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MOC, SM, BSC IN LEADERSHIP

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CONTENT

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 Matrix of change
 Strategy Map
 Balanced scorecard

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MATRIX OF CHANGE MOC

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 Change Management?
✓ is the process, tools and techniques to manage the people side of change
to achieve the required business outcome.
✓ Change management incorporates the organizational tools that can be
utilized to help individuals make successful personal transitions resulting
in the adoption and realization of change.

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MATRIX OF CHANGE MOC

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 As per ISO 9000:2000 Quality Management Principle, Principle 1,
Customer Focus, “organizations depend on their customers and
therefore should understand current and future customer needs”
(Cianfrani, Tsiakals, & West, 2002).

 Changing strategies and business plans as well as adapting new

features of existing product or services need a systematic
methodology to examine the nature of the future transition
compared to the existing situation.

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MATRIX OF CHANGE MOC

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 “The Matrix of Change (MOC) is a tool for business process
reengineering (BPR) adopted from Quality function Deployment’s
“house of quality”. It aims to recognize critical process interactions
to make decisions on process changes” (Cintrón, 2013). BPR efforts
failed to achieve consistent success rates, due to a lack in
managing the change process (MIT Center for Coordination
Science, 2015).


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MATRIX OF CHANGE MOC

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 MOC provides unique and useful guidelines for change
management which can help leaders to identify crucial interactions
among processes to be able assess the following concepts (MIT
Center for Coordination Science, 2015).
 how quickly change should proceed,
 the order in which changes should take place,
 whether to start at a new site, and
 whether the proposed systems are stable and coherent.

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MATRIX OF CHANGE MOC

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 MOC illustrates a technique to capture connections between
practices in a graphical displays showing both reinforcing and
interfering organizational activities (Brynjolfsson, Renshaw, & Van
Alstyne, 1997).
 The Matrix of Change (MOC) helps leaders to develop critical
interactions among processes. As Elattar (2014) indicated that,
MOC are not proposing solutions for current problems rather it
allows stakeholders to better understand the requirement for a
successful transition.
 MOC was developed by the Massachusetts Institute of
Technology’s Center for Coordination Science and the Center for
eBusiness@MIT and was mostly funded by Intel Corporation and
British Telecom (Elattar, 2014). 7
MATRIX OF CHANGE MOC

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 Matrix of change?
 (Elattar, 2014)
➢ Used MOC as the first phase to be a visualization of the problem at hand in his
Framework A Holistic Framework for Transitional Management

 (Agievich & Skripkin, 2014)

➢ “Matrix of Change – the only tool of change management allowing consideration
and efficient use of interactions between existing and implemented practices in
an enterprise”

• ”(MIT Center for Coordination Science, 2015)

➢ MOC is “a visualization tool for capturing the existing and desired states of the
proposed change, the complementary and opposing practices and how best to 8
proceed in the implementation of the change
MATRIX OF CHANGE MOC
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MATRIX OF CHANGE MOC

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Building the Matrix:
➢ Step 1: Identify Critical Processes: Managers should first list their
existing goals, business practices, and ways of creating value for
consumers and then break current practices into constituent processes

➢ Step 2: Identify System Interactions: After describing existing

practices, the team created a horizontal triangular matrix to identify
complementary and competing practices. Complementary practices
reinforce one another, whereas competing practices work at cross-
purposes.
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MATRIX OF CHANGE MOC

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Building the Matrix:
➢ Step 3: Identify Transition Interactions : a square matrix combining
the horizontal and vertical matrices that helps determine the degree of
difficulty in shifting from existing to target practices. Certain practices
complement one another. And Some of them are opposing.
➢ Step 4: Survey Stakeholders : Now the team needed to determine how
various stakeholders felt about retaining existing practices and
implementing target practices.
A value of “+2” means that a practice was very important, and a value of
“+1” that a practice was important but not essential, while a value of “–2”
indicated a strong desire to change or reject business as usual. A value of
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“0,” which can be omitted, represented indifference.
MATRIX OF CHANGE MOC

The respondent in this example

felt strongly that, among existing
practices, “narrow job functions”
should be discontinued (–2),
inventory levels should not be as
large (–1), and “piece-rate pay” is
somewhat important (+1).
Regarding target practices, the
respondent felt positively about
most practices and indifferent
about one.

Complementary: Interfering:
combining in such prevent (a
a way as to process or
enhance or activity) from
emphasize the continuing or
qualities of each 13
being carried
other or another. out properly.
 MATRIX OF CHANGE MOC

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 Interpreting the Matrix of change?
 Feasibility: Do the set of practices representing the goal state constitute a
coherent and stable system? Is our current set of practices coherent and
stable? Is the transition likely to be difficult?
 Sequence of Execution: Where should change begin? How does the sequence
of change affect success? Are there reasonable stopping points?
 Location: Are we better off instituting the new system in a greenfield site or
can we reorganize the existing location at a reasonable cost?
 Pace and Nature of Change: Should the change be slow or fast?
Incremental or radical? Which groups of practices, if any, must be changed at
the same time?
 Stakeholder Evaluations: Have we considered the insights from all
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stakeholders? Have we overlooked any important practices or interactions?
 MATRIX OF CHANGE MOC
 Interpreting the Matrix of change?

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 MATRIX OF CHANGE MOC
 Interpreting the Matrix of change?

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 Feasibility: Coherence and Stability: A system of practices with numerous
reinforcing relationships is coherent and therefore inherently stable, whereas
one with numerous competing relationships is inherently unstable.
• The existing system at MacroMed was, in fact, quite stable
• The desired state is also fairly stable but has a single
competing relationship.
• If a proposed state has too many negative relationships,
the project will be unstable and must be re-evaluated.
• Critically, the transitional state for MacroMed was
dominated by interfering relationships, indicating a
high degree of instability.
structural change becomes almost impossible.

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 MATRIX OF CHANGE MOC
 Interpreting the Matrix of change?

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 Sequence of Execution: Where to Start and When to Stop
➢ start removing practices that have no interactions with other practices
➢ the easiest new practices to implement are those that complement existing ways of
doing business.
 Location :Greenfield and Brownfield Sites : More disruptive changes make
existing or brownfield sites less attractive. In fact, new or greenfield sites are much more
popular for introducing new systems, even when they require abandoning years of
organizational learning.
 Pace and Nature of Change: Fast or Slow, Incremental or Radical: For purposes of
implementation planning, it is worth distinguishing between the pace (gradual or rapid)
and the nature (incremental or radical) of change.

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 MATRIX OF CHANGE MOC
 Interpreting the Matrix of change?

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 Stakeholder Evaluations: Strategic Coherence and Value Added: Stakeholder
evaluations make preferences and expectations explicit. If employees give an existing
practice low marks, they are likely to support a change. Conversely, if they do not support
a change, they will likely give an existing practice high marks. Negative values in the
target ratings section indicate a need to cooperate and better align incentives, to increase
the pace and avoid drawing out resistance, or to isolate factions whose interests oppose
the change initiative.

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 STRATEGY MAP

 A Strategy Map is a diagram that describes how a company or

organisation can create value by linking strategic objectives in a cause
and effect relationship.
 It is based on the four Balanced Scorecard Perspectives: Financial,
Customer, Internal Processes and Capacity, Learning & Growth.
 The key element of the Strategy Map is that it is linked to the
‘scorecards’ that monitor the progress towards the Strategic Objectives.
 The ‘scorecards’ will include: metrics, targets for the metrics and
strategic initiatives to drive performance towards achieving the
objectives.
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STRATEGY MAP – CLASSIC KAPLAN/NORTON
Productivity Strategy Growth Strategy
Financial Long-Term
Perspective Shareholder Value

Expand
Improve Cost Increase Asset Enhance
Revenue
Structure Utilisation Customer Value
Opportunities

Customer Customer Value Proposition

Perspective Availabilit Partnershi
Price Quality Selection Function Service Brand
y p

Product / Service Attributes Relationship Image

Operations Management Customer Management Regulatory and Social

Internal Processes Processes
Innovative Processes
Processes
Perspective Supply Selection Opportunity Identification Environment
Production Acquisition R&D Portfolio Safety and Health
Distribution Retention Design / Develop Employment
Risk Management Growth Launch Community

Learning & Human Capital

Growth
Information Capital
Perspective
Organisational Capital
Culture Leadership Alignment Teamwork 20
STRATEGY MAP - GENERIC EXAMPLE
Mission: Managing with greatness and strength, improving everything daily
Vision: Leading with inspiration and courage, passionate about future possibility and change
Financial
Perspective
Sustained Shareholder
Value
Productivity Strategy Revenue Growth Strategy
Expand
Increase Enhance
Improve Cost Revenue
Asset Customer
Structure Opportunitie
Utilisation Value
s

Customer Customer Value

Perspective Proposition
Availabilit Partnershi
Price Quality Selection Function Service Brand
y p

Production Service Attributes Relationship Image

Internal Operations Customer

Regulatory and Social
Perspective Management Management Innovative Processes
Processes
Processes Processes
Processes that produce Processes that create Processes that improve
Processes that enhance
and deliver products and new products and communities and the
customer value
services services environment

Learning &
Growth Organisational
Human Capital Information Capital

+ +
Perspective Capital
Skills Systems Skills / Training
Training
Knowledge
Databases
Networks
Knowledge
Teamwork
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SIMPLE EXAMPLE WITH ‘STRATEGIC THEMES’
Financial Increase Shareholder
Perspective Value

Improve position in
Increase Revenue Increase Profitability
Defined Markets
Streams

Customer Intimacy Technology Driven Operational Excellence

Customer Improve
Perspective Advisor Position Improve
Flexible Improve Repeat
Solutions Business Rate
Increase
Added Value

Internal
Improve
Perspective Increase
Resourcing
Knowledge
Improve Services
Base Usage
Integrated Improve
Strengthen 3rd Business Cost
Party Processes Management
Improve
Relationships Solution
Processes

Capacity,
Improve
Learning & Enhance
Operational Mgmt
Growth Relationship Skills
Improve Solution Skills
Perspective Management
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Improve Industry Enhance Career
Knowledge Planning
PUBLIC SECTOR EXAMPLE
Stakeholder Value to Taxpayer
Perspective

Customer
Support Balance
Perspective Business and Budget
Commerce
Safe Clear and
Convenient Accurate Create Business Cases
Lower Cost of Bus
Bus Services Timetables and Secure Funding
On Time as Transportation Services
Promised

Relationship Easy to do Innovation Operational

Management Business Drive Innovation in New Excellence
With Transport Systems
Deliver World Class Bus
Streamline Improve Services
Internal Processes

Regulatory Sustainability
Approval of Accelerate Develop and
Processes Communities Economic Introduce
Development New Provide Cost Optimise
Perspective

through Route Transport Effective Availability

Open and Frequent Investment Technology Solutions of Busses
Communication to Impacted
Customers

Improve All
Optimise Planning of Bus Understand New Route Aspects of Bus
Stop Position and Needs (and Old) Safety
Construction

Learning &
Growth Highly Skilled Bus Empowered Customer Service Integrated Knowledge
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Drivers Agents Management Systems
Perspective
EXAMPLE OF AMAZON STRATEGY MAP

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THE BALANCED SCORECARD BSC

 The Balanced Scorecard is a strategic planning and management

method used to:
 align business activities to a vision and strategy of an organisation
 improve internal and external communications
 monitor organisational performance against strategic goals.

 The design of Balanced Scorecard concerns itself with:

 the identification of a small number of financial and non-financial
measures referred to as Perspectives
 setting targets for the measures and then
 measuring them on a regular basis to determine success or failure.
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THE BALANCED SCORECARD BSC

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 (Nair, 2004)
It is a measurement tool in business. This management tool is highly
needed in businesses that want to achieve their goals
 (Niven, 2005)

the greatest benefits of BSC is its power as a communication tool

 (Archer, 2013)

the BSC is as a measurement tool to assess the return on investment

(ROI) on leadership development

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THE BALANCED SCORECARD BSC

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AMAZON.COM CASE STUDY EXAMPLE

 Capturing the Structure of Amazon

 Amazon.com SWOT

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BSC APPLIED TO AMAZON.
Objectives Measures Targets

Increase the net Net Income 15% profit

Financial
income

Reduce the cost of Costs (income Less than last year

Revenue statements)

Increase the sale Products/ Services More than last year

sold in the website sale

Increase Customer’s Forrester Research’s To be number one

Customer
Satisfaction annual study on again.

consumer electronics Around 98 score

brand customer

satisfaction

Enhance the Suppliers business 95%

suppliers’ stabilities also

relationships surveys.

Enhancing Amazon Number of hackings 0%

Internal
website, data loss or
Process
other security

breaches.

Amazon Future Number of acquired As Needed

acquisitions companies

Introduce New Number of As demanded

Products & Services services/products

Improve R & D New research and As needed

Learning
patents
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and growth
Customers’ Feedback Customers’ Review 70%

Partnering Number of Alliances As needed

Hiring Talented Meeting the Industry As needed

MOC FOR AMAZON.COM
Matrix of Change Current Practices

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MOC FOR AMAZON.COM
Blue, Green, Yellow and Orange MOC Future
Practices:

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MOC FOR AMAZON.COM

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AMAZON.COM LEADERSHIP IMPORTANCE

The highest LI is the blue leadership style

The blue leadership style is the best for Amazon’s leadership
development.

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APPLE MOC

 Apple Targeted Practices.

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APPLE MOC
Apple existing Practices.

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APPLE MOC

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STRATEGY MAP

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APPLE BALANCED SCORECARD

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REFERENCES

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[1] https://sloanreview.mit.edu/article/the-matrix-of-change/
[2] https://www.slideshare.net/aaalm/strategy-map-templates?qid=f7bd9ca7-
1cc8-4ce3-a44f-f4d76c2b6d3b&v=&b=&from_search=9

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