Decision Action Event Threshold Part 2

Think | Act

One in a series of Leadership Articles to cause you to think and perhaps to act. Read other articles.

You might recall in prior post we discussed the concept of the Decision Action Event Threshold (DATE). Check this out for a quick refresher course.

Delay relay

The essence of that post was to bring to the forefront that making wide reaching decisions is a good thing but that the delay time between the decision point and the full and complete effect of the decision was often long or unknown. Agile companies can get this down to perhaps months, ineffective ones perhaps greater than years!

Setting the scene

In our case study we monitored the progress of a crucial change to company policy of a rapidly growing high tech firm involved in the telecom sector. The company was about 125 total staff, they were spread over a number of commercial centers and traveled extensively. Significant numbers of travel expense spreadsheets were submitted for processing and the company was under pressure from it’s customers to constrain travel expenses, which were billed to clients.

Historically the company policy was one that allowed employees significant discretion with daily meal expenses. The company was considering a significant policy change on it’s reimbursement policy for travel expenses. They were moving from an actual cost based meal reimbursement to a fixed per diem. The president and senior team debated the alternatives and finally agreed to the revised policy. Immediately they had the policy change out in a mass emailing, with all the supporting rationale, and suggested that the change was important and should be implemented immediately.

It was at this point that we had the discussion with the president about how fast this change could be completed. He held firm that this would be done “100% in 4 to 6 weeks…” we held that the change would take at least five months given we had about a quarter to observe the pattern of behavior of the company.

The events unfold

Rather than pontificating about what happened you can see the results below;

At week 9 the president called us and mentioned that something was amiss. They had done all the right things that they had thought of and were still seeing a low success rate with the change. During week 10 we completed a full root cause analysis with the accounting staff. The results of this review led us to conclude that the main cause of erroneous reports were as follows;

Given the obvious results of the Root Cause Analysis we suggested some specific actions to be taken to address the most important to address the priorities in the errors;

  1. Distribute the expense spreadsheets to all office document servers and pull old templates,
  2. Rewrite the parts of the policy that were unclear and attach a quick guide to the spreadsheet,
  3. Place the acceptable per diems into the spreadsheet as pull downs,
  4. Allow exceptional cases to be documented in spreadsheet with approval process, and
  5. Manually corrected spreadsheets which were submitted prior to policy distribution.

Given these recommendations, and the heightened sensitivity to the importance of this change, we then saw an escalation for the next five weeks. Not surprising since the adoption curve is pretty much a standard ‘S’ curve. What was a bit surprising was that it took the company a full 24 months to reach 100% correct. What was also remarkable was that they had achieved 80% success at the 15 week markā€”much longer that anyone had expected. The president, in his original estimate, guessed at a DATE of 12%, we guessed at about 40% and in reality it was 46%.

What can be done?

Change at any time can be a tricky thing. Significant or far reaching changes must be handled effectively. Here are a few suggestions to make your changes happen quickly;

Communicate the proposed change quickly and clearly,
Eliminate any ambiguity in the communications,
Ensure that support tools (spreadsheets, documents, templates) are changed coincidentally,
Make the process of change easier than the status quo,
Communicate the progress of change.

What have you learned about change and what is the DATE in your company?

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