Managing Change Toolkit

Develop a Change Strategy

Top-down & Bottom-up

The "Turnaround" that started it all

The company was a subsidiary of one of the top ten electronics companies in the world. It had two main product lines; equipment used by studios for creating television programmes, and equipment for transmitting the television signals; and sold these around the world. However, it regularly returned far poorer profits than its competitors. A small team of three of us undertook a "business improvement review" in order to formulate a programme of improvements.

During this review, we classified the improvements identified into four levels:

4 LEVELS OF IMPROVEMENT

Four Levels of Improvement

The higher the level the more radical and disruptive are the improvements and the longer it takes to realise the benefits. The lower the level, the less radical and disruptive are the changes and the sooner the benefits realised.

As we completed the review, it became clear that the bulk of the potential for improvement (seventy percent) lay not at the higher levels but at the lower, operational levels and were more than enough to make the business competitive. Other similar reviews gave the same results.

Innovative & Continuous Improvement

This made us look at the way we as a company managed improvement. Up to that time we had focused mainly on "innovative improvements" - radical changes at the strategic, organisational, and systems levels which often (so our reviews indicated) contributed only thirty percent or so of the improvement potential.

Other companies, particularly those from the Far East but also those from the US, had placed their emphasis on "continuous improvement" - small regular improvements at the operational level. Often employing approaches from TQM and Kaisen. As a colleague summed-it-up:- " Its the difference between an innovative change that searches for a single improvement of 100%, and continuous improvement that searches for a hundred improvements of 1%".

On Managing Improvement

Clearly, any operation needs to embrace both. The difficulty lies not in the idea but in enabling and embracing the different management approaches required by each.

Operations that have tried to introduce out both "Top-Down" and "Bottom-Up" approaches at the same time have often found that the styles clash. The management-driven style of the top-down approach is seen by staff to conflict with and undermine the climate-driven style required for the bottom-up approach. It seems to raise doubts about the commitment of senior management and feeds any apathy, cynicism or resentment that exists. The end result is that only the top-down innovative improvements continue (often against some resistance) and the bottom-up continuous improvement approach withers away or never even starts.

Those operations that have been most successful in carrying forward both approaches have found it best to begin with the bottom-up continuous improvements approach, concentrating on that for (say) a year in order to get that style established, and then begin the top-down innovative improvements later.

Have we the right conditions in place?

All of this is about creating the foundations and the climate to enable improvements, both top-down-innovative and bottom-up-continuous, to start and flourish. And this is senior managementís key task; to establish the right foundations and climate and ensure that as time goes by, they remain in place.

This checklist may help them to check this:

  1. Is the Steering Group a real working team or just a talking/review shop? This is the senior managerís prime task. If the steering group is a real, constructive team then most if not all issues will be noticed by someone in the group and will be acted upon. If not, members will be semi-detached and uninvolved. People should actually be eager to go to the group meetings.  
     
  2. Do all managers really know what is going on and why, and how you intend to move forward? Do they understand and support this. Their active support is vital - otherwise project teams will run into invisible walls which slow things down. When things are stable, managers often only need to know what they must do. In change they need a deeper understanding about why and how. If you havenít given managers the opportunity to really understand what you want to achieve and how, then donít criticise them when some are passive or even resistant.
       
  3. Does everyone really know what is going on, why, and how you intend to move forward? Do they understand it? A memo is not sufficient. If you are starting on a significant improvement programme use workshops etc., to make sure that everyone has had the opportunity to "think and talk" about it. It is your duty to give them that opportunity.  
     
  4. Do people want to get involved, or are they waiting to see it get in a mess so they can say "I told you so."? What opportunity have you given them to get involved? A bottom-up continuous improvement approach depends upon getting a large proportion of people engaged and involved. You canít do it without.

 

If senior management can answer yes to all of these then this article is probably only confirming what they already know and they are well on the way to mobilising their operation into improvement. We donít know exactly how that will progress but we do know that the conditions exist for it to progress.

If they canít answer yes to all the questions, then their prime task is to put their normal agenda aside, identify their weak areas in the checklist, and then invest time and effort in remedying them until they can give a yes to all of them. As a first step in this, get the steering group to address the above questions and rate their strengths and weaknesses?