Managing Change: Unintended Consequences

Leading a change programme is a risky business, for the leader and the lead. The law of unintended consequences applies in full as change involves people. People see the the starting and finishing points and the intention of change from their point of view and act accordingly.

At a micro level, people have a unique ability when communicating to filter the inputs based on their environment, their mood, their upbringing and the degree of trust in which they hold the communicator. At a macro level this means that people as groups will understand change very differently to what was intended.

At a simple level, the use of performance indicators often leads to unintended consequences. Calls centres are particularly adept at getting performance measures constructed precisely to have a deleterious effect on the business in which they operate.

For example, call waiting time measures should encourage call centre consultants to ensure that "no one" has to wait more than the three for or five rings laid down in their processes and policies manual.

In many cases it only encourages consultants to hang up on existing calls as they usually can see the performance measure current status flashing at them from an overhead sign.

Couple this with another measure, which dictates on average how long a consultant should talk to a customer and the consultant now has two reasons to hang up before the customer has satisfied the concern that made them call in the first place.

Whilst these consequences are not satisfactory to the customer, the unintended consequence for the business is that the customer calls back at some other stage. The average level of repeat calls that can be taken out of a call centre in my experience is of the order of thirty percent! Most of that benefit comes from matching calls to consultants with the right competence and authority and getting the performance measures right!

Policies are another area which nearly always has unintended consequences. This is especially so if the policy document confuses policy with process and parameters and sets out to imagine every circumstance in which the policy may be relevant.

By saying "We will pay all reasonable expenses attributable to the project" is the policy and setting up parameters a test for reasonableness separately we can have a simple policy administrable in almost all occasions.

Instead, we tend to state every event under which an expense will be paid. The unintended consequence is that we teach our employees to falsify documents to ensure their expense claim "fits" a preset event description.

Credit policies are another area rich in unintended consequences. In one instance I know, a credit policy in a Latin American country which had extremely high inflation in the past was retained even after inflation was normalised. The policy was that all customers had to have each load of product they were ordering approved by a person outside of the order and despatch function. If implemented, this delayed despatch by up to a day.

The intended consequence was to retain control over debtors. The unintended consequence was customers ordering multiple loads and getting them approved before they needed them and cancel them if necessary. The implications for the company involved were that despatch never knew how many trucks and drivers to organise for any given day.

Legislation provides an even richer field of unintended consequences. When legislation is drafted with not only the parameters through which the legislation will control the issue of interest, but also the value of the parameters, it creates several unintended consequence.

One consequence is that the legislation, in becoming too prescriptive does not allow for changes in community standards or business standards over time. A second related consequence is that as the legislation is often not amended or updated for twenty years or more, people often seek ways around the legislation, not just the parameters. Another consequence however, is a person breaking the law without knowing it as they are behaving within the norms of society.

In everything we do in business or in the public service as we attempt to change the way we work, the possibility of unintended consequences lurks. Whilst there is no universal sure cure, thinking systemically about problems and issues we are trying to solve helps reduce the risk considerably.

Peter Senge has written several books about thinking systemically that are well worth a read for anyone contemplating change.

Additionally, conducting some contingency planning helps reduce the probability and impact of unintended consequences. Contingency planning is fun. Thinking of every whacky thing that could happen and developing actions to reduce the impact and or the probability of it happening even gets useful contributions from the doomsayers.

Learning from errors makes fascinating reading from other peoples experiences. Don't let your experiences in managing change be fascinating reading on the account of your unintended consequences.

WOODRIDGE

Change Management Articles

Managing Change: Unintended Consequences