Change Management Principles vs Continuous Improvement Practice

15min
Season 1
Listen directly on:

In our previous episode, a webinar, we received some great questions about change management versus continuous improvement. So, today Dr. Ivan Zak and Ryan Leech are diving into some of the best change management practices. From the ADKAR model, to McKinsey’s 7-S model, Kotter’s 8-Step Change Model and even Kubler-Ross, we discuss the continuous improvement and how it differs from change management. Change is inevitable, but when employees lead it, not only will it be better received, but it will touch on pain points they experience.
So, rather than waiting for corporate change management, foster a culture of continual improvement and your organization is sure to flourish and weather whatever storm comes its way!

Topics discussed:

  • Industry change management models;
  • What the McKinsey 7-S model is most useful for; gap analysis to assess strengths and opportunities;
  • Which steps are more important than the change management itself;
  • What continuous improvement means and how it can be implemented in organizations;
  • Why continuous improvement resonates with millennials in the workforce;
  • Fostering a sense of continuous improvement in your business is more effective than implementing corporate change.

Helpful links:

Speakers

Dr. Ivan Zak has earned multiple accreditations in veterinary medicine. After graduating, he worked in 35 veterinary hospitals across Canada, where he was inspired to create Smart Flow, a first-in-the-industry workflow optimization system. Smart Flow was subsequently acquired by Fortune 500 company IDEXX, where he became General Manager of the Software division. After consulting 500+ practices worldwide on workflow optimization, he decided it was time for a new adventure. Dr. Ivan has a holistic view of the whole veterinary business market and he’s making his next step the creation of a more cohesive, unified platform that will ultimately benefit the veterinary professionals.

Transcript

Ivan-Zak
Dr. Ivan Zak

Welcome to Consolidate That! Ryan, how are you today?

Ryan Leech, Director of Sales
Ryan Leech

I’m great. How are today, Ivan?

Ivan-Zak
Dr. Ivan Zak

Not bad, very windy and cold in Canada. I bet it’s – Do you have power in Texas now?

Ryan Leech, Director of Sales
Ryan Leech

We have power, it actually – we went from people with no power and zero degrees to I turned on my air-conditioning because it was too hot. All within three days. It’s been exciting but we’re back to full steam here and getting back to business.

Ivan-Zak
Dr. Ivan Zak

Awesome, what would you like to talk about today?

Ryan Leech, Director of Sales
Ryan Leech

Today, I know that we had a really great webinar, which our last episode of Consolidate That! published the webinar that we have with some great people and some of the cool questions we got were about change management versus continuous improvement. What are some of the best change management practices?

Ivan-Zak
Dr. Ivan Zak

There’s a few models in the literature that you can see or you know, if you’re going through business school, one of them that I like is the ADKAR model, which is basically Awareness, Desire, Knowledge, Ability and Reinforcement. The important one there is the desire, when we’re talking about the veterinary clinics that were just acquired, the desire is always questionable on how much people want to implement the change.

Now, there’s also Kotter’s 8-Step Change Model, which talks about the creating of sense of urgency, then building a strong coalition forming a strategic vision then gating the buy-in and they’ll enable in the action, generate short-term wins and sustaining acceleration through institution of change.

That’s a common one and the one that I like for when we talk to consolidators about their internal structure and just assessing their sort of gap analysis. I like using 7-S McKinsey model so that’s the one that we commonly use. Just looking at this sort of hard elements and soft elements of the organization, hard as strategies structure system and then south one is shared values like your core values and then the staff style and skills.

That’s the one that I like to use but there is others then that I bumped into in my previous sort of studies. One that I thought was interesting was Kubler-Ross and I don’t know if you’ll recognize some phases in that but it’s denial, anger, bargaining, depression and acceptance.

Ryan Leech, Director of Sales
Ryan Leech

Yeah. Yeah, those are the same ones right my therapist tells me about, right? The steps to grieving or the phases of grief, right?

Ivan-Zak
Dr. Ivan Zak

Yeah, exactly. To me, when I read that one, I was laughing because that seems more appropriate for most changes that is happening in the veterinary clinics because they’re dealing with grief rather than accepting it with the desire.

Ryan Leech, Director of Sales
Ryan Leech

Well, I guess grief is a major change in people’s lives so you can use it across there. You said the 7S’s is your favorite for consolidation? Is that your favorite one as well to use within a vet practice?

Ivan-Zak
Dr. Ivan Zak

It’s not so much for consolidation. I wouldn’t call it it’s for change management, it’s more for the assessment of the internal forces and structure and how the companies organize. I use it more for gap analysis together with the SWOT analysis to understand the company’s strengths and opportunities.

Ryan Leech, Director of Sales
Ryan Leech

Do you think it’s more a guide of what could go – undergo change or what needs improvement more so than an actual step to improving?

Ivan-Zak
Dr. Ivan Zak

Correct, yeah. It’s more not how-to but what, yeah, this one is used more for that.

Ryan Leech, Director of Sales
Ryan Leech

Okay. What do you think would work for the actual changes, right? You assess them with the 7S’s but what do you think is the best way to go about those changes?

Ivan-Zak
Dr. Ivan Zak

Well, you know, a lot of people talk about implementing changes through – I actually seen more in the veterinary clinics using this sort of 8-step model where you get the coalition, you create the vision, you get the buy-in, you celebrate then I was talking to one of the consolidators they had.

They invited someone externally, we talked about it in the webinar yesterday and someone asked, “Is it a good idea to invite someone from the outside?” It was interesting in the MNA course that I recently took, they were talking about who should do the change post acquisition.

Again, we were talking about bigger kind of like large companies, we were talking about US Airways merging with American Airlines and – but they were telling – I was trying to map it against our customers and the veterinary clinic acquisition. But they were talking about how important pre-acquisition alignment. Then, when the vendor is planning to sell or to be acquired, how important that is to get the buy in from your management team prior to acquisition. I think that those steps are more important than the change management itself.

If you drop the bomb of we’re – “We’ve been acquired yesterday” and then you didn’t align with anybody, well that can bring a lot of shock and dealing with it as a grief probably makes sense. As opposed to that, I think that what more important is to inform everybody in advance that the change is happening, that the acquisition is happening and that some change will come.

But then in the meantime, if you don’t already have it in the hospital, then as an organization such as consolidator, embrace more of a continuous improvement culture rather than proper change management.

Ryan Leech, Director of Sales
Ryan Leech

Yeah, that’s great. What do you think would be really big in the continuous improvement world? How would you go about looking at that culture of continuous improvement?

Ivan-Zak
Dr. Ivan Zak

It’s something that people say a lot but they don’t do much. It’s really important to dig in into what is continuous improvement culture. By the way, it’s one of the Lean principles that was applied in healthcare system.

What I mean by continuous improvement, it’s not when you need change, don’t come in with a solution. Embrace your staff and empower your staff to come up with the solutions on continuous basis. Basically, if you know what problem to be solved then present the problem to people that do the work.

Don’t come with the ready solution in the box and ask them how they would like to solve it. If you do have the answer, help them to come to the answer that you have but empower them to get there themselves.

As an example, I always like the story from the Boston General Hospital where they had this issue in the emergency room. They had a sign next to the bathroom and it said, “Don’t void before seeing a doctor.”

They had a huge problem because people would just go to the bathroom, they would urinate and then they wouldn’t have enough for sample and then you’re in an emergency room, you need a blood work, you need a urine sample and they couldn’t do all the diagnostics. One of the nurses that worked there and she was actually Spanish-speaking. She was not from – originally from the States but she mentioned this to her manager and she said, “Why don’t we change the sign, don’t void before seeing the doctor to don’t pee before seeing the doctor?” because she didn’t know what void means.

Then so basically, they made the sign, she owned it. She honestly owned it and she loved it because she made the change and everybody was holding and going to see the doctor and saving that sample.

Such a simple example of allowing people to do the work to make changes and then they will own the process and it goes to everything in the hospital. If you will come in and say, “Okay, this is our new workflow in the front desk and we want to see three patients per hour and this is our KPI and this is how you should do it”.

Then people will resist them. They’ll say, “Look, we know how to run the appointments, we know how to do TPR, we know how to do everything and this is what we do well.” And some dude come in with the suit and tie and explaining that they’re workflow optimizers. I think that’s just crazy, so if you will allow people to sort out the issues that you think that will bring improvements on your margin expansion or whatever growth lever you are designing, then let people to come up with the solutions.

Then let them do it continuously and that’s where the continuous improvement culture kicks in where then when the next change needs to happen, they will be ready for change and it’s a rolling thing, not an event that you have to grieve about after.

Ryan Leech, Director of Sales
Ryan Leech

We keep laughing about the grief but I know we were looking at the – a couple of the different models in the Kubler-Ross one has peaks and valleys, right? You’re absolutely denying it and you’re in denial. You’re grief-stricken and you’re feeling fine. You get over, you come down, you’re going to these peaks and valleys of emotions and it kind of sounds like the continuous improvement maybe is about leveling out a lot of those feelings and those interactions.

Where, as opposed to the group of change experts stomps in with their clipboards and starts marking up things with red pens and spikes everyone’s blood pressure and then people settle down while they’re thinking and then it comes back, maybe the continuous improvement keeps it at a level flow throughout the business so that people can feel ownership of it but then they also aren’t having that grief process of, “I’m completely changing my life and this is different than what I always wanted to do.”

Ivan-Zak
Dr. Ivan Zak

Yeah, it just changes the dynamic in the organization. Basically, when you are – if you are going with the classic change management, with the classic change management you need a stressor. I don’t remember you said that but I remember they had quote. They said that change is possible when living with the status quo is scarier than diving into the unknown.

I love that phrase because it’s basically you do need a stressor and understand that what you’re doing now is so stupid that you really want to change that. It was like when I came out with the smart flow idea, I hated these cage cards or flow sheets that sit on the clipboard on the cages. I really wanted to change that. But in continuous improvement culture turns that upside down. It’s basically people become curious on improving things in their environment but you need to reward them especially if you look at our workforce right now, which is composed mostly for millennials and then they’re the people that are narcissistic with this sense of entitlement and they need constant recognition.

You can’t up their pay every two weeks. But if you recognize their achievements through the continuous improvement projects that they are doing, then you are achieving the motivation of that particular person. You are giving them autonomy and both of those are triggers of the burnout by the way and then you’re eliminating those and then you’re letting people solve their own problems and you’re implementing the change that you need to do as a business.

Ryan Leech, Director of Sales
Ryan Leech

Yeah, it’s when we were on the webinar, you mentioned that same thing about the millennials being a little narcissistic and as a millennial, I would never say anything like that about us but I think we’re perfect. But I think it is interesting. We grew up being told that we could do any job, we could do anything in the world and we should strive for the best and find great jobs and reinvent things and change things.

When people are brought into structured organizations like corporate organizations, that’s why I see a lot of millennials doing startups and smaller businesses and local businesses, I think as a generation, we are looking for those inefficiencies and looking to change things. It’s a great group of people I think to reach to, to be able to find continuous improvement ideas. It’s one those things that I’m always just even around the house, you know?

I don’t know how many times I have tried loading the dishwasher in different ways to figure out ways to maximize the number of dishes in there. Not because I like doing that but because it means that I have to load and unload the dishwasher a fewer times. It’s working hard to be able to work less and I think that’s a big thing for the millennial generation to get excited about.

Ivan-Zak
Dr. Ivan Zak

There you go. Millennials are also afraid of the phones. Are you afraid of the phone ringing because they only accept the text before the phone call?

Ryan Leech, Director of Sales
Ryan Leech

No, I’m a sales guy. You call me anytime you want, I’ll pick it up. I’ll get out of the shower, I’ll talk on the phone anywhere. You just call me whenever you want.

Ivan-Zak
Dr. Ivan Zak

That’s awesome. Yeah, but I think that, you know, I think that just to bring the important things out of this episode is that creating continuous improvement culture is much more effective than applying corporate change management tactics. And it takes not only someone externally to come into your organization and then say, “Okay, this is how we’re going to do, we’re going to create a theme, we’re going to create t-shirts and this is what we’re going to… we’re going to change pins.”

I mean I think it was in Cornell University, they had the t-shirts when I was there. We were changing pins as well as the smart flow and it was a great sort of effort to engage everybody but if people are not used to change then they will be disturbed by it and I’ve seen it so many times with smart flow in the clinics and you’re talking to – you know when, I remember the nurse standing in the kennel with the dog with a leash on her hand crying with an iPad in her hand because we changed the codes.

We changed the software and we changed the names and then she couldn’t find what she’s trying to do to the pet while she has 20 years of experience doing that particular task. She knows what to do, she just doesn’t know where to record, where to insert the payment for it. It’s really about nurturing the culture of continuous improvement where people wouldn’t get into the stress like that while you’re implementing some changes.

Ryan Leech, Director of Sales
Ryan Leech

We always try to come and add additional readings and learning abilities. I do think that the previous episode, which was our webinar had some really great ideas from both Bob and Tom for wonderful ideas across the board but are there any books that you’d recommend for people to read to learn more about either continuous improvement or if they are set on change management, how to do that well?

Ivan-Zak
Dr. Ivan Zak

Well because continuous improvement is a part of the Lean Principles developed by John Tucson in healthcare, I think that some literature on Lean in the hospitals would be interesting. There is a good book on Lean Six Sigma for hospitals. It was written by Jay Arthur and then there is another one that I think I would recommend as more on the leadership side of things but it’s, Strengths Based Leadership and it is by Tom Rath, so those are probably the best.

Ryan Leech, Director of Sales
Ryan Leech

Wonderful. Well, I’ll have to pick those up. I know some other people on our team did a deep dive into eBay and bought a whole bunch of eBay used books to read in their little self-built MBA so maybe I’ll have to go on those and check them out but again, I always appreciate it and I’m looking forward to our next conversation.

Ivan-Zak
Dr. Ivan Zak

Yeah, thanks Ryan. It was fun sitting here.

Ryan Leech, Director of Sales
Ryan Leech

Bye.