With all the turmoil surrounding us, change is taking place in every aspect of organizations, leaving employees in a state of uncertainty and, sometimes, disengagement. Typically, through large-scale organization transformation, most of the attention tends to fall on implementing new processes and achieving fast results, while expecting the employees to simply go with the flow and keep it up. However, when the people’s side of change does not receive the attention it deserves, the organizational culture can suffer. In turn, performance can also suffer.
Change management is therefore an ongoing project that requires behaviorism to guide people through the transition. So, what are the set of activities that help employees’ transition from their present way of working to the desired way of working? What are some behavioral red flags to keep an eye out for? How does company culture impact performance? How can we maintain high performance throughout and post organizational transformation? And how do we integrate change into the organization in a sustainable manner?
In light of the above, ig hosted a webinar on December 9th to tackle the issue of business transformation from the people side. Our guest speakers, Mrs. Tricia Naddaf, President at Management Research Group (MRG) and Mrs. Nermine Naeem, People and Organization Development Manager at Heineken Egypt – Al Ahram Beverages Company delved into the topic, and shared with us their experiences, lessons learned, and advice, and answered some insightful questions by our host Mr. Camil el Khoury ig – Senior Partner and the audience.
The following is a summary of their answers to a series of related questions. If you prefer to watch a recording of our webinar, you can access it on this link.
Host: Tricia, I know that you have worked a lot with your research and with coaching programs on neuroscience. Can you tell us normally what happens and what do leaders and people feel when it comes to any transition?
Tricia: If I could give organizations and leaders one piece of advice, it would be to learn about the brain, because when we understand what happens to people’s brain, we can make better teams, help people grow, and can consequently create better cultures. In other words, we can understand what ways of engagement actually ignite the brain and make it work better. If you think about the brain as a big system, its first operating principle is to keep us safe. Interestingly, it operates by keeping us physiologically safe, as well as psychologically. The mechanisms of safety are the same whether you are in a physical threat or psychological threat, and change can be a big threat for people. If the brain is trying to keep us safe, one of the things that it really doesn’t like is uncertainty because it cannot predict what is likely to happen and, therefore, how it can make us safe. So, when we talk about change and transformation, even if from the organizational perspective it feels like a positive transformation, the first reaction of the brain is still “I don’t know what is happening. I don’t know what the impact would be for me.”, and goes through a threat-sensitive state by making a “fight, flight or freeze” response. We want people to have the ability to inhibit responses that aren’t helpful for the organization, and also the ability to observe themselves effectively. But instead, the body releases a hormone called cortisol, which makes the emotional part of the brain get more intense and limit another part called hippocampus, which gives us perspective. So, our emotions are up and our perspective shuts down. Therefore, the brain gets pretty anxious.
Host: Nermine, I know that in your current and previous jobs, you’ve worked on several transitions. For a human resource professional, what is the main challenge for you to conduct these transitions?
Nermine: Whenever there is a change or a transition, it always encounters insecurities and uncertainties. It is not only the challenge, but is also the lack of having a solid transitional framework that explains who are your stakeholders, what your vision is, and what is in it for the organization and for the people. So, the real challenges are the lack of having a framework and the absence of a unified ground. For example, when the top management do not share a common ground, it is an indicator that things are not really in place. Another challenge would be the lack of communication. Communication is a key success factor throughout any transition phase. If there is no well-thought communication plan, the transition will definitely be challenging.
Host: Tricia, when we look at the brain and its response pragmatically, what responses do we see in people and leaders and what are the red flags we should be looking for during a transition?
Tricia: If people stay in the threat state, anxiety will take place. One of the manifestations is that people are desperate for information because the brain is looking for certainty. So, if information is not coming down through a formal channel and in a clear way, we will have swirls, in which people will be hunting for information. Additionally, rumor mills will start and it is hard enough in this emotional state for the information to get inside. Accordingly, there needs to be a lot of examples and repetition to help people get to the desired level of clarity. We normally see people in such situations starting to act out due to vulnerability and aggressiveness, and the emotions will start spreading among the peers and teams. People will start calling in sick more frequently, and miss deadlines more frequently. These are just few examples of many that can corrupt the workplace environment.
Host: Nermine, during your change initiations, you train leaders to accept, cope and lead the change. What works and what doesn’t work with leaders?
Nermine: If we want to map it with expectations and behaviors, we first have strategic thinking. Strategic thinking ensures that leaders are structured enough and have the bigger picture in mind and the appropriate framework in place. Second, we have communication. Communication during a transition is similar to any basic transformation triangle, where communication is cascaded down to top-down, bottom-up and cross-functional. Even with great strategic thinkers however, if the communication plan is not there and the stakeholders are not defined, we will be giving room to rumors and disengagement. This is the biggest challenge in change initiatives. Whenever the communication is not there, rumors start. Accordingly, people start to be cautious and stop working effectively.
Host: Tricia, what is your experience with that?
Tricia: Oftentimes, senior managers ask people to just wait until things make more sense. But the brain cannot handle this vacuum. Instead, the brain will look for something in order to create a level of security. We often think of communication as the verbal or written vehicle that we send. One of the greatest challenges in the leadership space is to be really effective listeners because there are many different motivation patterns among the hierarchy. In general, people who are at the higher level tend motivationally to be satisfied, stable and certain. Their sense of what is needed in the organization for safety and security and of what pace people can adopt this understanding is different from their subordinates. This is mainly because employers move up the ladder the employees who tend to be comfortable with uncertainty, have more mental agility and deal better with complexity.
Host: Tricia, since you are the expert in assessments, what assessments are there in terms of change and culture? And what should you look for in people and organizations before starting any change exercise?
Tricia: What we need is a measure of culture and an understanding of how people are experiencing this culture. When we measure culture, we measure it through leadership because it helps us understand what people are experiencing through the leadership system and gives us guidance when we coach people around from the culture of now to the culture of future. It also helps us illustrate how people are experiencing leadership systems differently. When we assess culture, it is often the executive team that has the most different view of what the leadership culture is in the organization compared to all the levels. The organizational level assessment helps the executives by pulling away the blinders and exposing what other people see. We can talk about change as a systemic thing that happens but leaders are after all the ones leading the change, whether directly or indirectly. Leaders move people through the systemic change process and this is a complex task. Assessments can tell them here what the most important things are to focus on. The other thing is that leaders need to be more empathetic. If leaders cannot see what other people are experiencing, they are going to be beating the same drum over and over again and this will not resonate to bring people along. Leadership in change is complex and leaders need time away from the day-to-day tactical to think. Finally, we measure motivation. When we learn about motivation, we can help guide people more effectively. For example, if somebody is motivated by a lot of reassurance, a leader should gather people more frequently. If somebody is motivated by independence, a leader should give them as much autonomy as possible during the change. So, leaders should give people choices and let them speak more because they cannot motivate everyone with the same currency.
Host: Nermine, sometimes you cannot communicate the full picture and let confidential information out. Practically, how and what to communicate at the start to keep the stability and respect the confidentiality of information?
Nermine: To map it on a real exercise, we have a complex change project happening at Al Ahram Beverages Company, and the first thing we did is put a framework illustrating where we are moving forward. A big part of this framework is communication. It is true that we cannot disclose everything but at least we owe people a sort of explanation. Before the project initiation, people should know that there is an initiative happening without disclosing much details. Throughout the project, we give updates on the timeline so people can feel the connection. Most importantly, we use different medium with different people to communicate with different levels. We are currently posting a pigeonhole where people can anytime post a question, and these questions are directed to the committee where they answer the queries and any pending doubt they might have. We are always connecting with people in one way or another. And if you are onboarding your leaders first, they will be able to motivate people to ask any questions. At the end, people might not really trust the committee leading the change, but they need to trust their leader.
Host: Nermine, how can we retain the star performers during the transition?
Nermine: In order to retain star performers, we need to define the competencies and the skills we need in the future state. Defining them is a key along with a solid succession plan that really reflects who the talents are and their readiness. Removing the blockers is also important by assigning a scope to these talents in the project. Star performers can have a leadership role in the transition where leaders give them a cross-functional opportunity, and alternatively, a career progression opportunity.
Host: Tricia, what is the impact of downsizing on performance?
Tricia: There are so many levels of reactions on downsizing. One of the ways organizations can navigate through this is by talking about safety nets. How much notice will people have? Is there outplacement support? Is there severance pay? Psychological safety becomes even more important in times like these. Not all organizations can do that but giving time for people to say goodbye is important. When we make these decisions, we need to think of people and how these people will respond. The bottom line is that there will be sorrow, frustrations and confusions, and leaders need to make space for that. There is no one way to define this to avoid all the shadow side, except for understanding their reactions from a psychological point of view and helping them navigate through the different reactions. Humans are very adaptable and if we move them through a constructive space, they adapt really quickly. And transition is the time where we learn about the consequences of what we have done before the transition. If our organizational culture is one that our people trust, then when organization reaches out for help people will navigate with openness and compassion. People will still be scared of course but will have psychological reassurance. This is a lesson to organizations about what credit we are building up in normal times for challenging times.
Host: Nermine, you work with employees who have been with the company for 50 years and more. Can you tell us how to deal with such people during a transition?
Nermine: Sometimes you manage these people throughout extensive communication and explaining what is in the transition for them and for the organization. Some other times, you reach a barrier and you start thinking about the importance of retaining such people in the planned future state. The call is really tough, however, with the fast-growing environment, leaders need to revisit the capabilities the organization needs and the human capital that needs to drive the new agenda. From another angle, you need to give post-transition support to these people. Last year, we were launching a global intra-system across all operating companies and it was a big change. Once we were done with the implementation, we nominated change champions available at all levels and to all levels, and ensured the availability of one champion in every single location across the organization to answer the inquiries, support people, and help in driving a smooth process. On the other side, when you have people leaving the company, you always want to keep your corporate identity and values in check. Leaders need to make sure the experience is positive, not only during the onboarding and the employment period, but also during the last employment days. A smooth and professional exit process is really crucial.
Host: Tricia, can you share with us a success story about a transition that you worked with a client on that seemed very challenging at the beginning but you managed to turn it into a positive experience?
Tricia: The change I want to discuss was a change in a sector and was affecting the way work was going to happen in this sector. The project started five years ago and is still ongoing. Some of the dynamics that caused it not to go well in the beginning was that senior leadership felt there was enough communication. However, and since the organization is very large, it turned out to be a telephone game where information was changing and getting thinner throughout the hierarchy. There was also a problem in the planning process where the senior management thought that the initial stages of change should happen much faster and the organization couldn’t respond as quickly. When they finally started putting change agents through the organization, the transition became much smoother. Communication went better and there was more listening. And there is a huge difference between hearing how things look like on paper and how it translates within the organization. There were things that were not thought of and questions that there were no answers for. That whole feedback loop wasn’t accounted for but over a two-year period of time, all the questions surfaced and all unique circumstances were identified. People became finally aware of where to go, what to do and what are the things that are not happening the same way anymore. The lesson learned was that it is going to be slower if you want the transition to go smoothly. The role of the change agents and the pace of the change are very important. Leaders need to plan the change at a speed that humans can engage with it as opposed to the speed that you wish it would happen.
Host: Tricia, do you see different patterns in accepting the change in different generations?
Tricia: In a way, the response to change isn’t so different. We have got some challenges as every generation brings new challenges. Millennials and Gen-Z want more connection. After all, they are a click away from knowing way more than they need to know, so they want so much information and feedback. This whole constant sense of feedback is important to them. Moreover, they are not really impressed with hierarchy. This idea of formality is questionable for them. And they want to question the rules and shake up the system. The interesting thing is when we look at the behavior of Gen-X when they were at the age of Gen-Y. What we see has a lot to do with age and professional maturity as opposed to generations. The way we engage and talk to each other is going to change. The importance of hierarchy and rules will change as well. And it is important for organizations to be challenged. No organization is perfect and it is very helpful to keep looking for better ways of doing things. New generations who bring their questions can help in this.
Host: Nermine, when you are within a process and another process starts, is it too late for organizations to rethink and change courses?
Nermine: Not at all and the COVID-19 crisis was proof that all organizations could change plans if they are agile enough and have the vision of what is next and the relevant resources. Most of the companies across the globe changed their policies and their agenda in 2020. It is never too late.
Host: So your final words Tricia.
Tricia: In case of an emergency in an airplane, we are told that we need to put our oxygen masks on before helping somebody else. There is a Zen saying that “you cannot serve from an empty vessel”. Particularly for HR professionals who have a lot of heavy lifting in this situation, it is very important to take very good care of themselves and do what they need to do for their body and mind. If they don’t, then they, who are leading the change, will not have what it needs to lead it well. You can never serve from an empty vessel.
Below is a summary of our guest speakers’ answers to questions from the audience:
Q1: When there is a plan to cut costs and downsize, people will obviously panic. What is the best way to handle such a situation?
A1: We have to share what is happening. The brain relaxes when it feels understood. So, it is alright to say transparently “we may have to downsize” and “of course you will feel unsettled and anxious, that’s totally normal”. Employees need to feel that they are understood and that the organization is working on safety nets.
Q2: I am facing a challenge; while my company is going through a strategic shift, most of my team is still working from home. Announcing change from a distance has its damaging side. Morale is low and trust is shaken. How can I reach out from a distance?
A2: This is definitely not an ideal situation, times are tough and health risks are still high. However, do not underestimate the power of virtual meetings, especially the social ones. A very good example is to schedule virtual coffee breaks, those sessions are there to increase empathy and build connections. Moreover, if you are unable to have those conversations, and still have to announce the change virtually, be aware that the way you structure the communication cannot be done in the same way as you would do it face to face. You need to work on building an anchor and focus on a strong concise message that reduces misinterpretations
Q3: My company is experiencing layoffs, this did not affect my team directly but I can see change in their behavior. What can I do?
A3: It brings us back to empathy. In tough times, trust is shaken and people build a lot of assumptions. You need to be able to have open conversations and most importantly do not give promises that you cannot keep and do not become a merchant of optimism. Be transparent and make sure to communicate as much as you can.
Q4: What if my team disagrees with the change?
A4: There is an old saying that goes: If you want to make everyone happy, do not be a leader, go sell ice cream. While empathy is a top priority, this shouldn’t be confused with a constant change of direction everytime a team member states their opinion. Once you sell the “Why” of the change, listen to people and align, you have to go on with the execution. Here just be careful of negative people who will work very hard to make the change fail.