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Outsource magazine: thought-leadership and outsourcing strategy | August 24, 2017

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Ensuring the OCM domain delivers full value in BPO programmes

Ensuring the OCM domain delivers full value in BPO programmes
Howard Spode

I recently had to step in to personally lead the Organisation & Change Management (OCM) workstream of a business process outsourcing (BPO) programme I was running. For me, this is not that big a deal because even before I entered the BPO field almost two decades ago now, I was already an experienced OCM practitioner. But it struck me that it would be good for me to share some key lessons learned because this is by no means the first time I have experienced OCM in need of some help, and not everybody is in the fortunate position that I am regarding this particular domain of BPO.

I’d like to start by exploring the purpose and components of OCM. It’s often useful to begin an article with definitions, of course, but in this case I have a specific motive for doing so. In my opinion, certain elements of the domain are very poorly defined, which all too often leads to their being managed in an unstructured fashion and, consequently, to their producing sub-optimal results. So getting full clarity from the outset is in itself a key lesson learned for me.

The purpose of OCM

We are all familiar with the type of major change that organisations frequently have to go through – for example as a result of mergers, falling sales, new technology, etc. And BPO initiatives of course. Responding successfully calls for a range of actions specific to the situation at hand – for example, data migration is an activity that may be in play for a technology implementation, due diligence and workshadowing are examples for BPO.

However, in parallel to this type of action, which focuses on the “core change” as we might call it, there is always a need to manage the process of change as well – the “how” as opposed to the “what”.

To illustrate this how/what distinction, let us imagine an excellent facilitator who can add great value to a discussion about, say, where to locate a new business premises even though she has no personal opinion on the matter and knows little or nothing about the specifics of the content being discussed. In such a case she is not contributing to the core change (ie deciding where the new premises should be), but to the process of change (eg making sure that options are evaluated systematically, that all the relevant parties have their say, etc). She is managing the how as opposed to the what of change.

On a macro scale, managing the “how” of change is the focus of the OCM domain, whilst the other project workstreams focus on the “what”.

The components of OCM

OCM encompasses two branches:

  • HR-led activities that manage the “displacement of people” caused by the change. For example: government notification, employee consultation, redeployment, redundancy, employment transfer, recruitment. I call this area “HR transition”.
  • Management of the human aspects of the change in terms of the way people come to understand, accept and contribute to it. Traditionally, this is called change management.

The first area, HR transition, is largely a matter of applying set policies, procedures and approaches in a systematic manner. It is of crucial importance as it ensures effectiveness and fairness in dealing with key staffing ramifications. Moreover, errors can be very damaging in terms of business reputation or even legal penalties. But fortunately there is a great deal of guiding documentation available from government and HR institutes and, more to the point, there are many experienced HR professionals around.

The second area, change management, is more problematic. Pretty much everyone always agrees that it is important, but this is the area I mentioned above that is often not managed in a structured fashion and where results are often patchy.

In the light of this, I have more advice to share on change management than I do on HR transition. However, I will not ignore HR transition completely. Wherever relevant I will say a few words about HR transition after first focussing on change management.

Before we move on, let me briefly cover a related topic: “organisation design”. OCM competencies will definitely be useful in supporting the design of the new organisation that needs to be in place after the change. However, this activity is part of the core change (the “what”) not the process of change, and therefore it should be managed in the workstreams that focus on the core change, as opposed to in the OCM workstream. Accordingly, I will not cover organisation design in this article.

What is “change management”?

I will continue with the definitions theme for a short while longer, digging down now into the change management piece. I have seen lots of energy wasted on debating what “change management” is and who should be responsible for what.

In my opinion, change management consists of three sub-elements:

  • Communications – sharing key messages with the various stakeholder groups, primarily to inform.
  • Engagement – interacting with the various stakeholder groups, primarily to influence.
  • People development – working with groups and individuals to impart new skills and knowledge

In some quarters, only the “engagement” piece is referred to as “change”. This can lead to the wasted energy I mentioned above. Engagement is probably the least tangible of the three elements but arguably the most powerful. It encompasses such activities as change readiness assessments, one-to-one stakeholder meetings, roadshows and the “catalysing” (facilitating) of events. But even though engagement is a critical part of the mix, it is obvious that successful change cannot possibly be achieved in the absence of providing basic information (communications) and equipping people with new competencies (people development).

So, to summarise the definitions pieces before I move on:

1, OCM focuses on the process of change (the “how”), whilst the other workstreams focus on the core change (the “what”)

2. OCM consists of two components, with very different “flavours”:

  • HR transition
  • Change management

3. Change management itself breaks down into:

  • Communications
  • Engagement
  • People development

Now on to some more key lessons learned.

Structure the OCM effort properly – certainly don’t bundle “all the HR stuff” together

With all the components of OCM coming from “broadly HR-ish” functions, I have often experienced a view from non-HR quarters to the effect of: “it’s all HR, bundle it all together and let them get on with it”. I believe this is a big mistake so in this section I will spend some time exploring how best to structure the OCM function.

But before I do this, I will mention that I have even seen core change in the HR function (usually called “HR transformation”) bundled with the process of change as delivered by the OCM workstream. So, for instance, in a BPO initiative that affected Finance, Procurement and HR, there was a workstream focused on the core change within Finance and one on the core change within Procurement, but the workstream for “HR” encompassed both the core change in the HR function and the OCM piece focused on managing the “how” of change across all the functions. Within that HR workstream, responsibilities and accountabilities were hopelessly blurred and the less results-focussed elements of the OCM mix were provided with an ideal place to hide. This wasn’t “bundling”, it was “bungling”. It is an absolute no-brainer that the HR transformation should be separated out from the OCM piece.

Setting such extreme examples aside, let’s now take a look at the organisation of the OCM domain itself.

Within change management there are often organisational boundary lines between the Communications, Engagement and People Development disciplines, so it can sometimes be difficult to find one person to represent the whole piece. In such cases, people from all the disciplines will need to be mobilised, but one of them should become “first amongst equals” to lead a single “Change Management” workstream. It is absolutely not necessary to run separate workstreams for the three activities – to do so would disrupt the synergies between the sub-disciplines and unnecessarily increase the complexity of the overall project.

However, I do recommend running HR transition separately from change management. This is because the two areas have such different “flavours” as we saw above.

In this mix, it is very possible that some people will have to wear two hats, but so be it: basic project management disciplines can easily differentiate between the role and the person.

The more high-profile OCM activity happens on the client-side of a BPO initiative, but there is plenty of activity on the supplier-side too – recruitment, training, culture-building etc.  It is always good to have client- and supplier-sides loosely co-ordinated but there’s no need in my opinion to have a joint client/supplier OCM workstream. Clients are very interested in the outcomes of the supplier’s OCM activity (eg have enough people been recruited? Are they trained properly?), but not so much in overseeing the actual activity. Much the same is true of the supplier’s perception of the client-side OCM activity, although I will make the point here that I have experienced suppliers that show zero interest in client-side OCM activity. This is not in their own best interests and does them no favours at all if their quest is to be regarded as “long-term, transformational partners” as opposed to “transactional suppliers”.  Forward-thinking suppliers have OCM competencies on board not only to manage the supplier-side OCM activities, but also to advise, liaise and even support he client-side OCM activity.

Get the right people on the team

Looking first at change management, it’s crucial to get the right people on the team: pragmatic, results-focussed, able to work in a project environment. Specific BPO experience is a nice-to-have but it’s not essential. And, as mentioned above, one person who can step up to leading all three elements (Communications, Engagement and People Development), even though this may be beyond their day-to-day responsibilities and outside their comfort zone. Ruled out on my projects is the type of change management practitioner who spends their entire working life talking about the latest change methodologies from California or about how sensitive they are as people, which is why they went into change management.

Turning to HR transition, as I mentioned, there are many experienced HR practitioners in this area and much guiding documentation available to remind people of the basics and bring them up to date as necessary. So if a member of the internal HR team fits the bill, then great. But not every HR person is familiar with HR transition so it is certainly not a case of “any HR person will do”. This is not an area to expose to inexperience, notwithstanding the availability of the guidance documentation. If there are no experienced people available within the organisation, then an external contractor should be sourced and fortunately there are quite a lot of good ones working in this space. If an external is used, it is a good idea to get an internal person to shadow, with a view to building in-house capability for next time.

Don’t patronise

We all know that people don’t like to be patronised, but this doesn’t prevent many change management activities from being extremely patronising. For example, in a session to announce a BPO initiative to an audience who were going to be materially affected:

  • 90% of the content focussing on why the change was such a great thing for the organisation.
  • Even then, “cost savings” not mentioned at all, although this was one of the key reasons for the change. Apparently, mentioning cost savings (the truth) was not “on-message”.
  • Similarly, the word “redundancy” banned and replaced with “new directions”, even though a percentage of the audience were certain to lose their jobs.
  • No real opportunity for the audience to clarify and probe (I don’t count a 10-minute, ad-hoc, hands-up Q&A at the end as qualifying in this regard).

Of course some strategic context is important, of course certain aspects of the change may be confidential or still in development and of course the people affected should not be led to believe that they can probe every detail or even overturn a strategic decision. However, people should expect a very healthy degree of clarity, completeness and concern for the question “what does this mean for me?”. And it is the role of the change management team to ensure this, despite the fact that it might be under great pressure from various executive sponsors to the contrary. To this end, a good discipline is for the members of the change management team and executive sponsors to imagine how they would want to be treated if they were on the receiving end.

As an aside, perhaps the single worst change management example I have ever witnessed was an update from a communications department to all stakeholders affected by a BPO initiative. This described how the leader of the function being outsourced had been visiting India with the account manager of the chosen supplier and had been very impressed with the supplier’s set-up (fair enough)…and how the senior people had all been so happy that they proceeded to dance the night away in a famous club. I am not making this up. And the reaction of people back home whose jobs were going to be outsourced…?

Just a word or two about HR transition. Here the key is to apply pre-set policies and regulations in a fair manner so there is less room for “creativity” and therefore less risk of upsetting people by getting the style badly wrong. Experienced HR people are used to helping people maintain dignity in a range of difficult circumstances.

Set your goals low

In my experience, people want to do a good job, even if their own circumstances are changing in ways that are very uncomfortable for them. For example, I have lost count of the times where incumbent staff with many years’ experience will contribute positively to the training of a group of much younger people who have arrived from a faraway country to eventually take the work back with them.

As long as they are treated decently, people tend to reciprocate by maintaining at least basic standards of professionalism. And the point here is that this is all that can be expected.  There are never going to be ticker-tape parades for change that is going to see peoples’ working lives significantly altered. So I wonder why so much energy is wasted by change management teams and their executive sponsors fantasising about this.

To illustrate further, let’s take the introduction of manager/employee self-service (in HR, Finance, Procurement, etc). Yep, usually a good idea. Empowers people by providing them with access to data and the ability to execute certain transactions. Reduces back-office costs. Usually reduces total organisational costs as well because a proportion of the work transferred to the “self-servers” is absorbed by them without the organisation incurring directly proportional additional labour costs. But I have seen so many change programmes try to sell this as if the change was all for the benefit of the people that the work is being transferred to. The last thing that many busy people will want to hear is that they now have the joy of doing stuff that the back office used to do for them. Why not focus the change messaging on “look…this is what is happening, this is why it needs to happen and this is how we will help you make it work”, with the primary objective being compliance, as opposed to presenting it as some sort of gift from the Gods and expecting what – thanks?

The principle is also true in HR transition but here the primary objective is always pretty clear anyway – ie the proper application of pre-set policies and regulations that people accept are fair and reasonable, even though they might prefer the whole situation not to be happening at all.

Create a formal OCM plan

Beginning again with change management, a set of “interventions” should be designed, interventions in this sense being specific communications, engagement and people development activities. As described above, these should be based on sensitivity to the various stakeholders’ positions and have realistic goals.

It is usually a good idea to employ a variety of different media and styles, because different people respond differently to different approaches (eg seeing/hearing/thinking). And there is no problem at all with repeating the key messages multiple times.

A good design can contain a fair number of moving parts, with numerous interventions of different types at different times. And some of these might be quite sophisticated in their own right (for example a programme of roadshows or a culture-building workshop). But the KISS principle should always be born in mind (“Keep it Short and Simple” or “Keep it Simple, Stupid” – I have never known which is the officially correct form of words). Each element should be effective and efficient in delivering the key objectives of informing, influencing and imparting new competencies as per the needs of the project.

A formal change management plan should then be produced which clearly specifies each intervention in terms of why, what, how, who, etc. and sequences the interventions in line with the overall project plan, taking account of key interdependencies with the other workstreams.

Pretty much the same is true for HR transition. Within agreed policy and legal parameters, certain procedural matters will have to be decided (for example, what are the specific selection criteria for redundancy, how will outplacement support will be provided, etc), then the key activities need to be identified, specified, sequenced in line with the overall project plan and documented in an HR transition plan.

Subject OCM to the same project management rigour as any other workstream

Once the change management and HR transition plans are signed off, their execution should be managed through the normal project management mechanisms – monitoring, risk and issue logs, reporting, intra- and inter-workstream meetings, etc. In this way adjustments can be made where necessary, progress can be maintained and achievement of the overall OCM objectives can be ensured.

Ensuring that OCM adds real value is as much about project management discipline as it is about HR or behavioural science acumen. Obviously, the acumen is crucial but without the project management it can become diffused and non-effective. Despite the impression that some OCM practitioners might want to give, OCM is not some kind of mystic art. For sure, true OCM competence is invaluable, but this has to be subject to planning and control like any other workstream in a BPO project.


About the Author

Howard Spode 150Howard Spode is the Managing Partner of BPOpronet (www.bpopronet.com) a company that helps clients, suppliers and intermediaries in the BPO industry. He is perhaps uniquely positioned in that, in addition to being an expert practitioner in BPO with hands-on experience of every stage of the life-cycle, he is a psychologist by academic background and had already established a successful track record as an OCM practitioner prior to his entry into the BPO field. Indeed, his first exposure in BPO was in an OCM capacity – managing the change piece of some of the world’s first BPO deals in the mid and late 1990s.

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