract,
values-based corporate conduct, competent
government, positive international relations through
citizen diplomacy and business networks, and
national and community service.
Her previous book, Confidence: How Winning Streaks
& Losing Streaks Begin & End (a New York Times
business and #1 Business Week bestseller), describes
the culture and dynamics of high-performance
organizations as compared with those in decline, and
shows how to lead turnarounds, whether in
businesses, hospitals, schools, sports teams,
community organizations, or countries. Her classic
prizewinning book, Men & Women of the
Corporation (C. Wright Mills award winner for the
year's best book on social issues) offered insight to
countless individuals and organizations about
corporate careers and the individual and
organizational factors that promote success; a spin-off
video, A Tale of 'Of On Being Different, is among the
world's most widely-used diversity tools; and a
related book, Work & Family in the United States, set
a policy agenda (in 2001, a coalition of university
centers created the Rosabeth Moss Kanter Award in
her honor for the best research on work/family issues).
Another award-winning book, When Giants Learn to
Dance, showed how to master the new terms of
competition at the dawn of the global information age.
World Class: Thriving Locally in the Global Economy
identified the rise of new business networks and
analyzed the benefits and tensions of globalization.
She has received 22 honorary doctoral degrees, as
well as numerous leadership awards and prizes for
her books and articles; for example, her book The
Change Masters was named one of the most
influential business books of the 20th century
(Financial Times). Through Good measure Inc., the
consulting group she co-founded, she has partnered
with IBM to bring her leadership tools, originally
developed for businesses, to public education as part
of IBM's award-winning Reinventing Education
initiative and she is a Senior Advisor for IBM's Global
Citizenship portfolio.. She advises CEO s of large and
small companies, has served on numerous business
and non-profit boards and national or regional
commissions, and speaks widely, often sharing the
platform with Presidents, Prime Ministers, and CEO s
at national and international events, such as the World
Economic Forum in Davos, Switzerland. Before
joining the Harvard Business School faculty, she held
tenured professorships at Yale University and
Brandeis University and was a Fellow at Harvard Law
School, simultaneously holding a Guggenheim
Fellowship.
She chairs a Harvard University group creating an
innovative initiative on advanced leadership, to help
successful leaders at the top of their professions apply
their skills not only to managing their own enterprises
but also to addressing challenging national and global
problems.
November 2007 NHRD Journal 53
Hundreds of books and millions of dollars in
consulting fees have been devoted to leadership
and organizational change. No issue of the
past 15 years has concerned more managers or
a wider spectrum of organizations. Yet, for all
the attention the subject merits, we see every
day that certain kinds of change are simple. If
you're a senior executive, you can order budget
reductions, buy or sell a division, form a
strategic alliance or arrange a merger.
Such bold strokes do produce fast change, but
they do not necessarily build the long-term
capabilities of the organization. Indeed, these
leadership actions often are defensive, the result
of a flawed strategy or a failure to adapt to
changing market conditions. They sometimes
mask the need for a deeper change in strategy,
structure, or operations, and they contribute to
the anxiety that accompanies sudden change.
Years of study and experience show that the
things that sustain change are not bold strokes
but long marches -- the independent,
discretionary, and ongoing efforts of people
throughout the organization. Real change
requires people to adjust their behavior, and
that behavior is often beyond the control of top
management. Yes, as a senior executive, you
can allocate resources for new product
development or reorganize a unit, but you
cannot order people to use their imaginations
or to work collaboratively. That's why, in
difficult situations, leaders who have neglected
the long march often fall back on the bold stroke.
It feels good (at least to the boss) to shake things
up, but it exacts a toll on the organization.
Forces for Change
Organizational change has become a way of
life as a result of three forces: globalization,
information technology, and industry
c) 2007 by Professor Rosabeth Moss Kanter, Harvard Business School, Boston, Massachusetts,
USA. Used by permission of the author; not to be reprinted without express permission.
54 November 2007 NHRD Journal
consolidation. In today's world, all
organizations, from the Fortune 500 to the local
nonprofit agency, need greater reach. They need
to be in more places, to be more aware of
regional and cultural differences, and to
integrate into coherent strategies the work
occurring in different markets and
communities.
The first two forces for change -- globalization
and technology -- will inevitably grow. But it's
not enough for organizations to simply "go
international" or "get networked." In a global,
high-tech world, organizations need to be more
fluid, inclusive, and responsive. They need to
manage complex information flows, grasp new
ideas quickly, and spread those ideas
throughout the enterprise. What counts is not
whether everybody uses e-mail but whether
people quickly absorb the impact of
information and respond to opportunity.
Industry consolidation, the business story of
1998-99, has a less certain future. But even if
that trend abates, the impact of mergers,
acquisitions, and strategic alliances will be felt
for years. Mergers and acquisitions bring both
dangers and benefits to organizations (see
"Innovating in the Age of Mega mergers").
Partnerships, joint ventures, and strategic
alliances can be a less dramatic but more
highly evolved vehicle for innovation.
However, you must not starve an alliance or a
partnership. You have to invest the time and
resources to work out differences in culture,
strategy, processes, or policies.
You also have to bring together people at many
levels to talk about shared goals and the future
of the alliance in general, not just their small
functional tasks. Many alliances unravel
because, while there is support at the top of the
organization, departments at lower levels are
left to resolve tensions, answer questions, or
fill gaps on their own. The conflicts and wasted
efforts that result can end up destroying value
instead of creating it. You have to make sure
that the goals of people at many levels of the
organizations are aligned, and that people get
to know each other, before you can expect them
to build trust.
Keys to Mastering Change
Change is created constantly and at many
levels in an organization. There is the
occasional earthshaking event, often induced
by outside forces; there are also the everyday
actions of people engaged in their work. In
change-adept organizations, people simply
respond to customers and move on to the next
project or opportunity. They do not necessarily
change their assumptions about how the
organization operates, but they continuously
learn and adapt, spread knowledge, share
ideas. By making change a way of life people
are, in the best sense, "just doing their jobs."
Change -- adept organizations share three key
attributes, each associated with a particular
role for leaders.
• The imagination to innovate. To encourage
innovation, effective leaders help develop
new concepts -- the ideas, models, and
applications of technology that set an
organization apart.
• The professionalism to perform. Leaders
provide personal and organizational
competence, supported by workforce
training and development, to execute
flawlessly and deliver value to ever more
demanding customers.
• The openness to collaborate. Leaders make
connections with partners who can extend
the organization's reach, enhance its
offerings, or energize its practices.
These intangible assets -- concepts,
competence, and connections -- accrue
naturally to successful organizations, just as
they do to successful individuals. They reflect
habits, not programs -- personal skills,
behavior, and relationships. When they are
deeply engrained in an organization, change
is so natural that resistance is usually low. But
lacking these organizational assets, leaders
tend to react to change defensively and
ineffectively. Change compelled by crisis is
usually seen as a threat, not an opportunity.
Mastering deep change -- being first with the
best service, anticipating and then meeting new
customer requirements, applying new
technology -- requires organizations to do more
than adapt to changes already in progress. It
requires them to be fast, agile, intuitive, and
innovative. Strengthening relationships with
customers in the midst of market upheaval can
help organizations avoid cataclysmic change --
the kind that costs jobs and jolts communities.
To do that, effective leaders re conceive their role
-- from monitors of the organization to monitors
of external reality. They become idea scouts,
attentive to early signs of discontinuity,
disruption, threat, or opportunity in the
marketplace and the community. And they create
channels for senior managers, salespeople,
service reps, or receptionists to share what
customers are saying about products.
Classic Skills for Leaders
The most important things a leader can bring
to a changing organization are passion,
conviction, and confidence in others. Too often
executives announce a plan, launch a task force,
and then simply hope that people find the
answers -- instead of offering a dream, stretching
their horizons, and encouraging people to do
the same. That is why we say, "leaders go first."
However, given that passion, conviction, and
confidence, leaders can use several techniques
to take charge of change rather than simply
react to it. In nearly 20 years working with
leaders I have found the following classic skills
November 2007 NHRD Journal 55
to be equally useful to CEO s, senior executives,
or middle managers who want to move an idea
forward.
1. Tuning in to the Environment. As a leader
you can't possibly know enough, or be in
enough places, to understand everything
happening inside -- and more importantly
outside -- your organization. But you can
actively collect information that suggests
new approaches. You can create a network
of listening posts -- a satellite office, a joint
venture, a community service. Rubber maid
operates its own stores, for instance, even
though it sells mostly to Wal-Mart and other
big chains. These stores allow the company
to listen to and learn from customers.
Likewise, partnerships and alliances not
only help you accomplish particular tasks;
they also provide knowledge about things
happening in the world that you wouldn't
see otherwise.
Look not just at how the pieces of your
business model fit together but for what
doesn't fit. For instance, pay special
attention to customer complaints, which are
often your best source of information about
an operational weakness or unmet need.
Also search out broader signs of change -- a
competitor doing something differently or a
customer using your product or service in
unexpected ways.
2. Challenging the Prevailing
Organizational Wisdom. Leaders need to
develop what I call kaleidoscope thinking -
- a way of constructing patterns from the
fragments of data available, and then
manipulating them to form different
patterns. They must question their
assumptions about how pieces of the
organization, the marketplace, or the
community fit together. Change leaders
remember that there are many solutions to a
problem and that by looking through a
different lens somebody is going to invent,
56 November 2007 NHRD Journal
for instance, a new way to deliver health
care.
There are lots of ways to promote
kaleidoscopic thinking. Send people
outside the company -- not just on field trips,
but "far afield trips." Go outside your
industry and return with fresh ideas. Rotate
job assignments and create
interdisciplinary project teams to give
people fresh ideas and opportunities to test
their assumptions. For instance, one
innovative department of a U.S. oil company
regularly invites people from many different
departments to attend large brainstorming
sessions. These allow interested outsiders
to ask questions, make suggestions, and
trigger new ideas.
3. Communicating a Compelling
Aspiration. You cannot sell change, or
anything else, without genuine conviction,
because there are so many sources of
resistance to overcome: "We've never done
it before; we tried it before and it didn't
work." "Things are OK now, so why should
we change?" Especially when you are
pursuing a true innovation as opposed to
responding to a crisis, you've got to make a
compelling case. Leaders talk about
communicating a vision as an instrument
of change, but I prefer the notion of
communicating an aspiration. It's not just a
picture of what could be; it is an appeal to
our better selves, a call to become something
more. It reminds us that the future does not
just descend like a stage set; we construct
the future from our own history, desires, and
decisions.
4. Building Coalitions. Change leaders need
the involvement of people who have the
resources, the knowledge, and the political
clout to make things happen. You want the
opinion shapers, the experts in the field, the
values leaders. That sounds obvious, but
coalition building is probably the most
neglected step in the change process.
In the early stages of planning change,
leaders must identify key supporters and
sell their dream with the same passion and
deliberation as the entrepreneur. You may
have to reach deep into, across, and outside
the organization to find key influencers, but
you first must be willing to reveal an idea or
proposal before it's ready. Secrecy denies
you the opportunity to get feedback, and
when things are sprung on people with no
warning, the easiest answer is always no.
Coalition building requires an
understanding of the politics of change, and
in any organization those politics are
formidable.
When building coalitions, however, it's a
mistake to try to recruit everybody at once.
Think of innovation as a venture. You want
the minimum number of investors necessary
to launch a new venture, and to champion
it when you need help later.
5. Transferring Ownership to a Working
Team. Once a coalition is in place, you can
enlist others in implementation. You must
remain involved -- the leader's job is to
support the team, provide coaching and
resources, and patrol the boundaries within
which the team can freely operate. But you
cannot simply ask managers to execute a
fully formed change agenda; you might
instead develop a broad outline, informed
by your environmental scan and lots of good
questions, from which people can conduct
a series of small experiments. That approach
not only confers team ownership, but
allows people to explore new possibilities
in ways that don't bet the company or your
budget.
As psychologist Richard Hackman has
found, it is not just the personalities or the
team process that determine success; it's
whether or not the team is linked
November
appropriately to the resources they need in
the organization (see "Why Teams Don't
Work," Winter 1998). In addition, leaders
can allow teams to forge their own identity,
build a sense of membership, and enjoy the
protection they need to implement changes.
One of the temptations leaders must resist
is to simply pile responsibility on team
members. While it is fashionable to have
people wear many hats, people must be
given the responsibility -- and the time -- to
focus on the tasks of change.
6. Learning to Persevere. My personal law
of management, if not of life, is that
everything can look like a failure in the
middle. One of the mistakes leaders make in
change processes is to launch them and
leave them. There are many ways a change
initiative can get derailed (see "Sticky
Moments in the Middle of Change"). But stop
it too soon and, by definition it will be a
failure; stay with it through its initial
hurdles and good things may happen. Of
course, if a change process takes long
enough you have to return to the beginning
-- monitor the environment again, recheck
your assumptions, reconsider whether the
proposed change is still the right one.
Abdicating your role undermines the effort
because, unlike bold strokes, long marches
need ongoing leadership. Most people get
excited about things in the beginning, and
everybody loves endings, especially happy
endings. It's the hard work in between that
demands the attention and effort of savvy
leaders.
7. Making Everyone a Hero. Remembering
to recognize, reward, and celebrate
accomplishments is a critical leadership
skill. And it is probably the most
underutilized motivational tool in
organizations. There is no limit to how much
recognition you can provide, and it is often
free. Recognition brings the change cycle to
2007 NHRD Journal 57
 its logical conclusion, but it also motivates
people to attempt change again. So many
people get involved in and contribute to
changing the way an organization does
things that it's important to share the credit.
Change is an ongoing issue, and you can't
afford to lose the talents, skills, or energies
of those who can help make it happen.
Today's organizations have come to expect bold
strokes from their leaders. Sometimes these are
appropriate and effective -- as when a project
or product that no longer works is put to rest.
But bold strokes can also disrupt and distract
organizations. They often happen too quickly
to facilitate real learning, and they can impede
the instructive long marches that ultimately
carry an organization forward. That is why
imagination, professionalism, and openness
are essential to leadership, not just to leading
change. They give organizations the tools to
absorb and apply the lessons of the moment.
Likewise, techniques that facilitate change
within organizations -- creating listening posts,
opening lines of communication, articulating
a set of explicit, shared goals, building
coalitions, acknowledging others -- are key to
creating effective partnerships and sustaining
high performance, not just to managing change.
They build the trust and commitment necessary
to succeed in good times or in bad. Even periods
of relative stability (unusual for most
organizations) require such skills.
Change has become a major theme of leadership
literature for a good reason. Leaders set the
direction, define the context, and help produce
coherence for their organizations. Leaders
manage the culture, or at least the vehicles
through which that culture is expressed. They
set the boundaries for collaboration, autonomy,
and the sharing of knowledge and ideas, and
give meaning to events that otherwise appear
random and chaotic. And they inspire
voluntary behavior -- the degree of effort,
innovation, and entrepreneurship with which
58 November 2007 NHRD Journal
employees serve customers and seek
opportunities.
Increasingly, the assets that cannot be
controlled by rule are most critical to success.
People's ideas or concepts, their commitment
to high standards of competence, and their
connections of trust with partners are what set
apart great organizations. All these
requirements can be enhanced by leaders, but
none can be mandated. For all of the upheaval
of the past 15 years, that may be the biggest
change of all.
Innovating in the Age of Mega Mergers
Do mergers and acquisitions impair
innovation? It depends on the nature of the
deal and the abilities of leaders. Some
consolidations, such as the effectively managed
merger of Sandoz and Ciba Gigy to form
Novartis, are growth-oriented. In that case, most
of the pieces that were combined, and
eventually sold off, were in the chemical
business. What remained was a new,
strategically coherent life sciences company. It
can grow by building new knowledge and
collecting in one place a set of diverse products
that previously had been scattered.
The key for leaders in a growth-oriented merger
-- where the aim is to tackle new markets and
do things together that could not be done
separately -- is to foster communication,
encourage involvement, and share more
knowledge of overall strategy, special projects,
and how the pieces of the new entity fit
together.
On the other hand, many mergers are aimed
primarily at reducing capacity and cutting
costs. That is the case in most of the recent
banking and financial services mergers, for
instance.
These consolidations, and the efficiencies that
result, can make good economic sense. Yet
massive organizational change often drains so
much time and energy that the sustainable
benefits of the long march are lost, and the
temptations of the bold stroke are irresistible.
Often this leaves leaders with the task of putting
the best face on what, for many employees, is
not a promising future.
Mergers that focus on cost cutting -- often
necessary to pay for the deal and to satisfy the
demands of shareholders -- can threaten the
funding of promising experiments and disrupt
innovation. Massive mergers can also drive out
the knowledge that fuels innovation. Merged
organizations often lose a degree of staff
professionalism because people resent losing
a voice in their destiny or having to do tasks
that they're not prepared for. Training budgets
and opportunities for collegial exchange also
tend to shrink. Most consolidations fail to create
more integrated, value-adding enterprises and
fall short of their promised benefits. That is what
makes them such a demanding test of
leadership.
Sticky Moments in the Middle of Change --
and How to Get Unstuck
Every idea, especially if it is new or different,
runs into trouble before it reaches fruition.
However, it's important for change leaders to
help teams overcome four predictable -- but
potentially fatal -- roadblocks to change.
• Forecasts Fall Short. You have to have a plan
-- but if you are doing something new and
different, you should not expect it to hold.
Plans are based on experience and
assumptions. When attempting to innovate,
it is difficult to predict how long something
will take or how much it will cost (you can
predict, however, that it will probably take
longer and cost more than you think).
Change leaders must be prepared to accept
serious departures from plans. They must
also understand that if they hope to
encourage innovation it is foolish to
measure people's performance according to
strictly planned delivery.
• Roads Curve. Everyone knows that a new
path is unlikely to run straight and true, but
when we actually encounter those twists
and turns we often panic. Especially when
attempting to make changes in a system,
diversions are likely, and unwelcome.
It is a mistake to simply stop in your tracks.
Every change brings unanticipated
consequences, and teams must be prepared
to respond, to troubleshoot, to make
adjustments, and to make their case.
Scenario planning can help; the real
message is to expect the unexpected.
• Momentum Slows. After the excitement and
anticipation of a project launch, reality sinks
in. You do not have solutions to the
problems you face; the multiple demands of
your job are piling up; the people you have
asked for information or assistance are not
returning your calls. The team is
discouraged and enmeshed in conflict. It is
important to revisit the team's mission, to
recognize what's been accomplished and
what remains, and to remember that the
differences in outlook, background, and
perspective that now may divide you will
ultimately provide solutions.
• Critics Emerge. Even if you have built a
coalition and involved key stakeholders, the
critics, skeptics, and cynics will challenge
you -- and they will be strongest not at the
beginning but in the middle of your efforts.
It is only then that the possible impact of the
change becomes clear, and those who feel
threatened can formulate their objections.
This is when change leaders -- often with
the help of coalition members, outside
partners, or acknowledged experts -- can
respond to criticism, remove obstacles, and
push forward. Tangible progress will
produce more believers than doubters.
November 2007 NHRD Journal 59
 CORE TASKS FOR SUCCESSFUL
CHANGE MANAGEMENT
S. RAMNARAYAN
Organizational change can occur
in many forms. It can, for instance,
include accelerating growth,
leading transformation or arresting
decline. All these three forms of
change need to be managed. In the
growing literature on change
management, transformational
Ramnarayan is a
professor of OB at change has attracted a lot of
theIndian School attention. Referred to also as radical
ofBusiness. He has a
PhDfrom change, frame-breaking change or
WeatherheadSchool of reinvention, this type of change
Management,Case often involves simultaneous
Western
ReserveUniversity, and alterations in strategy, structure,
aPGDIM from and culture of an organization.
JamnalalBajaj Institute
ofManagement Transformational changes face a
Studies.He has a number high risk of failure with estimates
ofpublications to his
crediton change of successful transformations
managementHe was ranging between 20 and 40 per
formerlyteaching at the
IndianInstitute of cent. Over several years, we have
Management, closely observed these changes
Ahmedabad, Otto- unfold in a large number and wide
Friedrich University
ofBamberg, Germany, variety of organizations. We have
andCase Western noticed that effective change
ReserveUniversity. He is
activelyguiding large
leaders get people to assume
scalechange ownership and engage with
initiatives.He is on the difficult problems facing the group
boards of anumber of
companies inIndia. or the organization. For doing this,
they tackle major challenges
required to bring about changes in
people's values, beliefs, habits,
ways of working and ways of life.
In short, they recognize that
successful organizational change is
primarily about changing the way
in which people think and act.
Our inquiry of the change
management journey in different
organizations has shown that there
60 November 2007 NHRD Journal
are four main challenges that are
crucial to the change leader's
success as a navigator through the
rocky process of altering mindsets.
We list these challenges below and
also briefly refer to different roles
that change leaders would be
expected to perform:
(a) Appreciating Change: This
requires tuning to people's mindsets
inside the organization and outside
forces of change impacting the
organization. This task addresses
the challenge of clear articulation of
the destination and an appreciation
of what is required to reach that
destination. To perform this core
task effectively, the change leader
has to be a cognitive tuner.
(b) Mobilizing Support: This
involves more than mere
exhortation of people to do the right
things. It refers to strengthening
influence and communication
efforts to muster, assemble, and
rally people together to bring about
meaningful change. This task
requires change leader to be a
people catalyzer.
(c) Executing Change: This entails
designing, building and sustaining
a social architecture that can
establish new routines to replace
old routines. Just as the mould
determines the shape that jelly
takes, right structures and
processes create the architecture for
desired cross-functional linkages
and innovation efforts to emerge.
To address the challenge of executing change,
the change leader should function as a systems
architect.
(d) Building Change Capability: This involves
creating positive context that enables people
to have faith in their own capabilities, take risks
and learn. By engendering a feeling of optimism
and hope, change leader fosters a positive
belief in people that they can face challenges of
change. This positive belief lies at the heart of
capability building. Thus change leader should
be an efficacy builder.
Change management failures occur because
one or more of the above challenges are not
addressed effectively. In rest of the paper, we'll
briefly review what each one of the above four
roles entails.
Leadership
Appreciating Change
A traditional organization had sought to make
certain important structural interventions to be
able to face greater competition. Accordingly,
teams were constituted and resources were
allocated. The objective was to strengthen
interface management among the key functions
for developing new products. For the success
of the change effort, employees were required
to behave in ways that would be qualitatively
different from the manner in which they had
been used to operating.
For example, the organizational members were
required to work across functional boundaries
and operate with minimal guidance and
specific role prescriptions to pursue larger
organizational goals and priorities. This was
a sharp departure from the existing methods
that were characterized by hierarchical
approaches, strong functional loyalties and
turf concerns. For the change to succeed, people
had to communicate requirements and
demands, if required to individuals, groups
and functions even if they were powerful.
Juniors were expected to talk openly about
difficulties and voice opinions freely at
meetings. They had to assume responsibility.
The seniors, on the other hand, were expected
to actively seek opinions, encourage dissent
and support efforts to modify dysfunctional
procedures. They had to feel comfortable with
initiative being taken at lower levels and
feedback and expectations being expressed
frankly by their direct reports.
No thought was given to how such changes in
mindsets were expected to be brought about.
Not surprisingly, these mindset changes did
not occur and so the structural changes did
not take root. There was also no clarity on how
the inherent contradictions among different
sub-goals were expected to be resolved. For
instance, the sub-goal of new product
development was at odds with the sub-goal of
maximizing production of existing products.
Incentive systems, goal setting and
measurement procedures were not geared to
accept possible higher rejections, extra costs
and the dip in the top-line and bottom-line
flowing from investments for the future.
A key change management challenge is to
ensure that all such factors are visualized and
considered before the direction is frozen in terms
of specific sub-goals and tasks. When people
are able to visualize both the larger picture and
their assigned tasks, they become hopeful,
optimistic and committed to the transformation
process.
November 2007 NHRD Journal 61
We have referred to the leadership role for this
key task as cognitive tuning because it is largely
a process of reflection, analysis and thinking.
Cognitive tuning occurs through the medium
of dialogue and conversations. Change leaders
must, therefore be skilled in initiating dialogue
to both understand prevailing mindsets and
make people aware of their mindsets. They also
need to pay attention to the evolving
environment. While cognitive tuning is all
about paying attention to mental models both
inside and outside the organization, one cannot
understand the mental models of others unless
one is aware of one's own mental model.
Therefore, as cognitive tuners, change leaders
need to be able to reflect on their own ways of
thinking. This very act of cognitive tuning
initiates change in an organization.
Mobilizing Support
When Delhi Metro Rail Corporation (DMRC)
undertook the massive project in the Nation's
Capital, the leadership realized that among
other challenges, it had to generate external
support from Delhi's residents, politicians,
bureaucrats, contractors and several other
groups. The project owes its success to effectively
managing the dependencies on a wide array of
these external stakeholders. To illustrate the
leadership's approach, let us examine how the
public support was mobilized.
The leadership saw the challenge not merely in
terms of communication, but as winning people
over to the corporation's philosophy and
approaches. For example, a number of procedures
were instituted at work sites to minimize
disturbances. The procedures even specified that
the vehicles should not be allowed to leave the
work sites without their tyres being cleaned. As
the other public utilities were notorious for their
inefficiency, the interface with those agencies was
handled by taking additional responsibilities to
ensure that there was no public discontent. For
instance, when traffic diversions had to be made,
62 November 2007 NHRD Journal
DMRC appointed additional personnel at
important signals to help traffic police in
maintaining smooth flow of traffic. Though it was
clearly not its responsibility, DMRC also
undertook road widening and road repairs
where necessary to ensure that no road was
closed at any time and people were not
inconvenienced in any way. In the same way,
power, water supply, sewerage and other issues
were also pro-actively addressed.
Right through the process, there were regular
community interaction programs. People were
provided advance intimation and regular
updates by using several media. Help lines
were available to report difficulties. As a result,
the project consistently enjoyed a great image
in the eyes of the Delhi residents and received
their support whenever required.
When change leaders emphasize the content
of change at the expense of process, they may
wrongly perceive the process from a limited
perspective of education and exhortation.
Change involves a long and difficult journey,
and managers need to listen to diverse views,
keep making changes in a variety of settings,
and keep up the momentum of the change
campaign. An important set of leadership
challenges pertain to: building supportive
coalitions; evaluating the interests of people
whose support is needed; altering people's
incentives for change; framing and crafting the
message in a way that evokes support;
instituting a process that is open, transparent
and inclusive; consulting as widely as possible
before making a decision; attend to the timing
issue; and sustaining the momentum as
mobilizing is not a one-time activity. This
requires a blend of logic, emotions and values.
That's the reason why we have termed the
change leader's role as one of 'people catalyzer'.
Executing Change
In the celebrated case of Nissan's turnaround,
the new leader found that the organization had
very capable people; but the organization's
architecture in terms of its hierarchy,
procedures, policies, and decision-making
processes had contributed to a culture of
learned helplessness. Compartmentalization of
functions/ roles and rivalry between
departments/ divisions had reached such an
extent that there was a culture of blaming each
other for organizational problems. Employees
had lost both focus and energy. Changing
anything seemed to be a huge task beyond any
individual's capacity.
To convert this learned helplessness into
learned optimism, the leadership altered both
the structure and the culture of the
organization. Cross-functional teams (CFTs)
were set up to address critical issues. CFTs were
supported by a number of thoughtful
interventions, and so they became instrumental
in creating a strong foundation for the
remarkable turnaround of the company.
Another case that has attracted a great deal of
attention is the remarkable transformation of
the Indian Railways. The increase in the axle
loading from 20.3 tons to 22.9 tons led to a
significant impact on the performance of the
mammoth organization driven by strong
systems and documentation and governed by
manuals and codes. The change agents
recognized that resorting to directives or orders
at any stage would appear superficially to
hasten the change process, but would create
problems at the execution stage; it would also
not allow change to develop roots and get
institutionalized.
To make the change last, the change managers
painstakingly involved different stakeholders
through detailed background work, sharing
and discussing these in one on one meetings,
committee deliberations, exposure visits, pilot
testing and so on. For example, the concerned
officials from technical directorate, traffic wing,
finance department, research designs and
standards organization, chief commissioner of
railway safety, audit and other agencies were
involved in examining different facets of the
change. Important amendments were made in
the engineering code, bridge code, mechanical
code, preferential traffic order, and traffic
schedule. The change agents were patient and
meticulous in their efforts to prepare the ground
for the launch of the change initiative. Their
hard work contributed to effective execution
and institutionalization of change.
As we can see from these two experiences, a
key change management challenge is to
facilitate modification of mindsets by attending
to four requirements: exposing people to
alternative perspectives; enabling people from
different functions to work together; identifying
and removing roadblocks to modifying
existing routines; and creating new routines to
focus the organization's attention on
continuous improvement. Change leadership
establishes a context that facilitates these four
requirements. This is done by creating an
appropriate architecture that is made up of
roles, responsibilities, systems and procedures.
We refer to this important change leadership
role as that of a systems architect.
As a systems architect, leaders create cross-
functional linkages in the organization; align
policies, procedures and remove structural
impediments to performance and change; and
create new routines for continuous
improvement. Apart from the emphasis on
structure, leaders also pay attention to creating
a climate of hope and optimism by clarifying
purpose, enhancing preparedness and
providing psychological safety.
Building Change Capability
For a company that is almost 100 years old,
Tata Steel has shown remarkable agility since
the early 1990's. When the forces of
liberalisation were set in motion, the leadership
put in place myriad processes to prepare the
November 2007 NHRD Journal 63
company for global competition. Over a
hundred teams were mobilised to bring about
improvements in different areas. Cumulatively,
over 5000 people were entrusted the challenge
of carrying out various initiatives for
modernising mindsets of the company's 40,000
employees, enhancing quality, bringing about
radical performance improvements through
'Total Operational Performance' (TOP), creating
a market-oriented organization, de-
bottlenecking facilities, phasing out
technologically obsolete plants, adding new
facilities for manufacturing value-added
products, capacity expansion and so on. The
entire workforce of 40,000 people was trained
in certain improvement techniques to change
patterns of thinking. A major change initiative
called ASPIRE (Aspirational Initiatives to
Retain Excellence) was launched to use teams
as an instrument and source of innovation in
the company. The idea was to get people to look
at existing operations with new eyes, be
innovative and translate the ideas into effective
ground-level implementation. Not
surprisingly, the company has been rated
among the top five steel producers in the world
for the last four years by the World Steel
Dynamics. The purchase of Corus has also
propelled the company to a high world ranking
in terms of size.
Though the company changed all the
components of capability - its skills, systems,
structure, strategy and culture, the heart of the
64 November 2007 NHRD Journal
leadership lies in building self-efficacy. Self-
efficacy refers to the confidence an individual
has in his or her ability to achieve challenging
goals. A high level of self-efficacy makes it easy
for individuals to learn new things because
they experience less learning anxiety. As we
have noted, the subjective world and mindsets
of organizational members determine what
they see and how they would think and act.
This change leadership role of fostering a
positive belief in people that they can face the
challenges of change and overcome them has
been termed as 'efficacy builder'.
To build self-efficacy, leaders enhance the
aspirations of people to face challenging tasks.
They create positive role models for others to
emulate; design incentives that induce people
to set high goals for themselves; ensure that
there are support mechanisms to help people
achieve their stretch goals; and promote
learning as a desirable goal in the
organization. In short, they structure
opportunities for people to set challenging
goals and achieve them.
Finally, it is important to note that a single
leader need not necessarily address all the four
sets of challenges by himself/herself. An
effective change leader understands his or her
strengths and limitations and teams up with
other leaders having complementary strengths
so that the leadership team can perform all four
roles to be able to navigate through the complex
challenge of altering mindsets.
 DRIVING ORGANIZATIONAL CHANGE
LEENA NAIR AND ANKUSH PUNJ

Leena is an Electronic Engineer
who discovered her passion for
people and HR and switched
lanes. She went on to complete
her MBA in HR from XLRI,
Jamshedpur.
She has worked with Unilever
for the last 15 years in a variety
of roles like - Employee
Relations Manager,
Management Development
Manager, Business Partner for
the Home & Personal Care
Business. She has championed
many HR initiatives like
Diversity, Enterprise Culture,
and Coaching. With her recent
appointment as Executive
Director-HR, Leena has become
the first woman on the
Management Committee of
HUL.
Ankush Punj is the Corp
Employee Relations Manager
of Hindustan Unilever
Limited. XLRI batch of 2003,
Ankush joined HUL as a
Business Leadership Trainee
and in his first assignment
was the HR Manager of HUL
factory in Sumerpur (UP) for
two years before moving into
the Corporate ER role.Ankush
is an avid trekker, marathon
runner and passionate about
reading, writing, travelling
and music.
Abstract
The only constant in the new World - Change is a major challenge
in large-sized organizations where the sheer size as well as the
comfort of past successes causes inertia and resistance to change.
Change management is the single most important leadership
accountability and driving change initiatives successfully is a
key HR deliverable. In scores of big and small Change initiatives
that we have driven across in HUL, it has been our experience
that Change can be successful and Resistance to Change can be
overcome if a whole systems approach is followed and where
the complete organization along with its Structures, Systems and
People, processes, are viewed in totality studying the impact of
one on the other in view of the Change that is being driven in the
organization.
The paper focuses on certain tools at the disposal of the HR team
to drive change seamlessly and embed it in the DNA of the
organization:
1. Leadership Engagement
Change and Culture is driven from the top. Success is half achieved
if the leadership team is committed to and prepared to prescribe
the Change
2. Rewards and Recognition
The most effective HR tool to drive alignment in behaviors
3. Communication and Buzz
Generate curiosity and excitement towards the Change initiatives
4. Capability building
Up-skill and de-skill employees to align organizational
capabilities with the New Organization.
The paper also touches upon Resistance for Change and
measures to overcome the same.
In achieving the above we have generously borrowed from
Change theories and personal experiences of driving Change in
HUL.

November 2007 NHRD Journal 65

Driving Organizational Change
Conducting business in a fast evolving
environment where the rate of change itself is
accelerating every minute is a challenge which
most of us have not experienced in the past.
Even to be relevant in this world of Change,
organizations have to continually adapt and
evolve - call it the era of Survival of the Agile
and Adaptable.
In large organizations like ours, the sheer size
and the inertia makes embarking on a change
initiative itself a challenge, as it calls for
acknowledging the fact that historical success
does not guarantee future success. Real change
is not incremental but usually fundamental and
accompanied with a lot of resistance and pain.
In our experience of driving change especially
in large organizations, we have evolved certain
method to its madness which has proved rather
fruitful; this includes abundant borrowings
from Change theories as also learning we have
acquired en route. As an HR team, we find
ourselves in the middle of all sorts of change
initiatives, viz, restructuring a department/
team, driving behavioral change, creating a
growth mindset, promoting inclusion,
improving the effectiveness processes and teams
towards delivering organizational objectives.
Driving behavior/culture change is the toughest
change process to deal with it, and this paper
focuses a little more on those aspects.
Making sense of the Change - the Basic
Ingredients
It is imperative to begin with identifying the
triggers in the external environment that are
forcing an organization to undertake the
change process, while simultaneously map the
internal drivers for change and then review the
organization's People, Systems and Structures
to identify the facilitators and the inhibitors
towards this Change process.
Viewing any of the above elements in isolation
66 November 2007 NHRD Journal
can be catastrophic. Rather change initiatives
that are often brought in under the guise of total
quality management, re-engineering, or
strategic planning often fail because the
underlying culture is not addressed or
fundamentally altered to align with the
structure and processes.
Edgar Schein postulated three levels of culture;
starting form the outermost layer of physical
artifacts which include observable daily
features of organizational life such as activities,
rituals, jargon, office layouts, and so forth, the
middle layer of values and beliefs espoused by
the organization and the innermost core level
of basic assumptions including our deepest and
most comprehensive explanation of reality - our
views of fundamental truths about people and
the world
While most organizations succeed in bringing
about a change at the superficial artifacts level
however to drill down and challenge the basic
assumptions and changing those is the most
difficult process. These may often not even be
evident at the surface; as is the case of Values,
which often may differ between what is espoused
and what is really existent! So while the
organization structure, systems and the
Corporate Purpose read one thing, the way the
organization is run is an altogether different story.
To initiate on the path of driving organizational
change, it is imperative to diagnose the existing
organization culture; and its fit with the current
and proposed business strategies and create a
vision for the preferred future.
Driving Change - Role of HR
Driving Change is one of the most important
and difficult responsibilities in an
organization; in fact it is the essence of
leadership as rest is more or less secondary.
Human Resources as a function plays the
pivotal role in every aspect of driving Change
in the organization; creating a shared need for
change, preparing the leadership and the
organization at large for the inevitable Change
and then seeing the process of Change through!
In our experience the success of the Change
process is determined by a multitude of factors
of which Top Leadership forms a single most
important element.
Tools to Drive Change - Top Leadership
Engagement
The single most critical role of the HR
Champions in their organizations is to closely
engage with the leadership team and induct
them into the Need for Change. The process of
leading change is a shared leadership
accountability.
Any major change initiative in an organization
has to be guided by the top management team.
The success of a change initiative lies in its
sustenance and being woven into the very fabric
of the organization. This is possible only if the
top management team is as driving and living
the Change that they espouse.
Leadership conversations as well as
demonstration is important. Eg. If
consciousness for personal safety is being
embedded in a organization, then the leaders
at every forum must talk about it, must engage
their teams on safe and unsafe behavior. They
must equally ensure that they personally 'live'
safe behavior, viz, using a safety belt at all times
in their cars, following simple safety norms.
People ultimately practice what leaders practice
and not what they preach! HR at all times must
play the role of the conscience keeper to alert
leaders to the gaps between what they 'say' and
what they 'do'.
Tools to Drive Change - Rewards and
Recognition
What gets rewarded; gets driven!
The most visible cue an organization offers to
its employees' on desirable and undesirable
behaviors is through its rewards structure.
Aside from Leadership team visibly
demonstrating the desirable behavior ("Walk
the Talk"), the organization's reward and
recognition models too must align themselves
around the Change behaviors desired.
Employees are quick to learn what it would
take one to make it up the organization ladder;
• what the top leadership team displays,
• people who get recognized,
• behaviors and initiatives that they get
recognized for,
• individuals who are put on fast track
programs etc
They modify their way of working to align with
the rewarding behaviors to grow faster in the
organization.
Tools to Drive Change - Communication and
Buzz
It is vital to create a lot of buzz and excitement
around any Change initiative. A sense of
curiosity around what is going to Change and
what holds in the offing helps generate a positive
welcoming vibe for the Change initiative being
driven. A simple measure of effectiveness of
Communication is the number of positive
messages and the number of negative messages
that are communicated in the organization's
formal and informal (grapevine) networks
around any Change initiative. If the net of the
two is positive, the success of the Change
initiative is far more assured than if the net is
negative.
Now one can sit and wait for the cows to come
home or play the more proactive role of the
"Change driver" (the HR team) and actively
feed into the network as many positive
messages as possible. The trick here is to
identify the most active nodes which literally
are far more wired in the organization than the
others and feed those with more positive
messages to be drilled down across the
November 2007 NHRD Journal 67
organization. Important, it is, to realize that in
any Change initiative it is the 10% of the
resources who lying at either end of the positive
(early adopters) and the negative ends (change
resisters) can sail through or capsize the entire
initiative. Identification of the same is extremely
critical, and while at one end those in the favor
of the Change should be encouraged and
visibly recognized in the system, the alienation
or separation of those at the far end of the
negative tunnel is also equally essential for the
success of the Change initiative. If the Noah's
Ark has to take forward all that is good and
desirable in the new world; it has to begin by
identifying and segregating the unaligned and
incongruent!
Tools to Drive Change - Capability Building
Lastly, some change initiatives may call for
acquisition of newer skills and competencies,
adoption of newer ways of working and
interpersonal dealings; this may necessitate the
organization to undertake formal capability
building initiatives. However this would rarely
be an impediment and thus appears at the
bottom of the list because invariably our
capable and star resources once, they identify
the behaviors and skills that get rewarded and
revered in the organization, invariably either
emulate the same or find ways of covering those
capability gaps on their own in order to stay
ahead in the organization.
Resistance to Change
The toughest challenge with any Change
initiative is that it is always accompanied with
Resistance and the more sweeping the Change,
the stronger the Resistance
Why is there a resistance to change?
Resistance to Change is usually on account of
the following two broad reasons: Sometimes
on account of lack of information or
understanding of why the recommended
change is so inevitable; so people resist what
68 November 2007 NHRD Journal
they do not understand or find essential. This
can easily be tackled through the process of
Communication, Creating a compelling vision
of the future, Appreciative Enquiry processes
etc. However more often than not, resistance to
Change does not owe to lack of understanding
or knowledge but because of a more
fundamental problem…Change challenges the
status quo. This is a bigger and a more deep-
seated problem to resolve.
Big or small, every change challenges the status
quo and may cause:
• Redundancy
• Change in job content
• Change in social grouping
• Change in position, status, earnings or even
importance
Richard Beckhard and David Gleicher
beautifully captured Resistance and how to
overcome the same in the following formula:
D V F > R (e + p)
Where D = Dissatisfaction with the Current
ways of working
V = Vision created by the organization of
"What is possible"
F = Concrete steps that can be taken towards
the Vision
R = Resistance(economic as well as
psychological)
The push and pull between these forces
determines the success or the failure of a
Change initiative.
Resistance is also referred to as the cost of
change; and in the above equation is segregated
into economic and psychological cost of
change. Even if financially the cost of change
is low, the change will still not occur should
the psychological resistance of employees be
at a high level.
However the good news is that the above
factors are not static and in our experience of
driving change initiatives the dynamic factors
on the left had side can be effectively loaded
with effective deployment of the four tools of
Leadership: Engagement, Reward and
Recognition, Capability building and
Communication and Buzz to ensure that the
balance tilts in favor of Change.
The greatest challenge in D is that often people
learn to live and "manage" in the existing ways
of working and the "dissatisfaction" often
becomes a way of life not usually surfacing
quite openly in the organization. To drive a
change initiative it is critical to heighten the
levels of dissatisfaction with the process/
behavior that needs to be changed. This can
often be done through initiatives like
"Appreciative Enquiry"! Other initiatives like
"co-creating" a shared vision, eg., what is the
organization you want to be a part of, evolving
a theme, an anthem etc are some initiatives that
help to create buy in as well as creating a vision
of the Ideal/desired state and preparing the
organization for Change. Inclusion of all
stakeholders through different interventions.
As the organization formally steps into the
journey of affecting change, Communication
and Capability building play a critical role in
further tilting the balance in favor of the
Change. Concrete steps taken towards
achieving the Vision need to be visibly seen
and felt by the employees, periodic updates on
progress made, seeking feedback, informal
conversations, training people on new ways of
working etc all help drive change through and
through the organization.
Was the Change Initiative successful?
At the end of any change initiative the question
that would always confront the leadership team
would be "Has the Change been successful?"
To answer this, it is imperative to get the Vision
that it had set out for the organization. Change
is affected only if the desired business goals as
was visualized to begin with has been achieved
in the end. As most Change initiatives involve
behavioral change, formal dipsticks from a cross
section of people impacted by the Change
should be undertaken to measure the impact of
the Change. The success of a change initiative
has to be measured at different levels. At input
level are the milestones being met, at the output
level are the Business goals being met. The
change impact has to be measured or reviewed.
Closing Remarks
Kurt Lewin had described Change as a simple
three step process such as Unfreezing,
Changing and Refreezing. Moving too quickly
through the stages can endanger the success of
a change effort. People typically transit through
a series of emotional stages as they adjust to the
need for a drastic change in the lives; and that
is why the HR team is indispensable to the
Change process. As every change process is
invariably a behavioral change process, the HR
teams are usually placed in the "eye of the
storm" and owe the responsibility of sailing the
organization through the stormy seas through
innovative practices designed around Change
models and prescribed tools.

References
Beckhard, R. (1969). Organization Development: Strategies and Models. Addison-Wesley, Reading, MA
Gladwell, Malcolm (2000). The Tipping Point – How Little Things Can Make a Big Difference. Little, Brown & Company
Schein, Edgar (1992). Organizational Culture and Leadership. Jossey-Bass Inc., California.
Silverman, Lori L. (1997). Organizational Architecture – A Framework for Successful Transformation. Partners for Progress

November 2007 NHRD Journal 69

 MEASURING ORGANIZATIONAL
CULTURE AND CHANGE
RAJEEV KUMAR

Abstract
Organizational change invariably entails some impact on organizational culture. However,
organizational culture must be qualitatively and/or quantitatively measured to comprehend
the changes. After briefly introducing the concepts of organizational culture and sub-culture,
various qualitative and quantitative techniques for interpreting the nuances of organizational
culture are reviewed in this paper. Practitioners can make more informed decisions about
occurrences of cultural change based on this review. As early as 1965, the concept of culture
was gaining prominence in business education and research (Wadia, 1965). Over the last four
decades, culture has become a buzzword in social sciences. Executives and researchers both
recognize its role in any organizational change effort. Since the germinal study of Pettigrew
(1979), a number of research studies have used organizational culture as a variable. Both
qualitative and quantitative techniques have been employed to measure organizational
culture. This paper presents a brief introduction to the concept of organizational culture and
sub-culture. An evaluative review of techniques used to interpret organizational culture is
presented subsequently.

Culture • Culture is inherent in explicit

The concept of culture was
originally used in anthropology
(Wadia, 1965). Culture, as initially
used in anthropology and later in
sociology, referred to a way of life,
shared norms and values. It was
Rajeev Kumar, a Fellow supposed to operate at
from IIM, Ahmedabad, subconscious levels, and yet in a
and an MBA from IIFM powerful manner. Scholars offered
Bhopal, is an Assistant
several definitions of culture, and
Professor of HRM at the
Institute of Management Kroeber and Kluckhohn (1952, as
and Technology, quoted in Detert, Schroeder and
Ghaziabad .He has Mauriel, 2000) identified several
previous work experience
common elements in the different
of more than 4 years
definitions of culture. Combining
across Hewitt
Associates and an these commonalities with another
NGO-Society for the review provided by Wadia (1965)
Promotion of
yields the following attributes of
Wastelands
Development . culture:
• Culture is historically created
• Culture guides the behaviors of
individuals
and tacit beliefs, customs,
values and morals.
• Individuals acquire the
constituent elements of a culture
as they live in a society.
Sub-culture
In a society or a group, there may
be some characteristics that
distinguish one group from
another. The term sub-culture is
often used to denote such
categories. Sub-cultures develop to
address some common problems or
experiences of a group (Daft, 2008).
The need to distinguish between
culture and sub-culture is
particularly important during the
change efforts in a large and
complex culture. A more directed
discussion on culture and sub-
culture is presented below while
describing organizational culture.

70 November 2007 NHRD Journal

Organizational Culture and Sub-Culture
Organizations have been conceptualized as
socio-technical systems (Parikh and Garg,
1992). People who constitute an organization
(employees, managers, owners, etc.) come from
a societal culture, or possibly sub-culture. The
interplay between this "social" reality and
"technical" rationality of organizations is a
defining feature of organizations. This view of
organizations makes culture an integral part
of any organizational change effort.
The concept of culture in organizational
research is more than two decades old now.
The credit for introducing culture in
organization theory generally goes to Pettigrew
(Detert et al., 2000). However, the concept has
often been used vaguely (O'Reilly and
Chatman, 1996). At the same time, the
realization of the importance of organizational
culture in the context of organizational change
has also grown (Detert et al., 2000).
A wide variety of specifications of
organizational culture prevail in literature. But
over the years, some agreement has emerged
around the following key features:
• Organizational culture contains some
combination of artifacts, values and beliefs
and underlying assumptions that
organizational members share about
appropriate behavior. (Cook and Rousseau,
1988)
• These shared conceptions act as a normative
guide for behavior (Daft, 2008).
• Organization culture is holistic, historically
determined, socially constructed and exists
at variety of levels (Hofstede, Neuijen, Ohavy
and Sanders, 1990).
The many levels of organizational culture are
depicted in the following picture (Schein, 1985):
It should be noted here that the real
interpretation of organizational culture in the
context of organizational change efforts is quite
complex. A renowned expert in the domain of
organizational change and culture, Edgar H.
Schein, has aptly summarized these
complexities when advising consulting
psychologists to avoid the trap of assuming
"…that your client knows what culture is and
does, and, worse, you assume that you know
what culture is and does" (Schein, 2003: 79).
Nevertheless, it is useful to be aware of the
techniques that can provide some grip over the
different nuances of culture in an organization.
Therefore, a review of such techniques is
presented here.
Overview of Techniques
The methods to measure culture can be broadly
put in two categories, qualitative and
quantitative. It should be noted that some
scholars advocate the use of multiple methods
to measure organizational culture (Martin,
1992). Blalock and Blalock (1968) suggested
that firstly one should use qualitative
techniques, to be supplemented by quantitative
assessment subsequently. In the following
sections, a review of various methods is
provided.
Qualitative Techniques
Qualitative methods do not attempt to ascribe
a number to various aspects of organizational
culture. They allow researchers and
practitioners the flexibility of digging deeper
into various aspects of organizational culture.
Some of the classic approaches used to study
organizational culture involve the following:
• Case studies: A case study focuses on
understanding the nuances of a single setting
in depth. Case studies can be done at
multiple level of analysis, i.e., individual,
group or organization. Typical techniques
of data collection for case studies include
interviews, archives, observations, etc (Yin,
1994; Eisenhardt, 1989).
November 2007 NHRD Journal 71
• Ethnographic studies: This technique is
particularly important in social sciences,
though organizational sciences have
increasingly used it. It involves a long period
of systematic observation by a researcher.
During the phase of observation, the
observer almost merges with the culture s/
he is studying. Extended time required for
such studies, however, is a drawback.
• Action research - This method is being
increasingly employed in social
development sector. However, its use in
organizations is limited.
In an important contribution, Trice and Beyer
(1984) proposed that organizational culture
can be studied through rites and ceremonies
followed in an organization. Metaphors can
be useful in studying culture (Morgan, 1997).
Quantitative Techniques
Organizational culture is an all-encompassing
concept that needs to be broken into
manageable proportions for study (Meek, 1988).
The quantitative measurement of culture
focuses more on what a culture has (Smircich,
1983). A general agreement seems to be that
quantitative approaches are more capable of
measuring the general, shallow level of culture,
and qualitative studies are more capable of
penetrating the deeper levels of value system,
assumptions, etc (Ashkanasy, Broadfoot, and
Falkus, 2000). Quantitative methods try to
capture the manifestation of culture only,
which may occur as a behavior (a manifest
action) or a thought or feeling. These methods
do not have the capacity to penetrate and
directly touch the deeper layers of culture.
Several instruments have been developed, but
unfortunately they vary widely in format, items,
etc. These instruments can be clubbed in two
broad categories (Ashkanasy et al., 2000):
• Typing scales - These classify organizations
into particular taxonomies.
72 November 2007 NHRD Journal
• Profile scales - These describe the culture of
an organization.
Ashkanasy et al. (2000) reviewed 18 scales of
organizational culture. Some of these scales
measure norms while some other measure
values. Of these, complete reliability and
validity assessment was reported for only two
scales and partial reporting was available for
four other scales. It should be noted here that
reliability and validity assessments help
determine the scientific soundness of an
instrument, and hence one should avoid using
scales with unknown reliability and validity.
An important issue to consider here is the
scientific equivalence of scales when
translating scales for usages in local languages.
One way of ensuring this is back-to-back
translation (Brislin, 1986). This is an accepted
procedure for translating scales in some other
language. In this procedure, a bilingual
translator translates the original scale into a
local language. Then a second bilingual
translator translates the local language version
back into the original language of the scale
(mostly English). A third bilingual compares
the original and back-translated version and
the discrepancies are sorted out.
Concluding Remarks
It is important to realize the importance of
organizational culture in the efforts aiming at
organizational change. Though it would be
erroneous to assume that even an insider
would have complete grasp over organizational
culture (let alone an outside consultant), it is
useful to adopt scientifically discussed and
tested techniques of interpreting organizational
culture. This paper offers a brief review of such
techniques which can be useful for
practitioners dealing with issues of
organizational culture and change.
References
Ashkanasy, N. M., Broadfoot, L. E. and Falkus, S. 2000. Questionnaire measures of organizational culture. In N. M. Ashkanasy, C.
P. M. Wilderom and M. F. Peterson (Eds.). Organizational Culture and Climate. Sage Publications, Thousand Oaks.
Blalock, H. M. and Blalock, A. B. 1968. Methodology in Social Research. McGraw Hill, New York.
Brislin, R. W. 1986. The wording and translation of research instruments. In W. J. Lonner and J. W. Berry (Eds.). Field Methods in
Cross Cultural Research. Sage, CA.
Cooke, R., & Rousseau, D. 1988. Behavioral norms and expectations: A quantitative approach to the assessment of organizational
culture. Group und Organizational Studies, 13: 245-273.
Daft, R. L. 2008. Understanding the Theory and Design of Organizations. Cengage Learning, New Delhi.
Detert, J. R., Shroeder, R. G. & Mauriel, J. J. 2000. A framework for linking culture and improvement initiatives in organizations.
Academy of Management Review, Vol. 25. p. 850-863.
Eisenhardt, K. M. 1989. Building theories from case study research. Academy of Management Research. 14, p. 532-550.
Hofstede, G., Neuijen, B., Ohavy, D. D. & Sanders, G. 1990. Measuring organizational cultures: A qualitative and quantitative study
across twenty cases. Administrative Science Quarterly. 35, p. 286-316.
Martin, J. 1992. Cultures in Organization: Three Perspectives. Oxford University Press, NY.
Meek, V. L. 1988. Organizational Culture: Origins and Weaknesses. Organization Studies. 9, 453-473.
Morgan, G. 1997. Images of Organization. Sage, Thousand Oaks.
O’Reilly. C. A., III, & Chatman, J. A. 1996. Culture as social control: Corporations, cults, and commitment. In B. M. Staw & L. L.
Cummings (Eds.), Research in Organizational Behavior, vol. 18: 157-200. Greenwich, CT: JAI Press.
Parikh, I. J. and Garg, P. K. 1992. Theory of socio-technical systems. In I. J. Parikh and P. K. Garg (Eds.) Organization Theories,
Issues and Applications. Indian Society for Individual and Social Development, Ahmedabad.
Pettigrew, A. M. 1979. On studying organizational cultures. Administrative Science Quarterly. 24, p. 570-581.
Schein, E. H. 1985. Organizational culture. In R. Kilmann, M. Saxton and R. Serpa (Eds.) Gaining Control of the Corporate
Culture. Jossey Bass, San Francisco.
Schein, E. H. 2003. Five traps for consulting psychologists or, how I learned to take culture seriously. Consulting Psychology
Journal: Practice and Research, 55, 75-83.
Smircich, L. 1983. Concept of culture and organizational analysis. Administrative Science Quarterly. 28, p. 339-358.
Trice, H. M. and Beyer, J., M. 1984. Studying Organizational Cultures Through Rites and Ceremonials. Academy of
Management Review. 9, 653 – 669.
Wadia, M. S. 1965. The concept of culture. Journal of Retailing. 41, 1, p. 21-30.
Yin, R. K. 1994. Case Study Research – Design and Methods. Sage Publications, CA.
1 Reliability estimates communicate to what extent the items of a scale measure a common attribute. Validity
assessments tell if the attribute getting measured is the one that we want to measure.

November 2007 NHRD Journal 73

 MANAGEMENT OF CHANGE: CRITICAL FACTORS
TARUN SHETH

Abstract
Management of change is essentially the management of direction. In my opinion this is the core,
fundamental point. In a way, the direction can itself be a means to an end. However, the choice of
direction involves the choice of ends. Strategizing change, choice of the change agent, the cost of
change and implementation are all means to support the fundamental choice of direction.
The second part of management of change is execution. Execution includes planning for
change as well as executing its key elements, including handling communication and human
resource and cultural issues.
Both the above issues are part and parcel of a leadership initiative and hence leadership is
probably the most important part of management of change.
While there are many elements to management of change, we are going to touch on the above
key areas due to limitation son the length of the article.
In this article we shall make observations on business organizations. The term organization
can apply to governments, social communities, voluntary and informal bodies etc.

Direction are being addressed.

Management literature on change Organizational framework for
does include the issues of direction identifying change areas
but the vast majority of writings The following is an indicative list
focus on managing change and of areas that can aid in identifying
assume that the direction is a given. change in direction and then
At the organizational level, all the prioritizing and managing them:
elements or parts are interrelated
Tarun Sheth taught at I) Individual
the University of Baroda
and therefore managing change
and IIM, Ahmedabad. implies analyzing the • Role clarity
Worked with Hindustan interrelationships and then • Fitments in the role
Lever as head of managing the process. While it is
Organization important to know the • Competence/skills
Development for all
companies in India, i.e.,
interrelationships, the trick is in • Personality/Motivation
HLL, Lipton, Brooke knowing and choosing the
II) Group
Bond and Ponds. direction and then bringing in the
Currently consulting management of interrelationship in • Goals
with domestic and the change process.
international companies • Focus
for HR strategy, systems, In the overall organizational • Structure
structures compensation, situation the direction can be in any
recruitment, training and • Skills/ Competence
area. For the purpose of
coaching.
convenience we present a list • Morale
through which you could identify III) Functional
or choose directions in various
areas depending on the issues that • Marketing/Sales

74 November 2007 NHRD Journal

 • Finance and Accounts this choice can give different results.
• Technical/Production Take the telephony business. A large industrial
• Innovation/R & D group decided to go for the telephony business.
The new direction required defining the
• Information Processing/IT business, management of government and its
• Compliance/Legal legal provisions, creating a marketing
IV) Procedures organization, bringing in technology and
creating a structure that could provide focus,
• Entry/Exit direction, supervision and execution. The
• Procurement primary direction for change required creation
of a consumer-oriented business, recruiting
• Accounting/Finance/Control
people with experience in consumer marketing
• Development/Rewarding/Planning/ and building an organization that could focus
Review on market, technology and customer
V) Leadership relationships.
• Consistency with Objectives/Clarity of The company was successful in christening the
Goals new business attractively, going to a new
location and some specialist recruitment in
• Competence/Ability to carry people
sales and marketing. However, it brought
• Conservative/Change oriented leadership from the old business whose
• Achiever/risk taker experience was in commodities and controlling
costs; units were peopled with individuals with
VI) Culture
a marketing background but authority was
• Values/Beliefs diffused and there were issues of integration of
• Norms the old with the new. As a result of the above,
the first three years of its existence saw a lot of
• Employee Oriented/Control Oriented churn and failures. The choice of wrong
VII) Structure leadership may even mix otherwise seemingly
• Organization Structure good business initiatives.

• Hierarchy/Levels Hewlett Packard merged with Compaq and put

• Focus
• Accountability
• Supervision
• Cost of the organization
Leadership and change
Organizations which are autocratic and do not
allow free communication and freedom to
disagree can make the right decisions but the
lack of freedom does not give it any protection
from wrong decisions unless it is too late.
Sometimes you choose the right direction but
the quality of management of the process in
Carly Fionna to manage the change. She did
not live up to the challenges of the job and had
to leave. The business went through difficult
times and stabilized only with a change in
leadership.
The Tatas who have also ventured into
telephony failed to provide focused leadership
and support for the change in the direction of a
new business. They could have done much
better but haven't.
Bharti Airtel, which was relatively new, less
resourceful and lesser known in the market
started slowly but through management of the
direction and process of change has come out

November 2007 NHRD Journal 75

on top at least in numbers and growth.
Although the above is a very brief account, it
shows that when an organization embarks on
a new business it needs to define directions,
provide focused leadership, create processes
appropriate to the nature of the business and
clearly accept the deviation required from the
past. The last one requires either new
leadership to be brought from outside or
picking up leaders from the existing
organization with the right mind set. The thing
to avoid is to appoint successful individuals
from the existing business who not may be the
right fit in the new business.
Choosing a Direction and Managing Change
Successfully
IBM
IBM is a good example of a company managing
direction. When its progress got plateaued it
felt the need for change of direction. It was not
easy with existing leadership as more often
than not they would dish out more of the same
and cling to the past. It is the change in
leadership that brought back its glory. They
even took this logic further to sell their laptop
division to the Chinese company Lenovo.
Tata Tea
One of the more successful examples of
choosing the right direction and coming out
on top is Tata Tea. It started as a company
which owned plantations in the north and the
south and was more a commodity player while
other companies like Brooke Bond, Lipton and
Wagh Bakri prospered through branding the
commodity bought from Tata Tea. It made the
decision of branding and marketing tea many
years ago but the execution was poor and hence
the gains were not visible. Things have
changed with the acquisition of Tetley,
operational leadership given to executives who
understand the tea business, induction of
marketing professionals, reducing stake in
plantations (a high cost and labour intensive
proposition) and focusing on branding,
76 November 2007 NHRD Journal
product development and customer
satisfaction. The impact of these changes and
consistency in execution is there for all to see.
Debate the choice
Choosing the right direction requires debate at
the highest level by people who know the
ground realities that include customers and the
government. Entrepreneurs are good at this but
some successful entrepreneurs fall in the trap
of autocratic decisions for change. Such
decisions may come out right as the top persons
judgement can be right. However, without the
benefit of differing views there is no protection
if it goes wrong. Bajaj Auto's continuance with
scooters, while Hero Honda ran away with
customers and profits is a case in point.
External Advice
The decision to change direction can come from
many sources. One useful channel is external
consultants. As a director of a large national
bank I had been observing that all PSU banks
were playing within the same constraints,
doing the same things and vying for organic
growth. The new private sector and existing
multinational banks showed that retail
banking and investment banking required
different skills, ambience and mindsets. Even
with retail banking you need to understand the
customer and raise your service levels
considerably. The bank hired a professional
consulting group which brought research data
and market information to the table. The
Chairman and Senior Executives supported the
recommendation for changes in direction. The
bank has started the execution of the
recommendations and is benefiting from it.
One important point that comes out of this
experience is that while changes in direction
are made in a smaller unit or part of the
business, if successful, it should be carefully
taken through the organization as appropriate.
Trying things on a smaller scale enables
experimentation, reduces cost and resources
and gives the freedom to fail.
Change in Ongoing Businesses
It is important to ensure that once the direction
is chosen the new business is structured to
provide focus and accountability. ITC chose
to go into hotels as a business several years
ago. They provided focus to the fledging
business and accountability by creating a
distinct organization and leadership with
focus and accountability. The business has
now grown into a very profitable division.
Focus, leadership and accountability can help
even existing business that require
rejuvenation and/or meet tough competition.
When Nirma was actively eroding Hindustan
Lever's market share in the early eighties it
chose to fight the battle in the field on the sales
front. The company put three of its best young
managers on the sales side. They turned the
tide and two of them went on to become
chairman of the company later. Both ITC and
HLL examples suggest the importance of
leadership when changing direction in existing
business or perking it up.
Choosing a Wrong Direction
An Indian company that had been doing very
well in manufacturing technology based
commodities of good quality decided to change
its strategy and change to branding the same
and recruit FMCG managers to bring in the
change. While it is true that Intel and Gujarat
Ambuja cement have been successful in
branding their commodity, there are more
examples of people who have failed. In the case
of this company the market did not accept this
change. Its problem got compounded by the
fact that the newly inducted expensive
managers could not adjust to the underlying
technology of the products and from a profitable
business it slid to a loss. It has now changed
direction and is on its way back to health.
Multinational companies operating in India
at times benefit from changes of direction
initiated abroad after a lot of research and
debate. But they are also at the wrong end of
receiving the stick in India when the change of
direction initiated abroad does not jive with
realities in India. For instance, Unilever's
decision to hive off the chemical business and
focus on ice creams may be consistent with the
parents view of its 'core business' but may not
be in sync with local realities.
When People Are Affected
One of the most difficult areas of implementing
directional change is when it affects existing
people with long service adversely. Recently, a
large engineering company invited consultants
to do a job evaluation of all managers. They
had several hundred managers whose jobs had
to be evaluated and this evaluation would affect
several thousand others. This company did not
have a good performance evaluation system
and managers were promoted on a time bound
basis to a higher level even if they continued in
the same job. The consultants warned the
management that a proper job evaluation will
result in many jobs going down as their exalted
status is only due to the fact that the incumbent
has got into a higher grade in spite of doing the
same job. The management in an aggressive
mode agreed as they felt they needed a system.
By the time the project was getting over the top
management received several messages from
people who feared their jobs might go down.
In the end the company backtracked and very
little of the consultants work was implemented.
I suspect in this case the company decided to
go ahead with the job evaluation project and
fantasized about its will to be tough.
Conclusion
To conclude, management of change requires
the choice of direction and then the
management of various processes to support
the directional change. Successful companies
debate the direction, provide focus through
organizational arrangements and leadership
and then manage the processes.
November 2007 NHRD Journal 77
 ORGANIZATIONAL CHANGE: THE FORMIDABLE XI
RAJIV DUBEY

Organizational Change: The WHO, HOW and by WHEN,

Formidable XI organizational change will
With so much written on remain a dream. This drill-down
organizational change, the only of the dream into deliverables for
meaningful thing I can attempt is to every individual in the
pen the learnings from my own organization, done with all the
experience in the corporate world in rigor and discipline of project
the past thirty two years. I will keep management, is an exercise
Rajeev Dubey, is an whose importance as a
Economics graduate it simple and stupid, largely
and MBA from the Yale because that is all I am capable of, necessary and critical success
School of Management. and partly because of my fond hope factor cannot be over-
He is Alumnus of that of the few people that actually emphasized.
INSEAD, France, and
the Harvard Business
read this article, some may resonate I am particularly impressed by the
School-TMTC Tata with and remember a thought or two. power of the Japanese Policy
Strategic Leadership
I I/we have a dream: Clearly this Deployment methodology and its
Course, Ashridge Strategic variants.
Management Centre,
has always been the source, and
UK, the National sustaining power, of any III The Virtuous and Potent
Institute of Advanced organizational change. The PDCA (Plan, Do, Check, Act)
Studies, Bangalore, and clearer this dream and the more Cycle: Needless to say, these
CII- Aspen Institute,
USA, Human Resource
forcefully it is shared, the larger deliverables need to be regularly
Executive Program at the number of apostles it creates and systematically reviewed,
Stanford University, USA. who then spread the WORD so lessons learnt from experience
that it enters the DNA of every and continuous improvements
Rajeev joined the Tata
Administrative Services person in the organization, the made. This needs to be done
(TAS), the central greater is its power. And for it to with the same rigour as the
managerial cadre of the be a potent force it must touch a conversion of the vision to
Tata Group, in 1975, and
deep inner chord in people, specific deliverables, or else
after a career spanning
29 years in the Tata activate some higher-order implementation/execution will
Group, of which 7 years purpose that makes ordinary remain as elusive as a will-o-the-
were as Managing people own the dream and do wisp in the mist and dark.
Director, first of Tata
truly extra ordinary things. The above conditions are about
Metaliks and then of
Rallis India, Joined This dream needs to be talked about strategy, process, system and
Mahindra & Mahindra again and again from every metrics and address the perennial
in 2004, he is currently
possible platform, and many three questions
President (HR & Corp.
Services) & Member of
people must do the talking. The • Who/where are we?
the Group Management power of the WORD and
Board. He is on the Boards INTENTION is awesome, and its • Where do we go from here?
of several Group full potential must be unleashed. • How/do we go there?
companies, including
the Chairman of Mahindra II From dream to action: If the These are necessary, but not
Insurance Brokers Limited. dream is not converted into sufficient, conditions for successful
S.M.A.R.Tly defined WHAT, organizational change. I must

78 November 2007 NHRD Journal

therefore shift gear and venture into softer (but the self-confident to be able to see it in this light.
actually much harder!) dimensions and critical How many of us can do so? And what price
aspects of behavior/attitude that will convert are we willing to pay for it?
the necessary into sufficient conditions for VI Listen : Most of us are Masters at telling
change. others what to do, but how many use the
IV Trust: If you think of it, business and power of listening to connect with and
commerce-in fact human civilization-is understand reality, to grasp opportunities,
based on trust : our belief that people will to see the sources of problems and their
do what they say (and hopefully say what solutions too. The voice of the customer, the
they mean). If this belief gets diluted or employee, the supplier, the competitor, the
compromised, no initiative can deliver its winds of change….
potential. Hence it is critical that leaders are In my experience, the leaders who listened
trusted and in turn trust those that "follow" empathetically-not those who pretended to
them. Trust ultimately depends on leaders listen-were truly able to create transformational
being authentic : thought, speech and action change. The others were great at writing articles
are aligned so that people believe that and giving lectures to spell-bound audiences!!
leaders will do what they say, that different
masks will not be worn for different Of course, the art and power of listening must
occasions, that they will Walk the Talk. percolate throughout the organization if its full
Mahatma Gandhi was perhaps the most power is to be harnessed.
outstanding in this regard, and hence widely VII May a thousand leaders bloom (with
regarded as one of the greatest leaders in apologies to Chairman Mao!): Any major
modern times. change requires leadership initiatives
V Inspire, Especially When There is Failure: (within certain boundaries of course)
Every movement goes through its ups and through the length and breadth of
downs, and it is precisely when the going is the organization.
tough that we need to stand by each other, But it is equally true that in most organizations
when leaders need to focus on strengths to these boundaries are much more tightly defined
overcome weaknesses, to remind their than they ought to be if the required energy
followers "You can do it, I am with you". In and momentum of the change process is to be
such situations one would do well to achieved. Clearly the command and control
remember Napoleon's statement "Morale is approach needs to be revisited, for the pace and
to all other factors as four is to one". Too complexity of change can no longer be managed
often have I seen blame-games and witch- by supermen CEO s who know more about
hunts bring organizational change to a everything than anyone else.
grinding halt, in fact push it back, when the
going is not good. Fortunately, many organizations have realized
this and I have seen more and more change
Tolerating, in fact celebrating, failure (again initiatives being driven by large numbers of
within limits) is in fact an important ingredient empowered leaders and teams of both blue and
in the samundra manthan of change which white-collar employees -and they inevitably
unleashes innovation in organizations, for surpass expectations. Giving up power ends
failure often (perhaps always) paves the way up creating much more power! This is going to
for success. But it requires the brave, strong and be the Golden Age of the Leader as Mentor, of

November 2007 NHRD Journal 79

the gardener who enables a thousand flowers
to bloom.
VIIINo Gospel Truth : A corollary of distributed
leadership and empowered teams, is a
culture which encourages relentless
questioning of the unquestioned and the
unquestionable, without penalizing/killing
the brave soul who tells the Emperor that he
has no clothes on. This culture which
encourages questioning & challenging the
status quo, is a powerful complement to
listening as a major source of
INNOVATION.
IX From the Tyranny of either/or, to the Power
of AND: Creating synergy out of seemingly
conflicting forces and objectives, and the
ability to create WIN - WIN situations, have
been the hall-mark of the most successful
change initiatives I have seen. This is a
paradigm shift which will become
increasingly important as we move from
competition to co-operation, to a world
where sustainability becomes a major
challenge, and where we face threats to
things we have taken for granted and
ravaged over the course of civilization: air,
earth, water and climate.
X The Triumph of Good Over the Perfect:
Many change initiatives have floundered
because the search for the perfect way
forward has led to sacrificing many things
that were clearly good and desirable. This
led to slow-down and eventual death. On
80 November 2007 NHRD Journal
the other hand, more often than not, those
who dared to take the risk and challenge
and moved ahead with initiatives /
solutions that were good though not perfect,
and learnt along the way, created great
successes.
These were also organizations which kept it
simple and stupid, and unleashed enormous
potential from doing so.
XI Satya, Prem and Seva : Finally, the
organizations which were successful at
transformational change seemed to have
been powered by the energy of their core
values. They firmly believed that success
would be an empty and meaningless reward
if it were achieved by sacrificing the core
values of the organization, and the human
beings who were its source. For me
personally, I would prefer not to have
success if doing so would entail sacrificing:
SATYA: Do I speak the truth as I see it,
regardless of the consequences?
PREM: Do I have compassion - can I put
myself into the shoes of those that
I deal with?
SEVA: Can I be of service to
someone who is in need,
especially if he/she is less
fortunate than me?
This is a tall order, a formidable XI. Can anyone
get it all right? Probably not, but it may be worth
trying.
 COMMUNICATION EFFECTIVENESS, JUSTICE
PERCEPTIONS AND EMPLOYEE COMMITMENT DURING
ORGANIZATIONAL CHANGE
RANJEET NAMBUDIRI

Abstract
This paper examines the relationship between justice perceptions and employee commitment in
the context of organizational change. Extant literature reveals that organizational justice
perceptions are correlated with employee commitment in a change context. However, the
underlying processes governing this relationship have not yet been completely understood and
hence a review seems necessary. This paper, which is conceptual in nature, proposes a model
linking justice perceptions with employee commitment moderated by organizational and
supervisory communication. It is proposed that perceptions of justice would have a positive
impact on employee commitment in an organization that is undergoing change intervention. It is
suggested that organizational and supervisory communication moderate perceptions of justice to
hasten the restoration process of employee commitment in a changing environment. Managerial
implications of the review are discussed.
Key Words: Communication, organizational justice, employee commitment, and organizational change

• Introduction The interventions could be

'Change' is an extremely significant
phenomenon, discussed
extensively in the context of
organizational action. It is by now
very well accepted that most, if not
all organizations undergo
deliberate transformation during
Ranjeet Nambudiri is an
Assistant Professor in their lifetime. Firms undergo
change in an effort to gain more
OB & HRM, a Fellow in
Management from IIM efficiency and competitiveness.
(Ahmedabad). He has
These interventions are often
presented research
papers in several undertaken as a response to
international conferences environmental volatility, desire for
including the Asian enhanced organizational
Academy of
performance, as a problem-solving
Management Conference
(Shanghai, 2004) and the measure or as strategic decisions.
3rd Workshop on Trust Organizations change to address
Within and Between new challenges, priorities and
Teams organized by the
missions (Cobb et al., 1995). These
European Institute of
Advanced Studies in interventions could take shape
Management either as mergers, downsizing,
(Amsterdam, 2005). He restructuring, training, technology
has published research
transformations or implementation
papers in several
national journals. of new work-place practices and
various other models of change.
fundamental in nature, thus aimed
at effecting radical, long-term and
long-lasting change or could be
more peripheral aimed at solving
an immediate-term problem
(Cummings and Worley, 1997:30).
Equally well accepted, are
propositions, which give evidence
pointing to both positive and
negative outcomes of
organizational change. Change,
though initiated with the purpose
of bringing about positive outcomes
like improved organizational and
individual performance, often
unwittingly, brings with it negative
outcomes like reduced
organizational commitment,
turnover intent, stress, reduced
motivation, dissent and actual
employee turnover. Organizational
change interventions are posited to
have several negative
consequences, including but not
limited to personal loss, burnout,

November 2007 NHRD Journal 81

anxiety (Kets De Vries & Balazs, 1997), reduced
commitment to the organization (Brockner,
Konovsky, Cooper Schneider, Folger, Martin &
Bies, 1994) and reduced self-esteem of the
survivors (Wiesenfeld, Brockner & Thibault,
2000). It is inevitable that change interventions
will cause stress on the targets of change, i.e.
the employees (e.g., Wooten & White, 1999) and
concerns about the fairness of change processes
will naturally be raised time and again.
• Conceptual Foundations
Theories of Justice
The three widely accepted concepts of justice
are distributive justice, procedural justice and
interactional justice. Organizational justice is
the term used to describe the role of fairness in
the workplace (Greenberg, 1987).
Distributive Justice
Change in its basic nature involves a
redistribution of resources and power (Cobb et
al., 1995). These reallocations are often wide
reaching and have the potential to impact a
great range of people in the organization. Quite
naturally, there are concerns regarding the
fairness with which this resource re-allocation
is executed. The set of people who have been
divested of resources and power would resist
the change and are likely to perceive lack of
justice. At the same time, those people who have
benefited from the reallocation may have
experienced similar feelings prior to the
reallocation. Hence, the decision-makers
always need to bring about the change
considering the delicate trade-off involved.
Deutsch (1985; in Cobb et al., 1995) has outlined
the three criteria of equity, equality and need
as means of ensuring distributive justice. The
equity criterion proposes that equitable norms
based on merit are crucial in creating the
perception of distributive justice at the time of
allocating rewards or resources. Equality
emphasizes that rewards, which are equally
distributed, contribute significantly towards
perceptions of distributive justice. The criteria
82 November 2007 NHRD Journal
of need focuses on individual need as a
measure of allocating resources. Brockner and
colleagues (Brockner, Greenberg, Brockner,
Bortz, Davy & Carter, 1986) note that in
business organizations, the primary objective
is economic productivity and hence equity
would be the dominant criterion rather than
equality or need.
Procedural Justice
Thibaut & Walker (1975; in Wooten & White,
1999) have pioneered the research on
procedural justice, by focusing on how
distributive and other decisions are made.
Procedural justice looks at the fairness of the
'procedures' used for decision making. Since
change efforts or interventions often have the
consequence of increased ambiguity and
uncertainty, it becomes natural for concerns
about fairness of procedures to be addressed
by organizational development research.
Procedural justice emphasizes the issues of
'how the ground rules are constructed'
(reconstructing) (Folger, 1977), 'who is involved
in the rule construction process'
(representation) (Leventhal, 1980; in Cobb et
al., 1995) and the 'opportunity to voice or
redress one's grievances, (recourse) (Sheppard,
1984). These three issues are central to the
application of procedural justice to OD
research. Brockner and his colleagues
(Brockner, Konovsky, Cooper-Schneider,
Folger, Martin & Bies, 1994) have based their
study examining the justice-commitment
relationship on the six dimensions of
consistency, suppression of bias, accuracy,
representation, ethical standards, recourse,
and representation and proposed that advance
notice of the layoff to the victims forms an
integral part of procedural justice.
Interactional Justice
Interactional justice is a concept that had
emerged fairly recently as compared to the
distributive and procedural justice theories.
Bies (1987), in one of the pioneering works on
interactional justice focused on the 'social
accounts' given by the agents or leaders of the
organization while explaining distributive
decisions. Hence, this line of thought evaluates
the 'reasons' given by management to justify
the decision and contribute towards justice
perceptions. Greenberg (1987) furthered this
argument by stating that 'properly constructed
and communicated accounts can help mitigate
a wide range of negative attitudes produced by
disappointing outcomes.' Interactional justice
can be separated into interpersonal and
informational components and the
interpersonal component is sometimes
proposed to be similar to procedural justice (e.g.,
Viswesvaran & Ones, 2002). It is reasoned that
if management is perceived to treat the
employees well, it is likely that the employees
respond through greater commitment and
enhanced performance. Two factors
particularly relevant to the interpersonal aspect
of interactional justice are, (1) whether the
subjects believe that the reasons for the decision
were clearly and adequately explained (Bies et
al., 1988), and (2) whether the subjects were
treated with dignity (Bies et al., 1988). Thus,
issues of interactional justice seem specifically
relevant in the change context.
Organizational Commitment
Organizational commitment, was initially
proposed by Porter et al. (1974) who noted that
organizational commitment was characterized
by the following,
• "strong belief and acceptance of the
organizational goals and values",
• "willingness to exert considerable effort on
behalf of the organization", and
• "definite desire to maintain organizational
membership."
Mathieu & Zajac (1990) in their meta-analytic
review of organizational commitment have
identified antecedents like personality traits,
job characteristics, group and leader behavior
and consequences like job performance,
withdrawal, absenteeism and intent to leave.
• Communication and Employee
Commitment
Communication processes are an integral part
of organizational systems. Organizations,
when viewed as 'information processing
systems' (Hall, 2001), need to receive, process,
analyze, store and transmit information.
Organizational communication has been an
integral part of organizational theory, since the
pioneering work of Barnard (1938). Barnard
(1938) has been cited by Hall (2001) as stating,
"Communication occupies a central place in
organizational theory because structure,
extensiveness and scope of the organization
are almost entirely determined by
communication."
Communication processes in organizations are
either 'strongly individual or strongly
organizational' (Hall, 2001). This article refers
to communication as the organizational
process of interaction and information
processing, including communication by the
organization through formal and informal
modes and also communication by the
supervisor as an organizational agent. This
means that organizational communication or
communication as referred to here, indicates
all those processes, which enable an
organization to convey meaning within the
organization and to the external environment.
In the era of organizational change and
interventions like downsizing, corporations
have increased dependence on effective
communication systems. The knowledge
organizations of today are relying enormously
on effective internal and external
communication processes for improved
employee performance and commitment.
• Justice Perceptions and Employee
Commitment
Issues of fairness have been addressed
extensively by the various theories of justice
like distributive justice (Deutsch, 1985; in
November 2007 NHRD Journal 83
Wooten & White, 1999), procedural justice
(Thibaut & Walker, 1975; in Wooten and White,
1999) and interactional justice (Greenberg,
1987; Bies, 1987). Organizational development,
or the study of organizational change has
explicitly acknowledged the significance of
justice in its literature. There is ample evidence
that change efforts are fairly successful owing
to perceptions of fairness in the intervention
(e.g., Cobb et al., 1995). Studies have also shown
that different forms of justice are useful in
analysis at different stages of the change effort
(e.g., Novelli et al.; in Wooten & White, 1999).
Distributive, procedural and interactional
justice are discussed concurrently with the
humanistic orientations that characterize OD
practice (Wooten & White, 1999). It has been
fairly conclusively proposed that
organizational fairness is a "psychological
mechanism that can mediate employee
resistance to change"(Folger & Skarlicki, 1999).
There have been various studies, which have
linked organizational justice with change -
related outcomes like stress, turnover intent,
employee turnover, dissent and reduced
motivation. Justice perceptions contribute to
concerns about the following issues among,
both victims and survivors of organizational
change,
• Legitimacy of the change intervention
(Brockner, Grover, Reed, DeWitt & O'Malley,
1987)
• Fair and just communication of the change
intervention (Bies, 1987)
• Decision rule and procedures used to arrive
at a layoff decision (Folger & Greenberg,
1985; in Brockner, Grover, Reed, DeWitt and
O'Malley, 1987)
• Fairness of compensation and severance
packages offered (Brockner, Grover, Reed,
DeWitt and O'Malley, 1987).
Studies have shown that the three forms of
justice have a significant influence on employee
responses like organizational commitment and
84 November 2007 NHRD Journal
organizational citizenship behavior (e.g., Cobb
et al., 1995). Research evidence shows that
communications that "convey causal,
ideological, referential and penitential accounts
enhance employee perceptions of fairness" of
the intervention and contribute to positive
work and attitude related outcomes (Cobb et
al., 1995). This clearly points towards the
moderating role played by communication
effectiveness on justice perceptions. There is
however, some debate about whether the forms
of justice have an additive or interactive effect
(Brockner & Wiesenfeld, 1996). To summarize,
it can be held that an individual's reaction to
organizational resource allocation during a
change intervention is dependent on
distributive justice, procedural justice and
interactional justice which in turn gets affected
by the communication effectiveness.
Figure 1: Proposed Model of Relationship Between Communi-
cation Effectiveness, Justice Perceptions and Employee
Commitment.
• Implications for Managers
Employee commitment during organizational
change is one of major concerns for
organizations, because it directly affects the
organizational performance. Declining
commitment often results in turnover and
organizations also stand to lose some of their
best employees as a result of poorly managed
interventions. Given that organizations spend
enormous amount of resources in hiring,
training and motivating skilled employees, it
becomes imperative to ensure that the
intervention is implemented with utmost care
and in a manner that is perceived as fair, as an unavoidable event. The management
equitable and just. Communication processes should try and put in place occupational
that enhance perceptions of fairness go a long reinforcements that help the employees to
way in ensuring that benefits of the recover faster and leave them with a sense of
intervention outweigh its negative security. It is suggested that change agents
consequences. The major challenge is to ensure should try to ensure a fair interplay of all the
that the employees affected by change perceive forms of justice while implementing
fairness in its treatment, in the decision rule interventions because of the unchallenged
used to implement the change and in the impact that all forms of justice have on
rationale behind the exercise. It is evident that psychological outcomes like organizational
employee attitudes like involvement and commitment. This of course, is easier said than
commitment are the most difficult to recover done, but then the foundations of OD practice
fully following a change intervention. A logical rest on humanistic orientations like fairness,
focus would be the new psychological contract ethics and justice and hence the justice
under which the employees and management framework clearly has a significant role to play
would operate and ensuring that breach of the in any OD intervention.
previous psychological contract is perceived
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November 2007 NHRD Journal 85

 MANAGING PEOPLE IN MERGERS AND ACQUISITIONS
D PRASANTH NAIR

Abstract
Mergers and acquisitions, as a form of Corporate restructuring, are a common feature of the
global business scenario, especially since the 1990's, driven by the changing business
dynamics. One key factor in ensuring success in the context of merger is the ability to integrate
the organizations effectively.
The management mantra for mergers and acquisitions, more often than not, has been 'make
them like us'; an approach which research and practice, have indicated is not the best. Given
the fact that the critical managerial challenge is to manage the 'People and Organizational
issues' to deliver value in line with the strategic objectives for the merger, the paper seeks to
understand the different approaches to Integration, factoring in the strategic and
organizational variables. The paper also recommends proactive managerial actions to manage
the employee reactions and create an environment to facilitate integration. This paper seeks to
establish that the success, which is meeting the strategic and financial objectives set forth,
depends upon the ability of management to identify and foresee key issues and problems that
come up and evolve a plan, driven by the strategic objectives and factoring in the context,
realities and issues with respect to both, organization and people.

Context: • The Human Issues in a M&A

Mergers and acquisitions, as a form
of Corporate Restructuring, are a
common feature of the global
business scenario, especially since
the 1990's, driven by the changing
business dynamics. Mergers and
acquisitions (M&A) worldwide are
Prasanth Nair is a Fellow
of the Indian Institute of expected to set an all-time record of
Management, more than $3.57 trillion before this
Ahmedabad. His year ends and the Asian M&A
dissertation was on The
market saw about 5200 deals worth
Organizational and
Human Issues in $200 billion by September 2007.
Mergers and Interestingly, while M&A is
Acquisitions. dominated by strategic, financial
Prasanth started his and operational concerns and
career in the engineering perspectives, research conducted
field with GEC Alsthom
India Limited. After his
across the globe aimed at analyzing
the true benefits has indicated that
Fellowship, he worked in
HR function at different 50% to 70% of M&A's are financial
levels in the RPG Group failures, and one of the main
and Wockhardt.
Currently, he is President reasons for the failure are people
and Head-Human and organizational issues. Given
Resources for Thomas the criticality of this dimension,
Cook India Limited. this paper will focus on:
context
• Managing 'Organization and
People' Issues in the Context of
M&A.
The Human Issues in an M&A
Context
Given the fact that an important
variable that contributes to success
in mergers have been identified as
the 'People and Organizational'
issues, it will be important to
understand the dynamics
underlying the variable. A merger
is more than just an act of bringing
two different companies together
like pair of boxes and many a time,
in the pre-merger periods,
dominated by financial analysis,
the myopic focus stays limited to
that. Notwithstanding the
importance of strategic, financial
and operational analysis, the fact
is that the essence of an
organization is its employees and

86 November 2007 NHRD Journal

the merger, in whichever form has an impact
on them and thus, the 'People and
Organizational Issues' need to be factored in
and addressed in the context of merger.
The dynamics involved in the merger process
gives rise to different kinds of uncertainties in
the merger processes. Previous research has
shown that employees react unfavorably to
mergers and acquisitions. There are two
conditions that generate deprivation:
discrepancy between actual and desired
outcomes and a discrepancy between actual
and deserved outcomes. An organization
transformation process like merger could affect
the desired and deserved outcomes and impact
the actual; thus increasing the perception of
discrepancy. This could result in a feeling of
deprivation, leading to adverse reactions
(Buono and Bowditch, 1989). It has been argued
that the individual responses in a merger or
acquisition process are part of a fairly
predictable syndrome of merger related stress
and tensions. Again, human responses arise
from four factors:
1. Culture clashes that arise when
dissimilar cultures come into contact with
each other. The merger or acquisition
requires members of one organization to
interact with members of the other
organizations with different cultures,
behaviors, ideas, manners and working
styles. Cultural differences between
merging organizations influences the
extent of employees participation and the
creation of an atmosphere supporting
capability transfer.
2. Further, separate from cultural
differences, there exists an intense feeling
of "we versus they" resulting in distrust,
tension and hostility towards the other.
It has been sufficiently documented that
there exists a strong 'We versus They'
feeling even in cases where perceived
cultural differences were not very large.
3. Uncertainty associated with Process:
Uncertainty, as a reaction, is caused when
there is lack of understanding about the
causal relationships between the actions
and the potential outcomes of those
actions. Since the process of Merger and
the changes it brings forth are
evolutionary and the final outcomes are
not known during the pre-merger and
through merger period, it creates
uncertainty and ambiguity in
individuals, along personal, professional
and organizational dimensions.
Uncertainty, in context of merger leads
to dysfunctional outcomes like stress,
lowered job satisfaction, distrust and
decline in commitment, affecting job
performance.
4. Anxieties on account of the effect or
perceived effect it has on career plans
through transfers, job loss, relocation,
loss of individual influence and the
uncertainties associated with these
changes (Buono and Bowditch, 1989;
Larrson and Finkelstein,1999).
These factors, as mentioned earlier, give rise to
negative reactions in individuals--often
manifesting itself in active opposition (e.g.
voice, voluntary exits and sabotage) and
passive opposition (e.g. absenteeism,
disobedience), -- reducing their commitment to
successful integration of the organizations and
the extent to which they are willing to cooperate
with the members of the other organization
(Weber et al, 1996). As such, the negative
human responses do have an adverse effect on
the individual performance and effectiveness;
in the long term having an affect on the
organizational effectiveness.
Managing 'Organization and People Issues'
in the Context of M&A
Given the fact that mergers and acquisitions
would continue and there are bound to be
negative reactions from individuals in the
context of merger, the critical element is what
November 2007 NHRD Journal 87
can be done, to manage these, so as to effect a
smooth transition and deliver value in line with
the strategic objectives for the merger. The
success, which is meeting the strategic and
financial objectives set forth, depends upon the
ability of management to identify and foresee
key issues and problems that come up and
evolve a plan, driven by the objectives and
factoring in the context, realities and issues
with respect to both, organization and people.
This paper attempts to understand the process
by which the People and Organizational issues
can be managed in the context of Merger. This
is done through:
• Understanding the Variables which will
Determine the Integration Plan.
• Studying the different Approaches of the
Integration Plan.
• Key Actions in the Integration Plan.
Understanding the Variables Which Will
Determine the Integration Plan:
The management mantra for mergers and
acquisitions, more often than not, has been
'make them like us', depending on the power
equations based on the nature of deal. Research
and practice, have indicated that this is
perhaps not the best approach to management
of a merger and point to the consideration of
additional criteria for deciding on the extent of
change required, depending on the mode of
value accrual. The value accrual in the context
of merger would be through either Resource
Sharing, Skill Transfer and Combination
Benefits, or a combination of these. Given that
fact, in a pioneering research, Haspeslagh and
Jemison (Haspeslagh and Jemison, 1991) have
stated that the integration plan to be adopted
should be based on two additional criteria:
• Need for Strategic Interdependence - This
relates to the degree of strategic
interdependence that needs to be
established between the two companies.
This is drawn from the strategic objective of
the merger, which spells out the mode of
88 November 2007 NHRD Journal
value accrual. For example, for value
creation through Resource sharing and
skills transfer, a high-to- moderate strategic
interdependence may be required, while for
value creation through combination
benefits, the strategic interdependence
required may be low.
• Need for Organizational Autonomy - This
relates to the extent to which it is necessary
to maintain the autonomy of the company
in order to preserve its distinctive skills. The
extent of Organizational Autonomy would
relate to both, the need from a business
strategy and need from an organizational
point.
Studying the Different Approaches of the
Integration Plan
The consideration of these characteristics will
enable the choice of an appropriate Integration
Plan. The integration plan, will determine the
extent of changes in either one or both the
organizations, which in turn, will need to be
factored in, the roll out of Key actions. Even
though both these variables exist on a
continuum and plotting them would require
data collection and analysis, for the purpose
of having a better understanding of the
process, both these variables have been shown
as 'high' and 'low'. Figure 1 illustrates the
context, taking into account the two variables
and suggests an approach in each context
(Haspeslagh and Jemison, 1991).
Need for
Organizational Low Holding Absorption
Autonomy
Low High
Need for Strategic
Interdependence
Acquisition Integration Approaches
(Haspeslagh and Jemison, 1991)
• Symbiosis: A scenario, where the strategic
interdependence required for value creation
 is high, implying that there would need to
be changes done; but at the same time, the
need for autonomy, from an organizational
point, is also high. The approach is to
balance the need for driving the extent of
changes, while preserving the need for
autonomy. This is a challenging scenario
and the process takes time.
• Preservation: In this scenario, the need for
strategic interdependence is low, implying
that the changes are not really required for
value creation. In fact, conferring a high
degree of autonomy to nurture and keep the
source of value creation intact, leads to value
creation. A high degree of autonomy is
granted for enabling the same.
• Absorption: In this scenario, the need for
strategic interdependence is high, implying
that there need to be changes made for value
creation. At the same time, the need to
preserve the boundary or identity of the
organization is low. The suggested
approach is to fully consolidate the
organizations with the ultimate aim of
dissolving all boundaries.
• Holding: Here, the need for strategic
interdependence being low and need for
preserving the autonomy is also low. But, as
the changes need not be made and value
creation is possible without that, the suggested
approach is to have a holding structure.
The integration approach would influence the
extent of change in Organizational identity, the
Business model adopted, the Structure (which
will include roles and reporting relationships),
the Work Processes and the Human Resources
Policies. As discussed in the first section, each
of them, depending on the extent of change
would have an impact on the people. Based on
the Integration approach adopted, the
magnitude of impact would vary. The
Integration approach would also determine
whether people in both organizations would
get affected or whether the negative emotions
are limited to one organization.
In order to manage the employee reaction and
enable a smooth transition, towards meeting
the strategic objectives, it is necessary to have a
focused Integration Plan. While the details of
the plan would depend on the approach
adopted and the context of the merger, there
are certain necessary actions that need to be
incorporated in the plan, which will be
discussed in the next section.
Key Actions in the Integration Plan
Given that, there will be negative reactions in
the context of merger and it is necessary to
manage them in order to meet the strategic
objectives, it is critical to have a focused plan
for Integration. As mentioned above, while the
details of the plan would depend on the
approach adopted and the context of the
merger, there are certain key actions, as
identified by research and observed from
practice, evolved into a 4C model, that are
recommended as part of the Integration plan
for creating an environment to facilitate value
accrual. The 4C's are:
• Contingency Analysis and Planning
• Communication
• Co-Opt
• Collaborate
• Contingency Analysis and Planning: In
many a case, the integration proceeds with
focus on issues that come up and on a day-
to-day time line. It is quite clearly a recipe
for failure. An important step towards
successful integration is to have a plan in
line with the Integration approach. The
larger plan would then need to drill down
with a focus on micro issues. In a context,
where a lot of variables are fluid, there might
be unexpected situations and hence there is
a need for contingency planning for a worst
case scenario from both a business and
organizational viewpoints.
• Communication: Mergers and acquisitions
place new demands and pressures on the
November 2007 NHRD Journal 89
 communication process because of the
insecurity and uncertainties associated with
the combination process. There are two basic
types of communication that should be
included - first, to keep the organization
members informed about the merger, its
implications, and its implementation and
secondly, to facilitate the work getting done.
In the context of merger, there can be no 'over
communication' - people would welcome
communication. Employees are more likely to
react positively when they are well informed -
about the positive aspects as well as the
negative aspects than when they are forced to
rely on hearsay and speculation. Also, it is
not only important what is communicated,
but also how it is communicated. For
communication to be effective, it needs to be
seen as credible. The information should be
released in an honest, open and timely manner
and there should not be attempts to distort the
truth and manipulate people.
• Co-Opt: For a smooth transition to happen,
there should be an attempt to involve
individuals from both the organizations at
various levels. Setting up of integration
teams, or teams focused on projects, cross-
functional challenges can be used as
mechanisms for driving this. Integration
teams have been found to be a very effective
mechanism to share information, sort out
operational issues and facilitate execution
of the Integration plan. Moreover, the teams
can serve as conduits of accurate
information and be identified as sources
that employees can turn to. They help the
members to know each other; which help
resolve much of the "we-they" attitude that
inhibits the integration process. The greater
the number of shared experiences that can
be produced early on in the process, the
faster a set of symbols and shared meanings
will develop with which organizational
members begin to identify, which will
facilitate the integration process.
• Collaborate: It is important for a successful
90 November 2007 NHRD Journal
transition that the organizations start
working together and build a culture of
collaboration and trust. In the context of
merger, there might arise, a natural reluctance
to work together. Hence, platforms and
triggers need to be put in place to enable
cooperation. Co-opt is a powerful mechanism
to build trust and facilitate collaboration. In
addition to it, sending the 'Right Signals' help
in this process. Right signals, which appeal
to common values of fairness, respect, care
and reciprocity, serve to break down cultural
barriers and lead to mutual development and
implementation of a common organizational
purpose. Another step in this direction is the
need to enhance reciprocal organizational
understanding. This will enable the
organizations to work on knowledge and
skill transfer, both of which will directly
impact the value creation process.
The intensity and magnitude associated with
each of the Key Actions will depend and vary,
based on the Integration Plan adopted and the
context of the Organization(s). The details - like
when, who, what and how - also need to be
finalized after factoring in the context. It must be
kept in mind that the 4C's are merely the starting
steps in the Integration plan, which would need
to address, along with the macro issues, the issues
at the micro level. At the same time, the Key
Actions (4C's) enable creation of an environment
for successful execution of the Integration Plan.
Conclusions:
• Studies have shown the failure rates in
mergers at 50 percent and one key reason is
the failure to manage people and
organizational issues that arise, in the
context of merger.
• The dynamics involved in the merger
process lead to employees reacting
unfavorably to mergers. This could be due
to culture differences or uncertainty
associated with the process or anxieties on
account of the impact on role; or a
combination of these.
• Successful integration approach needs to (Contingency Planning, Communication,
factor in the business objectives and the Co-opt and Collaboration) as the Key Actions
organizational context. The variables that in the Integration Plan. Based on the approach
need to be taken into account for towards Integration and the context of the
determination of the approach to Integration merger, the intensity and the modus operandi
are 'Need for Strategic Interdependence' and of each of the Key Action would vary.
'Need for Organizational Autonomy'. • It must be remembered that managing a
Further, drawing upon research studies merger process is sensitive and to be
which, based on the mutual relationship successful, it needs to factor in the human
between these variables, there are broadly, and emotional element. As leading
four approaches to Integration: Symbiosis, researchers in this area, Buono and
Preservation, Absorption and Holding. Bowditch puts in perspective, "If mergers
• In the context of merger, irrespective of the and acquisitions are to be successful over
Integration approach adopted, there arises the long term, the basic nature of such
unfavorable reaction from employees - the change as a human process...must be
difference being in the magnitude and acknowledged, understood, and integrated
whether it is across one or both the into the planning process."
organizations. The paper recommends 4Cs
References
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WEBSITES
• John McGee/Blackwell Encyclopedia of Management: Strategic Management – Website retrieved on 21st Oct’07 at http://
www.blackwellpublishing.com/content/BPL_Images/Content_store/Sample_chapter/9781405118286/
McGee_sample%20chapter_Blackwell%20Encyclopedia%20of%20Management%20Stategic%20Management.pdf
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methods_haspeslagh_acquisition_integration_approaches.html
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• Corporate India goes shopping — And lands smart deals on foreign shores, Website Retrieved on 25th Sept 2007 at http://
www.thehindubusinessline.com/iw/2007/01/14/stories/2007011400170700.htm
Endnotes
1 For the purpose of this paper, the terms “merger” and “acquisition” would not be differentiated. The term ‘merger’ would denote ‘Merger and Acquisition’. Research has
indicated that such combinations are homogeneous in nature and typically have same repercussions on the firms and their human resources (Buono and Bowditch, 1989).

November 2007 NHRD Journal 91

 HR: AN EVOLVING FUNCTION
D HARISH
Abstract
This article explores the changing role of HR as a function and HR practitioners as
professionals. With the changing business and organizational context, HR as a profession is
evolving and is strategic partner in many of the long term interventions. Action that is reactive
to the context is natural but a conscious professional evolution that can enable the function to
be prepared with capability to cope with changes of strategic nature is the key.
Introduction:
HR as a profession has evolved over
the years. It has in many ways
responded to the changing context
and demands. It has come to be
recognised as an integral part of
business. In some organizations it
has even gained a place of pride
Harish is Vice-President -
HR Services, Unilever and recognized as a function of
strategic value.
(Asia, Australia, Africa).
He is an alumnus of
XLRI, Jamshedpur. He Currently, the business scenario is
has 22 years of corporate fast changing and we are
experience across India witnessing a number of new
and UK, mostly in horizon sectors coming into being.
Hindustan Unilever
where his last In these times of fast-paced change
assignment was Vice- and short-cycle reviews there is a
President - HR. mad rush to get into an action
Harish was recognised mode. I recognise many HR
with "Exemplary Leader practitioners caught in that fast-
Award" for Excellence in
HR both at the regional
action syndrome.
and national levels as In spite of fast changing business
part of Employer
Branding Awards 2007.
context I find many similarities in
the focus of HR response in the past
and in the present. The following
is an exploration of the HR
function's evolution to understand
the apparent paradox and
determine ways going forward.
Looking Back:
Many years ago the HR
professional existed only in the
context of a factory environment. In
this scenario he was expected to be
the conscience keeper of the
92 November 2007 NHRD Journal
management with respect to all
labor related issues. He was
expected to balance the pulls and
pressures between management
and labor. He was expected to
ensure that the employees were
treated fairly and the management
got the best out of its labor without
unduly exploiting them. It was
clearly an imbalanced relationship
with far greater power vested in the
management hands and hence the
strong possibility of management
not being responsive to the genuine
needs of the labour. It was to guard
against such a scenario that the
government regulators envisaged
the need for the position of the
labour welfare officer which is the
earliest "avatar" of the HR
professional.
With the advent of the trade-union
movement the role of safeguarding
the interests of labor was assumed
by the communist ideology touting
labour leaders. The HR
professional now had to "re-
balance" the equilibrium between
management and labor (with labor
taking quite an aggressive posture
with the support of trade union
organizations). From a
predominantly labor welfare
orientation he had to assume the
role of an arbitrator between
management and the labor leaders to ensure
that the labour leaders do not start abusing their
new found power. Quite often this also
entailed the HR professional to wield the stick
to enforce discipline at the workplace. This often
resulted in his being viewed as biased towards
management. The fact that the HR person was
in the payroll of the company definitely added
to the dilution of the perception regarding the
neutrality of his stance.
In an attempt to wean away the employees from
the clutches of the trade unions the
management charged the HR professional with
the task of introducing newer and more
appealing activities/benefits to keep the
employees motivated and focussed. Over a
period of time the various HR activities that
were initiated called for a large amount of
administrative focus in managing them
efficiently. This then started taking centre stage
in the life of the HR professional.
With growing competition in the market place
and easy access to technology and finance the
business leaders started realising the
importance of the People edge to business
success and started expecting the HR
professional to focus on attracting the right
quality people and developing the appropriate
skills amongst the existing people.
The growing interest in training and
development, learning center, quality circles
are outcomes of this phase.
The realization that the workplace culture
impacts almost all of the people issues has
started to bring attention to both the tangibles
and intangibles, the hardware and the
software, the furniture and the philosophy, the
work and the values, the rewards and the
recognition. Today there are many examples
of Culture related work and thanks to
involvement of experienced OD practitioners/
consultants these are no longer isolated
initiatives but more comprehensive in their
approach, leveraging all aspects of HR. TPM,
open offices, vision workshops, instant and
visible recognition schemes, objective
performance management process and
performance linked rewards.
Many of the leading thinkers and writers in
the area of HR have exhorted the need to get
more strategic in our approach and one of the
key levers of Strategic HR is leadership. The
high impact of Leadership on talent
management, organization culture, and
eventual business performance has clearly
shifted the focus on developing leadership
capabilities within the organization as a key
enabler of success. A large number of HR
professionals have begun to discuss leadership
development and some have indeed started to
influence and contribute to development of
leadership within their organizations.
As the HR professional found the demands on
his contribution changing he sought to build
his own capability to meet the changing
demands. Therefore from the stage of becoming
familiar with the regulatory guidelines to be
able to provide all facilities that were expected
at the place of work he moved to building his
capability to negotiate successfully with the
trade union leaders. He also had to develop
his knowledge of the jurisprudence so that he
could enforce discipline within the bounds of
law. He then started becoming creative in the
design of benefits and provision of facilities
which made the employees happy and
motivated. The big step was in understanding
of human psychology so that she could predict
the effect of her initiatives and activities on
people and their consequent behavior. (please
note that shift in the gender of the HR
professional at this stage of evolution! ). More
recently the understanding of business and
ability to contribute more directly to business
performance has become key to being more
strategic in their approach.
Looking Ahead
In many of the organizations belonging to the
new horizon segment the HR practice is being
November 2007 NHRD Journal 93
dictated by the "fires of the moment". The most
daunting challenge seems to be one regarding
Talent retention. This seems to have therefore
triggered a series of response around making
employees happy in their current company. The
provision of pick up and drop, frequent social
gatherings, birthday celebrations, gift vouchers
and dinner coupons etc. are targeted at keeping
the employee contended and not think of a
change. This is in many ways similar to the
efforts to keep them away from unions.
Reflecting on the past we know that, however
creative one may be, these activities provide
only a short term solution to the challenge.
Understanding this, a number of HR
professionals have focussed on value adding
training programs which has a slightly longer
term benefit both to the employee and the
organization. A few of the enlightened HR
leaders have adopted a comprehensive
approach and their response reflects a deep
understanding of the HR functions evolution
in the traditional sectors. They are not just
responding to the immediate demand but
initiating efforts which are more broad-based
in nature and addressing longer-term needs.
Unlike other professions like accounting and
medicine where the professional regulatory
bodies are keeping track of the learnings from
recent developments and insisting that their
professional members comply with emerging
standards, there is no mandatory adoption of
new frameworks and practices in HR. It is
usually left to the initiative of the practitioners
to update themselves and follow what they
deem appropriate. This is a pity, for many HR
professionals are failing to see the opportunities
and lessons.
Beware of employee backlash if you do not
listen to their intrinsic professional aspirations.
The way in which they will assert themselves
may not necessarily be through trade unions
but maybe through heightened attrition and
blog campaigns. This could be more lethal than
the historical "gherao" or strike.
94 November 2007 NHRD Journal
A study of history often helps one to prepare
for the future, for there is no doubt that history
repeats itself. However, it is in your hands to
write the history of tomorrow by doing things
ahead of its time and hence address some of
the needs before they become a Herculean
challenge. For example, you can work on
leadership development and organization
culture even as you grapple with the talent
attraction / retention challenge and this will
help your business unit skip a few of the
evolutionary (and painful) steps and catapult
into the realm of outstanding business
performance.
Of course in keeping with the times we need to
update ourselves with the possibility of
technology leverage for various HR
deliverables. The novel initiatives of job fairs,
campus presentations and employee referrals
have started gaining wider currency. With
global knowledge being accessible more easily
we need to adopt/adapt various experiences
in the area of people performance. The
balanced score-card approach and the strategy
into action model are accessible to all for
improved business alignment. The use of on-
line surveys and instruments has made our
feedback information, people and team
assessment easier and more robust. These
should enable us to address the issues in a
faster and better way.
Thankfully HR is an evolved function and we
must recognise that. We need to learn from the
experiences of the past and incorporate it into
our functional knowledge base so that we
perform as an improved version of our
functional forefathers. Failing to capitalise on
that is purely our loss and we will be painfully
driving our organizations to learn through first
hand struggle. In today's' highly competitive
environment it is unforgivable fool-hardiness.
No doubt the future will bring with it newer
challenges and opportunities which will
demand and provide for further evolution of
the HR professional.
 ONE REASON FOR FAILURE OF CHANGE
INTERVENTIONS
PVR MURTHY
On a lot of occasions, change initiatives misfire,
ventures and projects go haywire due to a
phenomenon called mismanaged agreement
(also known as "the Abilene Paradox"). Many
years ago Professor Jerry B. Harvey discovered
that the fundamental problem of contemporary
organizations is the inability to cope with
agreement--not conflict. He finds that most
agreement in organizations is actually false
consensus. It occurs because many people feel
they might be isolated, censured or ridiculed if
they voice objections. When members do not
share their feelings and opinions in an authentic
manner, groups end up working towards
inappropriate goals leading to organizational
failure.
The Abilene Paradox is a paradox in which a
group of people collectively decide on a course
of action that is counter to the preferences of
any of the individuals in the group. It involves
a common breakdown of group communication
in which each member mistakenly believes that
their own preferences are counter to the group's
and do not raise objections. Jerry B. Harvey
coined this term. The name of the phenomenon
comes from an anecdote narrated by Harvey to
elucidate the paradox:.
"On a hot afternoon visiting in Coleman, Texas,
the family is comfortably playing dominoes on
a porch, until the father-in-law suggests that
they take a trip to Abilene [53 miles north] for
dinner. The wife says, "Sounds like a great idea."
The husband, despite having reservations
because the drive is long and hot, thinks that
his preferences must be out-of-step with the
group and says, "Sounds good to me. I just hope
your mother wants to go." The mother-in-law
then says, "Of course I want to go. I haven't been
to Abilene in a long time."
November
The drive is hot, dusty, and long. When they
arrive at the cafeteria, the food is as bad. They
arrive back home four hours later, exhausted.
One of them dishonestly says, "It was a great
trip, wasn't it." The mother-in-law says that,
actually, she would rather have stayed home,
but went along since the other three were so
enthusiastic. The husband says, "I wasn't
delighted to be doing what we were doing. I
only went to satisfy the rest of you." The wife
says, "I just went along to keep you happy. I
would have had to be crazy to want to go out
in the heat like that." The father-in-law then
says that he only suggested it because he
thought the others might be bored.
The group sits back, perplexed that they
together decided to take a trip which none of
them wanted. They each would have preferred
to sit comfortably, but did not admit to it when
they still had time to enjoy the afternoon."
The phenomenon may be a form of group think.
It is easily explained by social psychology
theories of social conformity and social
cognition which suggest that human beings are
often very averse to acting contrary to the trend
of the group. Likewise, it can be observed in
psychology that indirect cues and hidden
motives often lie behind peoples' statements and
acts, frequently because social disincentives
discourage individuals from openly voicing
their feelings or pursuing their desires.
This anecdote was also made into a short film
for management education. The theory is often
used to help explain extremely poor business
decisions, especially notions of the superiority
of "rule by committee." A technique mentioned
in the study and/or training of management,
as well as practical guidance by consultants,
2007 NHRD Journal 95
is that group members, when the time comes
for a group to make decisions, should ask each
other, "Are we going to Abilene?" to determine
whether their decision is legitimately desired
by the group's members or merely a result of
this kind of group think.
The "Abilene Paradox" is related to the concept
of group think in that both theories appear to
explain the observed behaviour of groups in
social contexts. The crux of the theory is that
groups have just as many problems managing
their agreements as they do their
disagreements. This observation rings true
among many researchers in the Social sciences
and tends to reinforce other theories of
individual and group behaviour.
Researchers in this field have proposed various
means by which groups can avoid such
dysfunctional behaviour. None have proven
more effective than the inclusion of people with
diverse backgrounds in the decision-making
process. Groups so comprised tend to be more
effective in avoiding the Abilene Paradox and
tend to be able to make much better decisions
overall.
From Wikipedia, the free encyclopedia

References
• Harvey, Jerry B. (Summer 1974). “The Abilene Paradox and other Meditations on Management”. Organizational
Dynamics, 3 (1).
• Harvey, Jerry B. (1988). The Abilene Paradox and Other Meditations on Management. Lexington, Mass: Lexington
Books.
• Harvey, Jerry B. (1999). How Come Every Time Get Stabbed In The Back, My Fingerprints Are on The Knife?. San
Francisco: Jossey-Bass. http://www.abilineparadox.com/

96 November 2007 NHRD Journal

 IPO: A POWERFUL INTERVENTION IN
ORGANIZATIONAL CHANGE
RAVI VIRMANI
Abstract
Transformation from a privately owned company to a public company through IPO involves a
number of Changes while planning and executing IPO. Living up to the expectations and
demands of stakeholders itself forces organizations to bring in changes effectively.
"IPO, is a process not an end game.
After the IPO, and organization
must meet the operational
requirements of a public company
while delivering the value it has
promised its stockholders."
The IPO has too often been seen
only in terms of an intense
Ravi Virmani is a
management consultant
transaction that begins with the
with over 20 years of selection of investment bankers
consulting experience. He and the drafting of a prospectus,
is the co-founder of continues with road shows, and
Noble & Hewitt in India. ends with the first day of trading.
Currently based in
Singapore, he is the CEO
But it does not stop there. After the
of Trust Associates Pte. IPO the organization must meet the
Ltd. operational requirements of a
public company while delivering
the value it has promised its
stockholders.
But it does not start there either.
Research shows that CEO's of the
most successful companies (in
terms of post IPO performance)
began transforming their company
strategically, operationally and
financially in a process that
sometimes began years before they
went public. Improvement
initiatives in the area of strategic
planning process, accounting and
reporting systems, investor
relations, and employee incentive
compensation, were identified as
contribution most to the most to
post-offering performance.
November
Beyond Financials
A recent research, surveyed
portfolio managers to gain insights
into the key financial and non-
financial metrics they use when
making a buy or sell decision. Not
surprisingly, the research shows
that superior financial performance
measured against comparable
companies is paramount. More
surprisingly, though, the research
showed that non-financial
measures accounted for 40% of a
portfolio manager's decision
making.
The key non financial metrics:
• Quality of management
• Innovation
• Ability to attract and retain
talented people
• Management credibility and
brand image.
These findings underscore that
value is often found off the balance
sheet. Which is why Company
Executives who wants to realize the
greatest value at the IPO and in the
public markets must understand,
manage, and communicate the
non-financial metrics for their
company.
Management Pressures
The main paradigm shift is that the
CEO and the team are no longer
2007 NHRD Journal 97
working only for the promoter or a promoter
staffed board. The Board composition and its
activist role poses a challenge to the
Management team - initial response is that of
'being out of the comfort zone' - denial - and
then acceptance of the fact that we too can be
challenged, questioned and at times be refused
the permission 'to do so '. This transition
process in turn has implications on the
company culture, practices, and past historic
beliefs in the organization.
For the first time, perhaps, insiders face
bringing new players into what has been, in
essence, a private party, diluting their
ownership interest and losing at least a
measure of control over the direction that the
corporation ultimately takes.
Public scrutiny resulting from disclosure of a
company's operations may be painful enough
to a formerly private corporation, but actually
letting a large number of "outsiders" have a
voice in corporate governance is an entirely
different matter to a management team not
accustomed to shareholder oversight.
In addition, as the officers of a newly-public
company quickly learn, the company's new
owners will expect a certain return on their
investment, subjecting management to
performance pressures it may have never before
experienced. Substantial time and effort, and
thus dollars, must be expended in dealing with
the investing community in order to ensure that
investors and analysts remain satisfied with
the company's performance over the short term,
while at all times keeping in mind, and working
towards, management's long term goals for the
company.
Finally, fiduciary obligations with respect to
minority ownership interests have been
expanded by the courts in recent years and cannot
be taken lightly when planning to let others into
a previously closed circle of ownership.
The other aspect that becomes critical post an
organization going public, is the need for good
corporate governance practices. The
98 November 2007 NHRD Journal
requirement would be for a Board of Directors
that is independent has high levels of financial
expertise and one that follows and operates in
a Committee Structure.
The pressures felt at the leadership levels have
a widespread impact in terms of expectations
from others within the organization. The impact
is widespread and felt on aspects such as:
• Investment decisions
• Business planning
• Cost reviews
• Hiring of senior talent
• Succession planning
• Accountability
• Outcome orientation
• Incentive compensation
Managing Employee Expectations
If not managed well, the employee perception
is that the Culture has changed for the worse,
and motivational levels take a turn towards
south. Decisions are then 'interpreted' as harsh.
Even though the decision is not a tough one,
and would have been taken in a similar manner
'earlier too' but now its perception changes
dramatically.
The level of review and challenge becomes
relatively more in-depth - that's for sure, how
much more in-depth will be relative in each
instance.
Organization's need to come to terms with a
period of intense change initially and then
Change becomes a Constant! because the
fundamental shift is that the investors expect
extraordinary returns . This over-arching
expectation ushers in a 'hardening' impact on
work culture. And the fun things begin to
disappear in the wake of this Investor
expectation. Missing forecasts, and missing
budgets now have far reaching implications.
Earlier the promoter Board in its more
'acceptable response will' now behave very
differently in terms of missing forecast, falling
share price, and business projections.
In expectation of such a reaction, rightly or
otherwise, management teams and their CEO
begin to take very business focused, hard
numbers and 'no nonsense' approach. This
invariably, would work at max, as a short
term remedy.
Organizations undergoing the IPO journey
must, must accept two maxims -
Maxim 1. Culture will Change
Maxim 2. Performance Enhancement
The sooner these are internalized and accepted,
the less the transition period for the
Organization and greater will be the focus on
creating shareholder value. No matter how
much Google founders claim that the fun
culture will not change, Several recent IPO
organizations have proved that a dramatic
change in culture does happen.
Acceptance of the above two maxims provides
an opportunity to pro-actively redefine the
culture, retain the fun stuff, retain the heritage
if feasible and prepare the organization and
employees for what's the new landscape, what
will be different, how dynamic will the
performance expectation be, what additional
resources and infrastructure will be made
available and how the concept of
accountability and incentive compensation
will look like.
The erstwhile paradigm of success and career
growth will now have a new meaning and a
combination of these changes emerges the new
'avtaar '.
A visionary CEO can use it to his advantage
and provide the leadership to steward the Ship
through the 'perceived' turbulent waters to an
ocean where the dynamics are not the same as
cruising along the
River Nile.
The dynamics of a result-oriented organization
committed to creating shareholder value thus
becomes a way of life rather than a maze of
ambiguity and "we shall cross that bridge
when it comes".
Often an IPO is planned and perceived, as
merely a capital-raising exercise for definitive
business needs. And apparently it is so, there
is no denying the fundamental purpose.
However the dilution of ownership, the
expectation of institutional investors who in
turn have to serve their commitments! And it's
this cyclical commitment to capital, which
makes your own business relatively smaller
than it is. Your business initially is reported
'big' in terms of market capitalization at IPO
time, and yet in the cycle of the capital flow
which the IPO has now aligned you, your
organization is now a part of that capital flow
and you have to play your piece in the
orchestra.
Organizational Readiness eventually happens,
and if it more by design in a pre-planned
manner then your influence over it is likely to
be greater than "as we go along agenda". The
management team needs to regroup and
complete its process of acceptance and the
redefinition of the two maxims. Having then
planned a road map, the CEO can decide the
pace and timing of communication and
execution of Change depending upon his
assessment of the organization readiness.
Caution has to be exercised so as not to create
panic of an oncoming tsunami ! Each CEO in
his style and assessment should be able to lay
the course, as how will your organizations
graduate from one league to another. This
obviously requires building the necessary road
map and the support systems.
In conclusion, the sustainability of success
desired by way of IPO is through the non-
financial metrics and the credibility of the
senior management team to execute on it. The
IPO journey is a vehicle, which prepares you
to leap frog to higher business goals, and in
this aspirational evolution, success may be
proportional to the level of preparation and
execution.
November 2007 NHRD Journal 99
 FROM A SAPLING TO A FOREST:
THE SAGA OF THE DEVELOPMENT OF HRM IN INDIA
Udai Pareek, a Distinguished
Professor at the Institute of
IHMR, is an internationally
acclaimed academician and a
living legend in HRD. He is on the
Management/Governing Boards
of the Academy of HRD, IIHMR,
ISABS, JIM and several other
organizations. He has authored
and edited several books and has
contributed a large number of
research papers to national and
international journals.
Dr T V Rao is currently Chairman
of T V Rao Learning Systems and
Chairman of Academy of Human
Resources Development,
Ahmedabad. He was Professor at
the Indian Institute of
Management, Ahmedabad, for
over 20 years beginning 1973. He
has also worked as L&T
Professor of HRD at XLRI,
Jamshedpur, during 1983-85. Dr.
Rao is the Founder President of
the National HRD Network and
was President of the Indian
Society for Applied Behavioral
Science (ISABS). Dr. Rao has
several publications to his credit.
100 November 2007
UDAI PAREEK and T.V. RAO
This is a personal account of the change the authors
introduced in one organization through evolving,
experimenting and implementing HRD, spreading it
to other organizations and its diffusion and
institutionalization at the national level. While the
authors romanced with HRD as a part of change, they
developed commitment and became life partners of
HRD in India. Both singly, and together, they have been
contributing to the development of HRD in India.
The Beginnings
In 1973 after joining the Indian Institute of Management,
Ahmedabad as the Faculty, Udai worked with late
Professor S. K. Bhatacharyya on the problems in Larsen
and Toubro subsequent to its reorganization by Professor
Bhatacharyya. The main problem was conflict between
two independent roles created in the organization (DGM
Planning and DGM Operations). While doing role
clarification and role negotiation exercises, Udai realized
the need of working on the larger issues of development
of people. With TV Ra, later joining the Faculty of IIM,
Ahmedabad, Udai shared this concern, and both TV and
Udai decided to work on designing a new way of
developing people in an organization.
They made a proposal to the Chairman. Shri N.M. Desai,
CEO of L & T, arranged the discussion with the top group,
and accepted the proposal to try out the new system of
developing people. The authors would like to pay tribute
to the foresightedness of Shri N. M. Desai in agreeing to
experiment with a new system.
L&T Experiment: Its Main Thrust
After extensive interviews and discussions (including
with A. M. Naik currently the Chairman of L&T who was
a Manager at that time) the authors prepared a proposal
to introduce what they called human resource
development. This was in mid 70's. They had not come
across any such term in the western literature, and
appropriately thought of re-orienting personnel system
from administration to development. A comprehensive
NHRD Journal
system was designed, requiring managers to
perform development role through coaching
and performance management. Two main
features of the proposed concept of HRD were
that HRD dealt with all the human units of the
organization (from persons to the total
organization), and It was value-based.
Fortunately,L&T had a very competent
personal officer, Dr. Dennyson Pereira, who
was excited with doing new experiments. The
authors have already published the detailed
experience of developing HRD in L & T (Pareek
& Rao, 1998). The following 15 principles were
shared with the organization as the guiding
principles for designing the HR function.
• Focus on enabling capacity
• Integrating the development of people with
Organization Development
• Maximizing Individual Autonomy and
Growth through increased responsibility
• Decentralization through Delegation and
Shared Responsibility
• Participation Decision-making
• Balancing adaptation to and changing
organizational culture
• Balancing differentiation and integration
• Balancing Specialization and Diffusion of
the Function
• Ensuring Responsibility for the Function
• Balancing Linkages within and with other
functions
• Building Feedback and Reinforcing
Mechanisms
• Balancing quantification and qualitative
decisions
• Balancing internal and external help
• Planning evaluation of the function
• Continuous review and self-renewal
The following 11 systems were reassigned in
details:
A. Human Resource Administration
1. Manpower planning
2. Recruitment and placement
3. Performance and potential appraisal
4. Promotion salary administration
5. Staff administration
6. Information and data processing
B. Human Resource Development
Training
Organization Development and Research
Employee Feedback and counseling
Career development and career planning
B. Industrial Relations
Worker Affairs
Attention was paid to structure of human
resource function. Detailed recommendations
were developed for implementation of the
system and functions. To help the organization
take decision, detailed description of the HR
functions was prepared, including critical
attributes for each function. These were also
done through interviews and discussions.
Since the details have been published
elsewhere, we are focusing here only on the
process of success of the system.
The Factors of its Success
This was one of the most successful change
management, from successful implementation
of change to its diffusion and
institutionalization at the national level.
Several factors contributed to the success of
change. Some of these are briefly mentioned
below.
1. Committed top: When the proposal was
discussed with N.M.Desai, and Holk Larsen
both of them showed deep interest in re-
November 2007 NHRD Journal 101
designing the personnel system. L & T was
very successful company, and there was no
apparent reason for it to think of new system.
But foresighted as the top management was,
they welcome the idea of giving a lead in a
new area. Both the CEO and the top
management were interested and discussed the
proposal in detail.
2. Appointment of High level implementation
Task Force: They promptly appointed a high
level Task force headed by a General Manager
(G. A. Advani) along with some of the top
management team as members. The task force
functioned for nearly three years in introducing
and monitoring the implementation of the
system.
3. Placement of the System at High Level in
the Organization: One of the conditions the
authors stated for the success of the new
function was its strategic placement. Generally
at that time the personnel function was given
low priority and was generally placed at the
lower level in the organizations. We convinced
the management that the function could not
succeed unless it was strategically placed at a
higher level. It was agreed and the position of
Vice President, HRD was created in the
company.
4. The Competent Head of the Function:
While selecting a person to head the new
function, it was strongly recommended that a
very competent person should be given the
responsibility. Fortunately, the CEO agreed to
request S.R. Subramaniam (SRS), highly
respected competent Engineer, to head the
function. Subramaniam ensured
thoroughness and effective implementation of
the various parts of the new system. It may be
mentioned here that later, after the retirement
of N. M. Desai, Subramaniam became the
CEO of the company. The success of the new
function very much depended on the competent
leadership provided in the organization.
102 November 2007 NHRD Journal
5. The Strong Internal Resource: No change
can succeed unless there is strong and
competent internal resource to implement and
monitor the change. It was fortunate to have
Dr. Dennison Pereira as the internal resource.
Dr. Pereira combined his insightful experience
in the organization with his academic
competence and child-like excitement to search
new ways of solving problems. There is no
doubt that the success of the system owes a
great deal to Dennison's role in the beginning
of the new function.
6. Involvement of all Levels of the
Organization: The authors emphasized that
the systems and processes being introduced
must be discussed in various forums of
employees, helping them to raise questions for
any modification in the system as required.
Workshops and seminars were held on the
new systems and procedures. People raised
questions and seem to welcome the various
changes being planned. This facilitated the
success of the system.
7. Developing Internal Competence: The
Company needed several people to help in
implementing the new system. It was necessary
that the system and process were adopted with
the help of key line managers. Therefore, an
extensive training programme was organized
to develop relevant competencies for
implementing the systems. Over a hundred
internal managers were developed to
communicate the system all through the
company. The term L&T University was used
informally by these members to represent the
new education and learning they were
facilitating through the HRD system.
Spread to Other Strategic Organizations
Udai had worked with late Professor
Bhattacharyya on the second reorganization
of the State Bank of India. The new HRD system
was also developed for SBI. Shri R K Talwar,
the Chairman of SBI took personal interest.
Then the system was recommended for the other
state banks, and their CEO s were so excited by
the new concept that they suggested to take the
responsibility of introducing the system
themselves! Later, TV volunteered to work with
Bharat Earth movers Ltd. To introduce and
stabilize the new system. Capitalising on this
experience both Udai and TV offered the first
workshop on HRD systems at the Indian institute
of management at Ahmedabad in 1979. A draft
of their proposed book on designing and
Managing HR systems was circulate din this
workshop. Later a course and series executive
development programs were started by Udai and
TV at IIMA to popularize and promote HRD.
Crompton Greaves, State Bank of India and its
associates and a few other organizations
followed this initiative and Udai and TV worked
as their consultants in introducing and
implementing the HRD systems and starting new
HRD departments separate from personnel. The
spread of change to these strategic organizations
has been well documented (Rao, 2004).
Diffusion of Change: Networking Strategy
At that time Udai went on a long consulting
assignment, as USAID OD Advisor to the
Health Department of the Government of
Indonesia, TV continued the work of diffusing
change in India. Larsen & Toubro created a
Chair on HRD at XLRI Jamshedpur, which was
taken up by TV in 1983. One of the conditions
of the L&T Chair required L&T professor to give
an annual public seminar on his work. TV used
this to get L&T host the four-day seminar at
Mumbai, where more people could attend. The
seminar focused on the recent experiences in
HRD. About 40 persons participated in the
seminar. TV presented the integrated HRD
model developed at L&T. Dennyson spoke
about how it was being implemented. Susan
spoke about their attempts at Assessment
Centers. The seminar explored what was
happening and not happening in HRD, how
many organizations were not able to
understand the right spirit of HRD, the
helplessness of HRD managers in convincing
some CEO s etc. A number of success stories
were also shared and there was new
enthusiasm in all the members. Rajen Gupta
shared his struggle in Jyoti Ltd and the support
he was getting from the top. Subhash Durlabhji
shared how HRD was an integral part of the
Japanese philosophy. PVR shared HR practices
at Sundram Clayton member of the TVS Group.
TV shared his concern for continuing the
process of learning from each others'
experiences. The response was very positive.
As expected, in response to a suggestion from
TV who was leaving XLRI to return to IIMA,
the members proposed continuation of the
Initiative under a new banner. Several
suggestions were given. It was Rajen Gupta
who suggested that we call this body network
as the term network means connecting with
each other. The suggestion was readily accepted
to set up HRD Network. It was also agreed
that different cities should have such Networks.
T P Raman and his colleague Mohan agreed to
give facilities and promote it in Mumbai. PVR
and Chandrasekhar agreed to do this for
Chennai. Prasanna and Kishore Rao agreed to
do this for Bangalore. Rajan Gupta agreed to
do this for Baroda. TV volunteered to explore
for Delhi. Coordinators were appointed,
briefing them about organizing such Networks.
Fr Abraham agreed to stay behind in Mumbai
to visit L&T and get the material for the first
newsletter. The newsletter was supposed to
disseminate the new knowledge about HRD. It
was agreed to have one intellectual article by
an academician, one essay profiling in details
the practices of accompany, a few case lets of
problems and issues, which may be posed to
the reader, some references and bibliography
and news items. Fr Abraham and TV thought
of getting every number sponsored by a
company committed to HRD and having done
November 2007 NHRD Journal 103
some good work worthy of sharing. It would
meet cost of printing of 2000 copies of the
newsletter and also the mailing it free to all
HRD chiefs and CEO s in the country. L&T was
the natural choice as every one was talking
about L&T in relation to HRD. L&T readily
agreed. Abe stayed on in Mumbai to prepare
feature on L&T. TV wrote an article on HRD.
Rajen Gupta's dilemmas in Jyoti was converted
into a case let the first newsletter was published.
The seminar proceedings were also published
as a book "Recent Experiences in HRD". Then
TV returned to IIM, Ahmedabad, and continued
to promote networking.
In the fist newsletter the idea of forming the
HRD Network was announced. TV worked
with: State Bank of Patiala, Indian Oil,
Sundaram Clayton, Hindustan Petroleum,
MMTC etc. While Abe continued to coordinate
from XLRI, TV helped in setting up National
HRD Network. Somanth Chattopadhyay
drafted the constitution of NHRDN in a hotel
in Madras where they happened to work on a
joint assignment. S. Chandrasekhar facilitated
this initiative to form the South Indian chapter
of NHRDN at Madras with the help of the
Madras Management Association which
launched the first meeting of the chapter.
Institutionalization of Change: There is a long
history of the evolution of the National HRD
Network. The main milestones of the
developments are given below. The names are
indicative of the kind of persons involved and
the lists are not exhaustive. The lists are largely
limited to those office bearers who played active
roles. A large number of HR professionals like
Balaji, Mali, Aquil, RR Nair, Rupa Padki,
Nagaraj, Pallabh, Hari Iyer, Gopal etc. played
a very supportive role and kept the Bangalore
chapter provide leadership. G.P. Rao was all
over.
• Foundation and Culture Building: (TV Rao,
Fr. E. Abraham, S. Chandrasekhar, PVR
104 November 2007 NHRD Journal
Murthy, K.K. Verma, Anil Khandelwal,
KS Rao, H N Arora etc)
• Stability and Growth (MRR Nair, Udai
Pareek, Anil Sachdev, Arvind Agarwal,
Shashi Khanna P K Sarangi, Rakesh
Kumar, Keith D'Souza etc)
• Turbulent Times Management (Rajesh
Vidyasagar, VS Mahesh, Debashish Mitra,
Arvind Pande, Baburaj Nair)
• Turn Around (TV Rao, Satyanarayana, YRK
Reddy, Arvind Agarwal, Udai Pareek, Rupa
Padki, P V R Murthy, Bangalore team
and Delhi team)
• Going places (Santrupt Mishra, Arvind
Agarwal, G.P. Rao, P.D. Dwarkanath, Delhi
Chapter, Pune Chapter and other members
of current team)
• Going Global (in process)
Different individuals contributed to
development of NHRDN at different stages. Of
these, stage 3 of turbulent time took place by
accident. V.S. Mahesh and Rajesh Vidyasagar
left for UK and USA in the middle of their terms
and Arvind Pande was busy providing
stability to SAIL. During this period, NHRDN
slowed down but all core activities continued.
An interim committee had to be set up to
rejuvenate NHRDN and TV shouldered that
responsibility and got an Executive Director
appointed to pay full attention to NHRDN.
During the turbulent times, when VS Mahesh
left the country, TV took over again as Interim
President and ensured that the next President
was appointed and that no activity suffered.
Thus, twice in this period TV had to play the
role of managing NHRDN's stability and
continuance.
The credit of a big launch of the HRD network
should be given to Chandrasekhar of L&T,
assisted ably by Mukunadan and PVR Murthy
at Chennai, Anil Khandelwal and KK Verma
of Bank of Baroda and Fr Abraham. The
Newsletters used to be published and mailed
from Ahmedabad. This continued until Keith
D'Souza joined XLRI and Fr Abraham returned
to XLRI as its Director.
In the Initial years TV was self appointed
President of the NHRDN and Fr. E Abraham
was Secretary and Treasurer of the NHRDN.
There were no paid members. In a short time
NHRDN established itself and chapters were
opened wherever there were interested people.
It was registered as a Society and membership
was made open.
The journey from then for the next five years
has been that of hard work and perseverance.
No one knew NHRDN and many did not see
the reason for NHRDN when ISTD was serving
the same purpose. Only those who saw the
distinction between HRD and training
appreciated the need. The First national
Conference is a record of sorts. It had a full day
devoted to CEO presentations. Starting with Dr
Krishnamurthy who inaugurated the program
many CEOs made presentations. They include:
Suresh Krishna, Venu Srinivasan, M V
Subbaiah, Deenadayalu of MRL,
Arunachalam, and KK Nohria of Crompton
Greaves etc. A printed version of the conference
papers was distributed. All sessions started on
time and ended on time. There was a great
cultural program by a troupe of Krishnaswamy
Associates. A special issue of economic times
devoted to HRD was brought out (courtesy IIM
colleague and editor of ET Manu Shroff). This
was the turning point for the popularization of
NHRDN and NHRDN never looked back since
then. In this conference the next conference was
planned to be held in Delhi and the director
personnel of SAIL took a lot of interest and we
promptly requested him to Chair the next
conference to be held two years latter. To
distinguish NHRDN from others and to
communicate that this is not yet another body
for fellowship annually but a serious body that
does its work professionally, we wanted to give
enough time between the first and the second
conference.
While the preparations for the second
conference began almost two years in advance
the preparations for the election for the next
President also began. MRR Nair was requested
to take charge as the next President so that there
was also some synergy between the NHRDN
proceeds and the conference at Delhi.
The Delhi Conference two years alter was also
a great success. The programmme started on
time even when the Chief Guest Dr Abid
Hussein did not arrive in time. He appreciated
our starting the conference without waiting for
him. It was attended by over 600 delegates and
a book was distributed. The Conference set
benchmark in size of the Conference,
performance on time, themes and academic
content, and put now NHRDN fully on stream.
Some initiative in governance practices helped
NHRD to evolve as a vibrant democratic
organization. During the tenure of the authors
as President of NHRD , two provision of built
in the constitution, one that each person would
be a President only for one term and would not
be re-elected. The other provision except was
to avoid election, and search the next President
by a team appointed by the Governing Board.
Elections introduce politics in the process, and
therefore, it was thought important to have
some other modes for searching the President.
Arvind Agarwal, during the tenure as
President, introduced another useful tradition
that the search committee, after identifying the
potential President, would interviewed the
CEO of the company to negotiate release of time
and energy for the candidate to be appointed
as President. The provisions has made NHRD
a really democratic body.
Today NHRDN has over forty chapters, nearly
twenty and odd publications to its credit,
collaborating with CII to develop HRD models
November 2007 NHRD Journal 105
and assess HR professionals and is
collaborating with International bodies. By any
means it has done a great service to young HR
professionals. It has given opportunities to
many young managers to test out their
leadership potential and has helped a number
of young professionals to acquire HR
knowledge and set their careers in the right
direction.
Strengthening the Academic Base: The
Academy of HRD The Academy of HRD is an
education and research centre set up by the
National HRD Network. It is an autonomous
institution with its own members. It's founding
members consist of organizations like SAIL,
Voltas, Tata Steel, Crompton Greaves, Gati, Dr.
Reddy's Laboratories, Visakhapatnam Steel,
Satyam Computers, ILFS etc. corporations. It is
located in Ahmedabad and its campus
eventually planned to be in Hyderabad on a
ten acre land donated by Dr. Reddy's
Laboratories.
It has done remarkable work in its initial stages.
Though its pace has slowed down in the recent
years, it has been contributing silently through
its Doctoral and certificate programs.
AHRD contributed a great deal so far to Human
Capital Formation among HRD Professionals
in India. However, there was much more scope.
AHRD could have been a globally recognised
institution and would have been considered
the only place to go or main place to go for
scholars across the world. The great dream
still remains a dream - the great dream was to
have its own campus, data-bank, and library,
residential accommodation furnished for
scholars to visit, write, renew and disseminate
References
• Pareek, Udai & T.V. Rao (1998). Pioneering human resources development: The L & T System, Hyderabad: Academy
of Human Resource Development. 165p.
• Rao, T V (2004) Future of HRD, New Delhi: Macmillan
106 November 2007 NHRD Journal
their work. The relevance and need for such
an institution still exists today. Its doctoral
programme could have become a flagship
programme and would have contributed a
great deal to HRD knowledge.
In the last 20 years, NHRDN has grown vastly.
The seeds for its growth were sown and
foundation was laid in the first three years. The
agenda of learning from each other continues.
The annual or biannual conferences and the
chapter meetings for learning from each other
and networking continued. The chapters have
grown in number. The culture of publishing
papers to be distributed during conference
continues.
The Future
Division kills and Integration builds. It is high
time that all of us recognized the need and value
of integration: integration of "Personnel and
HRD" or "OD and HRD" or "Business and HRD"
or "AHRD and NHRD" or "NIPM and NHRDN."
Integration and collaboration is the only answer
for future success. Overemphasis on separate
identities and ownership, especially for
professional bodies and institutions whose
owners are all professionals and not any one or
few individuals, is dysfunctional. Divisive
thinking is detrimental.. The future of the HRD
movement is in realizing that we have not even
touched the most important sectors like
education, health, infrastructure, government
etc. where HR interventions are most needed.
We need to pay attention to these strategic
sectors. The spirit of HRD lies in learning from
each others: teachers, managers, doctors, nurses,
in fact all citizens involved in the pursuit of
change and development.
 CHALLENGE OF MANAGING
ORGANIZATIONAL PREPAREDNESS-ICICI
K RAM KUMAR
Abstract
In this article we look at the changes that are happening in terms of socio - economic,
educational, and demographic aspects of the society and organizational ecosystem and the
associated changes needed in the mind set of managing an organization. Drawing up on the
case of the financial services industry and specifically of ICICI, the changes required and
expectations from HR, employees, and top management are described. The various
interventions that are aligned to this change are also described here.

Introduction half a million engineers annually.

India finds itself in a unique phase
in its existence viz being in the
vanguard of not only the Asian
economic growth but also the
Global economic hope. For the first
time, its demographics and
reservoir of human talent is turning
K Ramkumar is the
Group-Chief Human out be a huge strength. A near-
Resources Officer at
double-digit GDP growth is
ICICI Bank.He has 22
years of work experience
powered by the service sector and
in private and public the resurgent manufacturing
sector industries. He has sector. By 2020 Indian population
earlier worked in
will have an average age of 28 years.
Hindustan Aeronautics,
Hindustan Lever
Currently 60% of the population
Limited, and ICI India has more than 30 years of
Ltd. Apart from human productive work life. Rarely has
resources, Ramkumar any country had 500 million people
has also had exposure in
managing
with so much productive work life.
manufacturing plants.
However the galloping economic
growth and the young demography
brings along with its challenges.
These challenges are linked to socio-
economic, educational, and
demographic aspects of the society and
organizational ecosystem.
Education
A broken education system which
does not have any relevance to the
new economy. India
produces 3 million graduates and
India's pool of university graduates
(<=7 years experience) is estimated
to be 14 million - 1.5 times that of
China's. Yet, less than 1/4th of this
pool are employable in organized
industries, given poor linguistic
and social skills. Equally, course
curriculum focused excessively on
learning theory by rote creates
graduates with few skills
applicable to industry of today.
This creates gross shortfall in the
inventory of industry ready talent.
Poor quality vocational education
in the technical discipline and
absence of vocational education in
the service sector. Estimates
suggest that by year 2010, Banking
industry will add 1.1 million new
jobs, Retailing will add 1.5 million,
Telecom 4.6 million and
Hospitality 33 million jobs. A large
percentage of these jobs is likely to
be in front line sales and customer
service. Yet, vocational education,
aimed at core skill building rather
than imparting theoretical
knowledge, is often looked down
upon by academia as well as
students. The consequence would
be significant under-capacitization
of vocational education sector.

November 2007 NHRD Journal 107

Socio - Economic
Highly mobile and churning workforce
resetting the norms of "what is acceptable
attrition". The scarcity of industry-ready talent
has resulted in too many employers targeting
the same limited talent pool. This has created
high churn and wage inflation, with attrition
in high growth sectors at 20-35%. This
combined with exploding employee numbers,
means that at any point in time as much as
50% employees could be less than an year old
in the organization. This creates an adverse
"new" to the "accultured" ratio, challenging the
DNA of organizations. The challenge is who
holds and inculcates the organizational DNA
and the institutional ethos to the thousands
who join the organization every year.
Confusion among the employees who want the
benefits of the capitalistic system but the
security and comfort of the socialistic system.
While individual choice and potential super-
normal rewards for extraordinary contribution
are desired, the flip side of undesired
consequences for less than expected delivery is
deemed unacceptable. This creates an
unrealistic expectation that one should get the
super-normal rewards and at the same time
there should be no down-side risk. This in turn
will result in a young and anchor less
leadership in organization wanting
meritocracy without appreciation of the risks
and the inequity & differentiation which
characterizes it.
Rapidly globalizing organizations faced with
the challenge of balancing exporting talent to
other parts of the world and coming to terms
with differing work cultures of host countries.
E.g. notions of required work hours, work-life
balance, private space vary significantly across
geographies. In such situations, what kind of
trade-offs does a globalizing organization
make? Ensure a homogeneous work culture by
continuing to export talent? If overdone, this
108 November 2007 NHRD Journal
may compromise brand proposition to local
customers. Adapt work culture of the host
country? This may compromise the work ethos
that makes the organization competitive.
Demographic
Plummeting average work age leading to
middle management talent crisis and the
challenge of young leading the young. Low
median age of the population translates into
an advantage at the entry level pool, yet poses
a serious challenge at middle and senior level
managers. At these levels, experience and
maturity built over time are critical; yet current
phase of outstripping growth has meant that
talented yet inexperienced managers have been
fast-tracked into middle management roles.
Relatively few middle level managers have
significant age, experience and maturity gap
when compared to their subordinates.
The Change Challenge with ICICI
Drawing from the overall challenges that are
explored, in the context of financial services
industry and specifically of ICICI we can link
it up as below. The financial service Industry
has been growing at 30% over the last 5 to 6
years. ICICI Bank has been growing at 35 to
40% year on year during the same period.
Given the challenges listed in the context, the
following mind set changes were required at
the leadership level with respect to talent
acquisition and deployment:
From outsourcing investment on training to line
managers taking ownership for training raw
talent.
Seeing the role of manager not simply as delivering
on tasks through one's team but also as builder of
organization's talent pool. Not simply a net
consumer of talent but a net creator of talent. From
insistence on readymade talent to raw talent that
is trainable. From seeing compensation as the
sole lever for attracting and retaining talent to
investing in learning for accelerating time to
productive deployment of raw talent. Looking at
the ability to take raw talent and en-skilling and
deploying it as a competitive advantage, creating
a cost barrier for competition.
From demanding bodies on job to letting new
employees go through thorough pre-training
for at least 4 weeks right from day one of joining.
Making a shift from "manning" of jobs to the
rigor of "license to operate".
From endlessly complaining on attrition based
on the old paradigm to investing in a bench
and innovating systems and processes that
counter the effects of attrition.
From complaining about the education system
to investing in creating appropriate content and
curriculum for the universities and training the
teachers and professors for creating the external
eco system. As industry leaders, making a shift
from perceiving self as beneficiaries or victims
of the current institutional eco-system, to being
builders of that eco-system.
The corresponding challenge for the HR
function was as follows:
Linking up with the challenges and the needed
changes, HR function needed to realign itself on the
following lines.
• From being recruitment agencies to eco-
system developers. This required
developing capability and stature to engage
with and intervene in the education system
of the country.
• From being administrators of learning to
creators, structures and innovators in
functional and behavioral content,
methodology and medium of learning.
Looking beyond the "best-practices" to
experimenting with mobile, gaming and
simulation technologies. Investing in and
gaining credibility as domain experts in
instruction design and valued partners for
creating learning content across domains.
• From hiring external trainers to trainers of
thousands of internal trainers. Creating a
pool of internal trainers to deliver
leadership, behavioral and functional
learning. Focusing on building institutional
capability rather than buying skills.
• From looking at HR function as provider of
services to "Business" to HR function
managing the "Business of People", with line
responsibility for sourcing, en-skilling and
deploying talent.
The Challenges with Employees were as
follows:
The changes that are required need a different
orientation from employees. The changes are
explored in the following lines.
• To cultivate an orientation to year long
learning, that will be tested for proficiency.
Looking at training as work, in certain cases,
license-to-operate on work.
• To change from class room and instructor
led learning to blended learning of E-
learning and class room learning.
• To be moved to domains they have not
worked earlier, with a pre-condition of
learning functional content before being
deployed to the new domain.
Systemic Interventions
The major mindset change that was required
was to get the organization to see attrition more
as the consequence of the nation's high
economic growth and hence a structural
external supply issue rather than an internal
culture or compensation issue. This led to the
initiatives of the organization and its leaders
to choose the approach of investing in easing
supply through the following initiatives:
• Partnering with NIIT to create the Institute
for Finance, Banking and insurance. This
will deliver 5000, 6-months pre-trained
employees in the first year and by year 3 it
November 2007 NHRD Journal 109
 will deliver 25,000 pre-trained professionals
to the Industry.
• Investing in the Academy for Banking and
Insurance in alliance with Manipal
University, which in year-1 will deliver 1000
Managers who have been pre-trained for one
year. By year-4 this will deliver 4000
Banking domain trained managers.
• Creation of a slew of Academies for Branch
Banking, Sales, Credit, Collections,
Operations etc. which will deliver high quality
accredited professionals year after year.
• Moving away from an Urban and English
centric talent acquisition to a broad based
inclusive talent acquisition fro Semi-urban
and Rural India. Focusing on job success
factors such as problem solving and
relationship skills, rather than linguistic
abilities. Creating capability to en-skill raw
talent in language and social skills.
• Looking outside of India to the International
Universities to service the Global requirement
of talent rather than export talent only from
within. Creating an employer brand in
campuses across the globe.
The Meritocracy Challenge
At ICICI meritocracy governs both performance
and leadership talent assessment. The age-old
confusion between performers and leadership
talent required to be cleared both among leaders
and employees. To add to this the much
maligned forced ranking system in both
performance and talent management required
to be put in context. Both these challenges were
tougher in the context of a highly mobile young
work force that was prepared to exit if not ranked
in the top half. The middle level leaders were
reluctant to own up to the system and very often
took refuge in pointing upwards towards the
bosses. While both the leaders and the employees
wanted a meritocracy, their comprehension of
the true character of the same or the willingness
110 November 2007 NHRD Journal
to accept the consequences thereof were poor.
Add to this the culture of stretch, which is not
negotiable. All this lead to a system where there
is uncompromising differentiation in growth
and rewards. While this engendered a culture
of achievement orientation, it also encouraged
competitiveness and high pressure all round the
year. We at ICICI believe that one cannot create
a culture of meritocracy without the top
management willing to be unrelenting and
unwavering in its clinical execution. We believe
that its success is more in its execution than in
the articulation of the philosophy. The top
management and the operating levels should
be willing to live with the attendant noise in the
system and not mistake it for dissatisfaction and
roll back the execution or water it down.
We have found the following to be the essential
necessities to change a work place to
meritocracy:
• Clarity that meritocracy is not going to be
popular and tolerance for noise in the
system.
• Clarity to the middle management that they
will qualify to be senior management leaders
only if they own this and show ability to
institutionalize this philosophy.
• Willingness to be clinical, unrelenting and
unwavering in its execution.
• Transparent and inclusive process, were all
levels of management are involved in its
execution.
• Communicate, communicate and
communicate year round the non-negotiable
nature of stretch and relative ranking system.
• A system that is open to audit by any
employee and reining in any senior leader
from exercising favors.
• Emphasizing that meritocracy is an
economic reward differentiating philosophy
and not a fair or equity based philosophy.
Conclusion
There is a broad agreement that growth
momentum of Indian economy is set to
continue over foreseeable future. ICICI Bank
has the ambition to be a significant global
player in the financial services industry
(among top-25 banks in the world) by 2010.
While evolution of the eco-system is underway,
as a process it occurs, not instantaneously, but
over a period of time. This means that the
change intervention for organization
preparedness is far from its logical conclusion.
The two-pronged approach of intervention
within the organization on meritocracy and in
the outside system to create talent supply will
need to continue. The analogy to explain this
phenomenon is that of riding a bicycle. Bicycle
is inherently unstable and requires significant
adjustments and gathering of forward
momentum to make it stable. We have now
gathered that forward momentum. Yet, exactly
like a rider on bicycle, we need to continuously
make the micro-adjustments to keep the bicycle
steady and moving in desired direction.
November 2007 NHRD Journal 111
 BRINGING ABOUT ORGANIZATIONAL
CHANGE-PHILIPS INDIA
VINEET KAUL
Change is part of everyday life and
all of us experience it. There are
changes which we see in the
family, society, the economic and
political environment too. All of
us understand and also gratefully
acknowledge that change is indeed
the essence of everyday. With all
Vineet Kaul currently
heads the Indian
this awareness, education and
Subcontinent HR experiences - still each one of us
function for Philips and finds Change Management as a
is also an Executive challenge in Organizations today.
Director on the Board of
Philips Electronics India
CEO's would also put bringing
Limited. His career as about change as one of their
HR professional spreads priorities today. My own
over 31 years across a experience and most of you would
range of assignments
and enriching
also agree is that whatever and
experiences. however much we deliver in this
He is on the CII National area, there is still always a lot to be
Committee for HR and done. Look at our own country.
IR and is also the During the past 20 years or so -
immediate Past
indeed a lot of change has occurred
President of the Mumbai
Chapter of the National and we are in a very different
HRD Network. He is a situation than before. However,
recipient of a number of despite the steps taken and results
prestigious awards as a
achieved - we still continue to have
HR professional.
a lot to do. The same principle
applies to Organization Change. It
is a given - and as one colleague
remarked - "It is like a Treadmill -
you are on it". Well, it is all up to
you as how you wish to manage
self vis-à-vis the speed on the
Treadmill.
Organizations I feel do not have
many options today. The
immediate Agenda of many
organizations is how do we cope
with change? Do we anticipate and
proactively prepare the
112 November 2007 NHRD Journal
Organization? Are we leading the
change process? Or are we
constantly repairing the impact of
change? Whilst we have many
programs to address the subject in
our Organizations - are we doing
enough? Will we be able to sail
through the troubled times? Is there
a clear strategy and approach
available which can steer us
through? These are some questions
on the minds of leaders in
Organizations.
Why do organizations look to
Transform and Change?
Interestingly, very often success
could be a very important cause.
Sometimes it makes the
Organizations complacent and
arrogant. Accumulated costs,
structures and processes during
growth phases are difficult to reduce
during tough times. Also, being
too focused on the interests of only
1 or 2 stakeholders at the expense
of others is a cause of the
Organization not doing well! In
addition to these "internal" reasons,
there are also "external" or
environment related causes that
require organization change.
• Regulation: An excellent
example is the deregulation
process and opening up of the
Indian economy which has
made the markets much more
dynamic and provided
consumers many more options.
• Technology and its speed of
 change is indeed the engine which fires up
the organization. Bringing newer products
and also changing processes is forcing
organizations to gear up in the real sense.
• Globalization is another linked reason,
with trade barriers being pulled down and
free market accessibility e.g. the full impact
of the WTO is still to be felt.
• Last but not the least is the Customer. The
shifts in customer preferences can be traced
to a few demographic changes - aging in the
West and younger generation in India,
changing role of women, etc. Companies
that fail to keep up with the changes their
customers are going through will gradually
lose them. Companies that survive in the
long run are those that are able to
dynamically adapt to their changing
circumstances. Interestingly, you will
observe the above four causes are also under
constant change. We do not have the comfort
of addressing "one" of them and then moving
on to the "second one", because all of them
are exclusive and also inter related at the
same time. This makes the subject very
challenging. I would venture to add that it
is a "chakraviyuh" which will be continuous
and never come to a stop.
Designing HR Interventions - Considerations:
Organizations are like living beings. Just as
we all go through different life stages, we can
also identify a number of stages in the life of an
Organization. HR interventions need to be
designed keeping in mind the context in which
the organization is operating. Let me illustrate
the above with the Philips India experience.
If we look at the developments in Philips India
in the last decade, we identify three phases:
• Restructuring Phase from 1996-2001:
During this period, the Company went
through a difficult period of low growth
and low productivity which was addressed
through a turn around strategy.
• Revitalization Phase from 2001-2005: The
Management Team was able to turn around
businesses. However, measures taken to
improve performance took their toll on
morale and motivation. Therefore, the need
for re-vitalization in the Organization.
• Growth Phase from 2005 onwards: With
the business performance in place, the
Company embarks on a growth strategy.
Depending on the issues at each phase, we
evolved appropriate HR interventions.
Some of the key initiatives taken are given
below:
Restructuring Phase:
Improving Operational Efficiencies
The Management deliberated and evolved a
turnaround strategy which involved divesting
of unviable businesses and optimization of
costs including headcount. Being a 75-year-
old Company, we did not see our legacy as a
handicap but dealt with it as a challenge and
opportunity. It took us a few years especially
as we were spread across six states and had
11 Unions across the country. Many restrictive
practices had got in place and these were
obstacles which had to be overcome. However,
by taking a few measures and actions we had
full flexibility, all non-core activities are
outsourced (they were run in-house earlier),
all activities towards reorganization and
rationalization are carried out with full
participation of employees. In our plants
today, a part of the wage is linked to plant
November 2007 NHRD Journal 113
yield/quality and/or skill based pay. The
wage increases have also kept below the
regional trend for similar Companies.
Interestingly, in addition to the Union -- a
settlement is also accepted individually by each
employee in a respective location. We have
also gone through quite some divestments and
all these processes have definitely had good
outcomes, which solely reflects positively on
the leadership.
Driving Performance Culture
We had identified this as a very major need
and hence have been actively working on this
area. The process comprised of proper
deployment within the teams, regular tracking
and measuring of performance both at
business and individual levels as well as
linking compensation to achievement of
targets. For the last 8 years, we have also gone
into differentiation in compensation, which
becomes quite aggressive to the extent of being
at least five times in one grade itself.
Revitalization Phase
Creating a Conducive Work Environment
Employees have responded very well to bring
change in the work place. To give an example,
we have been able to bring about a shift in work
culture by improving work place management,
which in turn has helped to build an open and
cordial environment, which enhances
productivity. All services have been
outsourced so as to provide good quality, costs
and delivery at the workplace. Employees
responded well to our decision to reduce the
number of paid holidays in a year from 18 to 10
days in all commercial establishments. I do
not think this would have been possible in the
normal course. All across the Company, the
employees are involved in the journey to
excellence and you will find departments
working on their improvement plans and using
Business Balanced Score Card and Process
114 November 2007 NHRD Journal
Survey Tools. All in all, these have been very
effective in bringing about changes in the
Organization and thereby Company benefits
as a whole. As a Company, we do encourage
cross-functional as well as quality
improvement project teams and hold
competitions at the country level and also
depute the winning teams for International level
competitions.
Communication
Today I see this as indeed the greatest challenge
before us as an Organization especially due to
the fact that we have different product
divisions across different industry segments as
well as being located across various parts of
this country. As one Company, we are indeed
putting in more effort in order to have better
lines of communication across the
Organization. Common platforms, learning
events and workshops do supplement the
existing practice of periodic newsletters as well
as town meetings in the Organization. We also
launched a number of programs aimed at
building Employee Engagement. For example,
the Employee Outreach Program, where a team
of Senior management meets employees at their
respective locations and hold Open House at
each unit. Our efforts paid off as evidenced by
the high scores Philips India achieved in the
company-wide global Employee Engagement
Survey conducted.
The Growth Phase:
Talent Management
Talent Management has been identified as a
priority area given our growth agenda. Career
planning and development receive focus as also
having the advantage of different businesses
where we are also able to provide opportunities
for people within the Organization. Very
specifically, we are focusing on identification/
development and positioning of our High
potential employees as also having functional
and regional development programs. We also
have a Career Centre, which is an internal job
portal, where employees can apply for
positions across Philips organizations
worldwide These activities are part of our
overall Talent Management process and stand
the Company in good stead with providing
Managers for our present and future
requirements.
Key Learnings
I will now move on to a few key learning's
which we have gained through experience. To
summarize, a successful change process
normally involves the following five steps:
a. Develop an Initial Plan:
This starts with painting a picture or "creating
a vision". Whatever be the state of Organization
or nature of the business, this is an important
step to put together as many pieces together
e.g. what is it that we want? Where should we
be? Where do we want to be? What is the
status today? How do we feel we will get there?
Why do we want to be there? What is not
going well today?
With many of the initiatives and changes that
we worked on - in quite some of them, I realized
that the time and effort spent in envisioning
and putting a plan was very useful and also
formed the Foundation for the next steps ahead.
b. Building a Sense of Urgency:
This to my mind is the most critical part in
organization Transformation. It is indeed a
catalyst to bring about the change. Having a
sense of urgency whilst mostly addressing a
"crisis" could also be directed to address "major
opportunities" too. In other words, it is not
only in tough times that we need to bring this
sense of urgency - but also looking to market
realities in grabbing opportunities. It is
popularly believed that the urgency rate is not
high enough until 75% of the management is
honestly convinced that business-as-usual is
totally unacceptable. Organizations that have
been successful in getting this step right - have
experienced that it smoothens very much
subsequent actions and communication that
are necessary in terms of change. We all know
that a crisis very often bonds large Corporations
and it is this state that brings people together.
• Forming a Core Group to Lead the Process :
Whatever may be the prevalent practices - it is
observed that most often the bottleneck is at the
Top. Even otherwise the troops in the
Organization look to the Top i.e. the leadership.
Be it for direction, guidance and even role
modeling. Hence, I find that in an Organization
wide Transformation - it is useful to have a core
group/steering team at the helm. Here I often
support a Top-Down approach which all would
understand very easily. The key people involved
in this team have to be persons who are in the
leadership group of the Organization and have
the mandate to lead and deliver the end results.
Of course, it is clear that the leadership group
has to own and bring about change. But, often
this role needs to be orchestrated and be seen
across in the Organization - more important is
that a "passion" in the whole process should be
evident rather than be perceived as one more
initiative / instruction flowing from the Top. A
key challenge is therefore getting to the Right
Leaders to steer the process and also more
importantly encouraging these to work as a
team.
• Communication:
This part does not need much explaining - but
truly the role it pays in the Organization, needs
some explanation. Organizational
Transformation heavily banks on a very good
communication across the Organization and
its various stakeholders. We have numerous
examples of the Organization, for whom good
communication has made the day (achieve
results). Simply put - the Organization is
people and people need to know a lot about the
November 2007 NHRD Journal 115
need for change, what will change and what
not, how does it impact the individual in the
Organization etc. etc. Organization Change
is not as difficult - but we constantly need to
communicate, the Vision, the need, the what,
how, why and numerous questions that we
anticipate and also cannot anticipate. Let me
clarify that we communicate not only by our
words but also by our actions. A compelling
vision, leading from the front, open houses,
continuous communication with all levels of
Organization is something many of us practice
- The quality of communication - does it seek
involvement, opinions and transparency of the
leadership are all put to test in a journey of
Transformation & Change. I have experienced
that open, fact based and the passion with
which we communicate is an indication of
success in getting to the results. After all, what
better results than when all employees in the
Organization are able to understand the
purpose of Transformation and also play their
roles in a manner which creates harmony and
the Organization change gets in place. It is
also possible that this process does take time
but I would say that it is worth the while and
just rushing through this step is not advisable.
• Track Achievements and Recognize
Achievements
It is useful to create some milestones as we
embark on the journey to Transformation in the
Organization. These milestones are indeed
points of arrival and also help in reviewing and
seeing where we have reached. After all, Rome
was not built in a day - so we have to look at
opportunities and signs of achievements. To
take an example, a total change in the way of
working and culture will take some time as we
go along. However, we can always be vigilant
for some indicators which are really "short-
wins" and small successes. These need to be
tracked and highlighted. Very often it is a few
incidents or people who really take the major
116 November 2007 NHRD Journal
steps/action for change. Now this to my mind
is an ideal opportunity to highlight to the rest of
the organization. Also, such individuals or
teams need to be recognized and even recorded
so that they indeed are seen as the role models.
Very often such recognition apart from
motivating the individual or team along - kindles
a positive feeling amongst the rest of the
organization too. The behaviour improvement
actions need to be publicized and also
rewarded. If it calls for a celebration - please do
it. Very often, these opportunities are missed
out and later it can be too late. Employees do
need positive stokes and hence these
opportunities for recognizing short wins are a
must do. The appreciation works wonders
and indeed charges up the environment. This
is exactly what the organization requires in its
journey to bring change. It reinforces the strong
positive feelings of the few individuals and goes
ahead in getting more to the flock of the vital
few. Believe me, it is not difficult to do these
acts, however the risk of loosing out by not doing
these is much more.
• Consolidate and Institutionalize
Whilst short term wins and gains take you
ahead on the journey of change, it is necessary
that these changes are consolidated and there
to stay. We also need to guard against things
slipping back to the earlier times Very often
good things happen and these should be
replicated as required across the Organization,
to expedite the change process.
Conclusion
To conclude, Change is inevitable and an
intrinsic part of life. Success lies in looking at
it not as a "threat" but as an opportunity for
transformation. In designing HR intervention,
one needs to take a holistic approach by
designing appropriate strategies and
processes to provide end to end solutions and
more importantly, involving people in the
transformation process.
 ORGANIZATIONAL CHANGE-MARUTI SUZUKI
S.Y. SIDDIQUI
The Context
The need for organization change
at Maruti Suzuki was necessitated
linked to two important variables:
• The changing business
environment in India with the
globalization setting in almost
S.Y. Siddiqui is all sectors including the Auto
Executive Director -
Industry
human resources at
Maruti Udyog Limited. • The changing structure &
He is also responsible for identity of Maruti from a PSU to
corporate HR for Suzuki
Powertrain (engine a 50:50 JV (between Government
company) and Suzuki & Suzuki) and then to be a
Motorcycles. He is on the Private Sector company (Mid
board of Maruti Suzuki 2003 onwards)
and part time director on
the board of Suzuki The Journey of 26 years
group companies -
Suzuki powertrain and Maruti was incorporated in 1981
Suzuki motorcycles. as a public sector company and
started its business operations in
1983 in technical collaboration with
Suzuki Motor Corporation Japan
with the objective of making small
cars with latest technology and
economic price offerings aiming at
the affordability by the masses.
If one may observe, the first phase
of Maruti lasted from 1983 to 1995.
This phase saw the revolutionary
launch of the initial models and
unprecedented commercial success
of Maruti. It also saw the
consolidation as well as
unopposed growth of Maruti. The
company enjoyed a virtual
monopoly with a market-share in
excess of 80%. The first few models
launched by the Company viz. 800
and Omni still remain one of the
bestsellers.
November
The period from 1996 to 2007 can
be considered as the second phase
of the Company which also
experienced the Globalization of
Automobile Industry in India. The
entry of global players in the Auto
industry in India meant that there
was a very specific need for Maruti
to change and prepare to handle the
global competition pro actively.
Jagdish Khattar, Managing
Director Maruti Suzuki often says
that "We thank our competitors for
creating excitement and getting the
best out of us to offer better products
and services to our customers".
This necessitated the Company to
introspect, reassess and redefine its
Business and Organizational
Strategy. It was important for the
company to come out of its comfort
zone and fight to retain its
leadership position. Both the media
as well as the experts had at that
time written-off Maruti as another
Government enterprise which will
succumb to the pressures of
globalization.
Inspite of the adverse business
scenario and negative Industrial
Relations environment in the
company, the entire Maruti team
regrouped and emerged as a strong
and committed team and under the
excellent leadership of Jagdish
Khattar, who took over the reins as
the Managing Director in August
1999" the company has undergone
a big change both on the business
as well as on the Industrial
2007 NHRD Journal 117
Relations perspective and emerged as a winner
retaining 55% of the market share with a
healthy and growing bottom line.
In 2003 Govt. of India decided to disinvest its
stakes in Maruti. The launch of Maruti's IPO
which was one of the most successful in India's
history, restructured the company's Equity with
54% by Suzuki thus making Maruti a Private
Sector Corporate & part of Suzuki Motor
Corporation, Japan. That was the time that the
company decided to drive another major
change initiative aimed at Organization and
People Strategy
Need for Change
Organization Culture of Maruti reflected high
Business focus and commitment; high target
and result orientation and strong business
systems and processes. However, it also
reflected an Inward-looking approach; strong
compartmentalization and functional
boundaries; looking up culture with low risk-
taking behavior; bureaucratic & slow decision
making process and culture lacking the
celebration approach.
The HR Function was IR centric, centralized,
administrative, and control oriented. The HR
focus was Policy and rule driven and not
people driven. The HR processes were
conventional, slow with bureaucratic decision
making. In 2003 too it still reflected primarily a
conventional approach to HR Policies far away
from the prevailing HR trends. Above all it was
lacking sensitivity to both business & people
connect.
The People profile has been warm, competent
and with an element of pride being a Marutian.
But the people profile was impacted by the
Culture and also the role of the HR Function
over the years. It thus did reflect a conventional
mindset. There were conflicting views on the
HR needs expressed by the young managers
vis-a-vis the relatively older population. Also
118 November 2007 NHRD Journal
the perception about the HR role being a black
box, policy and rule driven and insensitive to
the people needs, meant a clear disconnect
between people and HR
Philosophy of Organization Change at Maruti
• Integration of change initiatives with the
Business and Organizational strategy
• Organization Change aimed at redefining
and developing an Enabling Culture
• Focus on People development and
Institutionalization of capability building
processes
Periodicity and consistency of OD
interventions
• Leadership development processes for all
levels including the Top management
• All change Initiatives driven from the top
The Strategy of Organization Change at Maruti
• To build on the successful past, commitment
and competence of people by launching the
change in an appreciation mode
• Emphasize the need for change linked to
external environment & as a pre-requisite to
future success of the company
• Create ownership and participation
towards the change initiatives through
strong and consistent two way
communication and education process
• Focus on the senior pros to lead & the young
population to drive the change
• Organization change to be gradual and
linked clearly to business needs
Organization Change Initiatives at Maruti
To initiate the Organization Change at Maruti
the first pre-requisite was for the HR function
itself to change. Hence HR Team had to prepare
itself to change before attempting the
Organization Change Initiative. It took some
real time and effort to first initiate the change
in the HR thinking, approach and the HR
credibility at Maruti.
The effort involved introspection and
brainstorming sessions, informal and formal
training, exposure to external HR fraternity, the
strong HR linkage to business and people and
aggressive HR leadership and direction. It also
involved cutting open the HR cross-section
view to the key stakeholders - People,
Functional heads, Directors and the Board. It
required a participative, consultative and
flexible approach to define new or redefine
existing HR Policies, Systems and Processes.
Some key directions were as follows:
• HR's transition from a stand-alone identity
to Integral part of Business
• HR identity and credibility as mere Staff
support to Strategic part of Business
• From Manpower costs to Investment in
People
• From Labor Law compliance to Strategic IR
Perspective
• Personnel Administration to People
Connect
• Technical Training co-coordinator to
wholesome People Development
• Discipline concept to developing and
sustaining positive Work Culture
The Success of any Organization Change
Initiative depends to a large extent if it is owned
by the Top Management and if it starts from the
Top. Hence deliberating the Organization
change perspective with the Top Management
specially the Japanese colleagues at Maruti was
critical and cumbersome at times. Sometimes one
realizes that life is so simple if corporate
communication is based on English only.
Also it was an enormous task to overcome the
Cultural gaps between SMC, Japan and the
People issues in the Local context of our
country. At times we could observe a fairly clear
gap between the Indian senior colleagues &
our SMC counterparts. Hence the balancing
act required sensitizing them individually for
ownership of the Organization Change
initiatives. Above all it required a
tremendously patient, educative and flexible
approach to discuss, deliberate and convince
our SMC colleagues on some of the new
concepts, policies etc.
From 2003 onwards, the Organization Change
Initiative was launched through various
OD interventions at five different levels:
• Top Management
• Senior Management
• Middle Management
• Junior Management
• Technicians/operators
Leadership Retreat for Top Management
The key objective was to build & strengthen
the Top Leadership Team at Maruti including
the Indian and Japanese Directors. The effort
was to shift gears from an operational focus
and review perspective to Strategic Business
Planning & Transformational People
Leadership. The first initiative in this regard
was full of ifs & buts, language issues & the
cultural subtleties involved between the
Japanese culture of SMC Japan & Maruti's
Indian ground realities. The balancing was
tough and required tremendously patient
approach as there were Business Success and
learnings in both models. The Leadership
Retreat involving all Directors, over two & a
half days residential at Bangalore, was
facilitated by Dr. Pritam Singh and Dr. Asha
Bhandarkar with focus on:
• Team Building perspective i.e. Leadership
Team of Maruti Suzuki
• Self-development focus for each Director
based on feedback from others
November 2007 NHRD Journal 119
• Develop a Strategic Perspective of Long
Term Business Plan
• Mentoring/Coaching role to develop next
level people.
• Creating a new curve for Maruti
Leadership Development Initiatives for
Senior Management
Senior Management
The focus was on global business perspective,
people management and people development,
and leading and managing change. Leadership
development was facilitated through:
• A two and a half day Leadership Training
at NCR (Jaypee Greens, Greater Noida)
• External Training nominations at premier
Business Schools
• Two weeks, Training at Europe - meeting
thought Leaders from Corporates &
Academia through ESCP EAP Business
School (Germany, France and UK)
• Leadership Assessment of each person &
Feedback Session
• On the Job - Coaching and Mentoring Role
for young professionals
• 360-Degree Feedback Process
• Developing them as Internal Assessors &
Trainers.
Leadership Development of Middle
Management
The focus was on exposure to the external
business environment in India, people
management and people development, and
accepting & facilitating change. The need was
to develop them to play an effective leadership
role as the first interface with young population.
The development was facilitated through:
• Leadership Training by GE International
• Nominations to external Trainings at
Leading B- Schools
120 November 2007 NHRD Journal
• Leadership Training by Dr. Pritam Singh &
Dr. Asha Bhandarkar at MDI
• 360-Degree Feedback Process
• Performance Feedback Sessions
• Potential Assessment through Assessment
Centers & Feedback sessions
• On the Job - Coaching & Mentoring Role for
young professionals
• Developing them as Internal Assessors and
Trainers
Change Initiatives for Young Managers
• Create an Enabling Culture
• Positive and high performing
• Free flow of communication
• Appreciation and celebration
• Fostering innovation and creativity with
patience to absorb failures
• Mentoring/Coaching for all Campus Joinees
(Graduate Engineer Trainees, fresh CAs,
MBAs & graduates). This resulted in "On the
job" development that is customized to the
individual and yet is flexible -- formal or
informal.
Senior professionals in the company
selected as mentors. Training on mentoring
has been provided to all mentors. To help
the fresh joinees to settle in the Company,
all campus joinees are also provided with
buddies who are relatively younger
professionals.
• With a view to develop all-round business
managers who can become General
Managers in future the following initiatives
were emphasized:
• Job Rotation- Good performers who
have spent five years in one function
have to be necessarily rotated to other
functions. The job-rotated individuals
return to their parent function after
around 3 years.
• Cross Functional Teams (CFTs) on critical
projects are formed which give exposure to
young managers which fosters Team
Working, Experimentation - tolerance for
failure, Empowerment, Innovation and
Learning.
• Stretch Assignments such as employees at
Manager/Sr Manager level acting as
Department Managers (General Managers),
selection of Area Managers as Regional
Managers, etc.
• Clear Career Growth Paths
• Fast Track for high performers and high
potentials
• Normal Track for good performers
• Extended Track growth for solid citizens
Change Initiatives for Technicians
(Workmen)
After the VRS of 2001 & 2003, focused
interventions for Technicians were launched
to bring in positive culture and mindset change.
To achieve this, training initiatives were
introduced to educate and change the mindset
of workmen. Another big impact was created
by the participative approach in resolving IR
issues through Employee Relations
Development Committee (ERDC). Structured
communication channels have also helped the
company not only to manage the Industrial
Relations but also to evolve a environment of
trust, confidence and mutual cooperation.
Company has also created opportunity for
developing family connect through 'Parivar
Milan' (Weekly half-a-day event in which
approx. 40 technician families are invited for
plant visit) and 'Family Day' (Annual event in
which all the Maruti employees along with
their families, are invited for a evening full of
entertainment, fun and celebration).
Subsequent to this Company has also
introduced Reward & Recognition program for
all employees.
Strengthening Internal Communication
Processes - directly lead by MD
• MD's quarterly Communication Meetings for
young managers and for middle managers
• MD's quarterly informal 'Tea-Group'
meeting with young managers
• ED (HR)'s quarterly Communication
Meetings for young managers and for
middle managers
• ED (HR)'s quarterly informal 'Tea-Group'
meeting with young managers
2007-08 onwards, Maruti is now entering into
the third phase. This is going to be the most
critical and will define the future of Automobile
Industry as well as Maruti.
Now we are looking at re-defining our
Business Strategy & Plan as well as continue
our journey on Organization Change at Maruti
Suzuki. As per our honest evaluation, we have
covered only 50% -- 60% of the distance so far
and thus have to continue our journey to reach
the destination by 2010 --
November 2007 NHRD Journal 121
 IT WILL BE DONE, I HAVE TO DO IT:
A STORY OF PCBL
ASHOK GOYAL

At times some of the most things were going for a company

challenging aspect of one's that was the market leader.
professional life is to bring out a
PCBL Journey: My Experience
massive change. The turnaround of
PCBL is an experience that I cherish In this article, I am sharing the
and is fresh out of oven. strategies implemented, leadership
challenges faced and the culture
Taking Over the Reins
change initiatives taken which
Ashok Goyal is an IIT PCBL, a part of RPG Group is enabled organization to transform.
Kharagpur and IIM
pioneer and market leader in the From a loss making entity in quarter
Kolkata graduate. He
has 30 years of multi Carbon Black Industry in India with 1 of FY 07 to have profitability at
domain and cross market share of 41%. In spite of par with competition in quarter 3
industry experience over being the market leader, PCBL was of FY 07, the journey was nothing
the globe out which 16
lagging behind in profitability with but exciting. I believe any
years have been in
various companies of respect to the major competitor organization can be turned around
RPG Group, i.e., Ceat, (Market Share 33%) and the gap if we as leaders basically have a
Harrison Malayalam, was continuously increasing. For belief that "Nothing is Impossible"
KEC International and
FY06, PCBL had declared PAT loss and have that feeling and
Phillips Carbon Black
Limited. of (-) conviction developed across the
He is currently Rs. 14.64 cr and the position had organization by leading by
spearheading Phillips further worsened in Q1 FY07. example.
Carbon Black Limited
(PCBL), a jewel in the The comparative position is given Strategy
RPG group of Industries in figure 1 Over the last 18 years I had an
as its Managing Director.
He has taken the
opportunity to take over and turn
company through a around divisions/companies
journey of turnaround which were in crisis mode due to
and consolidation in nine losses being incurred. When I look
months and the
company has now
back, I find the common elements
embarked upon an of strategies applied were:
ambitious growth path.
a. Identification of operational
He is known as a "Turn- Figure 1 : Competition scenario pre turnaround
Around Artiste" in the efficiency gaps in each functional
RPG Group The Company vision is to become a area by benchmarking operations
global producer by 2008 with with domestic and international
capacity of 450,000 MT but due to companies and thereafter removal
poor financial results the Company of the gap by achieving mindset
had not initiated any action during change.
2005 and 2006 for expansion to
b. Continuous reduction of
enhance capacity from the existing
Competitive Disadvantage the
level of 270,000 to realize its vision.
company had due to ~
It was dismal in terms of how

122 November 2007 NHRD Journal

i. Technology
• Plant location
• Culture
c. Gradual increase of competitive advantage
quotient and thereafter embarking upon
"Sustainable Growth Path".
Competitive advantage was defined by one of
the Indian industrial leaders as under ~
"When the water level starts rising, the level should
come to your chin while all the others are drowned".
I have found the above a very simple way of
communicating to all stakeholders in the
company including workers and unions the
criticality of building competitive advantage
quotient and ensuring that no action or
decision taken gives the company competitive
disadvantage. The Benchmarking exercise
should be done with total honesty and for doing
same one should take inputs from all available
sources i.e. published data and inputs from
own employees, Ex-employees of competitor,
consultants, customers etc. We need to avoid
trap of justifying the gaps due to reasons
beyond our control but instead should focus
on preparing action plans to overcome the gaps
with innovative solutions. Having identified
the gap and prepared the action plan, same
should be shared with everyone in the
organization so that there is a public
commitment to deliver the results. Based on the
concept of competitive advantage, the strategies
applicable for a company in different phases
of growth are as under.
Turnaround Phase
Reduce Competitive Disadvantage
• Benchmark operations and identify gaps.
• Develop clear strategies to cover gaps
• Implement strategic actions as per time
schedule and monitor benefits.
• Capture opportunities
• Develop innovative culture and change
mindset
Consolidation Phase
Reduce Competitive Disadvantage
• Build on strategies of turnaround phase
Growth Phase
Build Competitive Advantage
• Execute growth/diversification plans
effectively at locations and with technology
which gives competitive advantage.
• While growing ensure continuous
improvement in operational efficiencies.
Sustainable Growth Phase
• Build a Business model which is not easy to
copy and has high entry barrier
• Follow Organic and Inorganic growth
• Ensure organization continually reinvents
itself
Leadership Challenge
Turnaround Phase
The leadership challenges in this phase are to
create a culture of high performance and
change the mindset of the people. The step wise
approach to achieve these challenges is :
Step 1
• Develop high level of commitment at the
Management Team level which sets an
example for others in the organization.
• Share vision and ensure acceptance of the
challenges across the organization to achieve
same.
• Challenge the Management Team Members
who are leaders for their functional areas
with assignments and targets which
provide stretch to enable them and their team
members to draw on their full potential
• Lift aspiration of people
November 2007 NHRD Journal 123
• Lead from front by example The Alignment of mindset leads to correct
Step 2 operational practices which resulted in
Superior business results
An organization becomes sick or performs
badly with respect to competition in the same The Leadership Challenge is to create a
industry only because of basic flaws in the VIRTUOUS CIRCLE ~
mindset of the people in the organization
which leads to wrong strategies and actions.
Unless the mindset are changed, company
performance cannot improve.
PCBL as an organization was focused on
market leadership and market share in each
market segment and had lost sight of
contribution levels leading to having market
leadership but not profit leadership. In
commodity market for a product like Carbon
Black where there is no price premium or brand Some of the examples of mindset change done
loyalty, a company has no choice but to achieve in the various functional areas in PCBL are as
Cost Leadership which would lead to Profit under ~
Leadership. Only with adequate generation of
internal funds, company can invest and
expand to maintain Market Leadership. As
such, it was critical to have this basic change
in thinking i.e from :
Market Leadership Cost Leadership
The leadership challenge is to identify the In PCBL the operational efficiency gaps were
appropriate mindset required across the covered only by such mindset changes across
company in each functional area and for the company in internal and external
arriving at the same, it is critical to understand stakeholders leading to an annualized benefit
what are the key industry drivers for the of more than Rs.90 cr in three months.
industry in which the company is operating Consolidation Phase
which would give maximum benefit in terms
Leadership Challenge in this phase was to
of revenue and profit as well as reduce
ensure that
competitive disadvantage and increase
competitive advantage quotient for the • organization continues with strategy of cost
company. cutting and maximizing contribution
The process followed was as under : • Captures opportunities and continuously
innovates
Identification of new mindsets required
• Maintains momentum to ensure ongoing
high performance
Growth Phase
Ensuring everyone shares the specific
new mindset In an organization which turns around and

124 November 2007 NHRD Journal

consolidates in a short period of four to six
months employees are likely to develop inertia
and a feeling of "We are the best" which can
lead to loss of momentum. We therefore need to
identify new strategic needs for changed
competitive condition to overcome inertia.
This can be done by creating positive crisis as
under:
• Convince employees that current
performance was good but not good Enough
• Develop new strategic challenges to
galvanise people into action
• Create an enemy which could be a threat to
survival of the company.
In PCBL having achieved cost leadership in
the turn around and consolidation phase new
strategic challenges identified and
communicated were :
• Achieve Service Leadership
• Achieve Quality Leadership
Positive crisis was created by communicating
the new Demand and Supply scenario of excess
supply due to expansion by competitor in
which survival would depend on being better
in Service and Quality to maintain market
share.
It is critical to reflect on the strategic health of
the organization in the Growth Phase when
company is financially doing well. In most of
the cases we do this when organization's
profitability is on the declining trend. Having
identified the strategic health gaps which are
giving competitive disadvantage, we need to
communicate same across the organization
and develop innovative solutions to overcome
same.
The other Leadership Challenges during this
phase are ~
• Ensure execution of growth plans at
optimum cost and as per schedule
• Preserve the culture of high performance
developed.
- By continuously reinforcing and renewing
mindset
- Consistently improving and increasing job
content of everyone
- Ensuring no burnout by work-life imbalance
It is extremely critical that the Core Team is
willingly participating in the journey of
"accelerated growth" as the work pressure would
need personal sacrifices by way of lack of time for
family. During this process we need to ensure
that we as Leaders are "Energy Givers and not
Energy Taker" through any action of ours.
Sustainable Growth Phase
For PCBL to remain on Sustainable Growth
Path, the challenges are
• Achieve Service & Quality Leadership
• Make PCBL Carbon Black a branded
product
• Enter Speciality Carbon Black business
• Continuously expand capacity
• By generating adequate internal profit to
finance growth
• Identifying locations for expansion with
secured and captive Feedstock supply
which will give long term competitive cost
advantage
• Grow at international locations
The above would enable creation of entry
barrier by increasing the competitive advantage
quotient substantially.
Culture Change
To build a culture in the organization where
individuals have an approach of
"I have to do it"
"It will be done"
is the biggest leadership challenge.
November 2007 NHRD Journal 125
In PCBL we have been focusing on this through
communication and interaction in various
Forums with the employees and the unions.
We firmly believe that "I am doing my best" or
"I shall try my best" are approaches which do
not lead to excellence in results. These
approaches connote as under :
"I am doing my best"
1. 1.Defensive approach
2. Putting limit on Self Capability
3. Cannot do Better
"I shall try my best"
1. More positive approach
2. Believing in his ability to deliver results
3. Commitment to do best but not sure of results
Success not guaranteed
As against above, the approach of "I have to do
it" and "It will be done" leads to excellence in
operations and a more efficient organization
as follows ~
"I have to do it"
1. Total commitment to achieving
2. Guaranteeing results to himself with no
room for excuses/explanation
3. Ensures stretching of self by unlocking self
potential
4. Not accepting any limit on self capabilities -
full of confidence
Success assured
"It will be Done"
1. An approach of "Nothing is impossible" for
me
126 November 2007 NHRD Journal
2. Boss can delegate fully without need to
monitor
Success assured
Productive organization
The above model was developed in PCBL
during the orientation program in November'06
and thereafter communicated to all managers
through email.
Leadership Challenge is also to build teams
across the organization which believe in
"The greatest pleasure life has to offer is the
satisfaction that follows from - Participating in
difficult and constructive undertaking".
Only if individuals get satisfaction from
participating in difficult and constructive
undertaking would they live, breathe, eat and
sleep with what they are doing because they
have the spirit of "I have to do it" and "It will be
done".
Company Status in July 2007
As mentioned earlier, I joined the company as
Managing Director in July'06 and the
organization went through a radical
transformation and within a Quarter covered
up the substantial gap in profitability and from
Qtr 3 06-07 onwards, the company's
profitability became at par with competitor as
given in figure 2.
Figure 2: Performance as of Quarter 3 - FY 07
PCBL has also embarked upon expansion plans
through Greenfield projects as well as
Brownfield expansion and is now poised to
achieve production level of 450,000 MT by June,
2009 to realize its vision. There is also
substantial improvement in market perception
of PCBL as a reliable and competitive supplier.

PBIT (Rs in crores.)
The Company has created substantial wealth
for the stake holders and has been ranked No.
11 in The Economic Times survey of the top
100 wealth creators.
PCBL received the "Best Corporate
Performance" and the "Best TQM Group
Activity" Awards in RPG Group for FY'07.
Company was also given the SAP ACE 2007
for the best implementation in Chemical
Vertical. Ashok Goyal received "Outstanding
Achiever Award" for 2006-07 in RPG Group.
The PCBL Way
Phillips Carbon Black Limited (PCBL)
completed the phases of turnaround &
consolidation and thereafter embarked upon
the growth path within three Quarters which
normally requires minimum two to three years.
The Management Team today proudly
proclaims
"Way to do it - PCBL Way - The Accelerated Way".
The Company now is implementing ambitious
expansion plan to move from No.9 position in
World to No.6 by 2009.
Summary
Our challenge as leaders is to ultimately ensure
that people enjoy what they are doing and they
own the dream that we may have as leaders for
the company. We need to assume a facilitators'
role by assisting the employees in their journey
to achieve difficult targets.
To facilitate the process of turnaround, one also
needs to put in enabling processes like
a) Award and Recognition Systems
b) Development of Talent and appropriate
skills in employees
The Award and Recognition System should be
fair, transparent and should necessarily ensure
that the Awards are given where the Group
values have been properly adhered to. In PCBL
we have been stressing on the RPG Core values
which are as under
• Customer Sovereignty
• Passion for Superior Performance
• People Orientation
• Transparency & Integrity
• Anticipation, Speed and Flexibility
• Innovation and Entrepreneurship
PCBL today has a new dream which is the
screen saver on the computer of all the
employees in the organization
World No.6
Achieve Quality
&
Service Leadership
It will be done
I have to do it
The above enables focusing on the criticality of
achieving strategic challenges of "Quality and
Service Leadership" and maintaining the spirit
of "It will be done" and "I have to do it".
November 2007 NHRD Journal 127
 BOOK REVIEWS
1. MANAGEMENT OF ORGANIZATIONAL CHANGE: LEVERAGING TRANSFORMATION BY K.HARIGOPAL
SECOND EDITION (2006), PUBLISHED BY RESPONSE BOOKS, A DIVISION OF SAGE PUBLICATIONS.
Business organizations and change are concepts that have been in the realm
of discussion and research ever since management developed as an inde-
pendent field of study. The development of management studies and its
expansion can be attributed to the ever growing and changing pace of busi-
ness transformation, the pace of which has accelerated after World War II.
Triggered and stoked by changing business scenarios due to technological,
political and economic forces, resultant intense competition has led to orga-
nizations going through the cycle of birth, growth, decay and death. In all
these, change remains the common factor. Therefore organizational change
is synonymous with organizational activities. Since organizations consist of
people, organizational change is predominantly behavioral change. Learning
has to precede such a behavioral change.
In the present world of hyper competition, management of organizational change is a continuous
and ongoing phenomenon. organizations need to master the skills required to manage organiza-
tional change as organizational flexibility is the key to success. Therefore the need to understand
and manage organizational change is a requirement for practicing managers, students who are
future managers and academicians and practicing academicians who intend to unravel the pro-
cess of change.
In the light of such a scenario, a book on management of organizational change seems to be in
perspective, although such books are numerous to the extent that books on specific aspects of
organizational change are in vogue such as social interaction, learning or informational technol-
ogy and change.
The book under consideration has been purported to have been written to address the needs of
students and practicing managers. The author, a widely experienced academician and trainer,
has attempted to express in a very simple and lucid manner the conceptual foundations, the
systems and processes associated with organizational change and its management. The book
is divided into six chapters.
The first chapter introduces the reader to the phenomenon at a conceptual level to facilitate his
understanding. It covers the meaning, nature and types of change. It also deals with the forces
which trigger organizational change. Chapter two and three deal with the concepts and pro-
cesses associated with planning for change such as strategic planning, management of trans-
formation and role of support systems. Having established the basis for understanding of organi-
zational change; the book, in the next three chapters, deals with the process of management of
change. Chapter four deals with the strategic levers which are used to implement change. Chap-
ter five deals with organizational culture and its role in management of change while chapter six
deals with the management of change through management of people.
The content of the book reflects the background of the author, whose main field of expertise is
human resource management, especially conflict management. The book is written in a simple
and lucid manner and uses boxes to highlight and stress upon certain key concepts associated
with organizational change. It also gives end of the chapter exercises to facilitate skill building for
management of organizational change.
Although the author uses his experience and case studies to buttress his arguments, yet the
book lacks case studies of business organizations which could have given the positioning of the

128 November 2007 NHRD Journal

concepts in an organizational context and facilitated the understanding of the reader. The book
stresses upon the role of people in organizational change yet has not touched the topic of learning
in detail. One expects that a book on change management would deal with individual and orga-
nizational learning as it is the key lever to manage change especially in the present business
environment of hyper competition. Further, the dealing with the concepts and terminology asso-
ciated with organizational change could have been better had they been linked to the concepts of
rate, quantum and volition. The book therefore, gives only the definitions of the terms associated
with organizational change but does not put them in a perspective to the other terms commonly
used with it. Management of change requires a thorough understanding of the concepts and
terms used.
Change in mental models of the practitioner is essential if he is to implement organizational
change, which requires that conceptual linkages among terms commonly used to communicate
knowledge about organizational change are clearly understood. To that extent, the book fails to
provide the reader a base to do so. In an attempt to be useful to the practitioner manager and
also the trainers and students, the author seems to have lost out on an opportunity to fortify the
book with essential case studies and theoretical basis which would have given a much better
base for understanding organizational change. Such an effort, if had been done, would have
added considerable value to the book.

Reviewed by
B.V.L. Narayana, FPM fourth year, Business Policy, Indian Institute of Management,
Ahmedabad.

2. COMPETING THROUGH KNOWLEDGE: BUILDING A LEARNING ORGANIZATION MADHUKAR SHUKLA, 2002

RESPONSE BOOKS (SAGE PUBLICATIONS), NEW DELHI.PP 334.PRICE IN INDIA -RS 395.
Change as they say is universal in creed. In 1997 when Bob Dylan sung the 1960's popular
anthem, "Blowing in the Wind" beside Pope John Paul, Pope Benedict opposed it, for he
considered Dylan to be "the wrong kind of Prophet". The world since Dylan's era got
divided into those on the side and those opposed to such Prophets of Change. For the
changing face of corporate America and also for corporates across the globe the answer
was indeed blowing in the wind…but it was to be listened to carefully. Those who did,
survived and those who didn't, are no more there to tell their tale. Change comes from
continuous learning not just by individuals alone, but also by teams and organizations as
a whole. As Dr Madhukar Shukla's book on building a learning organization enters its tenth
year of its first publication, it time for organizations to take stock of whether they have
enough leaders within their organization who are prophets of change and can build a
continuously learning organization to make it shine and outperform itself and others in the
marketplace.
The book is divided into three parts. The first part deals with why organizations need to learn in order to survive and
grow. It is supported by innumerable examples from the recent Indian economic history of what brought about the
winds of change and how successful organizations listened to the answers (liberalization and globalization) that
were blowing in the wind. This part also deals with several theoretical frameworks for learning within organizations.
In interesting law that Dr Shukla mentions (in fact first conceptualized by Garratt in 1987) is that for organizations
to survive, their rate of learning(L) must be equal to or greater than the rate of change(C) in its environment,i.e. L?C.

November 2007 NHRD Journal 129

It applies as much to dinosaurs (who probably didn't understand this law) as to contemporary organizations facing
equally hostile and turbulent environment. Author provides four important outcomes of learning leading to-innova-
tion, adaptation to change, continuous improvement and corporate transformation. The third chapter contains the
various forms of learning such as single loop and double loop learning, and building capabilities to learn. The last
chapter in this part of the book highlights how organizations can leverage knowledge to enhance capabilities, by
giving several examples like those of float glass technology, competing on proprietary knowledge and so on. One
of the most interesting things in this chapter is the 2x2 matrix of knowledge maturation process. There are two
dimensions to this matrix. One dimension has knowledge as either explicit or implicit. The other dimension
visualizes knowledge as either proprietary or shared. The matrix helps one to understand how knowledge should
evolve from tacit to explicit form in order to become useful. Throughout the chapters Dr Shukla has provided lots
of examples from various companies from India and from around the world to illustrate the various scenarios in
which organizations have transformed themselves successfully.
The second part of the book contains 6 case studies on foreign companies. These are, ABB, British Airways (BA),
Chaparral Steel, Citicorp, GE and Xerox. Together these cases cover the learning dimensions, namely-Learning as
means of organizational turnaround (BA),Chaparral Steel as a learning factory, Citicorp as a company learning to
innovate,GE on cultural transformation and Xerox who learns to cope with environmental turbulence. However it
would have been much more learning for the Indian readers, if some of the companies were Indian e.g.Infosys, as
a learning organization has achieved a lot, on most of the above mentioned dimensions. Similarly Kamini Tubes
where employee manage the organization(somewhat similar to Semco,an example cited by Dr Shukla in the last
chapter of the book). But if we look at current state of Indian organizations, there are ample examples of such
organizations that have defied conventional organizational theories and would have fitted the bill, for these cases.
The third and last part of the book contains two chapters on the architecture of a learning organization and the
emerging paradigm of learning organization. This part of the book, delves into details of building the new architec-
ture of the learning organization through three elements of the learning mechanism that consists of the strategic
intent to learn, learning mechanisms and supporting structures and processes.
In this endeavour to unravel the DNA of learning organizations, Prof Shukla has provided an insightful book for HRD
consultants, CEO s and senior management. Indeed the book would be a learning exercise even for the practitio-
ners in the top management level, as well as middle managers. Specially insightful are the six cases given in the
book. Dr Shukla takes us through the journey of firms through their transformation in all these cases. We only
wished that some of these cases should have been of Indian companies' transformation in recent times. The
Indian examples have been provided only in form of short snippets in boxes of chapters, on companies like Asian
Paints, Ceat, Mahindra & Mahindra, Milton, Mukund Steel, Eicher Tractors, Modi, Videocon and many others. It
would have been even more enriching experience for readers had the author provided case or snippets on those
organizations who tried learning to transform itself but couldn't succeed. Thus while we learn from inclusion of
successful companies, we may lose some potential insights from the exclusion of the failed companies.
This lucidly written book presents to the readers, a mosaic composed of academic literature and anecdotal
evidence on how to build and sustain a learning organization and make it more competitive based on leveraging
intangible assets like knowledge. It also initiates the uninitiated reader into the complicated world of knowledge
management. CEO s, leaders and managers with traditional mindset would have their plate full, after reading this
book. It is ultimately up to them to become the prophet of change through continuous envisioning and empower-
ment of their employees. Change - as Dylan sung 40 years ago - is blowing in the wind. You just got to listen to it.

Reviewed by: Ramendra Singh, FPM Student, IIM Ahmedabad.

130 November 2007 NHRD Journal