Just do it! But how.

The massive economic upheaval during the past decade has made it clear that just crafting breakthrough strategies is not enough. Winning requires execution, and the winning organization succeeds because it has out-executed its competitors.

Change, therefore, is a given. Rapid, effective change is not.

And the key to rapid, effective change? In a word: People.

The most widely respected change masters -- GE's Jack Welch, Allied Signal's Larry Bossidy, British Airways' Sir Colin Marshall, Chrysler's Bob Eaton, and others -- are, naturally, preoccupied with speed of delivery and customer value. They achieve both -- by transforming their people into their main source of competitive advantage.

Ben Cohen, the maverick co-founder of Ben & Jerry's, once said that people change when the need for change becomes self-evident. Today, we are in what could be called an era of "self-evident" change. So self-evident is the need for change to shareholders, leaders, consumers, and, yes, workers, that the starting point in all their conversations is no longer "why change?" or even "which change?" Instead, with growing sophistication, they're asking tough questions about pace, scale, costs, and the trade-offs necessary to achieve or sustain competitive advantage. In short, the question today is "how?"

To answer this question, Andersen Consulting developed a methodology for change that enables organizations to out-execute competitors while minimizing the risks, costs, and negative market forces that usually accompany upheavals in organizations and industries. The goal is to allow change management to evolve from a "black art' to a management science, so that how a corporation changes becomes as self-evident in the future as the need for change is today.

Gary Hamel, renowned London Business School strategist, maintains that those who achieve competitive advantage will be those who foresee and act upon opportunities to redefine markets so far ahead of their competitors that the transformation is "revolutionary in result and evolutionary in execution." He calls for a saner, less chaotic process for managing change, one that stems from foresight, not hindsight.

Andersen Consulting's methodology translates Hamel's clarion call into a core principle. Successful, on-time change doesn't have to be chaotic or desperate. It needn't be seen as a battlefield among stakeholders. An organization should be able to attain orderly change regardless of whether it's operating with foresight or simply playing catch-up. While foresight is, clearly, an advantage, it is possible to move rapidly and calmly when armed with a method that minimizes errors and anticipates stakeholder responses and needs.

To develop a method for managing change and to understand human behavior better, the firm tapped into research produced by academicians in Europe, the U.S., and Australia. To develop frameworks and procedures to ensure that complex initiatives are delivered on time, on budget, and with pre-determined results, Andersen leveraged its project-management experience.

In the "first wave" of thinking about change management, the catalyst for change was seen as "enablement," which included a heavy emphasis on training and education. But a synthesis of research and experience has led to an expanded "second wave" methodology. At the crest of this wave is a framework for understanding and mapping the range of activities that are required if an organization's change initiatives are to meet its business goals. Called the "Quadrant Model," this new framework is made up of what Andersen defines as the four critical elements of successful change: navigation, leadership, ownership, and, finally, enablement.

Nearly 40 years ago, American sociologist Philip Selznick noted that "strategies take on value only as people infuse them with energy." In a sense, the underlying principle, the energy behind the Quadrant Model, is the need to fill the chronic gap between brilliant strategy and real-life implementation and to become what author Henry Mintzberg calls "programmers of strategy" -- specifying the concrete steps needed to carry out an organization's vision.

This methodology is based on three premises. First, change is not a single, one-time event. It's an ongoing journey that must be carefully navigated -- forever. The path each organization navigates is unique, influenced by that company's culture, competitive environment, and constituent demands. Second, successful change requires that an organization focus on both "supply" (providing people with the ability, skills, and support to change) and "demand" (creating a shared will for change). Finally, the macro and micro aspects of transformational change must be addressed so the strategic "big picture" can be converted into actions that individuals throughout an organization are able to take.

Navigation:

FINDING THE WAY

"Death by a thousand initiatives" is what one corporate leader responded when asked how his organization ultimately succumbed to its ambitious goals. Ambitious change requires identifying and coordinating an organization's vital business processes; taking stock of current and planned change projects; and analyzing the factors affecting the pace of change, such as competitive environment, business cycles, and cash-flow constraints. Rather than leave change-navigation to chance, Andersen's methodology provides a range of guidelines, assessment tools, and frameworks -- from investment appraisals to risk management strategies, from baseline reports to benefit-delivery plans -- to guide complex change initiatives through each phase of implementation.

But critical to successful navigation is the realization that the change journey doesn't end. There's no final destination -- just ports of call along the way. Maps and compasses need to be both durable and adaptable, able to provide lasting guidance while they keep pace with changing conditions.

They also have to be able to reflect and adapt to specific and unique situations -- different cultures, different settings, different values and traditions. For Ernesto Martens, chief executive of Mexican container company Vitro, for example, change navigation has meant making sure that his attempt to move his company from an Old World sustained by the domestic economy to a New World of global sourcing does not ravage the firm's culture, values, and core strengths. One specific charge Martens faced: modernizing an increasingly competitive organization without undermining traditional employee relationships.

Leadership:

NO PAIN, NO GAIN

So much has been said and written about how important executive leadership is to change that it's created a mind-numbing mantra: Lead by example. Walk the talk. Manage by walking around. And yet, as George Bernard Shaw might have put it, there's truth in anything that's lasted long enough to be called a cliche.

While there are elements of truth in those words, we've come a long way since then. Effective leaders realize they can't expect to dictate anymore; they can't force change. Leaders can no longer just speak some inspirational words and expect change to follow. Change is painful, divisive, and all-consuming. If they want people to buy in to change, leaders need to involve people in the change itself. Communication and participation are key.

It's become clear that strategies, visions, and missions are all important, but it's also clear that they're only useful if they help elicit an emotional response across the organization. No one changes for rational reasons alone. To effect change, leaders must tap into the emotional bank accounts of fear, pride, and ambition. They must create the big picture as a context for involving employees.

Successful change, as new-style leaders understand, is not likely to be a happy experience. The breaking and rebuilding processes are painful and stressful. The message today's leaders might have for their stakeholders is, "I cannot promise to make us happy and content, but I am determined to help us be successful."

Daryl Conner, president of Atlanta-based management consulting firm ODR, and author of "Managing at the Speed of Change," sees "pain management" as crucial. "Remedies are vital to set direction and show the prize, but change cannot be sustained by remedies alone," he says. "Leaders also must constantly articulate the cost of failure to each stakeholder. The best barrier to regression and running out of steam is acknowledging that the price of failure is greater than the price of moving forward." General Electric's Jack Welch has described it on a more personal level: "My biggest mistake was agonizing too long over difficult decisions. I didn't want to break this company."

Ownership:

ONE FOR ALL

"Get everyone to agree on the same reality" is Welch's oft-touted advice. Cin-Made Corp., a small, Cincinnati-based can manufacturer, tried to do just that -- but without allowing everyone on board to "own" that reality. Instead, Cin-Made forged ahead without a uniform view of the cause and the need for change. It announced a sweeping change program and, following traditional labor relations tactics, played hardball in order to get the union to accept it. The result, says President Robert Frey, was that "by the rules of the game, we had won, but the victory prize was a factory full of angry employees."

A close look at these sorts of experiences undermines the myth that resistance to change is bad. Resistance is both inevitable and a sign of progress. In fact, as Cin-Made learned, the attempt to make employees see new change initiatives as good news is unrealistic and even unhealthy. The result is a tendency to treat everyone below the top as more delicate and to seek what Harvard business professor Chris Argyris calls the "benevolent censorship of painful truths."

Argyris has added some new insights into methods for building employee ownership of change. Turning the paradigm of leadership-as-benevolent-fatherhood upside down, he claims real breakthroughs in performance come only when workers realize and admit they have some responsibility for the chronic problems that change initiatives seek to eliminate. Although today's ubiquitous employee-focus groups, surveys, and fireside chats with senior management are intended as tools for "empowering" workers, they, in fact, only further embed the belief that an organization's problems are created and can only be solved by management. The intent of using the tools is to encourage workers to take ownership, identify problems, and pursue change. Instead, companies generally just set up a structure in which the worker is only expected to reveal problems when asked, and only management, as the benevolent father, has the power to bring about change.

The ownership quadrant of the change model takes the demand-side view. Tools and implementation frameworks that assess local benefits delivery, preparation for change, and local action teams enable companies to develop strategies and execute tasks to build employee "pull" for change. Continuous, open communication that flows both horizontally and vertically throughout an organization is one vital component. Another is team-building.

Case in point: In an enterprise of 89,000 employees, a team of 10 Allied Signal stock clerks reduced the company's raw material inventory cycle from five days to two, saving the company an estimated $3.3 million in the first year alone. To help Chief Executive Larry Bossidy underscore his message that the company's business had been advanced significantly through the efforts of people at the bottom of the organization chart, Allied Signal staged a high-profile recognition ceremony, flying the stock clerks to the company's New Jersey headquarters to be congratulated publicly by the company's top 125 executives.

If you examine the organizations that are most admired for how quickly they transform, you will see companies whose employees understood early on how they have helped create and how they can help solve their employers' most difficult problems. Look at Chrysler, for example.

In the early '90s, Chrysler's stock was trading at $9.13; it had a junk bond credit rating and a star CEO who had announced his intention to retire. The company would not introduce a single new product for two years. A white-collar work force reduction of 25 percent was expected. To the outside world, the situation seemed grim.

Yet inside Chrysler, magic was afoot. National media attention on Chrysler's woes had compelled the company to examine itself. The realization that the issue was, in fact, survival, forced employee attitudes to shift throughout the company, from headquarters in Highland Park, MI, through factories across North America. The enemy was no longer Japan. It was themselves. The employees waged war, not with Washington, but with their work processes.

With their company and their jobs at stake, all employees and suppliers saw themselves as either contributing to the problems or helping to solve them. Their sense of urgency and personal commitment helped Chrysler become the darling of Wall Street, car dealers, and consumers in just three years. Cross-functional "platform" teams headed out to meet consumers, and got a much-needed "reality check." Product-cycle time dropped from five years to a world-class three years. In rapid-fire succession, the company launched a series of hit products: the LH cars, the Jeep Grand Cherokee, the Neon, and the minivans. All this while instituting a $3 billion cost-cutting, waste-reduction program.

In the end, the employees had pulled off a dramatic shift from a company defined by its star CEO to one heralded for its star products.

In short, companies that make employee ownership of problems and solutions -- rather than paternalism -- a key strategy of their change initiatives will find they change much more quickly and see clearer bottom-line results.

Enablement:

MAKING IT HAPPEN

There's increasing pressure today on employees to demonstrate visible performance improvement. In turn, employees expect to be supplied with the necessary tools, training, information, and support systems that will allow them to improve their performance. They expect to be "enabled." Accomplishing enablement involves looking carefully at work flow and process design, job and organization design, human resource planning, and new approaches to training and learning. In terms of change initiatives, it takes the supply-side view.

A U.S. financial-services company with a substantial loan portfolio, for example, observed increasingly poor lending disciplines among its loan officers. Typical deals were complex, requiring finely honed skills and experience. Old-style classroom training was expensive and increasingly ineffective. Technology-based interactive multimedia -- such as CD-ROMs, videotapes, and online services -- could be employed to create a brand-new, exciting, and up-to-the-minute method of training and development. One result: Loan officers retained 10 times as much information as they had in a traditional classroom setting.

Similarly, a multinational, quick-service restaurant chain needed to develop skilled, customer-focused employees in retail outlets where staff turnover often exceeded 150 percent a year. The economics of off-site training simply did not add up. Once again, interactive multimedia provided an effective means for using goal-based learning to raise performance quickly and effectively.

Enablement processes create the "able" work force. A hallmark of the new change-management discipline is a focus on performance, not just on knowledge. In many cases, performance-based training and learning programs, both classroom and computer-based, are reducing time-to-proficiency by more than 30 percent. The result: cost savings and dramatically lowered work force turnover.

Journey

OF CHANGE

In this era of "self-evident," continuous change and winning through faster, better execution, leaders need proven methods and tools for managing change. Rapid, effective transformation can be achieved by taking a comprehensive, holistic approach, addressing stakeholders' micro and macro needs, building employee demand for change, and supplying the necessary tools and training.

When you view change as a constant, it's interesting how quickly your paradigms for managing change are themselves transformed. Originally seen as a brief, unpleasant hiccup in our world economy, transformational change produced chaotic, short-term responses that were dictated by management to employees and suppliers. Organizations were interested in results, but not necessarily in developing a lasting approach to managing change. Turbulence, battles among stakeholders, and rampant errors were expected. Employees had to "hang-in" during this brutal, short-term period of self-renewal, at the end of which everyone was sure to enjoy a well-earned reprieve.

But if change is a permanent business condition, managers and employees alike need to settle in for the long haul -- not all of which, of course, will be as wrenching as the old-style, once-and-for-all type of change. In this view, people are the primary source of competitive advantage. And change management, once seen as a novel service-offering of consultancies, is now a management discipline "with legs."

Armed with a methodology for change, then, business leaders can expect predictable results, lower risks, and fewer mistakes. Though they still can expect stress and strain, angst and aggravation, they also can expect more satisfied workers -- and more satisfied shareholders. Taking the high road on the never-ending journey of change, they'll have out-executed their competitors and entered a long-term relationship with business success.