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We trained you - why didn't you learn?

A case study in Change Management

Presented by:

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Agenda

About MorganFranklin

What is Change Management?

Change Management Case Study– Planning

– Execution

Q & A

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MorganFranklin is a 340-person “roll-up-your-sleeves”

management consulting firm.

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When it comes to Technology, we focus on Financial Mgmt,

Enterprise Systems and Information.

Leadership | Thought | Execution

1. Financial Management Solutions

2. Enterprise Systems Management

• PeopleSoft

• Oracle EBS

3. Enterprise Information Management

• Oracle (OBIEE, Hyperion, ODI)

• Microsoft BI Suite

• IBM Cognos BI Suite

Our Core

Our Extended Capabilities

Products

• SAP

• SharePoint

• Workday

• NetSuite

• JDE

Skills

• System Admins

• Infrastructure

• DBAs

• Developers

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Our Presence at Collaborate5 Session Presentations

• Sunday - April 10th (11:15-12:15) – Room W202A

IT Projects Off the Rails – Causes and Fixes

• Monday - April 11th (3:45 – 4:45) – Room W202A

Buying or Getting Bought? A Case Study in M&A Projects

• Wednesday - April 13th (10:30 – 11:30) – Room 205C

We Trained You – Why Didn’t You Learn? A Case Study in Change Management

• Wednesday - April 13th (2:15 – 3:15 pm) – Room 204B

Multicurrency Capabilities in PeopleSoft - All You Wanted to Know

• Thursday - April 14th (9:45 – 10:45) – Room 204B

Allocations in PeopleSoft - All You Wanted to Know

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What is Change Management?

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We re-designed the invoice approval process to reduce

manual effort/errors and provide better management

analytics.

• 168 Mouse Clicks per

transaction

• Manual

• Labor Intensive

• Prone to Error

• No analytics

Old Way

• 12 Mouse Clicks per

transaction

• Automated

• Fully Auditable

• Advanced Analytics

• Reduction in Close Process

New Way

VS.

We thought this would be well received.

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It was not. To get this change approved and in production, it

took . . . .

• 7 in-person meetings

• 4 conference calls

• 113 e-mails

• Personal involvement of the CIO, CFO

and 2 Group VPs

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3 months after it went live . . . . . they can’t live without it (and

they took back all of the things they said about us).

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So what did we do wrong?

• We failed to realize that generally people fear

change and the personal impact of the change.

• People will react to change typically in these

phases:

– Denial

– Frustration

– Bargaining

– Depression

– Acceptance (hopefully)

– Enthusiasm (hopefully)

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Phase 1 - Denial

• Ignore You

• Won’t Return Phone Calls

• Skip Meetings

• Generally Unresponsive

• Refuses to believe it will

happen

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Phase 2 - Frustration

• Yell at you

• Yell at their boss

• Belligerent

• Blame game

• Management Escalation

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Phase 3 - Bargaining

• Can we put it off a while?

• Can we do part of it?

• How about next year?

• Can we work around it?

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Phase 4 - Depression

• Begrudging acceptance

• Thoughts of

quitting/transferring

• Not open to learning

• Lots of water cooler talk

• Productivity drain

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Phase 5 - Acceptance

• Ready to adapt to new way

• Willing to learn

• Patience

• Collaboration

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Phase 6 - Enthusiasm

• Solution Partner

• Offering Suggestions

• Typically when ROI benefits

are gained

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Change Management Defined

• Approach to dealing with change, both from a

organizational and individual perspective.

• Getting people ready, willing, and able to adopt new

way.

• Change Management is not training, but training is

part of Change Management.

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In other words, change management should

Get people through these phases quickly

To This Point

And if all goes well.

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Change Takes Place in Three Areas

Thinking &

Understanding

HEAD

Motivation/

Emotion

HEART

Behavior

HANDS

What do I do

differently?

What’s in

it for me?

Why should

I change?

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So how do you do it? It starts with recognizing

Change Management’s role in the project.

Change Mgmt

Lead

CEO

Business Unit 1

Leadership

Business Unit 3

Leadership

Business Unit 2

Leadership

CFO CIOCOO

Implementation

Lead

Implementation

Team

(Functional)

Implementation

Team

(Technical)

End User End User End User End User End UserEnd User

Implementation Team

Change Mgmt Team Lead

Change Champions

Business Line Change SMEs

End Users

Key:

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BuildDesign

Enterprise

Overview

Core Team Organization

Process

Validation

RICE

Development

Planning &

Initiation

Scope &

Requirements

Process & PSFT

Appl . Design

PSFT Prototype

Build

Enterprise Data

Decisions

RICE Design

User

Sustainable Business Value

BuildDesign ImplementBuild/TestDesign

Assess Current Infrastructure and Develop Technology Plan

Define Change Mgmt Strategy, Identify Key Stakeholders,

Isolate challenges for adoption, Develop a detailed communication and training plan

Configure System, Perform Testing, Help Develop Cutover Plan

Support Cutover and Post Production

Prototype New Processes

Compare Current Processes with Leading Practice and Application Functionality

Compare Current Processes with Leading Practice

Perform Fit/Gap and Develop New Processes

Implement Procedures Cutover Solution, Post Production

Current State

Baseline

Solution

Blueprint

Tested

SystemGo Live

Implement Procedures Concurrent with New Application/Modules

Perform Fit/Gap, Design Solution and System Configuration

Make the user community aware of the upcoming change, Begin to educate users

Implement training plan. monitor the effectiveness of the communications and learning activities

Support Development and Establish Testing and Production Infrastructure as Well as Support System and Performance Testing Activities

DesignDesignPlan/Assess

Technical

Infrastructure

Process

Application

Change

Management

Data

Management

Core Team

Training

Organization

Design

User

Documentation

Catalogue and Categorize Data Sources/Needs

Design Data Management Strategy, Design Programs/Objects, Clean Data

Develop and Test Objects/Programs Cutover, Parallel Test

Project

Management

Core Team

Training

Organization

Design

User

Documentation

Update Plan, Build Team, Establish Project Control Office

Establish New Phase Activities, Implement Change Control, Monitor, Governance

Establish New Phase Activities, Monitor, Project Governance, Control PCR’s

Support Training Activities, Monitor, Project Governance, Lead Cutover

And realization that it is part of your project from

Day 1 through Go Live (and beyond).

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Seems expensive – do we really need change

management?

“If you think education is expensive, try ignorance”

- Derek Bok

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McKinsey study shows that sacrificing change

management dramatically impacts your project.

ROI Realization

Excellent Change Management 143%

Poor Change Management 35%

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The 11 companies that showed the lowest project ROI all had:

1. Lack of commitment / follow through from senior executives

2. Defective project management skills among middle mgmt

3. Frontline employee confusion about the project

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Top 10 Influencers to Achieve Change

Management Success

1. Sponsorship by senior leadership 82%

2. Treating people fairly 82%

3. Involving employees 75%

4. Giving quality communications 70%

5. Providing sufficient training 68%

6. Using clear performance measures 65%

7. Building teams after change 62%

8. Focusing on culture/skill changes 62%

9. Rewarding success 60%

10. Using internal champions 60%

PricewaterhouseCoopers LLP and Market & Opinion Research International (MORI) Global Change Management Study

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Change Management Case Study

Planning

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Greatest Obstacles for Change Projects (aka why

Change Management Planning is important)

1. Employee resistance at all levels

2. Middle management resistance

3. Poor executive sponsorship

4. Limited time, budget, and resources

5. Corporate inertia and politics

Best Practices in Change Management, Prosci, 2003

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There are five main inputs for the planning phase that

will enable you to build your plan(s).

1. Impact Assessment

2. User Assessment

3. Asset Inventory

4. Lessons Learned Analysis

5. Champion Identification

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No Impact

High Impact of Change

Medium Impact of Change

Low Impact of Change

53 out of 126

functions we

assessed were

impacted, but a

large number had no

or low impact

Input #1. Impact Assessment

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Functional Area Sub-FunctionTraining

ComplexityAudience Size Language Location Comments

PCB – Contracts Setup and

Admin

High 15 E DC This includes training all

PMs, Project Control and

Contract staff on new

processes, cross-walks and

tools.

Inquiry / Reports Low 9 E DC

Time & Labor Entry Low 600 E/S Global Training via CBT. No

development or delivery

LOE.

Approval Low 100 E/S Global

Administrator Low 1 E DC

Travel & Expense Entry Medium 300 E DC CBT

Approval Medium 100 E DC

Administrator Medium 1 E DC

Accounts Payable Inquiry Low 20 E DC AP will be processed by

Shared Services.

Billing Bill Preparation High 9 E DC

Revenue

Recognition

Low 20 E DC

Input #2. User Assessment

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Travel and Expense

Time and Labor

Running Reports and Queries

Chartfields

Writing Queries

PS Architecture and Access

All

Em

plo

yee

sP

eop

le S

oft

Fin

an

ce U

sers

Time and Labor Approver

Travel and Expense Approver

Project Management and Financial Analysis

PM Dashboard

Business Operations

Internal Funds Request

Billing

Contract Setup Contract Closeout

Revenue Recognition Accruals

Procurement

Budgeting & Forecasting

Required Training Job-Specific Training

Inquiry*

AR Inquiry

AP Inquiry

GL Inquiry

Corporate

Journal Entries Accounts Receivable

KeyIn training scope

Material will either be covered in other courses or

is not deemed critical for Conversion Project

Material not currently covered and deemed

critical for Conversion Project* Note: Training could be applicable to users across Corp and BU Org.

Input #3. Asset Inventory

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Issue

Category

Number of

FindingsExamples Improvement Actions

Project

Management7

• Project timing didn’t take into

account quarter and year-end

close periods

• Changeover leadership didn’t

involve business unit

• Project plan includes post-go-live support

effort

• Include BU active involvement as

stakeholders and on Steering Committee

Training 11

• Insufficient training resulted in

lack of adoption and

frustration

• No documentation or flowcharts

for new processes

• Emphasize change management work

stream as key component of overall plan

• Provide documentation, processing

timelines, and process flows for new

processes

System 13

• Work Authorization as configured

doesn’t block overcharging

• People in secured sites can’t

access the portal

• Perform detailed fit-gap to determine areas

of customization

• Review infrastructure access as a part of

overall plan

Process 13

• ODC’s are still being charged to

wrong projects resulting in long-

term cleanup

• W-9 information was required but

that wasn’t clear ahead of cutover

• Focus on detailed conversion strategy and

process mapping to new environment

• Perform process fit-gap to minimize

surprises

Input #4. Lessons Learned

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Input #5. Identify your change champions (and

roadblocks).

High

Low High

AG

REEM

EN

T

TRUST

Bedfellows

In agreement about how to proceed but share a low to moderate trust relationship. We are strategic & careful

regarding information.

Fence SittersWon’t Take a Stand

Allies

Share our vision and have a great deal of trust in them.

Adversaries

People with whom our attempts at trust have failed.

Opponents

Share a high trust relationship but conflict on visions, goals,

or methods.

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Now that you have your 5 inputs, you can develop

your change management plan.

1. Impact Assessment

2. User Assessment

3. Asset Inventory

4. Lessons Learned Analysis

5. Champion Identification

1. Training Plan

2. Communication Plan

3. Change Mgmt Schedule

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Functional Area Sub-Function Audience SizePrep &

Delivery LOE

User

Training Hrs

Avg Hrs

/PersonStrategy

PCB – Contracts Setup and Admin 15 400 360 24 Develop new training and deliver

in in person classes 6 weeks

before go live.Inquiry / Reports 9 8 72 8

Time & Labor Entry 600 0 600 1 Training via CBT. No

development or delivery LOE.

Approval 100 0 200 2 Same

Administrator 1 0 4 4 1:1 Desktop training.

Travel & Expense Entry 300 0 600 2 CBT

Approval 100 0 200 2 CBT

Administrator 1 0 4 4 1:1 Desktop training

Billing Bill Preparation 9 400 288 32 Develop new training and deliver

in in person classes 6 weeks

before go live.

Revenue

Recognition

20 16 80 4 Develop new training and deliver

in in person classes 6 weeks

before go live.

Accounts Receivable All 5 16 20 4 “Buddy” system training method.

General Ledger All 5 0 40 8 “Buddy” system training method.

Total Hours 840 2,468

Output #1: Training Plan

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Output #2: Communication Plan

Key Deliverables Additional Notes

Employee Communication WebsiteContinually updated. Includes a Calendar, Training Guides, Announcements,

POCs, & FAQs.

Employee Communication Updates Drafted for BU Leadership to disseminate to all employees.

Supervisor Communication UpdatesDrafted for BU Execs to send in the early stages of the project. Send on a

daily basis the week before and after Go Live.

Change Agents Engaged Hold Conference Calls and emailed updates throughout the project.

Course Completion Tracking Track individual course completions and communicated with supervisors and

employees that needed training before Go Live

Course Reuseables

• FSMs own their respective training materials

• Training University will coordinate quarterly updates to the training materials

with the FSMs

• Manage all current updates to each course as result of this training rollout

and will make classes and course guides available to all BUs via Business

Operations VPs in late October

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Output #3: Change Management Timeline

Deliverable/Milestone 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

July

Conduct PCB Working Sessions (Contract Setup, Revenue Rec, IFR)

August

Web-based PS Intro Course Delivered by Vendor

Web-based PS Intro Course Posted Online

Conduct PCB Training Dry Run

Deliver PCB Training (Contracts Setup, Revenue Rec, IFR)

Conduct PCB Working Sessions (Bill ing)

Web-based non-PCB Courses Delivered by Vendor

September

Non-PCB Courses Posted Online

Conduct PCB Training Dry Run

Deliver PCB Training (Bill ing)

Conduct PM Dashboard Training Dry Run

Deliver PM Dashboard Training

October

Provide Helpdesk Support (BU Ops, Contract Setup, Bill ing, and Project Mgmt)

Kick-off Conversion of Instructor-led PCB to Web-based

Kick-off Development of Additional Training Courses

Complete Training Maintenance Plan

Provide On-site Support for Bill ing, Close Activities

November

Provide On-site Support for Bill ing, Close Activities

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Change Management Case Study

Execution

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In the Execution Phase, you work your plan through . . .

1. Awareness Activities

2. Training Activities

3. Adoption Activities

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#1 Awareness – let them know that the change is coming.

Characteristics

1) Short Term

2) Immediate

3) Specific

4) Passive Audience Participation

5) Broad Reach

Ideas

o Checklists, pamphlets, cheat

sheets

o Memos from top mgmt

o Newsletters

o In person briefings

o Intranet

o Posters

o Awareness coupons (e.g. memo

pads, other trinkets)

o Sign on messages

o Events, conferences, briefings

o Cookout, picnic, happy hour

o Sr. mgmt briefings

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Awareness Example - Intranet

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Awareness Example: Executive Memo

Key Communication

Considerations:

•Utilize multiple

channels of

communication (e.g.

snail mail, e-mail, in-

person, web-ex) to

ensure users receive

pertinent information.

•Make sure message is

consistent across

communication

channels.

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#2 Training – builds knowledge and skills, through credible,

feasible and effective training mechanisms.

Characteristics

1) Formal

2) Longer Development Time

3) Selective

4) Active Audience Participation

Consideration #1: General Learning Styles

1) Auditory = listen / read

2) Visual = diagrams / charts

3) Kinetic = tactile steps / do the task

Consideration #2: Age Demographic Learning Style

1) Boomers – traditional classroom delivery; structured; big picture

2) Connected (1970-1985) – comfortable in multiple delivery channels

3) Always On (1985-) – want to do; learn quickly; short attention span

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Training Example: Training Reference Guides

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Training Example: Frequently Asked Questions (FAQ)

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Training Example: Online Training Mechanism

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Training Example: Online Training Mechanism

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#3 Adoption – conform to the norm and realize the ROI

Characteristics

1) Continued upper management support

2) Provide feedback mechanism

3) Resolve issues quickly

4) Monitor / audit usage and take action as necessary

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Good Users

#3 Adoption – monitor your users and determine state of

mind

• Follow the letter of the law; adoption high;

make champions

Bad Users

• Naïve mistakes; dangerous tinkering; needs

follow-up

Ugly Users

• Detrimental misuse; fraud; abuse; identify

and weed out

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PCB: Contract Setup PCB: Billing PM Dashboard

Total Number of Training

Participants12 12 47

Overall Evaluation of the

Training Session*4.60 4.82 4.31

Overall Understanding of

Training Material

Presented*

4.28 4.75 4.14

How could your training

session have been

improved?

• Better hardware - had keyboard

and mouse issues, some trainers

went through the material a bit too

quickly, had to spend time

catching up

• Contract setup could have more

references using an actual small

contract

• To be able to have access to

the test site. To be able to

practice before we go live on

PS.

• Visual of billing folder would

have been nice to see

• Take a sample project that has some complexity

and then run through an example to show how

contract/project/subtask run-up

• Recommend walking through a side-by-side

example with MIS so people can see exactly where

to go in Dashboard to find their MIS data.

What other training topics

might help you to do your

job better?

• Visibility of PM Dashboard so we

can speak the same language.

• Maybe a little more on reporting

• Need reconciliation and query

training

• Overview of company financial processes. Not

everyone has Mini MIS experience

• Forecasting would be great for all PCAs

Additional Comments or

Suggestions

• You're doing a great job!!

• Overall…good presentation!

• Thanks for providing such a

well put together

presentation.

• Wonderful teachers - thank

you!!

• I was at Disney when we converted to SAP. We've

had more access and training to prepare us for the

conversion than I received at my previous org

• PeopleSoft definitely needs a budgeting,

forecasting capability to be of more benefit to PMs.

• Overall great job on complex presentation.

* Employees were asked to answer these items on a scale from 1(Poor) to 5 (Excellent)

Adoption Example: End User Feedback Statistics

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Training CoursesDelivery

MethodLead

General Ledger• Journal Entries

• GL Inquiry

Web Accounting

Accounts Payable Inquiry Web Accounting

Accounts Receivable• AR Conversations

• AR Inquiry

Web Accounting

Time and Labor• All Employees

• Time Approvers

Web HR

Travel and Expense• All Employees

• Expense Approvers

Web HR

PCB – Contracts Classroom Finance

PCB – Internal Funds Request Classroom Finance

PCB – Billing Classroom Finance

PCB – Revenue Recognition Classroom Finance

PM Dashboard Classroom Finance

PeopleSoft Overview • System Architecture

• ChartFields

Web Finance

Accruals WebEx Accounting

Leads Own Training Materials

Web Based Training will reside on LMS

Classroom Based Training documents and job aids will

reside on Enterprise Business Systems Intranet Site

HR Owns Maintenance Plan

HR Triggers Quarterly Updates from the FSM’s

HR coordinates updates with vendors as needed

Updated Training Materials Published and Communicated

Once updates are complete, HR republishes to the LMS or

Enterprise Business Systems Intranet Site

Adoption Example: Training Maintenance Plan

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Three things to leave you with . . . . . .

1. The fear of change is real and natural.

2. Change Mgmt must address heads (why), hearts (WIIFM) and

hands (how).

3. The cost of not doing it is high - 143% vs. 35%.

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Q&A

John Hoebler, Director, ERP

MorganFranklin Corporation

office: 703.564.7525

e-mail: erp@morganfranklin.com

Contact Us

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For more information:

How MorganFranklin Can Help

Contact Us

John Hoebler, Director, ERP

MorganFranklin Corporation

office: 703.564.7525

e-mail: erp@morganfranklin.com