The use of Action Teams in a merger or major change process

Why we need Action Teams (containment)

We often hear that mergers are difficult to achieve because of cultural differences – the way we do things in our different organisations obviously differ, and difficulties can arise as a result. Some people assume they know what they mean about something and others have a whole different idea of how to behave.

In a merger what happens to culture?

The two pre-existing cultures are actually destroyed by the process of merger. As this happens, and as new ways of looking at things take hold, many of us can feel very uncomfortable. Instinctively we react quite strongly to the loss of the old way. The loss of the shared reality, on which we relied as individuals and a group, evokes a strong feeling of anxiety and can lead to strong  resistance to change.

The most important thing for managers to do in this situation, as I have described before, is to provide reassurance and emotional containment so that the staff in the organisation can continue to work as normal, and in general find themselves in conscious support of the necessary process of change.

If the process of containment is not supplied by the leadership of the organisation very quickly people become highly anxious, feeling threatened by every change initiative, they hunker down and become paralysed. Then they start to throw around blame, scapegoating, attacking back, and their understanding of what is happening can become quite separate from reality. Even in my organisation where we have worked hard to contain anxiety and keep the focus on the task we have been surprised, and sometimes amused, by hearing back some of the gossip. If you find even normally able people saying they didn’t understanding, or weren’t told, or didn’t get the email it could be that their perception has become less reliable due to the stress that they are carrying. When this happens their ability to work effectively is seriously compromised. Concrete thinking leads to rigidity, a loss of creativity, and polarisation. As a result they cannot work effectively with others on integrating their differences and collaborating on the necessary change process.

Of course all change management is not about how we are feeling. Not at all. There are technical issues to be sorted out – what IT systems we will use, how savings will be made, what our growth strategy might be. All of these have to be planned in and work done to achieve them. But how people are feeling about the organisation, their team, the way the are treated and how trust (or distrust is growing) is of even greater importance. Senior managers need to understand and plan for the emotional aspect of the changes required, all the time providing containment of emotions.

While there will be plenty of delays, failures, difficulties and expense involved on  the technical side it will not seriously affect a merger or any major change programme. However, if there is a failure to contain the emotions of the organisation, the set backs will be very severe. At worse, it could stop all progress and result in considerable loss of revenue. When this happens, and I have seen it in many mergers and change programmes to date, the staff are in a state of panic and anxiety. They spend most of their work time, and much of their time outside work, worrying about the change. They believe all the rumours about being taken over, discriminated against, treated unfairly, ignored, told lies, undermined, undervalued etc. And even if senior managers do not mean to harm or attack their staff the sentiment soon grows and is believed. Even innocent decisions are felt as attacks and the ability to carry on working, delivering services to their customers, is severely undermined.

What is an Action Team?

At Notting Hill Genesis we decided to use Action or Co-creation Teams to begin to create the new teams that will serve the new organisation. Originally a product of Total Quality Management Action Teams are a vehicle which can foster individual, group, and organisational learning, while contributing to the task of the organisation.

These are teams made up of representatives of different parts of the organisation who are empowered to solve cross-functional, and intra-functional problems. This includes the design of new departments, but also issues such as our accommodation strategy, or issues like terms and conditions.

Their success depends on their terms of reference which provide enough senior management input to contain anxiety, but not so much that their scope is limited. They need some overall parameters in which they must work (eg the accommodation action team has to take the convenience of customers and staff into account as well as a desire to save money and use our offices efficiently). Of course the main priority is to empower this group of staff to make decisions on how the whole organisation will go forward. This empowerment is real, not just words. The expectation is that the Board will accept their recommendations in full.

Here are the guidelines we issued to each department and team:

1. Each team will work on problems connected to the strategic direction of the organisation, ie real, big problems not small sub-sets.

2. Make sure one sponsoring senior manager is responsible for the team. He or she must have sufficient delegation to be able to make decisions.

3. Make sure that all managers know why and how these teams will operate and recognise their key importance in the work of the organisation. This means releasing staff and allowing them sufficient time to carry out their work.

4. Impose a time limit. These projects are relatively short term and have a clear finish time. We have found 3 months is about right, although some may take longer. Decisions on offices took about 12 weeks, whereas the design of our key operating model (delivering our key services to our residents) took five months.

5. Do not make a whole industry of this approach. Most people need to be able to get on with business as usual.

6. The sponsor is responsible for measuring and monitoring the progress of each action team in terms of both the task and the team dynamics. Most of our teams have worked effectively on the key task. However there have been cases where teams have been at loggerheads and have been fighting for supremacy. This has required the sponsor to take back control in order to reset the work.

7. There may also be difficulty and stress around processes which affect other parts of the organisation, for example the need for new IT systems or HR policies. In these cases the sponsor needs to oversee the processes which cross over into another part of the organisation.

8. Always celebrate team success and share the learning.

9. Make sure the contribution the team has made to the strategic direction of the organisation is documented and communicated to the whole organisation.

Next week I will describe how we got on; the successes and failures.

 

 

 

How people really react to a merger

This week I completed a major merger. Two organisations, each made up of around 1500 people, managing about 65,000 homes between them, amalgamated into a £750m turn over organisation. Over the next few weeks I am going to write about merger specifically, and I would be very interested in your feedback.

I have never led a merger on this scale before, so I am entering new territory. I am determined to the integration of the two organisation as well as I can, supported by a group of excellent managers.

A merger is really a disturbing experience for those involved, where we confront both real dangers (will I have a job?) and mental anxieties (feelings of disorientation and loss, for example). These mental worries remain in our minds and consume us. I am not the only one who has lost sleep.

A merger is a radical change which is already affecting everyone in both organisations, even if for many of them nothing is actually changing in terms of jobs or terms of employment. Merger changes things more fundamentally than most of us have ever experienced before at work. The process will rupture the links that all of us have with our work, the company and each other. All our profound emotions that are contained within our original organisational structure are released, and can result in ourselves or our people descending into panic. Who is in charge, will my manager change, will I have to work from somewhere else?

At the emotional level we worry if we will be liked, understood and treated well in the new environment. Under emotional stress we can feel we are being persecuted and react by putting up defences to protect ourselves. These defences can include projecting all our bad feelings on to the leaders who have done this to us, or onto the other organisation. This is the rich emotional tension that leads to crazy rumours.

Managers planning for merger

Under threat or what feels like a sustained attack many of us regress emotionally. We start to blame our managers, or the Chief Executive; we scapegoat the teams that got us into a vulnerable position, we start to believe that our existing organisation is perfect and we need to fight to maintain it; and so on. When we feel vulnerable and frightened our perceptions can get distorted. At meetings to discuss how the merger will proceed, or what role we might play, we often find ourselves having tense and difficult discussions. Our  ability to work effectively or creatively with others can become seriously compromised. Our thinking can become leaden and rigid, things seem very black and white,  and we find ourselves fighting for supremacy when what actually need is the capacity to integrate differences and to collaborate.

Our subconscious fear that we may not survive the change can lead to anger and aggression projected into the new organisation. Compassionate Managers understand why people feel like this and as the old organisations begin to break up they work hard to contain the understandable but damaging emotional release of their colleagues. If we fail to contain the anxiety of our colleagues they (like the child told to “get over it” that I mentioned the other week)  can feel so uncomfortable that they disconnect from the organisation and its support systems. By supporting colleagues, explaining what is happening, bringing them back to reality and helping them cope, we not only help the individuals – we also ensure that the new organisation begins to develop a robust and healthy culture.

Because some people will be leaving the new organisation – board members at the end of their tenure and a few who have chosen not to stick around – I have experienced a sense of regret, loss and grieving. I love my organisation and it is now going to end!  I am also upset that many of my taken for granted behaviours and practices have to be renegotiated with new people. Of course we worry, intellectually, about risk and the destruction of value. But emotionally all of us experience loss and disorientation in a major change programme. And this can make us irrational or aggressive. Because everyone fears that they will be taken over/dominated/wiped out/annihilated in a merger, it is easy to turn the tables and to seek to dominate the “aggressor”.

The intense emotional experiences of our senior teams is an early warning of how the larger staff group is feeling, or would feel, if we were not able to contain their anxieties effectively. Because the senior team are experiencing some turbulence,  it has meant we would be more likely to neglect the need to support our staff. If managers are no longer available to listen to and support their teams, then they will be left to their own devices and will lean on fragile and less rational groups and structures within their disintegrating organisations. In these situations it is not surprising that individuals or sub groups may be mobilised to carry the anxiety.

A sub-group, for example, a managers team, may hold on to the worry and try to get it resolved in whatever way they can, even if that is organisationally inappropriate. It is essential to recognise  that what they are holding belongs to the whole organisation and should be regarded as anxieties expressed on behalf of the whole organisation. In no way should they be regarded as awkward or negative people. We need to listen and acknowledge that what they are saying is undoubtedly felt by the whole organisation and then respond to the anxiety by openly discussing the reality.

The success of an organisation is deeply connected to how it contains anxiety. We have tried to help everyone keep an integrated, realistic, psychological connection to the people and events around them. We ourselves and those we manage are helped to discover what are realistic dangers, and conversely what is a product of our unconscious worries and emotional feelings.  Acknowledging and dealing with emotional anxieties effectively allows us to use our minds in the service of the organisation and task.  If we don’t we will be forced react rather than reflect – just going on instinct or responding to the emotions in the room, rather than creating an opportunity for personal and organisational growth.

Helping your team deal with change

Little kids trip up in playgrounds on a daily basis and wail in pain and upset. If you have responsibly for children you may have seen three different types of behaviour.

Parent A ignores the child who is crying loudly. Or she shouts “Shut up! Stop whining!”. This child does not have his anxiety contained and he is frightened. Maybe he will bleed to death if no one helps him. Without Mummy to help, he has to come to terms with his feelings and his pain all on his own.

Parent B rushes over in a panic as he imagines his child in A&E, with stitches, blood, fainting and infection. He fails to contain his own anxiety, setting off ever louder wails and dramatic behaviour in his offspring. The child finds it hard to contain her anxiety and gets more and more worried by Dad’s behaviour. Soon she starts to imagine that this is really serious, maybe she is going to die – not only has the parent lost it, he has also contributed to his daughter’s mental anguish.

Parent C immediately goes to her little boy. She doesn’t gasp or run over, but gets there fairly fast, helps him get up, looks at the damage, while all the time holding him close to her own body, offering reassurance, kissing him and saying things like “Mummy’s got you! I will look after you! Shall we go and wash out the dirt? “

Can you apply these archetypes to work – three different types of manager, and a member of staff who has just heard they are at risk of redundancy, for example?

I have outlined over the last two weeks how major change – like death of a close relative, moving home or redundancy – can fill us all with a sense of panic, anxiety and dread that may not be realistic but is very real and frightening.

I know some people will think this is ridiculous. Many managers have said to me something like “oh the best staff will be really enthusiastic about change”. They then admit this is their own view. Maybe they are the relatively rare people who really like uncertainty, but the chances are they are just telling themselves they like change. They may indeed be signed up to the positive benefits of the change, but this is probably only possible if they don’t think it will affect them personally. Even the most senior managers will, in a big change programme, be threatened by loss and change, and have exactly the same feelings of anxiety, loss and fear of obliteration that everyone else has. We may as well tune into our feelings, realising that what affects us will certainly be affecting our teams. And they will feel it more strongly than us, as they have less say and less control over the process and the outcomes.

My point is that even though your logical brain may know that things will be fine, even positive, your instinctive feelings and your emotional brain will probably be quivering in their little boots.

A few years ago I was mentoring a talented financial services HR manager who was involved in a merger situation. Jim was required to reapply for his job and we discussed his extreme discomfort. I knew that he was highly likely to get the job, given his length of service, significant achievements, general attitude and congruence with the values of the organisation. I tried to reassure him using two arguments – firstly that he was very likely to get the job (80% chance), but that if he was not chosen he would easily find another opportunity. His length of service would ensure he received at least one years pay, which would tide him over for 18 months or two years if he wasn’t working. I asked him what was the chance of not being able to find a new, similar job in two years? Jim agreed that he would probably find a new job easily, but protested that he loved his job, his team and the job he was doing. He was not looking to move and had imagined he would stay where he was for most, if not all, his working life.

I did what I could to reassure him. While Jim knew he was good he resented “applying for his own job”, and he thought the man he was up against was not very good. He said the management had “a cheek” expecting him to compete, even though (as a qualified HR professional) he should have understood the legal situation that both HR managers had a right to be considered. He was out of sorts for weeks as he waited for the interview.

As well as giving factual reassurance about his chances, I also did what I could to contain his anxiety. Just as my brother “put his arms around me” when I was a frightened kid, I metaphorically put my arms around Jim. I became a vessel to put his anxieties into, a safe depository for the worries he was carting around; I put my arms around him as I promised he would be OK. I listened, I empathised and I reflected back to him about how he was feeling. I explained why he was feeling so threatened and helped him recognise why he felt so angry.

Because he was burning up with a feeling of injustice (despite his rational brain knowing why the process was necessary) I knew the best way to help him was to try to get him to acclimatise and adapt to the new reality created by the merger. The merger was happening; we needed to focus on his survival practically (getting the job if at all possible) and survival emotionally (containing his anxieties so they did not undermine his performance at work or in the interview). We made a plan for a good interview and I tried to help him come to terms with his feelings. I tried to be Parent C. Jim got the job, but he found the interview process very uncomfortable and having to compete made him resentful. It took a long time for him to forget how he was treated by the company.

Wrapping your arms around me

I am involved in managing a merger at work – bringing two  housing associations together. Everything is going well, but the most important part of my job is making sure the human beings are supported and looked after during this period, and I will write up some of our learning over the next few weeks.

Obviously change on such a massive scale causes enormous worry. It is no use senior staff and board members talking about opportunities and what will become possible when we operate on a larger scale if the staff and residents do not feel safe. I want to touch today on how we experience significant change, and next week I will develop what an organisation can do to help people deal with change.

Ask yourself how did you feel when your parents told you that you were moving house, or that you were going to have a new brother or sister, or that a loved one had died?

I know how I felt when told, rather abruptly, that we were moving house.

I remember feeling angry, bereft, at a loss. My immediate worries were about all the people I loved – my school friends primarily, and neighbours. I was worried about going to a new school. Even now, decades later, I can recall a sense of absolute dread about what a new school would be like. I thought there might be bullies lying in wait for me. I felt a huge sense of loss about everything I was familiar with – even aspects of my life that I didn’t love – unpleasant teachers etc. I felt “better the devil you know”. I just felt sick. But also powerless and unable to change the situation. I feared the unknown and the huge effort in having to adapt. I know it sounds dramatic but I am sure you will have had some similar experiences in your childhood or adult life. My post on change tried to address how even a few years ago a change of office location made me feel anxious and uncomfortable for at least a fortnight. And I was in control!

Change involves loss, especially of the people we hold dear. It is very difficult to stomach and any of us involved in requiring others to change – whether it is our kids or people at work – need to proceed with caution, knowing that we will cause a great deal of anxiety and stress. We should only make the changes that are really required (avoiding all strictly unnecessary “reorganisations”).

Let’s go back to my parents telling me we were going to move house. They were reassuring – “you will make new friends, the new house is bigger, you can choose the colours for your new bedroom, the new school is a better school, your old friends can still visit you.” I am sure you will immediately see that these arguments did nothing to reassure and console me. I was angry, sad, panicky, and felt powerless and small. And all the “logical” arguments in the world failed to impress or reassure me. Life as I knew it had just changed utterly. My parents had so little insight into my feelings that they hadn’t even considered (much) the impact of their decision on my whole world. I felt that life as I knew it was being thrown away without a care, and I felt very low.

What I needed was not “logical” arguments, but love, security and reassurance. What I was feeling was a maelstrom of negative and frightening emotions, not the rights and wrongs of a balanced score card. In the midst of the new information it is likely that my fears may have been exaggerated. In my imagination those school bullies were very scary. I thought about a life of long term misery and fear. You will not be surprised to know that the move was fine actually and my new school was certainly no worse than the previous one (I wasn’t that keen on school of any sort).

When I burst into tears of fear and frustration I may or may not have got a big cuddle from my Mum or Dad. They had no negative intentions and I know that, in fact, they did what they thought was best for us as well as themselves. But what I remember is that I got some important and relevant support from my younger brother. He and I talked. We clung to each other. We felt something like “we still have each other; we are in this together; we are still friends”. He and I helped each other come to terms with the reality – something we could not change, but over time we came to live with.

My brother James and me (dressed as a teacher!) c1964

The most important thing he did for me was help contain my messy, unruly, unhappy emotions – my fears that were deeper than just adapting to a new address. Deep down I was fearful of being abandoned, left unloved to perish. He showed me love, solidarity, understanding and care and helped me come to terms with the change I needed, eventually, to accept.