Managing Change Successfully
August 2013. The cluster of global automotive parts suppliers in Nizhni Novgorod, the fifth largest city in Russia, was growing. One of these suppliers had recently acquired a plant in the area and anticipated the need to ensure the successful adaptation of local operations to their global business strategy. A partnership with intercultures resulted in the customized design and development of a two-day change management and team-building workshop to achieve the following benefits:
- Strengthen the organizational ability of the supplier’s Europe region division for successful adaption in a fast changing environment;
- Harmonize the efforts of project managers and change agents by using a common “toolkit” and change model within the organization for managing change effectively; and,
- Support different work groups/ functions to increase effective cooperation.
What follows is a view into the context within which change was necessary, and the approach for beginning to make change.
Open Up Your Mind
Dr. Heike Pfitzner was invited by intercultures to co-develop and facilitate the workshop. She would conduct it in a location selected by the customer’s local General Manager: A wood lodge by a stream in a tiny province town near Nizhni Novgorod.
Though Heike thought that the setting was rather unusual, she “thought it would be good because we were talking about opening up our mind, learning about other cultures. It would be good to have as much air as possible.”
A Local Company Goes Global
Thus far, the alignment had been unsteady. Heike described the Russian unit of the supplier with which she worked on the project, and how a small, acquired company went from local to global:
The global supplier “bought in Russia a company that existed five years before they bought it. This is a crucial point because [the founding owner of the company that was acquired] was a pretty rich guy from the region.” His employees felt as though he had “built [the company] up just to sell it to foreigners. The team was used to Russian management methods and ways to deal with changes. Workers were really loyal. There was a sadness that [the owner] left his children behind and just sold them to these foreigners…No one [of the acquired company’s team members] had been abroad, no English, very patriarchical [style] of leading. On one side, there’s discipline and loyalty; on the other side, there was already an issue [in] understanding taking risk and moving forward.”
Facing New Challenges
In addition to feelings of loyalty and abandonment on the part of local employees, the management structure of the local organization acquired was incongruent with the needs of the company and its employees. Over time, the Russian team had transferred their dependence from their “father-figure” of a founding owner to Ugnė, described by Heike as “a brilliant GM.” Again, too much reliance was being placed upon one guiding figure, and team members did not take responsibility for their own futures with the company. Further, there were off-site decision makers in Asia who were in the business of buying European companies. Leadership was using their own local experiences and the approaches of their German experts to manage and absorb the new local company into the global whole.
Russian managers explained to Heike that leadership had more to learn about their new employees; didn’t understand the local dialect of English; and, set standards that the local team did not understand how to apply as expected. To compensate for the yet effective management on a global scale, the Nizhni Novgorod-based team of automotive parts engineers depended significantly upon Ugnė as a unifying mechanism. She represented a cogwheel without which the team likely had less drive and could not smoothly operate.
Investing in Change Management
With the cost of the recent acquisition, the global automotive parts supplier invested in a change management process to help ensure the security and profitability of their investment.
With the one day available to deliver change management processes to the customer’s local team in Nizhni Novgorod, Heike decided to approach change management with John Kotter’s change management model. In her experience over the last two years leading a change management project with Russian teams, Heike knew that Kotter’s model was known, well-structured, feasible for use with those with no prior background knowledge in change management, and an easy concept to sell in Russia.
Finding the Right Model for Your Purpose
With more training time—five days, for instance—Heike said that she might use a model very different from Kotter’s “old school” approach which she believes would also have made the stakeholders happy. Considered by some to be a holistic approach to change management, Presencing or Theory U, was developed by Otto Scharmer and his MIT colleagues, Joseph Jaworski and Peter Senge. Heike characterizes the framework / method / way of being as “more future oriented” and “a responsible way of doing business.” According to the website of the Presencing Institute, “Theory U proposes that the quality of the results that we create in any kind of social system is a function of the quality of awareness, attention, or consciousness [from which] participants in the system operate.”
A Successful Outcome
In the course of the workshop, for instance, Heike motivated participants to identify and understand the realities present. What surfaced was a “learning highlight” that affected leadership development and succession management. The local team realized their dependence upon their General Manager. Ugnė realized the need for her continued leadership in the region before retiring to the Baltic. She had anticipated that an unnamed outcome of the workshop would have been the rise of a team member(s) who was willing to take over management in the near future. The consequence of Ugnė’s departure before the development of such leadership would have represented costly consequences. Even with her being there, the reliance upon Ugnė one-woman leadership could not be sustainable in the long-term. And, potentially most relevant for the global supplier, the success of their recent merger could not be fully realized until a changed and locally relevant management practice was installed that met local needs and achieved global goals. At the conclusion of this set of realizations, participants recognized the need for behavioral change on their part.
How might this narrative end at your global Company?
Read the book that many others have recently picked up: Leading from the Emerging Future: From Ego-System to Eco-System Economies (2013). The book, authored by Otto Scharmer and Katrin Kaufer, compiles the results of over three years of research on Presencing.
Share your thoughts on the book and this article at brown@www.www.intercultures.de.
Meet Dr. Heike Pfitzner
Dr. Heike Pfitzner is a consultant with intercultures. She holds a Ph.D. in developmental psychology, has studied pedagogy and psychology in Moscow and Germany. Heike has 20 years of intensive work experience as a trainer on professional assignments in Russia. Her professional activities focus on change management, intercultural coaching, preparation of international teams for their work in Russia, and leadership and communication trainings for the Russian middle and top management of international enterprises. In addition to her mother tongue, German, Heike speaks fluent Russian and English and is conversant in French. For more information, contact info@www.intercultures.de.
This post is from the Jan. 2014 intercultures e-newsletter. Subscribe to the monthly e-newsletter.
Photo Credit Title Picture: Dr. Heike Pfitzner