3. Change Management otherwise known as change control, is a method of regulating changes used to ensure a
standardized methodology for incorporating change.
Change Management focuses on ensuring positive responses to change in the organizational environment. (change
management, 2003, para. 1)
Organizations often create ways of accomplishing things that work well enough and thus become institutionalized.
These comfortable routines or even lack of routines can become boxes that constrain and inhibit thinking about trying new things. (Clawson,
2012 , p.311, para. 1)
In the past at ECG, there has been little to no focus on widely communicated and consistent ethical standards. This was
partially due to concerns about the companies growth as well as the assumption that employees would take the ethical approach without
management interference.
However, as the company quickly learned and as I briefed in my last presentation the perceptions of ethics can differ
widely due to diversity and numerous numbers of ethical view points available.
Therefore, as the newly appointed compliance officer at ECG I have recommended and drafted a standardized code of
conduct to provide leadership and employees with specific, company-wide, ethical guidelines. This code of conduct is a dramatic shift from
previous practices and will require a large amount of change in employee behaviors.
Change can be very stressful for employees. In order for change to occur without resistance employees must
understand the changes that need to be made, they must be flexible and willing to change, they must be instructed on how to incorporate the
change, and they must keep a positive attitude while implementing the change.
A lack of change management can create demoralized employees and a failure in implementing change. A lack of quality
change management can result in overstressed workers and managers continuously searching for new formulas for success.
There are various responses to organizational change. Some welcome change viewing it as an opportunity for learning
and breaking out of the comfort box. (Clawson, ???? , p.312, para. 3) Most, however, would rather remain in the comfort box and feel pain at
the mention of change. These individuals systematically deny, distort, discount, and ignore change for as long as possible. (Clawson, ???? ,
p.312, para. 4)
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4. Responses to change can occur at many differing organizational levels.
Top management (more strategic) may underestimating the changes impact on lower levels and respond to change by
feeling isolated from middle management or frontline employees, or top management may squeeze change enforcement on middle
management.
Middle management (more tactical) usually feels pressured to enforce top managements changes but is provided
inadequate information to successfully do so and in return is further squeezed by frontline employees who greatly resist the changes.
Frontline employees can feel threatened to change and respond with hurt, pain, or denial. This can be especially critical
when challenging what an employ perceives to be ethically sound and will require delicate management by leadership.
Leadership can have a drastic influence on the change process. Leadership should address the comfort zone and see
what changes need to be implemented and effectively communicate the necessary strategy needed to incorporate the changes. (Clawson,
2012, p.314)
Leadership should promote enthusiasm within the organization and the reasons why the proposed changes will aid the
organization. Leadership should engage managers and frontline employees in the change process and initiate a methodology for instructing
employees on how to incorporate the changes, possible providing incentives for incorporating the changes. (Clawson, 2012, p.314)
Leadership should search for alternatives if the proposed changes offer too much resistance or if the changes promote
unwanted behaviors, especially if the changes are causing unnecessary harm or pain and experiment with new change initiatives. This can be
accomplished by building a change team which will be discussed later.
Finally leadership should review and confirm the effectiveness of the changes and reinforce change results with new
strategic vision.
In summary leadership can lead the change process by clarifying the changes that need to be made and the reasoning
for the changes, building a change team, designing change experiments, and reinforce change results with new strategic vision. (Clawson,
2012, p.315)
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5. There are several roles in the change management process. These roles are designed to accomplish the maximum
management and implementation of change throughout the workplace.
“The change leader is the one who initiates a change process.” (Clawson, 2012, p. 318, para. 5) The change leader is
responsible for commissioning change studies, and requesting new processes for deploying the company strategy. (Clawson, 2012, p. 319,
para. 1)
A change agent is the person that causes change to begin in an organization. The change agent can also be the change
leader but is not required to be. (Clawson, 2012, p. 319, para. 2) As the newly appointed compliance officer I have been assigned the role as
the change leader, change agent, and change model for the incorporation of the new code of conduct at ECG.
The change manager is the person whom has the day-to-day responsibilities of implementing and overseeing the change
effort. This is normally a staff or line person. I have assigned the lead line person as change manager of this change management program.
Finally, as compliance officer I will also act as the change model, exemplifying the change effort and encouraging others
to comply with the new code of conduct.
Effective change incorporation involves, having valid reasons for incorporating the change, personalizing the change so
employees understand the benefits, thoughtful implementation of the change, assigning a respected person in charge of the change, telling
the truth, waiting patiently for results, and acknowledging change efforts.
The continuous improvement model for change management involves assessing the need for change, designing
procedures to incorporate the changes, implementing the changes, managing the change, evaluating the effectiveness of the change and
repeating the process.
It will take time for ECG employees to effectively model the changes required by the new code of conduct but in the end,
compliance will ensure ECG is able to expand and grow as a respectable company, with consistent, standardized, ethical practices beneficial to
ECG and society.
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6. Kurt Lewin theorized a three stage model for change known as the unfreeze, change, and refreeze model. Edwin Schein
later added details to Lewin’s model.
In Lewin’s model employees must first be unfrozen or motivated to take on the change. Change requires adding new
forces for change or removal of factors that play at perpetuating the unwanted behavior. (Wirth, 2004, p. 1, para. 2) Motivation to take on the
new code of conduct will involve the creation of an awards program that will reward the most compliant employee in each division each
quarter and will become part of the employee annual review program.
Next employees must move to the state required of the change, in other words they must make the changes necessary.
It is important to give careful consideration to the words, concepts, expanded meanings, broader context and metrics involved in the change.
The code of conduct will be scrutinized by first by the ethics review team, then by corporate leadership, and then by middle management for
careful consideration of the clarity and unconsidered impacts of implementing the new code. Once reviewed and signed off at each level the
code will flow back to the ethics review team and corporate leadership for final decision making. Once the code of conduct receives
finalization it will be dispersed through middle management and employees for implementation.
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7. Kotter’s eight stage process for understanding change involves establishing a sense of urgency, creating a guiding
coalition, creating a clear vision simply expressed, communicating the vision, empowering others to act, creating short-term wins, and
consolidating improvements. (Naughtin, n.d., p. 1-2)
Establishing a sense of urgency will require leadership and the change management team to identify and discuss crises
and opportunities that could occur with the implementation of the new code of conduct.
Forming a powerful guiding coalition team will involve assembling an energetic group with authority to lead and enforce
the change effort through ECG. The team will also need to work well together and be able to communicate implementation problems to me.
The change vision must be clear and artfully communicated at all levels with methods for measuring compliance and
dealing with non-compliance. Leadership will meet with the change management team weekly during the first six months of the new code of
conducts implementation and their after will meet monthly to review progress and suggest improvements.
Leadership will need a strategy to empower others for acting on the new vision. This will require looking at and
removing obstacles, changing systems/structures in violation of the new code of conduct, and risk taking.
A plan for visible compliance to the code of conduct will be created by the change management team addressing
compliance indicators for metrics and rewarding employees involved in the improvement effort.
Lastly improvements will be consolidated and training will be incorporated as the changes will be institutionalized.
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8. Common errors encountered when trying to incorporate change include allowing complacency, failing to create a
sufficiently powerful guiding coalition, under-estimating the power of vision, under-communicating vision, permitting vision obstacles, failing
to create short term wins, declaring victory preemptively, and not anchoring changes to the corporate culture. (Naughtin, n.d., p. 1-2)
If there is no sense of urgency set towards incorporating the changes needed to make the new code of conduct
effective, there is no motivation for compliance. Without motivation, people won’t assist and all efforts to incorporate the change will be
useless. Therefore it is imperative that deadlines and penalties are set with the effective dates needed to ensure the changes occur.
Without a sufficiently powered guiding coalition the management and enforcement of changes will not be
accomplished. This usually occurs in companies that underestimate the difficulties of producing change. The guiding coalition will need full
support and empowerment from leadership in order to meet the change objectives.
Without a clear and realistic leadership vision and communication guiding the code of conduct change management
program, the change effort could take the organization in the opposite desired direction. Therefore the vision must be decimated clearly at all
levels and clearly communicated to everyone.
Obstacles that do not communicate the vision of the code of conduct must be removed for the code to become
effective. This may involve removing managers and employees unwilling to accept and incorporate the code into their daily activities. This
also goes with practices that are in violation to the code, therefore I will be reviewing all standard practices for compliance. Practices that do
not meet the new code will need to be corrected until they are in compliance.
Leadership and management will need to actively look for ways to reward the people involved in incorporating the new
code of conduct into all aspects of business. There will be a leadership and management leading to discuss these reward programs next week.
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9. The key for organizational change is empowerment. Without empowerment of the people leading the change there can
be no motivation on the part of employees. Managers and Supervisors will need the authority to disciple employees that fail to make the
changes required of the new code of conduct. In order to empower managers and first line supervisors, a monthly review of employees
adherence to the new code of conduct will be completed and recorded between managers and employees. These monthly reviews will
become part of the employees official annual performance record each year. Employees failing to meet the standards set by the new code of
conduct after six months will be reported to upper management for review and action. Employees failing to meet the standards set by the
new code of conduct after one year will be terminated.
There are five principles leaders should follow to ensure effective implementation of the new code. Leadership must
communicate with a clear compelling vision. Leadership must make structures compatible with the vision set by the new code of conduct.
Procedures found to be in conflict must be corrected or removed. Employees and managers should never be forced into actions or behavior
incompatible with the companies code of conduct by leadership, and if so Leadership should be held accountable. The code of conduct must
not be relaxed by leadership to allow seemingly beneficial but unethical behavior at any level. Leadership that supports breaches to the
organizations code of conduct will be removed from leadership positions. Training will be created by the change management team and will
be required by all leadership, management, and employees. Specific, applicable training will also be given to employees by first line
supervisors on a monthly basis. All systems and tools, to include information systems incompatible to the code of conduct must be corrected
until in compliance or removed. It will be the responsibility of middle level management to review each system for compliance. Finally,
supervisors whom undercut the incorporation of the new code of conduct must be confronted.
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10. In order for change management to be successful leadership, management, and employees need to maintain and
communicate a positive attitude for making the change. The speed and capability at which change can occur is tied the attitude of those
involved in the change.
The attitude response curve to change shows six stages normally encountered when dealing with change. Not everyone
will experience every step. Some employees respond favorably to change and thus never experience some of the negative responses.
The attitude response to change includes denial, resistance, attitude through, exploration, responsibility, and
commitment.
In the denial stage, employees ignore unpleasant facts about the changes and dismiss them for more pleasant thought.
In the resistance stage, security and other needs begin to feel threatened and the employee develops overt defenses to
the changes being made. This stage can be critical when incorporating something like a corporate code of ethics as many people have
conflicting ethical beliefs and enforcing practices such as a zero policy on sexual harassment may be quite contrary to the ethical systems
which employees were brought up in.
The attitude through stage involves resentment, anger, and worry. This stage must be dealt using strong interpersonal
skills to communicate the necessity behind the change in order to help employees move forward.
The exploration stage is where the employee comes to realize that change is necessary.
The responsibility stage is where the employee finally takes responsibility for the changes needed, and takes actions to
improve conditions surrounding the change.
Commitment is the final stage and involves dedicating oneself to the change until a new change becomes necessary.
Positive reactions to change occur when people, believe change is right, have authority on the change process (this is
another reason employees will be asked to review the new code of conduct and change program for suggestions), respect the person
championing the change, expect the change will be beneficial to them, and believe that the time for change is now!
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11. ECG’s Code of Conduct will be functionally divided into four functional areas. The first area of the code of conduct
regards maintaining an inclusive, fair, and healthy work environment.
ECG employees should act with integrity and honesty in all company dealings. This includes complying with all laws that
govern ECG’s business, maintaining an ethical an professional work environment, and complying with all company policies. ECG employees
are required to treat venders, customers, and fellow employees with the utmost respect, integrity, fairness, dignity, and honesty.
Maintaining an inclusive, fair, and healthy work environment involves ECG policies on diversity and equal opportunity
commitment, discrimination and harassment, workplace violence, workplace safety and environment, substance abuse, solicitation and
fundraising, gambling, employee privacy, and misconduct off the job.
The second functional area of ECG’s code of conduct involves maintaining integrity and fairness in the workplace.
ECG’s reputation depends deeply on the integrity and activities of its employees. It is therefore imperative that
employees avoid any activities or relationships that could impair, or appear to impair an employees ability to make objective and fair decisions
while performing his / her duties. ECG employees owe a duty to advance ECG’s interests whenever the opportunity arises. ECG employees
must never use information or property for their own personal gain nor take personal advantages that arises from work done for ECG.
Maintaining integrity and fairness in the workplace involves policies regarding avoiding conflicts of interest, political
conflicts of interest, and insider trading and financial interests.
These concepts will be explored in greater detail by the ethics compliance group in the official code of conduct
presentation on Monday next week.
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12. The second half of ECG’s Code of Conduct is divided into the sections protecting assets and reputation and maintaining
integrity and fairness in the marketplace.
No business goals of any kind should ever be an excuse for misrepresenting facts or falsifying records. Remember the
Enron fiasco I used as an example during last weeks meeting? These kind of unethical practices should not be allowed to occur for any reason,
and must be dealt and corrected immediately if an ethical dilemma ever occurs.
Protecting assets and reputation includes the policies in regards to preparing, disclosing and maintaining records,
safeguarding company information, proper use of company property, protecting communication and information systems, intellectual
property, and handling external communication.
The final section of the ECG code of conduct concerns maintaining the integrity and fairness in the marketplace. In
summary it says that all ECG employees should treat customers fairly in all aspects of transactions, including pricing, advertising, marketing
and service solutions.
Maintaining integrity and fairness in the market place includes policies in regards to customer relationships, the
government as a customer, selecting and maintaining relationships with business providers, gifts and entertainment, bribes, kickbacks, and
loans, relationships with and obligations of departing and former employees, interaction with competitors, relationships with affiliates and
international relationships.
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13. The purpose of this ECG change management procedure is provide the ethics compliance team with a method of
controlling and actively monitoring project changes. The change management plan seeks to increase communication on changes being made
and to delegate authority to facilitate decision making by the change management team.
The key objectives of ECG’s change management program are to identify and control changes in scope of ECG’s new
code of conduct, resolve questions and issues between customers and employees providing clarity for ethical and unethical conduct, ensure
changes to systems and processes are justified and that proper procedures exist in accomplishing the changes, obtain authorization for
implementing the changes in the workplace, and for monitoring the progress and impact of the changes caused by the new code of conduct.
(Northrop Grumman Corporation, 2007, p.1)
When a potential change to the code of conduct is identified, it should be brought to the attention of the compliance
officer for initial evaluation. Based on the merit of the proposed change, and it’s potential of impacting the scope of the code of conduct, the
compliance officer will determine the action to take. (Northrop Grumman Corporation, 2007, p.3)
If the change is accepted by the compliance officer the change will be assigned a control number, brief description,
priority, and name of the originator identifying the change. (Northrop Grumman Corporation, 2007, p.3)
The change will then be sent to upper leadership for review to ensure the change complies with the companies strategic
vision. If it does the change will be incorporated into the code of conduct and all procedures/methods/training will be modified as necessary
to update personnel on the change. (Northrop Grumman Corporation, 2007, p.3)
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14. Leadership, management, and computer based training will be initiated once the code of conduct is finalized and occur
reoccur on an annual bases. New employees and employees caught violating ECG’s code of conduct will be required to take/retake the
companies initial code of conduct course before work can begin at ECG. The computer based training modules will be developed off-site and
approved by the compliance officer and other leadership before being dispersed throughout the workforce.
Policy and hands-on scenario based training between supervisors and employees are required on a bi-monthly bases
and will be developed by middle level management.
Supervisors will be required to complete feedback notification forms about the progress in their centers toward
adapting the new code of conduct, with questions, and areas of concern on weeks 2, 4, 10 of the code of conducts implementation. The
change management team will collect, review, and report the findings to the compliance officer and code of conduct review board.
All employees to include management, and leadership are responsible for reporting violations and concerns in regards
to ECG’s code of conduct. Employees will have a large breakout of the code of conduct printed at each work place. All employees my submit
anonymous or confidential complaint forms by calling the compliance officer or using the ECG ethics guideline website at
www.ECGethicsguideline.com.
ECG employees must report, instances of violence, hostility, possession of weapons, danger, and illegal conduct,
discrimination or harassment, and accounting, internal audit control, and auditing complaints. All reports are kept confidential to the extent
permitted by law.
Finally middle and lower level managers are required to create change and compliance incentive programs encourage
phasing the ECG code of conduct into the workforce. Leadership will work with management in deciding appropriate rewards and benefits
available to management for promoting the code of conduct.
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