HBR Issue: January/February 2010
Article Title: Accelerating Corporate Transformations by Robert H. Miles.
Question: It is said that people don't resist change, but they resist being changed. Analyze the usual factors that lead to executives turning recalcitrant and employees disengaging themselves during the process of transformation. Also, explain how various tactics for accelerating corporate transformation can help in overcoming these barriers.
Any successful transformation of company can be characterized by the faster execution, focus on few goals, periodic reviews and team work form top to bottom. Whereas many transformation initiatives of companies fail because of lack of people buy in for such initiatives, as they are the ones who will execute the vision into reality. They become recalcitrant and disengage themselves. CEO' with grand vision many a times fail to understand this fact and hence fail. Some of the factors that result in such situation are discussed below.
Factors leading to executives turning recalcitrant and employees disengaging
Cautious Management Culture: The executive decision makers try focus their efforts more on tried and tested methods to bring in incremental changes.
They get themselves busy with daily operations so that they don't have time to re-imagine the bigger business ideas, or work on ways to improve underperforming business units. Such a cautious management culture results into those controlling more resources will monopolize the decision-making in the organization with various reasoning's. Transformation programs in such organization will lead to a situation where the people don't believe in the leader that he will carry on with the transformational agenda, as the initiatives were half-hearted, half-thought and half-baked. Such program will get killed if new challenges come up. Hence the people will be disengaged with such initiatives to protect themselves under the guise of focusing on the daily operations.
"Business As-Usual" Management Process: The day-to-day management process is already overloaded and there is no room for the new transformation initiatives. Leaders and People will wait and keep on postponing taking decisions till the transformation initiatives are forgotten.
Initiative Gridlock: Organization launch the transformational initiatives without alignments, hence resulting into each department launching their own improvement programs resulting in loss of focus and too many to focus on. It results in loss of motivation from the employees to carry on the change initiatives and the leadership will have fear of discarding those that wont work. It will result in gridlock situation.
Loss of Focus during Execution: Even if the leaders of the organization cross the above 3 hurdles and launch the change programs, they can get killed during the execution phase. "Post Launch Blues " is a problem caused due to turning vision into detailed plan. Many organization have ideas at 50000 ft level, they fail to translate them in to ground level execution plan thus killing the idea at the level of execution. Even if they detailed execution plan, some where during the course of execution based on the initial success, people are overconfident thus losing the execution focus causing "Midcourse Overconfidence". Many change programs are multi-years when they initial success and continuous monitoring is done during the launch year successfully, they think that momentum will carry on. However such "Presumed Perpetual Motion" will not occur due to priorities changes if they focus is not there.
Recalcitrant Executives: Executives who have been part of the organization become in denial mode for any change programs to insulate themselves having seen many change programs fail due to the above reasons. Though they give a picture that they are not against the change initiatives, but they never take a lead to support and execute the change.
Disengaged Employees: Employees are the last one to be known on the change programs. These change programs are always top-down and thrust on the employees without they understanding the core reasoning. When the employees are forced to do something that they don't understand they disengage themselves causing the failure of the program. By the time, the company try to explain the reasons for the launching the initiatives employees already disengaged themselves from the change initiatives.
Ultimately the 6 problems mentioned above revolve around people being resistant to change. They are interrelated with each other. The top management becomes unsupportive because they don't have confidence in the change programs and the employees disengage themselves because they are not trained for the change programs.
Tactics for Accelerating Corporate Transformations
Companies worldwide can adopt the tactics discussed below (based on the case in HBR) to maximize the success rate of accelerating corporate transformation initiatives.
Cautious Culture to Confronting Reality and Acting
Forcing to confront the reality can eliminate a cautious culture. Leader need to emphasize and explain why the transformation is necessary and make the participation as mandatory one and create a safe passage by clarifying how and when the individuals will be involved. Establishing the ground rules for dialogue and decision making will be another tactic and employing a third part to table difficult discussion and objective data will also fetch results. Finally after executing all the above convene a well designed "Confront the Reality" event so that entire team can work through new information and develop/refine the vision and business model. This will enable the company to address quickly the issues and make resource allocation decisions easier.
Business As-Usual to No Slack Launch
The company should go for the quick wins that are visible to instill the confidence. The launch of transformation should be compressed and overlay to the regular management load. Follow a No Slack Launch to gear for the high speed and high engagement process. No Slack launch will not wait for the complete preparation of the initiatives. Once the base information is clear, the management need to clearly put down the deliverables, milestone dates and track them. Every day actions will accelerate the whole transformation on fast gear. A sample no slack launch process is pictorially depicted below.
Gridlocks to Focused Agenda
Rather than having many initiative executed half-backed concurrently resulting into failures, its better to align the organization in to few (3-4) initiatives that are focused with clear deliverables. Within these 3-4 initiatives, have 2-3 focus areas with clear metrics. Companies should focus to do more on less.
Recalcitrant Executive to Change Leaders
After creating safe passage for the executive leadership team its important to establish a process architecture that is geared for high performance and behavioral changes for sharp focus required. Recalcitrant Executive who are denying the new change should be confronted and removed if they are not willing to change sooner. Its important to involve all the senior members who are agreeing (quick adopters) in leading the process initiatives.
Disengaged Employees to Employee Buy-in
Employees should be communicated of the transformation initiative as soon as its getting launched. They need to know what they are going to do for these changes. Structure processes and training are must to get their buy-in. This involves deploying a rapid high engagement employee cascade of multiple levels inside the organization. Getting the employee commitment before the competency development is a must. Finally align the performance management to individual commitments.
Loss of Focus to Predicting the Slumps
Successfully launched transformation initiative should be carried on to its end through predicting where it can fail (on 3 stages) namely - Post Launch, Mid Course Over Confidence and Presumed Perpetual Motion. It involves enacting a rigorous plan for execution and learning.
Attack the post launch blues through thinking in nuts and bolts or Ballast and Keel from the high level vision. Translating the vision into execution plan will resolve this issue.
Address Mid-course Over confidence issue through conducting a rigorous, periodic top-to-bottom assessment of the progress as part of the process rather than keeping the program in autopilot.
Presumed perpetual motion issue can be resolved through a full, streamlined re-launch of the process on every year beginning to instill the need, vision for the change program.