Stonehill CEO On Adopting Change Management

If there’s one way to explain human behavior, look at mice.

In the book ‘Who Moved My Cheese?’, Spencer Johnson describes the world of mice who vie for a block of cheese. Each day they go to the same spot to find their food. That is until one day the ‘hand of God’ moves the cheese and the mice panic. Facing starvation, they go day after day to the original spot looking for the cheese rather than searching for it elsewhere. The moral of the story: change is hard to implement because we’re creatures of habit.

Doug Pace is CEO of Stonehill, a Tampa-based strategy and innovation firm. He likes Johnson’s work because he finds similarities in the world of business. People aren’t mice, but we suffer from the same resistance to doing things differently, says Pace. This is why the principles of change management are so important for a company.

Simply put, change management is a term for preparing and supporting individuals, teams, and organizations to make organizational change. And it’s not an easy task, says Pace.

“In an organization, there are a lot of people who want to continue doing something the same way. So, it’s very hard to change that habit, because you’re not just changing the habit of one person. You’re changing the habit of multiple people simultaneously.”

Encouraging People To Change

Implementing change in a firm is an ambitious, multi-step process. One of the first steps is creating a strategy map, a visual representation of a company’s objectives and how they connect to each other. When creating the map it is important to get input from all levels of individuals.  You need to create a sense of ownership across the organization and ensure that employees are given the opportunity to relay feedback about the map and ways they would alter it.

“It’s facilitating a lot of conversations so that people feel heard and that people feel that they had a piece of the change,” Pace said. “There still must be one person who decides what we are going to do and how we are going to do it, and what things we aren’t going to do. But the most important thing is to give people a forum.”

Once people are onboard with the conversation, the hard work continues. How do you convince a team to make change?

Pace offers an anecdote. Three years ago, Pace suffered a stroke. During his recovery people asked him what he would do lifestyle-wise to prevent this from happening again. These comments aggravated Pace because he was in good health prior to the onset of his medical problems. Asking him whether he would change his lifestyle was the wrong question. Instead, if people asked Pace post his stroke if he would change his work habits in order to help more people or spend more time with his family, he would be motivated by the question and change working long hours in the office.

Pace shares his personal story to convey the message that knowing what right questions to ask your staff based on people’s intrinsic needs can trigger a motivational response. It’s a step toward convincing people to change course. Sometimes you have to offer a carrot, or incentives to change.

This is called the question-behavior effect and it’s a psychological tool that requires asking questions about the future to promote an individual’s willingness to change.

“You have to be in sync with the person. You have to learn what’s important to them and then you implement change management related to that,” Pace said.

The Analytics Behind Change

After getting people involved in the process and understanding what they want, change management then requires delving deeper into the strategy map. Here, you can become more innovative and ideate. After that, you establish a workflow and then train your audience on it, says Pace. This is when you watch the numbers and gather some quantitative data to figure out if people are following the plan you laid out. And just because things have been changed, doesn’t mean it’s always working. At some point, you will have to reevaluate your steps.  

However, if the analytics show that the process is working, then it’s important to determine if the changes have become new habits for employees and employers. Implementing new habits involves repeated reminders. Getting the message across to 100 or 1,000 employees means having the same conversation many dozens of times.

“It’s management’s responsibility to communicate and to drive the vision. If you came up with a strategy that had a lot of change, every conversation that you have should be aligned with that strategy and with that change,” Pace said. “You have to bang the drum so much, because once again, you’re changing the habit. Banging the drum is hard for senior management sometimes because they get tired of hearing themselves say the same tune.”

This is the challenging work of change management.

What makes change so hard?

Pace offers a straight-forward message.

“It’s the unknown. It’s the inherent human trait that we don’t want to make people upset and we want to make things easy. Change is not easy. Change is scary,” Pace said. “I believe you hire consultants because people don’t always want to have the hard conversations.”

What’s exciting now about change management?

Change management must adapt just as fast as our economy and as consumers’ demands shift.

“The world is changing faster than ever. What people want, what people’s expectations are, the workforce, the customers, everything. There’s no time in history that expectations have changed faster. So, change management is very exciting right now,” Pace said. “We’ve entered the experiential economy where it’s not just about getting a Coke, it’s about the experience of getting a Coke. Obviously, people’s expectations change, the bar gets raised a lot. Take Uber for example. Now everyone’s expectation is that you can hit a button and the cab comes to the door and you don’t need cash anymore. Something else is going to come out tomorrow that’s going to be better than that.”