Change Management.

Thoughtful leaders find layoffs among the most stressful events they manage. Warren Heffelfinger, CEO of Ingenio, has a compelling story.

Hire the best.

In 1999, Warren and his college roommate Dave Riordan started a telecom business.

“It was a crazy time. Telecom was particularly hot; if you had a pulse and could dial a phone you could get private equity backing. The private equity guys wanted us to raise $500 million and hire 1,200 people over a 12-month period. Dave had five years of management consulting experience and I had never hired a human being in my life. So, we went back and said, ‘Listen guys, we’re flattered but you’re nuts. We need to hire a CEO.’”

“The single most important thing that we did in that business was, we hired a boss — the world’s most wonderful role model you could imagine. I would say that I learned 80% of my leadership skills from being joined at the hip with Tony DiStefano for six-and-a-half years.”

But then the market crashed. “We were in the epicenter of the dotcom meltdown. And raising $500 million? We couldn’t raise five cents after April of that year. We faced a gigantic round of layoffs in 2000. And that’s where Tony was the master.”

Err on the side of transparency.

“I had a view that great leaders are paternalistic — they sheild their company from bad news. It’s your job to do that because the company can’t handle bad news.”

“Tony helped me understand that it’s exactly the opposite. We didn’t get funding, our credit line was at risk, we had looming layoffs; all this bad stuff was happening. My gut was to lock Dave and Tony in a room and figure this out. Tony said, ‘No, tell them.’”

“So, we were incredibly open with our team about what was exactly going to happen. In September we said, ‘Listen, one of three things is going to happen: We’re going to find an investor, someone will buy us at the last minute, or we’re going to have to fire everyone. Those are the outcomes. We understand if you don’t want to stick around, but if you do, double-down and work your tail off. That will help us get to the best outcome.’”

“There was an initial shocked reaction. But then everyone was like, ‘Alright, let’s get back to work. We’ve got to work harder.’ It was a great lesson. When given a choice between sharing and not sharing, the answer is almost always: share.”

Tailor your communication.

According to Warren, “A significant percentage of the company sees a problem exists. A smaller subset sees the problem and will figure out what the right solution is. The smallest subset sees the problem, can find the right solution and how to communicate it. Communication is the hardest part. It’s not your knee-jerk reaction. It’s understanding all constituencies and how they are going to be impacted.”

“There are two important constituencies in a layoff: the people you are letting go and the people who are staying. The people who are staying are going take great lessons about how you communicate and how you handle the situation. What you hope for is, they say, ‘This sucks but at least if it ever happens to me, it looks like I’ll be treated pretty well…with respect, like a human being.’ That’s super important communication.”

Fire before Christmas.

“There were some very counter-intuitive parts of our layoffs. For example, we were facing layoffs around mid-December. My reaction was, ‘How can you fire people before Christmas?’”

“But Tony’s answer was, ‘You must absolutely fire before Christmas. Right before Christmas, people are going to Christmas shop and rack up credit card bills because they think they have a job. If you give them the bad news ahead of time, you let them avoid that mistake.’”

“’And, if we lay them off December 15th, they get a month of notice and greater severance. If you wait until January 1st, they only get two weeks.’”
The team followed Tony’s advice. What surprised them most was that people understood. Not only did they save the company, but Warren received thank you notes from people who were laid off.

Message based on the strategy, not the person.

Large layoffs are painful, but even the decision to fire just one person can be wildly stressful.

“There was one caustic executive who had a big personality. He was very smart, but manipulative. I was up at 3 a.m., nauseous, not sleeping, for close to a year because I knew he was plotting against me every day. And I knew that every time he walked into my office, something manipulative was happening. He brought benefits to the business, but the psychic cost of having to deal with him every day was extraordinary.”

“I learned that when you decide to let a toxic person go, you’re already six months later than you probably should be. But there’s nothing more liberating than the day you make that decision.”

“Still, you need to create a win-win. The conversation I wanted to have was, ‘You are a pain and caused me not to sleep, and you’re a miserable human being.’”

“But I parked my ego. I said, ‘Listen, I’ve made a hard decision. I’m eliminating your position. You played a significant role as we were transitioning. Now I believe our resources are better spent in other ways. There’s just not a fulltime job here.’”

“I said, ‘I’m open to handling the communication. I’ll handle it if you don’t want to but I’m open to other considerations.’ He thought about it and came back the next day with an elaborate spin on how he wanted to retire and spend time with his kids.”

“We had a three-week transition plan. I let him stand up at the all-hands meeting and drop the news himself. We had a going away party. There was no blow-back whatsoever.”

“Often, once you’ve made the decision a person is not a good fit, you radically overthink the impact of that person leaving on the rest of the organization. That’s my number one lesson to leaders and managers: when you know it, you’re already too late.”

Find your best possible outcome.

The fun of leading a business is accomplishing meaningful work with people we love. The worst part is when the business is struggling and we must make tough decisions. Warren, Tony and Dave’s decision to be transparent, take the employee’s perspective and keep their eyes on strategy helped people remain focused as they turned the business around. They found best possible outcome for a difficult situation.

Take confusion, distrust, speculation and a healthy dose of unrealistic expectations and you have the typical M&A environment. New leaders struggle to align and communicate the new direction. Teams are smashed together in reorgs that make sense only on paper. New systems add chaos to players who don’t know or trust each other yet. It’s painful but a few guiding change principles can lessen the agony.

Align, Message and Cascade…and Do it Quickly

A lot of money and thought went into why the merger or acquisition was important and how it would benefit the combined organization and the people in it. That message must get out quickly and it has to be delivered often and consistently throughout the organization. Specifically, people need to understand what they are moving from, what they are moving to, how they are going to get there, and how the end result will benefit them.

Albert Einstein famously said, “If you can’t explain it simply, you don’t understand it well enough.” The message must be simple and concise, and that means the leadership team has to be fully aligned on the problem, the solution, the action, and the end goal. If the organization hears different versions of the truth from different members of the leadership team, they won’t trust or buy in to the direction.

Just as importantly, the message should cascade through the organization – not as a view from the top, but as a vision of the future for the listener. Select facts and examples that resonate with the people you’re addressing. Message framing is both an art and science.

Don’t Sink the Learning Life Raft

M&As are naturally going to create some level of redundancy, and rationalizing those redundancies drives a good bit of value to the new organization. As a support function, Learning and Development is one group you’ll be tempted to trim early on. Don’t! The combined organization is going to need every L&D resource they have, and then some. Your M&A rests on a foundation of new teams, new processes, new systems, new policies…all of which require new skills and knowledge. That’s the job of your learning experts! Once the change has been fully absorbed by the organization, everyone has been skilled-up, and new systems and processes are purring along, then it makes sense to look at the ongoing resource requirements of L&D, but until that time don’t even think about it.

A Cube with a View

It is amazing how often M&A projects are run as a series of separate activities, with little or no consideration of how they impact each team. Employees assume someone has thought through all aspects of the change – the people impacted, their roles, the timing, and the magnitude of changes that will hit them. That’s the expectation, but rarely the reality. M&A is complex and it makes sense to divide and separate the integration into multiple work streams. But once you have a high-level plan, look at the work through an organizational lens.

Focus on each team, one at a time. Think of the change as if you were sitting in the employee’s chair. Determine how and when they are impacted by each of the work streams. Can they expect new leadership? When? Will they use new systems and processes? When? What new skills and capabilities will they need, and when will they get the training? What is the communication plan for each team – what will they know, and when?

People view change from their own workspace. Their dominant reaction to the M&A is, “What’s going to happen to me and my team?” Only when we understand that can we answer their big questions, ease uncertainty, and show them a path forward.

Engineer the Experience

Successful change management initiatives engineer the win by focusing on the employee experience. “Familiar, controlled and successful” should be your mantra. First, make the change feel familiar to employees by comparing it to other programs they feel good about. Second, give them a feeling of control by sharing that employee-centered information on what’s ahead for them. Your goal for them is no surprises. Third, create employee interactions with small parts of the change – a new procedure, new terms, a new task – and make sure they’re successful. If your change includes new technology, build support into these practice sessions. Let people discover how easy it is to get help when they need it. Simulate a help desk and “white glove” support for managers, power users, and key influencers. As employees demonstrate to themselves that they can succeed, their resistance will lessen and their readiness will improve.

M&A is naturally difficult and messy, however, a thoughtful change management approach goes a long way to mitigate the pain and help the organization realize the benefits that were promised. In the end, it comes down to aligning on the right messaging, viewing and communicating the change from the employees perspective, and helping teams through the change with support and positive experiences.

To download a preview of Emerson’s Change Management Methodology, click here.

By Emerson Consultant, Kelley Egre

Weathering change is easier when leaders make it predictable. I am so relieved when my local forecaster accurately predicts bad weather. I follow their advice every day and I’d like to think they save me from many icy accidents and horrible hair days. But recently, the weather has been a source of real anxiety.

Multiple deadly storms ravaged our country this year. Just a couple of weeks ago, mudslides killed more than 15 people in Southern California. Without warning from local forecasters, the death toll could have been much worse. But 15 is still too many! These deaths may have been prevented with more time and/or information to better prepare. I find my thoughts often consumed by “What if?” and “What could happen in my own backyard?”

According to a study from the University of Illinois at Chicago, having an increased sensitivity to ambiguous, uncertain threats—or a heightened fear of the unknown—is at the root of a wide range of serious anxiety disorders. And change is high on the list of perceived workplace threats.

In today’s high-paced business environment, change is constant. Unless we are lucky enough to live with a psychologist, fears of failure or job loss can fester into visceral and unhealthy responses. In the workplace, that may translate into lack of focus and motivation. At home, it may lead to substance abuse, depression or anger.

To avoid a potential downturn in productivity at work, it is important for leaders to give their teams a predictable environment in which change is valued and expected. Though often wrong, predictions can give us a sense of control and a clear set of expectations. This helps us conserve our energy and more effectively prepare for the changes ahead.

How to Make Change Predictable for Employees

• Don’t surprise them. Be sure to give plenty of advance notice and involve them as often as you can with regular updates. This will give your team a sense of control, helping them plan for the change in their own way.
• Be specific. If people understand exactly what is changing, with details about how the change will impact them, they will feel more comfortable moving forward. Generally, people tend to go straight to the worst case scenario.
• Link it to what they know. Show them how it is similar to a previous and successful change. Be sure to use positive metaphors and examples.

When you think of LinkedIn what comes to mind? Once upon a time, I immediately thought of job postings, self-promotion, and professional networking. Sure, career advancement and networking are still the big benefits of LinkedIn membership, but it’s also a social network and a robust venue for professional development.

One way to stay in touch with your industry peers is, of course, to connect to them. Another way is to follow them. Following someone on LinkedIn gets you access to any articles they write, and you’ll also see that person’s engagement with other LinkedIn users. So, if you pick the people you follow carefully, you’ll be tapped in to some of the best thinking in your field.

Let’s say you are following President of Top of the Line Company in your industry. Whenever President comments on something or shares a post that he thinks is interesting, it will appear on your newsfeed. Simple! Following a LinkedIn user who is a thought leader in your industry gives you the latest thinking, professional development insights, and an opportunity to join the conversation.

No matter what the industry, there’s an influencer for you to follow.

Four Behavior Change Experts to Follow on LinkedIn

Trish Emerson – Emerson Human Capital

Okay, I’ll admit I’m a little biased, but the founder of Emerson Human Capital is the reason I became interested in change management. With more than 25 years’ experience helping organizations with major transformations, Trish is truly a behavior change guru. She routinely posts practical ideas for enabling big change through human behavior.

Eric Barker – Blogger and Author

One of my favorite bloggers is also an avid LinkedIn participant. His blog focuses on scientific ways “to be awesome at life.” (Eric’s words, though we wholeheartedly agree!) In other words, he talks about ways to change behavior and be more successful. Following him on LinkedIn gives me easy access to his prolific library of blog posts and LinkedIn activity to – hopefully – make my life better.

Nancy Duarte – Duarte, Inc.

Effective communication is essential to behavior change. One of the best of the best communicators is Nancy Duarte. Duarte calls herself a persuasion specialist. Her firm focuses on developing influential visual messages. She produces monthly blog posts and she’s a frequent participant on LinkedIn.

Kathy Caprino – Ellia Communications

I am a new LinkedIn follower of Kathy’s. She is a self-described women’s career and personal growth coach, writer, speaker and leadership developer. Most of her messages resonate with anyone looking to change. Many of her regular blog posts give suggestions to better oneself by altering (you guessed it) behavior.

Following these behavior change influencers on LinkedIn is as easy as clicking a button on their profiles. It takes no time to produce a steady stream of influential content – targeted directly to your professional interests.

A dear friend of mine is Chief Learning Officer of a prominent, widely admired company whose lawyers asked us to mask his identity. We’ve worked together since 2003, so he was naturally one of the first people I interviewed when I decided to write a leadership book. In fact, as a direct result of his interview, I hired an EA (yay, Michele!), applied his system for reducing my email inbox to zero (here’s to you Sally McGhee!) and prioritized ways to create the life I want.

One of the questions I asked him was, “What advice would have prepped you better had you received it early in your career?” This is what he shared wtih me.

Five Leadership Insights

1. 1. Be clear about your strengths. As an INTJ on the Myers-Briggs, I’m naturally reflective rather than reactive. I need to process and come back. I learned to create a window of opportunity to do that, to be aware in the moment and say, “I’ll get back to you.” If I had learned that as a younger person, I would have made better decisions.
   2. Face the thing you don’t want to do. If you don’t, it will only harm you. There was a colleague I worked with years ago who was smart, extroverted and, frankly, we didn’t get along. I began to avoid that person. Our lack of communication escalated to the point that it actually contributed to a job change. Recently, I had a similar situation, but by then I had learned to face the hard work. My reaction? I scheduled regular meetings with my coworker. Getting to know each other has made things easier. We might not be best friends, but I have learned to focus on this person’s strengths and use our complimentary styles to create good work together.
   3. Don’t overschedule. So many people allow the day to control them. If you start the day fully booked, you are in trouble. You have no bandwidth to assess, respond, and shift priorities. Twenty-five percent of the day should be unplanned. The more senior you are, the more unplanned your day should be.
   4. Understand the power of a great admin. The right assistant is someone you can trust and someone who knows you well enough to help focus you on your goals. My admin helps me be successful, with ease. She reminds, reschedules, and facilitates. She puts both contracts and birthday cards on my desk to be signed. She helps bring my intent to reality.
   5. Over time, increase bandwidth or capacity. How are you aligning others around you to magnify your impact? As the years go by, it’s less about what I do and more about how much I accomplish through others. If I can get more done while maintaining expectations and standards of excellence, I feel I’m growing my company and myself.

There’s a thread through my friend’s observations that we can learn from. For me, it means challenging myself before taking on a task and asking, “Will this investment of time result in something that expands or does its effect end when I stop doing it?” It’s a true-north question that helps prioritize. As leaders, our common limitation is time. Our effectiveness is directly related to how we shape our time to create the ripple we want.

You probably don’t know his name, but I bet you would recognize him. I also bet you could tell me what company he worked for several years ago, and what company he works for now. What if I say these five words: “Can you hear me now?” Does that give you the clue you need?

His name is Paul Marcarelli, and he is the ubiquitous cellular service provider “test man,” roaming around the city testing his network with the words “Can you hear me now?” Paul, in his gray Verizon branded jacket, made these five words a household phrase until 2011. Now, Sprint is leveraging that brand recognition for themselves. Paul now walks around in a yellow Sprint jacket referring to his switch from one network to the next and saying those same five words.

Why is it that you remember the phrase? Or that you remember the color of his jacket? Maybe even his horn-rimmed glasses? It’s all about repetition.

The advertising community has said the average consumer sees between 3,000 and 20,000 messages a day. That’s a lot of messages traveling through our busy minds. However, seeing is different than absorbing. To make a message resonate, we typically need to hear it or see it seven to 15 times.

Change communications that drive behavioral change are no different. For an employee to adopt a message, it takes repetition – multiple times across multiple channels. In The Change Book, we talk about the different stages of absorbing a message: Exposure, Awareness, Attention, Retention, and Action. Then, we recommend layering it across multiple vehicles, helping others share the message, and testing it to ensure you’re on track.

That’s how we make messages resonate with people. Messages lead to changes in behaviors, which ultimately become habits. The more you hear it, visualize it, and think it, the more it “sticks.”

Can you hear me now?

Most leadership literature is, frankly, useless. It’s loaded with generalities like “Great leaders need to be decisive, strong communicators, cool in a crisis, build agile teams, hire wisely, work toward their values, define markets…” Who wouldn’t agree? When I asked my friends, colleagues and professional contacts, “Has the leadership literature helped you?” their answer was “No.”

Their experiences are grittier than anything the leadership literature addresses. For example:

• Those who managed VC-based companies discovered each was a horse in the stable, employed to solve a particular problem: the executive who can build a team, the one who can grow a market, get the IP protected, or raise capital. Once they achieved their outcomes, they were fired. Each was devastated. But soon they were hired to perform that trick again for another company in the portfolio. Effectively, this type of person became a career executive for that particular problem, for that investment group.
• Executives who acquired a company realized that while they were personally excellent in sales, finance or engineering, they had to learn what it meant to be “strategic.” One had to redefine how he spent his time, what to do, in order to be strategic; another found herself managing a partner who disagreed on how company money should be spent; a third dealt with the anxiety of being personally accountable for mountainous debt; another exec grappled with the sense that, now that he was committed, he couldn’t just quit.
• Leaders who operated within a traditional company had other challenges. One had to create a dynamic personal brand; another had to find a balance between leading and being authentically himself; one felt she had to sometimes choose between being liked with being respected; another had to figure out how to lead while the previous CEO was still with the company, on the board as a co-CEO.

Despite the wide variety of situations, we identified common threads during our conversations.

• The job is filled with worry and stunning levels of stress, even when it’s fun.
• You have to maintain energy and “mojo” and not just focus on problems.
• The nature of your business has its nuances, which affect how you lead.
• Managing time – and those who demand your time – is a critical skill.

The stories from these authentic and accomplished people are superior to anything I’ve gleaned in school, and it’s time to pay it forward. Mary Stewart & I are putting them together as book and, as the work takes shape, I’ll be sharing elements of our interviews in a blog. Stay tuned!

What is your purpose? If your organization disappeared tomorrow, what would customers miss? If your organization’s purpose is not fulfilled, you might as well be gone. Customer relationships are threatened. Living a diminished version of yourself puts you at risk in the marketplace and emboldens the competition.

Purpose is different from values, Values are behaviors that orient the organization to deliver the purpose. They are the “how.” Purpose is the “why.” Values look inward, Purpose looks outward.

Living your purpose requires attention. It shouldn’t be a line on a poster or a PowerPoint slide. It is an intentional set of activities by leadership, management and employees. The organization’s founders know this better than anyone – they certainly knew why they created the company. But, as the organization grows and scales, it’s hard to maintain attention on the activities that make purpose real. Don’t make that mistake.

Five Ways to Activate and Maintain a Purpose-Driven Organization

1. Harmonize it. Make sure your purpose and values agree and reinforce each other.
2. Lead it. Leaders should live the purpose. They should use it to filter decisions and messages to the company.
3. Orchestrate it. Hold purpose-driven events; create reinforcing rituals and symbols.
4. Model it. Identify key behaviors for executives and managers to demonstrate purpose. Tap high-potential champions who can cascade purpose-based activities through the organization.
5. Align it. Make sure organization design, performance management, incentives and recognition support purpose-driven activities.

Delivering a consistent purpose will drive your performance in the marketplace.

A great chef might tell you that the key to a success in cooking is confidence. But belief in your success comes with experience. Before you get out the blender for the first time, you need a recipe and a vision for the finished dish.

The same applies to getting great results for your organization. Humans are more likely to feel optimistic and get on board if we understand where we’re going and what it will take to get there.

Regardless of the end result, successful change has some essential ingredients. Here’s a quick recipe to give you the confidence to jump-start your next project!

1. Combine at least one strong sponsor and a shared vision; mix until smooth. Slowly fold in strategy and pour into a message frame.
2. Chop business knowledge and expertise with project oversight and spread across the top.
3. Sprinkle on another pack of communication.
4. Whisk together training, practice, and shared values. Spread over employees, and drizzle with inspiration.
5. Gently heat employees until you see desired behaviors.
6. Season with recognition.

Most importantly, allow enough time for preparation. Your organization will love the results.

So many of us have experienced bad news at work. It’s bound to happen at some point, right? Sitting here today I can remember more than one layoff, company sale, significant process or system change, firing…the list goes on. Interestingly, the only negative memories I have come from bad news that was not addressed by leadership openly, honestly and early.

I certainly understand the tendency to keep bad news under wraps. When my stepson was young, my husband and I would hide the bad news from him until the last possible moment. We cared so much that we wanted to shelter him. After all, he had already been through so much: a divorce and new step parents. But we noticed early on that it was so much worse when we didn’t share bad news in the moment, or when he learned the news from someone else. He became quiet, unproductive and frustrated. We learned that he needed time to let the news soak in and talk through his concerns.

The more open we became, the less drama we all faced and the more patient he was with us during transitions. More importantly, he got to celebrate the good news that came with the bad!

When I was a young manager, I had that same fear of telling people about difficult changes. I thought for sure everyone would stop working to complain or gossip. It took me only a couple of times to realize that good communication can stop the gossip altogether! I also became more comfortable with letting people feel uncomfortable. Discomfort is a catalyst for change.

Besides, there is nearly always good news with the bad. A new system to learn means efficiencies. A reorganization improves the bottom line. When a new leader is hired, there is innovation. You get the idea. People may not like change, but they really like growth!

Here are a few things to think about when it’s time to share bad news with your organization.

• Your team is capable of understanding. Armed with knowledge, your team is more likely support the change than resist it.
• Well-informed people make better decisions. OK, we know that well-informed people don’t always make good decisions, but good decisions almost always start with well-informed people.
• Credibility builds trust. Leaders who have gained their employees’ trust are more likely to have an engaged and motivated workforce.
• Accurate information stops rumors in their tracks. Even if you don’t have all the answers yet, sharing news sooner than later minimizes misinformation and distraction.
• It is the right thing to do. For so many people, change is unbearable. Give them time and enough information to adjust and prepare for what lies ahead.