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Organizational Change, the Indian Context, and the Change Champion’s

FieldGuide: An Introduction

Chapter · January 2005

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1. ORGANIZATIONAL CHANGE, THE INDIAN
CONTEXT, AND THE CHANGE CHAMPION’S
FIELDGUIDE: AN INTRODUCTION
Debi S. Saini

Leading change in the contemporary business environment, which is surcharged with chaotic
competition, is perhaps one of the most serious challenges for organizations all over. This task is
increasingly becoming complex due to rapid changes in economy and polity that are being
caused by globalization. In the new scenario, the basic assumptions of doing business have been
changing; new paradigms are emerging.

Some of the business trends that are noticeable in the new economy are as follows:

 big-sized companies, venture capitalists, and global consulting firms are driving today’s
economy;
 mergers and acquisitions are taking place at a phenomenal scale as devices to counteract
competition;
 virtualization of organizations is being resorted to in a big way to help promote more
effective organizational survival;
 the incidence of customization in manufacturing as well as services sectors operations is
increasing;
 product lifecycles are becoming shorter resulting into constant need for research and
innovations;
 bureaucratic organization structures are being dismantled to expedite decision-making;
 the lines separating different businesses are getting blurred as technology and markets
have been converging fast giving rise to new opportunities for growth;
 corporates are searching for managers who can deliver high degree of performance under
rapidly changing conditions; and
 effective people-management and change management strategies are being evolved to
cope with the emergent realities.

The changed environmental realities have resulted in opportunities and challenges.

Organizations need to capitalize on the opportunities provided by the today’s information-driven
and globally competitive business environment. They also need to benchmark practices in
change leadership to make full use of the opportunities. There is considerable pressure on
organizations for delivering competitive performance excellence.

Companies face the challenge of devising appropriate strategies that help balance short-term
results with long-term viability. Since enterprises are finding it difficult to develop sustainable
competitive advantage, organizational mortality is on the rise; and the need for constant
innovation in different business processes and functions has become more important than ever
before (Saini, 2000: 7). With environmental uncertainties becoming the rule, organizations have
to invest heavily into their capacity-building so as to cope with the emerging complexities.
Changing complexion of market reveals that products and services must not only meet needs of
the fastidious customer but must also be provided in a continuously innovative, cost-effective
and productive manner. Hence managers face serious challenges of designing, implementing and
leading of change in organizations.

This chapter seeks to discuss: the dynamics of change in today’s business environment in
general; the Indian realities of changing business environment; the tools, methods and
perspectives of change discussed by different chapter authors in this book; and how the
perspectives built in this book will be of help in managing change in general and in the Indian
context in particular.

THE CHANGE DYNAMICS

Several factors have led to greater intensity of change in business dynamics. Among others, they
include: globalization exigencies and consequent changes in international economy,
advancement in communications, developments in information technology, and breakthroughs in
biological sciences. While it may not be possible for managers to control the influences of the
external business environment, they can enhance their capacity to cope with new realities by
devising and implementing appropriate strategies, tools and techniques of change management at
the internal level. David Norton of the Balanced Score Card fame pointed out that “managing
strategy is, in essence, managing change.” Organizations have to show greater adaptiveness to
change and constantly fight their tendency to get stuck in the past. Leaders have to devise ways
for confronting this syndrome. This of course involves enormous challenge.

It is being realized that meeting the emerging challenges in business environment

necessitates new thinking, approaches, systems, processes, awareness, habits, culture, attitudes
and behavior. The speed with which changes are taking place is viewed as frightening by
employees in general and especially those who are in their mid-career. At the same time, the new
worker is seen to be emerging at the workplace whose perceptions have been influenced at a
faster rate by the above-mentioned realities. She/he is often expected to play the role of change
agent, especially in older organizations with people having traditional mindsets (Gupta and
Dhaliwal, 2005; Saini and Bhatnagar, 2005). In order to be effective employer initiatives in
change management have to cater to all categories of employees. They also need to respond to
the demands of the changed workplace realities.

Consequently, one can witness the emergence of new paradigms in management. For
example, workplace is witnessing a new psychological contract between employer and
employee, which is built on the edifice of individualized relationship, trust and performance.
And the role of unions through their collectivist adversarial interventions is getting considerably
diluted. Yet change issues are so intriguing that most organizations have been searching for
correct diagnosis of their organizational malaise and the appropriate medicine for regaining their
declining competitive health.

While organizations want to pass through the change transition fast, most of them find
themselves insufficiently prepared for this challenge. To the extent they are able to learn to
adjust with the realities of the market dynamics, there are visible patches of stability in the

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chaotic ambience. But the change literature is replete with cases of failed change efforts. There
are several cases of failure of interventions such as: total quality management (TQM), business
process reengineering (BPR), transformational leadership development; organization
development (OD), etc. Often, it is the non-human factor, such as organization structure,
performance management system, work processes, etc. that are addressed. But in actuality
organization change takes place when people change their attitude and behavior.

Organizations have also to provide leadership to the change processes to get answers to many
intriguing questions:

 why some leaders are able to use these tools to effect change more dramatically;
 how successful leaders conceive new ideas, engineer consensus on their adoption and
internalize them throughout the length and breadth of the organization;
 how visionary leaders take big and decisive moves; how sense of urgency can be nurtured
among individuals and teams;
 how change management processes can be linked with quantifiable business results;
 how vision is created and communicated to give clear mandates to people;
 how resistance to change is overcome in short- and the long term; and
 eventually, how change culture gets internalized to become a way of organizational life.

Interestingly, the Change Champion’s Fieldguide helps the reader find answer to most of
these questions. A reading of the book would show that the key to effective leadership in change
management involves careful selection of appropriate change tools and methods, staying focused
on change, making all others in the organization do the same, and leading the change effort in
such a way that it creates excitement for all concerned to remain committed to change.

INDIAN BUSINESS SCENE AND THE DYNAMICS OF CHANGE

MANAGEMENT:
India has been traditionally known to be one of the leading participants in world trade. One
thousand years ago, in the year 1001 the world was divided roughly into three main trading
blocks: China, India and the rest of the world. Each of these had about 33 per cent share of the
world trade. Goa, Cochin (now Kochi) and Calicut (now Kozikode) were the main ports of Asia
where entrepot trade used to take place. When the British arrived in India some 250 years ago,
the country had 27 per cent share in the world trade (Ohtaki and Bucknall, 2005). But it failed to
retain this status over a period of time. This was due to, among others, the policy of rigorous
state controls of the economy through licenses, controls, bureaucratization and planning. In the
year 2004, India’s share of world trade got reduced to just 0.62 per cent.

As per the statist philosophy followed by nearly half a century, miracles were expected from
the huge public sector that was created by post-Independence India. It was expected to be taken
to commanding heights so as to be a role model for employers in the private sector as also to
subserve the common good by focusing on mainly the core sector. Industrial working was highly
regulated during the pre-reform period in relation to almost all aspects of its development. This
model, however, did not deliver results as per the goals envisaged. It resulted in

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bureaucratization, inflexibility, inertia, corruption, non-accountability. It also legitimized running
the public sector and even other organizations on principles similar to those involved in state
administration rather than those of business enterprises.

The control-economy framework began being dismantled when the country switched over to
the liberalization model in July 1991 through its new economic policy (NEP). India adopted this
policy fairly long time after the rest of the world including China had resorted to it. Most
established players in the Indian industry, especially which were the beneficiaries of the
favorable attitude of government towards them, were shocked by the new policy. They feared
their protected citadels to be attacked by the global market as also by the new indigenous
geniuses in entrepreneurship who were expected to enter the market due to the globalization
policies. They formed what came to be called the Bombay Club, which demanded (without
success of course) a level-playing field against foreign competition and consequently invasion by
the multinational companies (MNCs).

Achievements and Opportunities

Huge tidal waves of self-confidence and the resultant psychological revolution with the new
policies occurred that are continuing in most parts of the developed and the developing world.
Increasingly, it was realized in India as well that the country had wasted precious time trying to
make it to the modern world by remaining prisoners of redundant ideologies. This thinking has
now got internalized in most parts of the world and also across the whole of the Indian sub-
continent.

The globalized Indian economy is witnessing the arrival of new entrants in both
manufacturing and service sectors, which has led to substantial dilution of traditional bastions of
industry. It is noticeable that there is increasing tendency to invest heavily into skill
development, organizational and workforce restructuring, change management, leadership
development, human resource development, outsourcing and automation; these are not limited to
multinationals and the private sector. Managers are facing intense challenges to show results and
deliver tangible value additions. The biggest challenge for organizations is to develop global
vision, proactive mindsets and leading the change.

A large number of MNCs are operating in India; they have put tremendous pressure on
domestic companies to search and activate state-of-the-art management practices and initiatives.
One can see emergence of common running threads of strategy, change and leadership issues in
different professionally-managed organizations across the globe including India, the cross-
cultural differences discovered by Hofsteed (1980) notwithstanding.

The new policy in India proved to be a boon to several new entrants to the industrial world.
Remarkable success has been achieved by some companies, among others, like: Wipro, Infosys,
Ranbaxy, Reliance, TCS, Satyam, Bharat Forge, Tata Motors, Moser Baer, Hindalco and
Cognizant. Several young people in small companies that work in customized software have
done exceedingly well. Some of the Indian companies like Barista, Jet Airways and NDTV (New
Delhi Television) are, for example, world class brands today.

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 As is the case with the rest of the world, India also benefited from the Internet’s ability to send
even highly-skilled work to anywhere in the globe. It became a centre of focus for leading MNCs
to operate in the supposedly huge Indian market. Some of the factors like low labour cost,
abundance of human resource, rising education level, and fast increase in English-speaking
workforce are creating an economic momentum. Interestingly, the emerging scenario has also
created a new flourishing industry of analysts and consultants who are trying to understand the
full import of the change dynamics and conduction of business in the Indian conditions.

India is no longer just a place to get cheap labour. With the rise of the Indian software and
certain other sectors, taken together with the general boom in the global economy, much of the
brain drain is believed to be slowing down and even returning back. This talent is now helping
to enhance India’s contribution in several sectors including software, telecom, and
pharmaceuticals. More and more work is being outsourced to India. A recent survey of 200,
mostly 500 Fortune, companies sponsored by Fuqua School of Business, Duke University, USA,
revealed that they are likely to send work to the following countries: India (69 percent); China (8
percent); the Philippines (5 percent); Latin America (5 percent); Eastern Europe (4 per cent); and
the Caribbean/Mexico (2 per cent). The work included call centres, research, engineering
services and HR functions.

Challenges of Change

With the global economy changing rapidly, India is facing new challenges. Indian companies
need to become world class, and it is not enough to be a leader in just the Indian market. Unless
they build themselves into globally accepted brands, it is difficult to think of their viability in the
globalized world despite remarkable performance and growth. The Usha Martin group, for
example, has world-class skills in producing wire ropes; but international buyers do not risk their
application in areas such as bridge-building. Likewise, Sundaram Fasteners could sell to General
Motors (GM) only simplest of its products which too for models that GM was gradually phasing
out. In relation to the Indian IT sector, despite resounding success of IT companies, they still find
it difficult to sell their products for some of the most complex jobs in IT at the global level.

Somehow, senior corporate leaders in India have not developed the requisite belief in
themselves that they can succeed in the global market. As Ghoshal et al. (2000) have argued,
while Indians are aware of the need for radical response by the challenges posed by the new era,
they are somehow trapped in an incrementalist mindset defying the requisite sense of proactive
urgency that change dynamics warrants. Most of the cases of remarkable success by Indian
companies are unsung stories e.g. TVS Motors, Sundaram Fasteners, Kalyani Exports.

What does the country really require to make the picture bigger? Indian companies and
managers have to learn to discard their tried and tested solutions and old perspectives in
understanding the problem. The strategy-structure-system doctrine, which envisages that
structure follows strategy, was seen by the Indian managers as the primary lever for directing
performance of their organization. They have somehow reconciled to see this model as
invincible, not realizing that the world has been changing with great speed. Thus, they have been
busy directing themselves towards building and shaping strategy. But the new era discounts the
primacy of strategy-building model.

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 The great industry leaders like NR Narainmurthy of Infosys and HT Parekh of HDFC,
however, have been focusing on what Ghoshal et al. (2000: 317) refer to as “a sense of purpose
within the company” in terms of the value the company will create for its stakeholders. Instead
of formal structure in an organogram, they focused on building core organizational process and
develop new capabilities on the basis of existing resources and challenges. They have been
basically people developers. That is how they are marching towards attaining global standards
with great speed. Many other companies like Ranbaxy, Wipro, Bajaj Auto, Hero Honda, and
Hindustan Levers also have somehow learnt to adapt to the new environment in different
degrees. Companies need to soften their strategy focus at the top and give way to generation of
new possibilities and change exigencies. The corporate world is now in the era of, what
Mintzberg (1994) would refer to as, “emergent” and not rationalist strategy. As per this thinking,
the vision and values have to be brought down to the level of each individual rather than
eulogizing the strategy and system hypothesis.

What does India Need to do?

India has so far got right only a few successful experiments in business excellence. It needs to
understand the external variables in determining business success and change management more
realistically. Surely, any change is bound to be painful. India does need massive resources in
governance and leadership for change. It has settled around a 6 percent growth rate in gross
domestic product (GDP) in the post-liberalization period, which in some years even reached 8
per cent. This improvement is from an earlier hindu rate of growth of around 3 to 4 percent. If it
can ensure appropriate leadership and governance structure at macro and micro levels, as is
being promised in the second-generation reforms in the country, the possibility of crossing 10
percent growth rate is high. As is being argued by the management guru C.K. Prahalad, Indian
corporates need to exploit the domestic market to know the dynamics of the bottom of the
pyramid. This will help them hone requisite skills that are essential for becoming global players.

With the recent emergence of India as a major hub for low-cost manufacturing and business
process outsourcing (BPO), a large number of MNCs are looking towards setting up their
operations in the country or are already in this process. The SMEs have also been growing
rapidly, thanks to an impressive economic growth the country could attain in the last few years.
This sector is expected to play a critical role in the economy, as it will provide useful challenges
and opportunities to those at the bottom of the pyramid. Human resource managers have a crucial
role to play in this regard. But can the Indian economy rely mainly on BPO as a long-term
alternative to holistic industrial development? Increased invitation to MNCs due to the non-
competitive nature of Indian companies may not be desirable from social and cultural point of
view. Indian economy needs to grow at over 10 percent per year to solve its key problems and
meet the aspirations of its people. Re-consideration of change issues has to become not only an
economic but also a societal concern for marching towards this direction.

Several factors have been responsible for Indian business not attaining the world class status in
most spheres. These include: lack of aspiration to be world class, lack of vision, lack of
professionalism, lack of process sensitivity, sense of collective paralysis, lack of cost
consciousness, little respect for time, among others (Prahlad, 1999). The problems get magnified
due to other limitations that industry faces. These include: the problems of outdated technology,
excessive workforce, inadequacy of skills, and lack of concern for customer satisfaction, and

6
unsatisfactory levels of productivity. Tackling these problems necessitate not just reorienting
management systems and processes but also bringing about strategic and attitudinal changes.

Indian Corporate Sector in New Era

Attending to the basics of change management in an organization often does not get the attention
it deserves. A large number of business organizations in the third world including India needs to
align to their operations with the global market realities. Most of them are feeling the pressure of
the new dispensation; but do not really know how to deal with it.

If one looks at the performance of Indian corporate leaders of yester years, it has been falling
quite rapidly. As revealed in a recent study, out of a total of 2151 companies, 1696 (i.e. 79 per
cent) were making profit in the year 1991 but in the year 2001 only 1000 (46 per cent) were
making profit. And, the performance of over 50 per cent of the pre-reform corporate leaders has
gone down both in terms of their salesrank and profit position (Kumar, 2003). This shows that
Indian corporates have not been able to withstand the winds of change caused by the
globalization syndrome.

Even out of those corporates who are successful ones in the new scenario, a large number have
not been seriously considering internationalization of their businesses. It is doubtful if Indian
industry can globalize without the leaders reaching out to the knowledge resources and markets
in other countries. Many corporates have reconciled to remain in the mould of short-term
opportunities, which strikes at their long-term viability. This somehow has become the corporate
culture in the country. They need to think global and act local in the real sense. This means that
they should get best of the ideas from all over the world and implement them to Indian
conditions, for achieving the best results for the people of India, and for eventually marching
towards internationalization.

Indian companies have to benchmark with the best companies in the world. Japanese, who
are known to be the best benchmarkers in the world, have been doing this for more than 100
years, and are industry leaders at the global level in several sectors. In India, Gujrat Ambuja
Cement is an excellent case study in benchmarking. There are several other companies which
have learnt from the best companies in the world. There is a need to take change management as
a strategic challenge and search for new models.

In a recent speech, President of India, Dr Abdul Kalam––also a distinguished scientist––

pointed out that there are six important factors that determine value addition in organizational
working: technology and its absorption, accepting and learning from failures, understanding the
implications of change for developing requisite attitudes and habits, recognizing the implications
of being competitive in an open economy and society, the traits of leadership as enabler rather
than aggressor, and upholding the unchangeable core values and ethics. The Indian reader will
see several of these formulations find illustration in this book, The Change Champion’s
Fieldguide.

An important question arises whether ways of looking at change and leadership issues in the
Indian sub-continent are going to be substantially different. Corporate growth and excellence

7
model has its own logic despite the variable degrees of contextual and cultural influences. One
can increasingly see emergence of similarities of sorts that professionally-managed organizations
are demonstrating across the globe. Of course, different countries in the world are not similarly
placed so far as local economic environment is concerned.

Thus while talking of change a question arises: Is the nature and impact of change likely to be
similar across regions and cultures? It is believed that with the increasing influence of
globalization, the impact of cross-cultural specificities in management has been getting
somewhat diluted. There is a talk of the emergence of convergence theory in management. As
per this, management practices would eventually come very close to becoming similar across the
length and breadth of the world, with reduced impact of local cultures and indigenous factors. Of
course, it would be simplistic to completely wish away the impact of cultural influences on
organizational working. With the likelihood of a greater degree of universalization than before,
companies have been searching such people-management and change-management models that
are closer to those adopted by multinational corporations (MNCs) and other professionally-run
organizations at global and local levels.

The eminent social historian Francis Fukuyama (Ohtaki and Bucknall, 2005: 23) endorsed the
convergence thesis when he observes as follows:

In all three areas, however––economic, political and social––there are good reasons for
thinking that the distinctive institutions and practices fostered by Asia’s cultural systems
will converge over time with the pattern seen in the West. That is, economic life will be
more open and subject to market forces; governance will be increasingly democratic; and
social structures (as well as social problems) will come to resemble that of post-industrial
Western societies. Far from reinforcing Asian exceptionalism, the current economic crisis
will accelerate homogenizing trends all three areas.

With the continuous opening up of the Indian economy, corporates have to be continuously
ready to face world class competition. Interestingly, several of them are recognizing the need to
learn beyond local contexts and realities. There are also evidences of devising of change agenda
so as deviate from the past and discover new ways of promoting competitive advantage. At the
corporate level, dealing with change dynamics involves taking a number of steps. Some of these
include:

 appreciation of the factors that have led to the changed business atmosphere;
 critically examining the organizational awareness about the need to change and issues
involved in this process;
 recognizing the multiple dimensions of change;
 developing systems and processes to promote the desired change;
 deciding who are likely to play the role of change agents and an overview of the role
they are expected to play;
 developing a change program including the interventions to be used; and
 managing and reviewing the change management process on an ongoing basis.

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 The Change Champions Fieldguide addresses complexity of these issues and will help managers
and companies in general as well as in the Indian context to build frameworks for generating
alternative change perspectives for adoption in today’s increasingly tumultuous business world.
This book has been built around four major areas of managing change: some basic approaches to
managing change; some fundamental tools and techniques in managing the change effort;
developing creative culture through transformational leadership; and measuring change results.
The sections that follow present how the book has handled these four broad themes.

SOME BASIC APPROACHES TO MANAGING CHANGE

Despite a good amount of literature on managing change and the successful efforts of change
masters, it is rare that an organization subjected to gyrations of change dynamics knows where it
is going or how should it reach where it wants to go (Kanter et al., 1992). Managing change
involves several acts of balancing. Among others, it involves striking a balance between
individual and collective actions, focusing on contents and procedures, and balancing short-term
and long-term goals. Change is difficult to bring about through the efforts of just one individual,
howsoever charismatic he may be. It is necessary that groups and teams of people are made to
collaborate in articulating the nuances of the change process.

It is also well-known that change is always a painful process in whichever sphere it is

introduced. Any organization seeking to effect change has to grapple with forces both inside and
outside the organization. Often they undermine or do not sufficiently take care of the external
forces which come in the way of promoting it. Managing change almost invariably involves a
shock treatment and/or a healing therapy, depending upon the power of the various actors in the
change system. All change efforts should keep in mind certain basics that need attention of those
involved in designing and implementing the change program.

While change spells apprehension, it can also be viewed as hope for stemming the rot and
bringing in a new order. Visionary leaders remind their people how available resources could be
used to address the challenges they face. In chapter two of this book, Dannemiller, Eggers and
Johnson discuss how discovering rays of hope during times of mistrust can be seen as one of the
basics for any change management exercise. In this regard they discuss “whole-scaleTM” in
action. It involves a process of shifting by organizational members from old paradigms to a new
vision that they all share and see their individual and collective roles in marching towards that
vision.

Do change management processes involve same set of basic tools in handling change in
different contexts? Goldsmith, Morgan and Effron (in chapter three in this volume) study five
very different organizations which set out similar goals i.e. determining desired behavior for
leaders. Each organization used a somewhat different approach in achieving the goal of increased
leader’s effectiveness. Yet all were successful. The authors bring out five factors that helped
leaders achieve positive, long-term change effectiveness. These included the following:

 leaders interaction with co-workers;

 feedback and coaching in person or through telephone;
 coaching makes a positive difference;

9
  training coupled with follow up make huge difference; and
 frequency with co-workers and coaches was more important than duration of interaction.

Some people are able to adapt to the demands of change more quickly compared to others in
the target group who are not able to succeed. This requires knowing what is going “right” within
the target group. This is precisely what is involved in a positive deviance (PD) approach to
change, which is being viewed as something basic in gauging the change dynamics. Jercy Sternin
who is well known as the father of applied positive deviance, discusses his attainments through
this methodology (in chapter four of this volume). He demonstrates how he developed this
approach over a period, used it for changing a situation of malnutrition of more than 2.2 million
children in Vietnam and replicated it in 24 other countries.

The PD process involves defining the problem; determining if some individuals exhibit the
behavior that one wants to develop in all; discovering strategies or practices that enable the
positive deviants to succeed when others could not; and designing an intervention that enables
others in the community to access and practice the PD behaviors. Sternin also lays down a step
by step approach to PD, a formula for positive deviance and how-to-do and what-to-do approach
to positive deviance that could give important insights for applying it in other organizations.
Many interesting case studies have been described that involved PD. Interesting stories have
been included to illustrate the formulations.

Leading change also involves a basic issue of leadership development. Should it be done for
each individual leader or for the leaders in the organization as a whole? Most approaches to
leadership development focus on assessing leadership competencies of individual leaders and
providing training to overcome deficiencies in them. Is this the right approach? In actuality,
leadership deals with questions of future macro- and micro-level uncertainty, and building a
collaborative environment in the organization to counteract them. Therefore, leaders need
common understanding of the deliverables they are expected to work for.

Picking on the above point, Jacobson (in chapter five of this volume) talks of the need to shift
emphasis from developing individual leaders’ skills to developing shared organizational
leadership deliverables through a common leadership language, process and tools. Several best
practice tools for leadership development have been described, including the outcome of an
approach that was implemented in a fortune 100 financial services organization and a
construction company. The approach followed in this organization has been endorsed for
application in other organizations as well. Jacobson has also advocated that anticipation of
leadership behavior to be exhibited for shaping the environment should be done at the time of
design phase of leadership development.

Change interventions are generally built on the basis of the problems that are visible. When the
problems are too many this promotes pessimism and even a sense of hopelessness. Cooperrider
and Whitney (1999) talked of appreciative enquiry (AI) for focusing on the achievement rather
than the problematic. AI focuses on power of words and images for shaping creative
conversations of the past, present and future. Cooperrider and Bright (in chapter six of this
volume) summarize the idea of AI as a major OD intervention. They describe how major
stakeholders in the organization can indulge in a powerful, shared, positive, forward-looking
inquiry to discover and derive the best possible of what presently exists within the organization.

10
 The discussion on basics of change dynamics helps provide perspectives on the subject that
must receive critical attention of change masters and thought leaders while they undertake
change management programs. The book has been able to build a sound edifice of these basics
on the basis of which change management tools, techniques and instrumentalities can be devised
for implementing the change agenda.

DEALING WITH CHANGE

Handling change may involve attending to several dimensions. Some of the fundamental tools
and techniques that are considered as crucial in all change management efforts have been
discussed in detail in Part II comprising seven chapters of the Change Champion’s Fieldguide. In
this part the book deals with issues such as:

 innovation;
 negotiation and communication skills;
 valuing diversity and building an inclusive workplace;
 building total organizational integrity;
 use of dialogue for shared understanding;
 use of business simulation to accelerate high-impact learning and change; and
 management of succession and values.

Promoting innovation in systems, processes, products and ideas is one of the key issues that
come to one’s mind while thinking of any change. In chapter seven (of this volume), Land and
Zlevor discuss certain key elements of change, transformation and creativity. They remind the
reader that there are nature’s continuous cycles of creation and destruction. The process of
change and creativity shifts continuously. In this regard, they envisage three phases of change
and innovation: the first phase is the one of developing a pattern through experimentation; in
phase two attempt is made to maximize this pattern; but after a stage the output begins
diminishing. Thus, the third phase sets in, which is the time for innovation. They have argued
that most organizations fail at negotiating the transition from phase two to three, which is the
most crucial. The real challenge for the change masters is to grapple with the unpredictability of
the third phase.

At the centre of all change efforts is change in attitude and behavior. Kotter and Cohen,
(2002) developed a see-feel-change pattern and argued that the core of organizational change is
always about changing the behavior of people—i.e. what people do, and the need for significant
shifts in what people do. This necessitates efficacious communication and negotiation skills.
Susskind (in chapter eight of this volume) emphasizes that negotiation training of managers
should be linked to organization demands. In this regard, he talks of a negotiation preparation
worksheet; a checklist for value-creation while making attempts for consensus building; and a
checklist for anticipating problems that are likely to be encountered. Susskind exhorts managers
to follow the basics of negotiation theory as he endorses Roger Fisher’s belief that “there is
nothing as practical as a good theory.” He suggests that good negotiation practices inside the
company be publicized as success stories on a regular basis.

11
 Diversity management has become one of the key themes in human resource management
(HRM) strategy. It is important to ask how issues in valuing diversity and building an inclusive
workplace culture are related with managing change. In other words, can change issues be taken
care of by respecting the individual and group needs and idiosyncrasies of people? Katz (in
chapter nine of this volume) addresses himself to these issues. He identifies eleven behaviors for
promoting inclusion and suggests a six-step model of building an inclusive workplace and for
leveraging workplace creativity.

Diversity management has received considerable attention of corporates in the Western

countries. But managers in the Indian sub-continent have not yet given sufficient attention to this
issue. Perhaps, it is more due to weak individual and collective employee power resulting from a
situation of high level of white-collar unemployment and under-employment. But progressive
organizations have to learn to proactively work in this regard for enhancing their competitive
performance. In his insightful analysis, Katz discusses the example of Kodak in support of his
formulations on diversity management. This company is known for its proactive diversity
program. It aims to link and align inclusive culture initiatives with organizational strategies.
Valuing the diversity of those who can confront and debate ideas and show courage helps bring
out the best perspectives. Leaders have to learn to argue with themselves and encourage all
others to do so. It indeed requires courage to offer a different perspective and challenge the
popular views.

Does ethical practice facilitate change acceptance? Till recently organizations have been
practicing it in a legal mode so as “to stay out of trouble.” Ventrella (in Chapter ten of this
volume) argues for shifting corporate focus from the compliance model of ethical practice to the
one valuing total organizational integrity (TOI). The new model, he argues, makes good business
sense. This would help companies to attract and retain talent and enhance company image,
eventually facilitating change happen. He talks of TOI as a comprehensive corporate value
system, which involves: its rootedness in strategy; leadership involvement; total integration;
tactical deployment; and review and updating.

Often, it is asked whether organizations should attempt to change people’s behavior or focus
more on change relationships that determine organizational behavior. In this regard, can dialogue
be used to promote shared understanding for removing conflict and promoting consensus
building? Proactive questioning and participation are considered as important ingredients of any
meaningful dialogue. And, in order to have good answers, we must ask the right questions.
Dialogue can facilitate commitment and change acceptance. This is Knox’s (in chapter eleven of
this volume) central argument. The dialogue process helps engineering consensus and its
internalization among the participants rather than forcing change on those who perhaps do not
understand its full import.

This brings us to the question of relationship between learning and change and how the former
can be used to promote the latter. Noble (in chapter twelve of this volume) advocates the use of
well-designed business simulation to accelerate high-impact learning and change. He has argued
that through simulation it is possible to create baseline conditions for group dialogue and inquiry.

What is place of values in business management? Stakeholders and investors in today’s

environment have immense concern for knowing the line of succession which a company has

12
prepared for its future and also the values that underlie the organization’s image. Enlightened
consultants are focusing on launching of programs that allow for qualified replacements of
executives overtime. Rothwell (in chapter 13 of this volume) has analyzed how succession
management is usually carried out in organizations and how it is a mistake to define succession
as an HR effort. His analysis challenges the reader to think beyond succession management and
realize that the order of the day is to get outstanding results and while still putting primacy on
core values and morals. In this regard, he suggests that values modeling and competency
modeling are likely to drive future succession efforts. More and more organizations would be
having a rigorous approach to modeling values and ethical issues. Companies which use these
two critical instruments in their corporate psyche and working will be at a competitive advantage
in handling the changing situations.

DEVELOPING CREATIVE CULTURE THROUGH

TRANSFORMATIONAL LEADERSHIP:
Much of the literature on change management gives critical importance to the role of the leader/s
in effecting change. Leadership development is considered as the most important focus area for
confronting change as a way of corporate life. In a recent study by Carter, Ulrich and Goldsmith
(2004), a majority of their “world’s best” organizations described leadership development and
organizational change as “the real work of the organization.” This study found strong demand in
the following areas in order of importance:

 leadership development;
 performance management;
 organizational development and change;
 innovation and service enhancement; and
 coaching.

Business organizations are keenly looking towards identifying corporate leaders who can
respond to change exigencies and help them conquer the corporate battle. Given the complexities
of change tornadoes, these change masters are also expected to be restless and impatient with the
existing realities and to continuously strive for improvement and change. Thus efforts are on
towards ensuring that organizational leadership brings together the best minds, hearts, and
resources to promote commitment among members of the organization. Leaders are expected to
help organizational members to benchmark standards that facilitate collaboration among them.
They need to create conditions that help people embrace and accept change. In fact, the need for
effective, system-wide change leadership has never been more important than today.

Developing transformational leadership can be seen as the master tool of change management.
It is important to identify the leadership qualities that make the difference. Why are some leaders
able to take their organization to peak performance by helping deliver shareholder value while
others get lost in the complexities of present day environment? What leadership strategy and
style is making some of the organizations thrive in the era of globalization? How is it that some
leaders are able to effect personal change in people but others are not able to do so? Why are
some organizations responding to globalization with a sense of social responsibility while others

13
are not able to move beyond survival? How is it that some leaders are able to effect emotional
alignment and organizational alignment so as to promote team cooperation and synergy? These
are some of the unanswered questions for which organizations are searching answers.

There are cases where human resource managers have addressed the issue of identification and
development of leadership competencies in their own organizations so as to orient competitive
forces to their organizations’ advantage. While some have been successful to their satisfaction in
this regard but many questions remain still unanswered. Leaders at all levels are expected to
contribute to value creation that fosters sustainable shareholder value. How actually does this
happen? Part III of the book carrying six chapters handles issues involved in this process. It
covers topics such as:

 building intangible value by business leaders;

 connecting action learning and leadership development;
 culture change by leaders through synthesizing collaborative experiences;
 crucial conversations for transformational change;
 managing organizational and business chaos for transformation; and
 issues of measurement in change management.

It is pertinent to ask as to how we should espouse leadership development process so that it

increases organization’s capability and ensures current and future earnings in consonance with
values that the firm espouses. In the lead chapter in this section, Ulrich and Smallwood deal with
this issue. They argue that leaders at all levels are expected to create sustainable shareholder
value. The challenge a leader faces is to “become an architect to build intangible value of his
company.” The real change can not be achieved unless a company is able to leverage
“intangibles”––for example, performance culture, talent, speed, learning attitude, accountability
and execution, collaboration, and quality of leadership. This requires building a leadership
system that can ensure that all leaders understand what value should be built. A six-component
approach to leader development that they suggest includes:

 building a case for change;

 tying leadership development to existing business initiatives;
 articulating one theory of leadership for leaders at every level;
 assessing leaders;
 using leadership brand as a goal; targeted investment in leaders; and
 measuring impact of investment in leadership development.

How does one convert real life and work experiences into leadership competencies so as to
build a strong organization that can bring about the desired change? Lynch and Dowlings’
chapter (chapter 15 in this volume) suggests that action learning is the real way to do so. They
have advocated it to be the way to operationalize organizational capability. An operational model
and an array of technology tools is discussed that can encourage and leverage learning at every
level.

Leaders have to discuss ways for promoting a sustainable and creative culture. With the help
of analysis of structuring and working of the Project Playtypus (a product development process

14
created by a world number one toy company), Ross and Kuehler (in chapter 16 of this volume)
discuss how human potential could be brought out through the synthesis of collaborating
experiences resulting in new business opportunities. They have devised a 13-way model of
promoting sustainable creative culture. Among others, it emphasizes trust, collaboration, storey-
telling, intuitive leadership, and other creative product development strategies.

Often, we note a big gap between what we want to do and that we actually achieve. Leading
change necessitates, among others, speaking to the dysfunctions that teams and individuals in the
organizations have been indulging in resulting in gaps between the espoused and the realized
change. It is important that people as individuals and as collective move forward towards
contributing to an effective organization.

This issue has been addressed by Peters and Grenny (in chapter 17 of this volume). Their
focus is on how to make people see their “integrity gap” and enable them to make choices––a
choice “between continuing to be stuck or move forward in more effective ways.” This often
requires a path of confrontation with the established ways. They resorted to hundreds of “crucial
conversations” in the insurance company they consulted with and where the culture was found
misaligned with strategy. Based on this success storey, they suggest the initial focus in any
change effort should be not on asking the structure, system and process questions. Rather the
leader should focus on: what crucial conversations are we not holding, or not holding well, that
are keeping us stuck; how are we as leaders failing in these conversations; and how will we hold
others to our new standards for making a difference. These are aimed at personal change; and
issues of structure, system can follow later.

Highlighting the need for integrity and allegiance to one’s values Mahatma Gandhi often said
that one must open the windows of one’s mind, but must not be swept off one’s feet by the
breeze. You must define what your core values are and what you stand for. Values like honesty,
integrity, consideration and humility have survived for time immemorial. It is values that
describe a leader more than the achievements. For it is the means of achievement that decide the
viability of the achievements.

Leadership essentially involves taking your people along and inspiring them to march towards
the goals envisioned. The leader has to see the big picture and make every one else see it. But
ensuring the commitment of organizational members requires that leaders are able to effect
emotional alignment and organizational alignment so that teams cooperate and synergy surfaces.
Rozman and Childre (in chapter 18 of this volume) discuss how organizational, emotional and
business chaos can be managed for exceptional performance results. They have argued that most
organizations have the real problem of alignment. They outline the Heartmath’s Inner Quality
Management (IQM) system for creating emotional alignment within the individual and the
organization. In this regard they discuss two Heartmath tools: the Freeze-Frame® technique, and
the CutThru® technique.

Many companies are struggling for want of appropriate leadership. The crucial questions is not
just how do you develop leaders to manage in these times, how do you retain them and how do
you excite them. It's a lot easier to be a good leader in good times than in bad, but a reputation of
effective leadership over the long term is established during times of change. The most obvious
skill of a proactive leader is the skill of keeping one's antenna on the ball. It should be done

15
without creating a sense of panic. He must make certain that people are aware of which way the
wind is blowing. When such a mindset pervades across the entire organization, it is likely to
prepare everyone for change. That is usually half the battle won. Leading from the middle is very
important. This is where the magic of change takes place. This is also where the power of teams
lies. Also, inculcation of values is extremely important for sustainability of leaders. If your
people believe that you have the right values, they will even tolerate your mistakes and will stay
with you. But they want to see that the leader is decisive and compassionate. This book sees
leadership building as a very crucial question requiring critical attention, and handles it in most
of its possible dimensions.

MEASURING THE CHANGE RESULTS:

Human resource (HR) departments are often assigned an important role in designing and
managing the change agenda. But HR is known to have reconciled itself into believing that they
work in the softer side of people management issues such as training, leadership development,
coaching, counseling, mentoring. They also believe that the results of their efforts can not be
measured the way like those of other departments like finance and marketing. However, the
world has changed a great deal in view of new developments. Keeping relevant data of
deliverables of all departments is being considered essential to know their efficacy and
relevancy. When an HR manager approaches the Chief Finance Officer (CFO) for funding of the
development plan, the CFO asks the first question about the value the program would deliver in
terms of tangible measures. The discovery of the balanced score card concept, later followed by
HR score card, shows the importance of measuring the relevance of every organizational activity
(Becker, Huselid and Ulrich, 2001).

It was discovered by a Business Week survey of Fortune 500 companies in USA that while
strategy continues to be the most important issue for the top management for most companies,
over 90 per cent of effectively formulated strategies fail in implementation. Questions arise: why
organizations fail to implement new strategies; and why change management projects fail? It has
been found that not enough concern has been demonstrated towards measuring various aspects of
change implementation. For example, a large number of companies are making the largest single
expenditure in their change management and people-development programs but have the least
information about the returns they get.

In the concluding chapter of the fieldguide, “You can't Be a Champion Unless You Keep
Score,” John Sullivan has underscored the importance of measuring results. He has argued that
one couldn’t become a champion without measuring results in an Olympic. Quite like it is so in
Olympic, only those who can deliver the best possible results in business will actually survive.
The use of numbers and metrics is going to become a part of people-management as well as
change-management effort in a big way. All successful firms are evaluating their projects,
products, and business units in terms of numerical results. Sullivan has cited that The Watson
Wyatt Human Capital Index study demonstrated that the potential impact of people programs on
a firm’s overall market value could be as high as 47 percent. He rightly says that metrics are the
fastest and the cheapest way to change behavior in business.

SUMMING UP:
16
The Change Champion’s Fieldguide is a no doubt a treasure trove of analyses, models, case
studies and tools which change masters and transformational leaders can apply and learn from.
The book lays down a roadmap of best practices in an easy-to-understand manner. The
contributors to this book are some of the most widely recognized academics and professionals in
the area of organizational change and leadership development. They have discussed important
perspectives for successfully confronting change exigencies.

The book has discussed necessary elements in implementing a best practice change or
leadership development initiative within an organization. It helps build perspectives on selecting
tools and techniques for designing and implementing change initiatives and evaluating their
effectiveness. It can be seen as a professionally developed guide for discovering winning and
successful business strategies. Of course, each organization is distinct in adopting their change
path, processes and methods. Yet there are several commonalities that underlie each change
attempt. Some of the well-known commonalities among others include need to imbibe the value
of: collaboration, humility, ethical working, innovation, regard for people expectations and
psyche, and passion for change. Organizations and managers across the globe will learn
important lessons about the contexts in which these virtues and values can be demonstrated and
how specific measurable results can be realized through leading the change effort.

Louis Carter, the CEO of the Best Practice Institute (BPI), USA, is one of the leading
authorities and training consultants in the field of best practices in change management,
leadership, and organizational development. He has used his position in contacting some of the
best-known international authorities in this area to contribute to this insightful book. The BPI,
Louis Carter, and the chapter writers deserve accolades for this splendid effort. The book was
originally published in USA in 2003 by the Best Practice Publications LLC, USA. It is now
being presented in a modified form and at a much cheaper price for managers, management
academics, researchers, change masters and organizational-turnaround experts in South Asia.
The book deserves to be read from cover to cover so as to grasp the full import of perspectives
delineated and apply the suggestions made by different authors to get results that matter. The
readers will find useful nuggets as they travel into the space of change dynamics and leadership.

REFERENCES:
Becker, Brian E., Mark A. Huselid and Dave Ulrich (2001) The HR Scorecard––Linking People,
Strategy, and Performance, Boston: Harvard Business School Press.

Carter, Louis, David Ulrich, Marshall Goldsmith (eds.) (2004), Best Practices in Leadership
Development and Organization Change: How the Best Companies Ensure Meaningful
Change and Sustainable Leadership, San Francisco: Pfeiffer/John Wiley.

Cooperrider, D.L. and D. Whitney (1999) Appreciative Inquiry: Collaborating for Change, San
Francisco: Barrett-Koehler Communications.

17
 Ghoshal, Sumantra, Gita Piramal and Christopher A. Bartlett (2000) Managing Radical
Change: What Indian Companies Must Do To Become World-Class, New Delhi: Viking.

Gupta, Rajen K. and Kamalpreet Dhaliwal (2005) “Overcoming the Legacy of the Public Sector
Culture: case Study of a New Organization,” Abhigyan, Vol. XXII No. 4.

Hofstede, G. (1980) Culture’s Consequences: Software of the Mind, Beverley Hill: Sage.

Kanter, Rosabeth Moss, Barry A. Stein and Todd D. Jick (1992) The Challenge of
Organizational Change: How Companies Experience It and Leaders Guide It, New York:
Free Press.

Kotter, John P. and Dan S. Cohen (2002) The Heart of Change: Real Life Stories of How People
Change Their Organizations, Boston: Harvard Business School Press.

Kumar, Krishna (2003) “Has India Inc Failed in Playing the Leadership Role?,” Vikalpa, Vol.
28 No.3 (July-September).

Mintzberg, Henry (1994) The Rise and Fall of Strategic Management, Prentice Hall: New York.

Ohtaki, Reiji and Hugh Bucknall (2005) Mastering Business in Asia: Human Resource
Management, Singapore: John Wiley & Sons (Asia) Pvt. Ltd.

Prahlad, C.K. (1999), "The Power of Imagination: India's Legacy and the Path to the Future,"
Business Today, 22 February, 115-119.

Saini, Debi S. (2000) “Introduction” in Debi S. Saini and Sami A. Khan (eds.) Human Resource
Management: Perspectives for the New Era, New Delhi: Response––A Division of Sage.

Saini, Debi S. and Jyotsna Bhatnagar (2005) Case: “North Delhi Power Ltd: The Dynamics of
Change,” Vikalpa (Forthcoming).

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