Expert Perspective by OmniMedia’s Editorial Board
Mergers require change: operational, managerial, organizational change – and most importantly, individual change. Employees must understand, embrace and follow new procedures, protocols, strategies and leaders during and after the merger. As we all know, it’s hard to change. People rely on consistency, normalcy and sameness. We like our home field. The Towers Watson merger has us thinking about the change process that our friends and colleagues at these organizations will face and how they might react.
Kendra Van Wagner summarizes one of the best known and enduring behavioral change models in an article for About.com. (Link to full article.) “Researchers have proposed many theories to explain how change occurs. One of these theories, known as the ‘Stages of Change’ model, which was introduced in the late 1970’s by researchers James Prochaska and Carlo DiClemente, has been used to help people understand the change process.” Since its introduction, the Stages of Change Model has been found to be an effective aid in helping us understand how people go through a change in behavior. The Model is based on 6 stages: Pre-contemplation, Contemplation, Preparation, Action, Maintenance and Termination (in the Model’s terminology this last means self-sufficiency).
Although generally used to help individuals address addictions (no connection implied), perhaps the Model could offer Towers Watson management some help in promoting effective and enduring change on the part of its new-entity employees.
Let’s take a closer look at this change model and see how its philosophy might apply to a corporate merger change management effort.
Stage 1: Pre-contemplation is characterized by denial concerning the change. Strategies to overcome this reaction are to explain the risks of current behavior and encourage introspection.
Stage 2: Contemplation is characterized by ambivalence, and strategies at this point include helping the individual weigh the pros and cons.
Stage 3: Preparation is characterized by experimenting with small changes and strategies, including goal statements and action plans, and evaluating employee reactions.
Stage 4: Action is obviously characterized by taking direct actions and effecting meaningful organizational change. Here rewards are most important, the carrot for the effort.
Stage 5: Maintenance is characterized by avoiding relapse to outdated behaviors and practices, and strategies again include rewards designed to continuously support the new organizational strategy.
Stage 6: Termination is characterized by self-sufficiency.
It is important for the individual Tower and Watson organizations to move the majority of their consultants and staff through Stage 3 (Preparation) by close date (expected to be the end of this year). That is all about mentoring people, connecting with clients, answering questions honestly and providing complete information (or as complete as is permitted before close). These simple but time-consuming steps should help those folks who are struggling in the Pre-Contemplation and Contemplation stages.
Then to address the Preparation stage, Towers Watson managements must ensure that annual goal statements include specific actions that will support the strategy of the merged firms, its vision, mission and values. Encourage not just metrics-based goals (sales, client service hours, etc) but personal goals such as integrating staff into new offices and mentoring junior staff.
Certainly, planning for the merger close will focus heavily on the development of new compensation and benefits packages. Those rewards packages will drive the behaviors that support the strategy of the newly combined firm, not the individual strategies of the prior entities. If properly designed and communicated, those rewards programs can help ensure that every consultant and staff member makes the right moves at the right time to consistently drive business strategy and organizational success.
Post merger, the Towers Watson management will need to be vigilant about addressing and resolving concerns among and between consultants and managers. “Turf battles” or conflicts need to be addressed immediately and disappointment must be handled carefully and consistently.
The greatest worry may be the integration time frame fore-casted by Towers and Watson management – as long as three years. Our point of view: that’s way too long. Three months might be a better goal or the new company is likely to leave far too much shareholder value on the table and far too many valuable people behind.
The process won’t be easy. Change is hard. But as Charles Darwin said: “It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.”
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