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Culture Shaping

Giving frontline employees a voice in change

Subscribe to Culture Shaping 9/13/2017 Brian Klapper
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For widespread acceptance and adoption of a change initiative, those living the change on a daily basis must fundamentally believe in it—and to believe in it, they must help to shape it. The key to unlocking an organization’s ability to produce lasting change is to use the knowledge already present within its staff. Frontline employees are too often overlooked or not given a voice within an organization. Yet this group is closest to customers and to the products and services a company offers. Without them, a change initiative doesn’t stand a chance.

The following case study, drawn from a real-world example, illustrates the critical role a frontline team played in solving a thorny change management issue.

The challenge

A North American financial services firm with more than 10,000 advisors concluded that increased connectivity with its customers would be an important element of its strategy. A big step toward building connectivity was migrating its customers to an electronic delivery platform, meaning they would receive statements and other communications through e-mail and text messages.

Executives were keen to develop the platform for several reasons. First, they thought it would allow the firm to communicate with clients in a much more timely fashion, rather than relying on answering machines and snail mail. Immediate contact of this sort might help build relationships with customers. Second, reducing or eliminating physical mail could add about $1 million of net operating income for every percentage point of customer adoption of e-delivery.

The firm rolled out an initiative to increase the number of clients using e-delivery and reached approximately 12% adoption after about a year. But progress stalled, even though the e-delivery platform was attractive and user-friendly. In response, executives changed their approach. Instead of pushing the initiative as a cost-reduction move, they decided to offer various incentives to branch administrators and customers to encourage adoption. Nonetheless, four years later, just 19% of clients had signed up for e-delivery.

The insight

Leadership was stumped. Executives saw that a top-down approach wasn’t working and, instead, tried a different direction. They created a cross-functional team of six talented frontline managers to explore what was going wrong and how to fix it. To help the team recognize—and overcome—the entrenched mind-sets that held them back, the company launched the project with an intensive, two-day working session. (To learn more about how The Corporate Lab works, click here.)

The firm then gave the team 30 days to develop a pilot program to double e-delivery uptake that it could eventually roll out nationwide.

It was an intimidating goal, given how much effort had been expended previously and the perceived difficulty of working with the financial advisors in the field, who thought of themselves as entrepreneurs and didn’t like being told what to do. However, after some consideration, the team decided that 38% adoption wasn’t ambitious enough—instead, it proposed to management an adoption rate of 100%.

The first step the team took was designing and circulating a new customer survey that asked for impressions of the e-delivery system. In addition, the team wrote an observation guide that could be used in field visits with financial advisors.

The real breakthrough came from spending a week in the field observing dozens of interactions between advisors and clients. What soon became apparent to the team was that the issue of adoption had little to do with branch administrators or even customers. The team saw that the advisors rarely mentioned e-delivery to customers. The few times a client raised the subject, the advisor dismissed the idea, saying, “It’s not quite the right product for you,” or, “We’re still working on it.” So it was the advisors who were ultimately the stumbling block.

The result

Why were the financial advisors resistant to promoting an electronic relationship? That was the next question for the team to answer. First, in interviews with the advisors, the team found that originally positioning the initiative as a cost-reduction measure had backfired. “What’s in it for me?” the advisors asked. Second, there was a lack of trust. The advisors feared that, in moving to an electronic process, they would lose “their” clients to the firm, so their customer relationships would suffer. Third, the firm never made clear what benefit might accrue to advisors under e-delivery.

These insights were new, and the team was able to gather them in just one week. The survey data also came in, and the feedback was, in brief, “We didn’t even know that you offered e-delivery, and if you do, we would be interested in learning more about it.”

At this point, the team designed a series of experiments to show that the crux of the issue was the financial advisors’ attitude and that a mind-set shift was in order. This meant undertaking a lot of advisor education. The team had to explain why e-delivery was in the advisors’ best interest—that it would actually lead to deeper, “stickier” relationships and that clients who used an electronic platform had higher average balances. The team then had to convince the advisors to promote e-delivery in client meetings, whether at the time of the initial appointment or in a quarterly or annual review.

The team found that when e-delivery was recommended by an advisor in a face-to-face meeting with the client, the adoption rate soared, from 19% to 94%. The only reason it didn’t climb higher was that some clients didn’t own computers.

Ultimately, all that was needed was to convince the advisors that e-delivery was the right thing for them and their clients. Once the pilot program overcame that significant challenge, the firm readied a national rollout, which is currently under way. The firm is still shooting for a 100% adoption rate. While the strategy to go electronic came from senior executives, the way forward was entirely the work of frontline managers.


About the author

Brian Klapper (bklapper@heidrick.com) is a principal in Heidrick & Struggles’ New York office and the founder of The Corporate Lab.

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Brian Klapper Principal 212-699-3142

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