CPA_Practice_Advisor_June_2020 - 20

FEATURE
Building a Change Management Capability:

What the Coronavirus Crisis Revealed
By Erin Shannon, Deloitte & Touche LLP.

ACCOUNTING FIRMS ARE certainly familiar with change. Market dynamics,
shifting stakeholder expectations, regulatory rule-making-all this and more
compel the profession to be agile.
Traditionally, many companies tackle change
on a project by project basis. But the pace has
picked up in recent years, exposing a potential
capability gap when it comes to managing change.
At Deloitte, we realized our Audit & Assurance
business needed to consider a different approach
if we wanted to adapt to future opportunities and
challenges. Here's what we did-and what the
Coronavirus (COVID-19) pandemic has revealed
about it.

A RESPONSE TO DISRUPTION
For us, the catalyst to rethink our approach to
change management was digital disruption in the
2010s. As it took hold, we found ourselves dealing
with change almost constantly. No longer was
it practical to assemble and onboard a project
team for every new digital initiative-and there
were lots of them.
So we decided to create an in-house change
management capability. This has provided several
benefits over a project-based approach, including:
* Readiness to execute
* An active sphere of inf luence within the
organization
* A deep understanding of the business-including
strategy, operations, and culture
With those outcomes in mind, we built a dedicated team of change management specialists to
support our Audit & Assurance business. Since
then, a capability that started out as a response to
digitizing our business has also helped us address
changes in accounting and auditing standards,
evolving stakeholder demands, and other sweeping developments. But when the COVID-19 crisis
struck, it put our change management team to
one of its greatest tests.

THE ESCALATING COVID-19
THREAT
Like other organizations, our audit teams ordinarily work in an office-based setting, often onsite

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at the client's location. In a matter of days, this
decades-long delivery model gave way to a virtual
working environment-for us and clients-as the
COVID-19 threat escalated.
This kind of transition would have been much
more challenging without a change management
capability. Our change management specialists
were able to implement much of what was needed
on very short notice, including equipping professionals to effectively work from home. At the
same time, we developed a multi-dimensional
task force to resolve emerging issues and opened
communication channels to help keep people
informed: newsletters, online resource centers,
twice-weekly webcasts, a mobile news app to
share real-time updates, and an emergency support email box. We also launched a social mediabased photo campaign and online crowdsourcing
site to keep our people feeling connected.
The result, we were able to carry out our
work despite extraordinary circumstances with
minimal impact to client delivery. Once again, a
capability we had invested in years earlier, and
continue to invest in, helped us step up in a way
we hardly expected.

FUNDAMENTALS OF THE CAPABILITY
The COVID-19 crisis illustrates how a change
management capability can help companies cope
with dramatic shifts in the business environment.
But it also highlights important attributes that a
capability like this should have. Among them:
Executive-level attention. With a seat at the
executive committee table, our change management team was on top of and in tune with
leadership's thinking right from the start. That
positioned the team to execute at any point, even
as more of our engagement teams and clients felt
the impact of COVID-19 and executive guidance
evolved in tandem.
Sensitivity to timing. The COVID-19 crisis

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broke just as engagement teams were completing
audits for calendar year and first-quarter filers.
Because of the timing, it was imperative that any
change took place seamlessly and with minimal
interruption to our clients and professionals.
An open dialogue with key stakeholders.
Businesses and organizations around the world
are working through their response plans to the
pandemic, such as how to transition to a virtual
workforce and manage filing deadlines in a virtual
environment. A change management function
should stay in close contact with key stakeholders
(clients and regulators in our case) and develop a
plan for varied scenarios.
These attributes have a common thread,
which is to look across the extended enterprise
to see where changes might land. Any given initiative has its stakeholders, and they can be more
fragmented than you might expect. Internally, for
example, leaders may need different information
from employees. An effective change management capability reflects these nuances and shapes
itself to meet the demand by tailoring actions and
communications to be impactful for the intended
audience.

KEY CONSIDERATIONS OF
CHANGE MANAGEMENT
With that, what should you consider as you set
up a change management capability of your own?
Here are three principles to start with:
Collaborate. Bring training, communications,
and other relevant functions into your change
management structure. All likely have a deep
understanding of your organization's culture
relative to receiving, absorbing, and acting on
information and have developed practices-formal or informal-that can help a given change
to take hold. And don't expect these functions to
wait for orders-they can be much more productive when they have input into what the business
is trying to achieve.
Monitor. Carefully define your desired outcomes upfront. Goals can be qualitative (such
as employee awareness, buy-in, and behavioral

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