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The winds of change

Top distribution executives in the information technology, cosmetics and grocery industries plot a course for sailing through change.

Sara Pearson Specter, Editor at Large -- Modern Materials Handling, 9/1/2003

Change is uncontrollable. How you manage change, however, is within your control. That's the view of three distribution executives: Terry Tysseland, senior vice president of operations for North America at Ingram Micro in Santa Ana, Calif., Mark Newberry, vice president of logistics for Coty in Sanford, N.C., and Paul Widener, director of distribution systems for KVAT Food Stores (Food City supermarkets) in Abingdon, Va.

All three have managed recent facility and operational changes, while dealing daily with rapid-fire changes in customer demands on their order fulfillment systems. Here they share some of the habits they've cultivated to help their companies manage change.

1. Recognize and accept change.

Don't waste time by sinking into denial that a change has occurred, especially if it's a big one, says Tysseland. Although he initially made that mistake when the information technology (IT) industry began to decline three years ago, he quickly got over it.

"If you don't accept that you have to change, then over time you're going to become unprofitable, and maybe even go out of business," he cautions. "You have to change your model to whatever the situation is."

2. Analyze and plan your response to change.

Whether you're changing in reaction to a slowdown that forces facility consolidations or to a significant uptick in demand, information gathering is critical to setting a new, accurate course.

Critical information comes from your own distribution center and beyond, says Newberry of Coty. He recommends developing a full view of your company's supply chain and your role in it before building the new plan.

"If you can understand your company and stay in touch with the front end of the change process—in our case, the strategies of retailers—then you can start to guide change," explains Newberry.

3. Communicate the plan and the reasons behind it early and often.

Sharing the change management strategy with every level of your company will help generate buy in, particularly when done early, clearly and repeatedly.

Widener of KVAT stresses the importance of how that information is presented. "Make sure you're giving information to people in the proper formats at the right time, so that they can manage change as well," he says. "If people don't understand why the business benefits, then the process is going to suffer."

Tysseland recommends leveraging internal resources, like marketing and human resources, to develop internal communication plans, especially when changes call for a reduction of work force.

"It's a painful process because you're affecting a lot of people's lives," he says. "You have to tell people what you're doing, work with corporate communications to get the right messages out, and work with HR to ensure that you're treating people the right way."

4. Be honest with people.

It's important to be realistic about what you communicate and how it will be perceived. Choose your words carefully and tailor them to your audience, but never sugarcoat what's happening. People will see right through it, and the entire process will lose credibility.

Also critical, yet often difficult, is understanding the magnitude of the changes and the challenge people will have dealing with it, says Newberry. "Everything in our distribution center was new: all the equipment, all the processes, all the jobs. People had to do everything—other than come to work and leave work—entirely differently," he adds.

5. Build teams of internal and external people from all levels.

One of the best ways to ensure a smooth change management process is to involve as many people as possible to share in the responsibility for its success, say all three executives.

"When you have hourly employees involved in making the change process work, not only do you reap the benefits of their knowledge and their day-to-day contributions, but also it improves overall morale about the changes," says Widener. "There's public relations value when the people involved in the change process go back out on the floor—they're salesmen for you."

In the case of new and upgraded distribution facilities and systems, this includes suppliers who can help with training and related activities.

6. Establish a review process.

Regular monitoring and measuring is the only way to know if you're on or off course. Whether it's a daily informal discussion, a weekly management meeting, or formal post-project documentation, scheduling a review process will help in reaching the ultimate goals.

Tysseland likens the process to sailing: "It's a constant resetting of your course as you navigate from one location to another. But you need to know where you are and where you need to go," he says. "How you get there is through navigating from one location to another."

7. Plan on changing again.

Since change never ends, the steps taken to anticipate and respond to it should be ongoing as well. "Change management is an evolutionary process," offers Newberry. "You don't ever really get to where you want to be, you just keep evolving."

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