CGMA LMS Tailor Preview-Leading organization
.pdf
School
Institute of Finance and Economics, Mongolia**We aren't endorsed by this school
Course
FINANCE MA CGMA 2024
Subject
Management
Date
Dec 16, 2024
Pages
12
Uploaded by Khaliuka
TOPICLeading organisational changeCourse learning objectiveAfter completing this course, you should be able to understand the role of leadership in effectivelydriving organisational change.IntroductionAs with the different characteristics of management and leadership, the strengths of someone whocan provide effective transactional leadershipin rewarding high performance and correcting lowperformance, may not translate directly into the set of strengths necessary for transforming anentire organisation.Instead, change that dramatically affects employees and organisations requires transformationalleadership and the ability to lead organisational change.Organisational changeNearly all managers or supervisors face situations in which they have to lead a change initiative intheir organisations. Change initiatives may stem from to new regulatory standards or legal statutes.They may stem from organisational reorganisations or changing client requirements. Almostinvariably, managers face resistance to almost any type of change initiative. The uncomfortable factis that less than 50% of change initiatives meet the organisations’ internal performance metrics.How can leaders like you increase the success rates for change initiatives? This video willsummarise some time-tested tools to help you better lead change initiatives such as the following.Click the arrow to advance the slides.Diagnose the type of change needed using one key question.12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12191/12
Learn how to review your team’s experience in successfully managing change initiatives.Assess change initiatives through three common phases in an organisational life cycle.Apply three common change phases you can use to lead your change initiatives.Analyse tools to create urgency for the change and whether to focus upon a ‘big challenge’ or a‘big opportunity’.Help your team define guidelines on what is ideal, acceptable, and unacceptable with differentelements of the change initiative.Identify key stakeholders and why they are crucial to success.Learn to ‘think like a marketer’ by using multiple channels to amplify key messages for sustainedsuccess with the change initiative.12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12192/12
Click the video or the transcript button below.Organisational changeOrganizational change is a fact of life, yet even though it's so common, relatively few people leaderscan manage and lead organizational change effectively. This content covers research-based toolsand frameworks you can use to lead organizational change more effectively.As humans, we frequently love stability, we like routine, we like the way things are.In organizations, change is a reality. It's hard, it's difficult, and it can be a powerful catalyst forincreased performance. Change leadership is a skill. And the more you practice it, the more you andyour team will be effective at it, which makes it more important as things continue to be volatile andchaotic.The following walks you through how to diagnose change, three common phases of change, andsome master class tips that you can immediately use in your next change initiative.The first thing to think about in diagnosing change is to have a very clear-eyed assessment. Is whatyou're trying to change an incremental change? Or you're just modifying a little bit to make it better?Or is it going to be a completely disruptive change because something has happened from theoutside, that is causing us to radically have to pivot to meet the challenges of the new situation.Because incremental change is difficult. Disruptive change is hard, and it is very time-intensive.Part of this diagnosis in terms of understanding whether it's incremental, or disruptive is to help youwhere you can allocate your time and your effort to determine how to best go about driving andleading this change. A second diagnostic tool that you can take a look at is the look at what yourorganization's life cycle is.Just like any other biological organism, it changes over time. In organizations, you generally gothrough a five-step process. You have a startup, or a launch of a brand new process, or a brand newproject. If it's successful, you then need to find ways where you have to scale it and make it go evenmore. Where you have to implement processes so that you can be more efficient and effective inscaling the process.Sometimes, it's not working like you need it to do and so you need to turn things around. That is adifferent and difficult stage of the organizational life cycle.12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12193/12
And finally, you need to take a look at what's driving this change. And in driving this change, it's notonly incremental versus disruptive, it's whether this change is being driven by your seniormanagement, or something going on outside in the environment, or whether it's bubbling up becauseof things that your team or others teams have been able to find out based on what they're focusingon and working with their clients.So in diagnosing change make sure that you first understand whether it's incremental versusdisruptive, number two, where you are on the organizational life cycle, and three, what's driving thechange.There are lots of different change management models and frameworks. However, almost all ofthem have a certain set of common phases going through change.Number one, you've got the current situation, and there's got to be a reason for the change. In thatcurrent situation, you've got to rally your team to understand not only what the change is, but why it'simportant. That reason for change can either be something negative, or it can be something positive,or aspirational. Some people call this a burning platform about which we've got to change, otherwise,we're going to fall into that burning platform, or it could be a great opportunity that we need to takeadvantage of.The second tool, or the second phase in terms of change processes focuses on this idea of driving.What are you going to do differently? And you're clear about what people have to do differently, aswell as why they need to do it.As a leader, it's incumbent upon you to tell not only the what but also the why. And in many cases,the "why" is more important than the "what" People need to know you're not just changing just forchange's sake, but you're changing because of either taking advantage of an opportunity, or becausethere's something disruptive in the marketplace that's causing us to pivot.And people can do that for a short period of time. But you also have to set processes in place to beable to sustain that change over time. Not only for that particular change initiative, but also to helpyour team grow the skills. So that they can be even more powerful and more high-performing withfuture changes, that are going to keep going down the road.There are three master class tips that work effectively when you're looking at each of these threephases of change.1. For the rally, you want to help everybody understand what the top three reasons why we have tochange. Again, this gets back to the why. Because people need to know the why before they canunderstand the what and the when.2. You need to tell stories about how this impacts real people. Don't just show a bunch of statistics.Stories are powerful. With this phase, you need to help people understand clearly what the ideal way12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12194/12
to approach this as what's good enough, and what's bad. They need to understand those guardrailsso that they can drive. Hopefully, it's going to be a two, or three-lane highway, but sometimes it's avery narrow track that you've got to use in order to drive that change.You also have to understand who the key stakeholders are. These stakeholders can be inside theorganization, they can be your clients, they can be your peers, they can be somebody completelyoutside of the organization. But understanding who is key is a powerful tool to help you figure outhow to drive this change forward.3. The third master class tip focus is on sustain. And with sustain, you need to look at the channels,the messages, and the frequency. Channels focus on how you're sending that information out. Itcould be a town hall, it could be a webinar, it could be a phone call, it could be a text, it could be aface-to-face meeting. My suggestion is, the more important it is, the more you want to have face-to-face as much as possible. Because then you're able to see the body language, engage the bodylanguage with the person that you're trying to share the information with. Channels are key.The second thing that you need to ensure is that you understand that there's a clear messageacross. That message should be one sentence. What's the title? What's the headline? Not aparagraph, not a page, one sentence.And then, number three, what's the frequency? How frequently do you need to share this message?Because people are used to things moving by the wayside. You have to have a clear frequentmessage that you drive home until you're completely tired of it. And only after you're completely tiredof it, can you think that they're starting to understand it, which means you need to continue toamplify it.When you're looking at organizational change, first diagnose whether this is an incremental or adisruptive change. Number two, look at these change phases that go along in terms of rally, drive,and sustain. And third, use these tools that I shared in the master class tips that will help you putdetails behind what needs to happen with each of those three phases.12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12195/12
Organisations are always affected by outside changes, such as new customer needs, competitivechallenges, economic conditions, political and legal events, as well as technological advances.Change leadership skills are vital for leaders to succeed and thrive in this uncertain world. Leaderscan apply organisational change concepts to their organisational units and larger enterprises to takeadvantage of opportunities that change offers.An initial diagnostic can help determine actions to take when encountering changing circumstances.The initial diagnostic should answer the following question: Is this a situation requiring incrementalchangeor disruptive change?●Incremental change happens when an organisation makes an update to a product orservice or expands that product or service to a new client market segment. It usuallyfollows a carefully sequenced product or service road map for improvement.●Disruptive change, on the other hand, occurs when either a competitor or an externalevent seemingly turns the organisation upside down. The organisation has to make asignificant or crucial pivot to survive. Completely new technologies or external eventslike the COVID pandemic are examples of external events that drive disruptive change.No matter the type of change, leaders can use a three-stage common change model to helpdetermine how best to lead their team through organisational change and turbulence:1. Rally2. Drive3. Sustain12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12196/12
Click each folder to learn more.RallyDriveSustainInitially, leaders need to rally their teams to the need for change. Sometimes, the need for changecomes from an existential type crisis, or ‘burning platform’. Other times, it may be to takeadvantage of a very attractive opportunity. Leaders rally their team to understand the ‘what’ of thecircumstance and the why’ behind its importance.A common second phase is that of driving the change throughout the team. Leadership skills andmanagement skills are both employed in this drive phase. Team members need to know the keymetrics, the key components, and the key roles and stakeholders to make the change successful.A third phase is to sustain what successes have been made. Constant communication, clarity,and monitoring key metrics are common leadership behaviours in this phase.Knowledge checkSelect the choice(s) that best answers the question below.QuestionStella Woolkinson has recently been appointed as chief executive of a leading fashion house.The company has fallen on difficult times, and the board has been described by one fashionjournalist as having ‘lost touch with its customers, its staff, and its shareholders’. Stella hasbeen hired to shake up the board of directors and get the company back on track.The recently ousted chief executive, Kevin Nightshade, said he was not sad to leave because,in his estimation, the board is incapable of making decisions.‘They can’t hang a ballgown on a mannequin because they can’t even agree which is the frontand which is the back,’ he said.When asked about Stella’s appointment, he said, ‘At least she has designed a ballgown before.Whether she can organise a ball, only time will tell.’12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12197/12
SolutionWhich are the THREE most important attributes that Stella would need to demonstrate toachieve her role of transforming the board and the company?A.To demonstrate her commitment to being a change agent and setting out tomake a difference by transforming the organisation.B.To have the courage to challenge existing power bases and norms.C.To deal with conflict via constructive negotiation over issues rather thanpersonal attacks.D.To convince her fellow board of directors of her knowledge of the industry.SUBMITKnowledge check feedbackDue to the comments in the scenario made by the ousted chief executive about Stella’s experience,you may be tempted to include choice D in your selection. However, Stella’s credentials would bepublic knowledge. Effective leaders have a self-belief in their own abilities and understanding of theirtask to change the organisation, therefore they would not spend time trying to convince people oftheir abilities. The first three choices are correct and were all included in the scenario.Leadership in practiceKeys to be an effective leaderAs a leader, you need to develop your own style, but there are some general recommendations(especially regarding change) that you should consider that distinguish effective from ineffectiveleaders.Share your vision12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12198/12
Be real and authenticBe transparent and openInvolve your team in change managementDevelop your staffHelp your employees understand that they work for the organisation as a whole, not just forthemselves, their team, or their department. One of the best ways to get your employees on boardwith your organisation’s mission and goals is to share with them where you envision theorganisation going in the future. A key is effective communication. Effective communication isnot about being loud or ostentatious. Often, quieter and more reserved leaders can be moreeffective at communicating a vision with enthusiasm.Having self-awareness and understanding of your values, strengths, and weaknesses isfundamental to be a successful leader. People sense very quickly who is authentic. You may beable to pull off a façade for a while. Ultimately, however, it will not work — especially when dealingwith challenging issues.A good leader leads with integrity and honesty and builds trust. When you say what you meanand mean what you say, people will trust you. Good leaders also take full responsibility for theiractions, as well as the performance of the team. They also give much credit to staff andemployees, when due.When leaders openly share their thoughts, beliefs, and information, that creates a partnershipwith the team and a participative environment.Trust and relationships are critical when an organisation is going through change, and they needto be built upon through continued open, honest communication. Leaders who make opencommunication part of the change effort create a foundation for engagement and improvedperformance.Successful leaders involve and help employees view challenges as opportunities for problemsolving and encourage their employees to view solutions from new perspectives.Encourage your employees to take responsibility for the change as long as the solutions supportthe vision. Before you attempt to solve a problem, first ask your employees to tell you how theythink the problem should be solved.12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/12199/12
Value each team memberUse sources of power wiselyUse your emotional intelligenceLeaders encourage their employees to develop professionally. This support may take the form ofgiving them opportunities to enhance their skills and abilities while on the job or through outsidetraining. The key is to support their professional growth —one of the best ways to demonstrate toyour employees that you care about them.Development of your staff also entails delegating and trusting your employees to do the job right.Change initiatives offer great opportunities to give staff more responsibilities and to furtherdemonstrate their capabilities.Help your employees understand how important their jobs and tasks are for the betterment of theteam and organisation. Employees should understand that what they do is important for thecompany’s success. Understanding how one fits into the current and future organisation allowsbetter decision making by all and a higher sense of employment satisfaction.There are different forms of management power (legitimate, reward, coercive, expert, andreferent). The key to good leadership is to recognise when exercising different elements of poweris appropriate.For example, when in a meeting discussing the financial implications of investing in changesaround production models, a CFO has expert powerin relation to the financial aspects, but theproduction director will have expert powerin relation to the production aspectsof the decision. Ifthe CFO is well respected, he or she may well be able to exercise an element of referent powertopersuade the chief executive and management team to follow the advice offered. However, whenmanaging the finance department legitimate powerand reward powercan be used to motivatethe staff to perform to the best of their ability.Emotional intelligence is the ability to identify and manage personal emotions and relationshipswith others effectively. It is generally said to include three skills — emotional awareness; the abilityto harness emotions and apply them to tasks like thinking and problem solving; and the ability tomanage emotions, which includes regulating your own emotions and cheering up or calmingdown other people.Emotional intelligence is an important ability for leaders, especially during organisationaltransformations because motivating others requires you to:12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/121910/12
1. understand your emotions and control them;2. understand the emotions of others and what drives them; and3. have empathy.ExerciseFor this self-reflection exercise, think about preceding leadership recommendations and rateyourself. How well you do you follow these keys to successful leadership of organisational change?Please note, pick any situation involving some form of change where you act as a formal or informalleader. It could be in a project, with staff or co-workers, or outside of work. When you have chosenyour answers for all of the behaviours, click ‘Submit’. Once you review the response, click the X toclose the window.NeverRarelySometimesOftenAlwaysA. Share your vision.B. Be real and authentic.C. Be transparent and open.D. Involve your team in problem solving.E. Develop your staff.F. Value each team member.G. Use sources of power wisely.Submit(Embedded page: https://media.aicpa.org/Association/CGMA/E2/17I/i/int-t3-010n.html)Conclusion12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/121911/12
To drive organisational change, leaders need different behaviours and skills than they use for moreday-to-day management of their teams. Effective transformative leadership and changemanagement is needed.Transformational leaders are proactive and can change team dynamics and cultures to move themeffectively in new directions, when needed.12/16/24, 11:09 PMCGMA LMS Tailor Previewhttps://learning.cgma.org/preview/#/print-preview/121912/12