Category Archives: Change

The Role of Communication in Effective Change Management

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The Role of Communication in Effective Change Management

GUEST POST from Chateau G Pato

Change is a constant in today’s business environment. Whether it’s implementing new technologies, restructuring teams, or shifting strategic directions, effective change management is crucial. At the core of successful change management is communication. The role of communication cannot be overstated, as it facilitates understanding, minimizes resistance, and builds a collaborative atmosphere. In this article, we will explore the role of communication in change management through conceptual analysis and case studies.

The Role of Communication in Change Management

Communication serves as the lifeblood of change management. It is necessary for:

  • Creating awareness about the need for change
  • Conveying the vision and objectives
  • Building stakeholder engagement and participation
  • Addressing concerns and mitigating resistance
  • Providing clarity on new roles and processes
  • Ensuring continuous feedback and improvement

Case Study 1: Transforming a Global Manufacturing Enterprise

Background

Global Manufacturing Co. (GMC) was facing critical operational inefficiencies, leading to high production costs and prolonged delivery times. To remain competitive, GMC decided to undergo a comprehensive digital transformation aimed at streamlining operations and increasing productivity.

Challenges

The enterprise was highly decentralized, with multiple facilities operating independently across different countries. Each facility had its well-entrenched way of doing things. Resistance to change was high due to a lack of understanding and fear of job displacement.

Approach

The leadership at GMC recognized that communication was key to overcoming these challenges. They developed a multi-faceted communication strategy that included:

  • Initial Town Hall Meetings: To inform employees about the reasons for the transformation and the expected benefits.
  • Regular Newsletters: Keeping everyone updated with the latest developments, successes, and upcoming milestones.
  • Feedback Channels: Establishing open lines for employees to express their concerns and suggestions anonymously or openly.
  • Training Programs: Providing information and skill-building sessions to prepare employees for new technologies and processes.

Results

The comprehensive communication strategy facilitated a smoother transition by reducing resistance and increasing engagement. Employees felt informed and valued, which led to faster adoption of new practices and technologies. Within two years, GMC saw a 20% reduction in production costs and a 35% improvement in delivery times.

Case Study 2: Cultural Change in a Tech Startup

Background

RapidInnovate, a tech startup, was scaling quickly. Initially, the company thrived on a culture of freewheeling innovation and minimal hierarchy. However, as the company grew, this very culture started to create inefficiencies and misalignments. The leadership realized the need for a more structured yet agile cultural framework.

Challenges

The startup’s team was extremely diverse, featuring a broad spectrum of cultures, experiences, and working styles. The initial announcement of the cultural shift created anxiety among many employees who valued the existing open culture.

Approach

To ensure the new cultural framework was accepted and integrated effectively, RapidInnovate employed a robust communication plan:

  • Small Group Discussions: Leaders engaged in intimate discussions with smaller teams to explain the vision behind the cultural shift and how it would benefit everyone.
  • Storytelling: Using real-life examples of how the new culture could solve existing inefficiencies and misalignments.
  • Workshops: Conducting interactive workshops where team members could voice their opinions and contribute to developing the new cultural elements.
  • Visual Aids: Creating infographics and videos to easily communicate complex concepts and keep everyone aligned visually.

Results

The approach allowed for transparency and inclusiveness, which were instrumental in the success of the initiative. The new cultural framework was implemented smoothly and led to a more aligned, efficient work environment while retaining the innovative spirit. Employee satisfaction improved, and the company saw a 25% increase in overall productivity.

Conclusion

Effective communication is not just a component but the backbone of successful change management. It ensures that all stakeholders are on the same page, reduces resistance, and fosters an environment of collaboration and continuous improvement. The case studies of GMC and RapidInnovate illustrate that, regardless of the nature and scale of change, a well-thought-out communication strategy is indispensable for achieving desired outcomes.

SPECIAL BONUS: The very best change planners use a visual, collaborative approach to create their deliverables. A methodology and tools like those in Change Planning Toolkit™ can empower anyone to become great change planners themselves.

Image credit: Pexels

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COVID-19 Presents an Opportunity to Create an Innovation Culture

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GUEST POST from Pete Foley

I left P&G about eight years ago, and one of my last jobs involved working on innovation culture.  It was a passion project, and the topic of one of my first blogs published outside of P&G.  It’s also something I keep coming back to, as I believe it is one of, if not the most important components of a successful innovation organization. But I’m writing this because I believe Covid19, together with recent socio-political dynamics has created a once in a lifetime window to effect cultural change in our organizations.  It’s a huge opportunity, but one that comes with commensurate risk.

Changing culture is hard.  A leadership team can often make a strategic change almost on a dime, but culture has much deeper roots, and so takes longer to change. Strategy is more about what we are doing, culture is more about how we do it.  It’s comprised of a multitude of little everyday things that ultimately much of our time.   It’s how we make decisions, take risks, act or procrastinate, how much we share, how much we listen. In other words it’s deeply linked to fundamental behavior and values, and is heavily influenced by habits and the unconscious decisions frameworks that Daniel Kahneman calls System 1 thinking.  As such, it cannot be changed by management decree.  It can be nudged by changing reward or organizational structure, something we tried every few years at P&G.  But ultimately changing culture means either changing people’s deeply rooted behaviors, or changing the people themselves.

That’s hard to do, and also inefficient, at least in the short-term.  If an innovation team is thinking about process, it’s not thinking about innovations. But Covid19 created a once in a lifetime opportunity.  I’d not wish the last 18 months on anyone, but like it or not, our cultures have been disrupted, and that gives us a semblance of a fresh start, and hence an opportunity for change.  Habits have already been broken, ‘givens’ challenged and new skills learned. And if the great resignation actually occurs, we can expect an elevated level of personnel movement both between and within companies to go along with broken habits and new skills.  A perfect storm for cultural change.  .

But how do we take advantage of this rare opportunity? Culture is a big, hairy topic, with a lot of moving parts, so one option is to be a little reductionist, and break it down into it’s component parts. My personal culture model is a hybrid derived from many sources, and comprises Capability, Space, Psychological Safety, Designed Serendipity and Motivation.  Let’s look at them in turn:

Capability– Innovation needs people with knowledge and experience.  But it also needs fresh perspective. Too much experience locks us into isolated pillars of expertise that make it hard embrace new technology.   But too little experience risks the merry-go-round of constantly reinventing the wheel.  We need to balance between the two.  But we can hit that balance far more effectively if we retain the right kind of experience, experts who are also cognitively agile, open to new experience, and so able to integrate fresh ideas with their hard earned knowledge.  The conundrum is that these experts are often the most likely to seek out new challenges, or to relish the risk of career changes. In other words, those most likely to participate in a ‘great resignation’.  This makes it imperative to proactively  identify, recruit or retain experts with high mental agility, or T-Shaped innovators who can bridge between different groups.

But it’s not enough to get the right mix at the organizational level, we need it to drill down into individual teams. Humans have a habit of self selecting groups that they feel comfortable working with, which can mean diversity within an organization translates into diversity between, rather than within teams. Curating teams to ensure each fully team reflects organizational diversity reduces factions, spreads knowledge, enables cross mentoring and thus creates a stable but not stagnant culture more quickly after a period of change.  It also grows the next generation of innovation leaders who have learnt bridging skills ‘on the job’, by working in cognitively diverse teams.

  1. Space –Innovators need time and autonomy. Obviously this needs to be within some reasonable constraints, as businesses today cannot afford ivory towers.. But truly disruptive ideas take time, and some failure along the road to success. Build too much stage gate control into innovation, enforce unrealistic timelines, or talk about productive failure without actually embracing it, and the result will be mediocrity and increasingly smaller innovations.  Everything becomes disruptive in name, but not reality.  The good news is that this is perhaps the biggest opportunity to come out of Covid19, as for many, remote working has increased both time and autonomy.  Of course, remote working comes with downsides, some of which I discuss below, and not everybody has more time at home. But overall we’ve been given a gift of more time and more autonomy.  It’s critical that we take full advantage of this, and don’t lose it, or over-manage it in the name of efficiency.

2. Psychological Safety.  Failure is now widely acknowledged as part of the innovation process. But in reality, but when the rubber hits the road, it’s still often considered as a negative. After all, we build a culture that values capability and expertise so that we can anticipate ‘obvious’ pitfalls, and so avoid failure.  But if we’ve sufficient capability, that makes failures more valuable, as the unexpected is the single biggest source of disruptive and breakthrough innovation.  Furthermore, the scientific method, when employed correctly, designs tests to challenge our assumptions, not confirm them.  We run tests to uncover unexpected issues before we go to market. So as we rebuild innovation culture, it is critical that the psychology safety needed to fail productively is not just preserved, but enhanced. It really is the key to big ideas. But at the same time, it’s also critical not to confuse it with ‘safe spaces’.  Psychological safety has nothing to do with avoiding ideas we are uncomfortable with.  Instead it’s about creating an environment where people can safely challenge their own and others’ ideas, share unpopular opinions and failures, and be treated with respect when they do so.  That is fundamental to the scientific method, and hence to an effective innovation culture.

3. Designed Serendipity.  While this is a reductionist analysis, it’s impossible to avoid how interdependent these components are.  Capability needs space to operate, while space helps to create psychological safety.  That in turn makes it easier to fail, and share unexpected results.  And our most disruptive ideas typically come from those results experts weren’t expecting. Assuming that most competitors have similar pools of expertise, surprising results are the only way to break a close innovation race.  These can come from failures, as discussed above.  But they can also come from outside, either from someone viewing  our results through a different lens, and so seeing something we miss because of confirmation bias, or from somebody sharing information that they wouldn’t realize is relevant to us.  While we cannot force this type of cross- disciplinary interaction to occur per se, we can design organizations to facilitate it.  We can create spaces where people mix and communicate informally.  Or run training sessions that bring together mixed teams. A coffee bar in a work place, or an excellent cafeteria that encourages people to stay on site and mix all have benefits that are hard to quantify, but can also do an enormous amount to trigger an innovative culture.  But much of this requires people to be physically present.  Remote working provides time and convenience benefits, and works well for some tasks.  But we need to prevent the pendulum from swinging too far.  Whether it’s the serendipity of unexpected discussions at the water cooler, or the subtle body language that encourages someone to share a counter intuitive idea, or a failure, some personal interactions work better when people are physically in the same place.  We can certainly learn from our Covid experience, and reduce non productive time in the office.   But subtleties such as body language and microexpressions get lost on Facetime, making tough discussions tougher, sharing ‘bad’ results harder. And without physical presence, we’ll lose much of the serendipity of insight and information sharing in common physical spaces.  We don’t have to go back to where we were, but getting the balance right will drive competitive advantage by optimizing sharing, serendipity, and recruitment and retention.

4. Motivation. I’ve saved what I think is the hardest topic until last. Intrinsic motivation is absolutely key to an innovative culture.  If people love what they are doing  they will go the extra mile.   Passion means problems stay top of mind, increasing the chances of serendipitous innovation, or ‘Eureka moments’.  Money is important if you don’t have enough, but it’s intrinsic motivation that drives disruptive innovation. That motivation largely comes from one or all of three places; fascination with a problem, deep commitment to a team or authentic alignment between project and individual purpose.  The first two are fairly self-evident.  But the last one has always been tricky, and has become more difficult in our post Covid, more polarized world. Firstly, it must be authentic. For example, motivating a team to get behind a sustainability project that turns out to be largely greenwashing, or that evolves from authentic to greenwashing under timing or economic pressure can quickly turn motivation into indifference, or worse.  And the line between greenwashing and real environmental initiatives is often more fuzzy than we like to admit.  There are inevitably trade offs as we try and balance the needs of a business with the need to improve an environmental footprint, and often what starts as a major benefit gets trimmed en route to market.  And it’s not one size fit’s all, as one persons authentic is another persons greenwashing.   Furthermore, environmental is probably the easiest of the ‘purpose motivators’ to manage.

For more contentious social justice areas, it’s increasingly likely that not everyone in a team will be aligned with a project.  Even if they put aside their personal views, intrinsic motivation will inevitably fall in this situation.  Conversely, tap into a teams passions too well, and we risk  the core brand or product becoming secondary to the ‘cause’.  But even bigger risks as we look outward to the consumer.  Even if we have an organization that shares common values, taking a position on a contentious social justice issue is quite likely to alienate a significant segment of consumers.  Yet we know from Ehrenburg-Bass research that broad appeal and availability usually generates more volume than loyalty, and so even initiatives that enjoy short-term bumps in volume from socio-political positions can suffer long-term damage.  The short-term loyalty they create is often more short-lived than any emotional disconnection from a brand from consumers who disagree.   There are also additional issues with cognitive fluency, as while some brands are a good fit with environmental or social justice positions, many are not.  Consumers only associate about 1-3 attributes with a brand, and there is a significant risk of with subtraction by addition if a brand starts focusing on communications that are not a fluent fit with core equity.

None of this means we shouldn’t strive to create greener products, and indeed for many categories a healthy environmental profile is rapidly becoming price of entry.  The picture with social justice is more complex and more polarized, but again, all companies should strive to do the right thing, and be good corporate citizens.  But it’s important to do so carefully, ensure that we’re not alienating consumers, that initiatives are a fit with equity, and are sufficiently differentiated at a time when environmental and social justice communication is pervasive.  And there is always the question of source validity, and whether your brand has the perceived authority to  take a position on an issue.  And if our goal is to improve intrinsic motivation and employee satisfaction, it’s also worth considering that internal cultural benefits can often be achieved more effectively via inwardly facing initiatives that don’t risk  alienating consumers.

In conclusion, Covid19 has created opportunity for significant change in innovation culture, and in some cases, that change is already irreversible.  But it is sill important to step back, ask ourselves how much we want to change, and what parts of our culture we may want to protect.  If you are reading this, you are probably an innovator, and so change is in your blood.  But do keep in mind that the grass is always greener.  Whether we are innovating products, services or organizations, the new often looks better simply because we don’t know the issues we haven’t yet discovered.

I sometimes think innovation is like a giant game of wack-a-mole, where we innovate to improve one area, only to inadvertently create a new unexpected one along the way.  Sometimes these are minor, and just a part of the innovation process, sometimes they are much bigger, as in Boeings 737 Max.  This does not mean we should stagnate, or miss a once in a generation opportunity.  But just as culture is usually slow to change, it’s also slow to fix if we get it wrong.  So before messing too much with the DNA of an organization, it’s worth at least considering if the upside is worth the inevitable disruption, both anticipated and unanticipated. We have a once in a lifetime opportunity – don’t miss it, but don’t throw the baby out with the bathwater either!

Image credit: Pixabay

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Leveraging Technology in Change Planning

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Tools and Platforms for Success

Leveraging Technology in Change Planning

GUEST POST from Art Inteligencia

In today’s rapidly evolving business landscape, change is inevitable. Whether it is a shift in market demands, a new competitor entering the scene, or a global crisis such as the COVID-19 pandemic, organizations are constantly faced with the need to adapt. However, implementing change within an organization can be a complex and challenging process, requiring strategic planning, effective communication, and strong leadership.

One key factor that can greatly facilitate the change planning process is the use of technology. Technology has become an integral part of modern business operations, offering tools and platforms that can streamline processes, improve communication, and facilitate collaboration. In this article, we will explore how organizations can leverage technology to drive successful change initiatives, using two case studies to illustrate best practices.

Case Study 1: Company A

Company A is a global technology company that specializes in developing innovative software solutions for businesses. When the COVID-19 pandemic hit, Company A was faced with the challenge of transitioning its workforce to remote work virtually overnight. To ensure a smooth transition, Company A utilized a project management platform that allowed employees to collaborate on projects, track progress, and communicate in real-time.

By leveraging this technology, Company A was able to create a seamless remote work environment, ensuring that employees were able to stay connected and productive despite the challenges posed by the pandemic. Additionally, the platform allowed for centralized communication, enabling leadership to provide updates and guidance to employees in a timely manner.

Case Study 2: Company B

Company B is a manufacturing company that was looking to implement a new ERP system to streamline its operations and improve efficiency. However, the implementation of a new ERP system presented a significant change for employees, who were accustomed to using legacy systems.

To ensure a successful transition, Company B implemented a change management platform that allowed employees to access training materials, communicate with project leads, and provide feedback on the new system. The platform also served as a repository for resources and information, ensuring that employees had access to the support they needed throughout the transition process.

By leveraging technology in their change planning efforts, Company B was able to minimize resistance to change, increase employee engagement, and ensure a smooth implementation of the new ERP system.

Conclusion

Technology can be a powerful tool for organizations looking to drive successful change initiatives. By leveraging tools and platforms that facilitate communication, collaboration, and information sharing, organizations can streamline the change planning process and ensure a smooth transition for employees. The case studies presented in this article demonstrate the impact that technology can have on change management, highlighting the importance of incorporating technological solutions into change planning strategies. By embracing technology, organizations can navigate change with confidence and achieve long-term success in today’s rapidly evolving business environment.

Bottom line: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Unsplash

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Change Management Needs to Change

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Change Management Needs to Change

GUEST POST from Greg Satell

In 1983, McKinsey consultant Julien Phillips published a paper in the journal, Human Resource Management, that described an ‘adoption penalty’ for firms that didn’t adapt to changes in the marketplace quickly enough. His ideas became McKinsey’s first change management model that it sold to clients.

But consider that research shows in 1975, during the period Phillips studied, 83% of the average US corporation’s assets were tangible assets, such as plant, machinery and buildings, while by 2015, 84% of corporate assets were intangible, such as licenses, patents and research. Clearly, that changes how we need to approach transformation.

When your assets are tangible, change is about making strategic decisions, such as building factories, buying new equipment and so on. Yet when your assets are intangible, change is connected to people—what they believe, how they think and how they act. That’s a very different matter and we need to reexamine how we approach transformation and change.

The Persuasion Model Of Change

Phillips’ point of reference for his paper on organizational change was a comparison of two companies, NCR and Burroughs, and how they adapted to changes in their industry between 1960 and 1975. Phillips was able to show that during that time, NCR paid a high price for its inability to adapt to change while it’s competitor, Burroughs prospered.

He then used that example to outline a general four-part model for change:

  • Creating a sense of concern
  • Developing a specific commitment to change
  • Pushing for major change
  • Reinforcing and consolidating the new course

Phillips’ work kicked off a number of similar approaches, the most famous of which is probably Kotter’s 8-step model. Yet despite the variations, the all follow a similar pattern. First you need to create a sense of urgency, then you devise a vision for change, communicate the need for it effectively and convince others to go along.

The fundamental assumption of these models, is that if people understand the change that you seek, they will happily go along. Yet my research indicates exactly the opposite. In fact, it turns out that people don’t like change and will often work actively to undermine it. Merely trying to be more persuasive is unlikely get you very far.

This is even more true when the target of the change is people themselves than when the change involves some sort of strategic asset. That’s probably why more recent research from McKinsey has found that only 26% of organizational transformations succeed.

Shifting From Hierarchies To Networks

Clearly, the types of assets that make up an enterprise aren’t the only thing that has changed over the past half-century. The structure of our organizations has also shifted considerably. The firms of Phillips’ and Kotter’s era were vlargely hierarchical. Strategic decisions were made at the top and carried out by others below.

Yet there is significant evidence that suggests that networks outperform hierarchies. For example, in Regional Advantage AnnaLee Saxenian explains that Boston-based technology firms, such as DEC and Data General, were vertically integrated and bound employees through non-compete contracts. Their Silicon Valley competitors such as Hewlett Packard and Sun Microsystems, on the other hand, embraced open technologies, built alliances and allowed their people to job hop.

The Boston-based companies, which dominated the microcomputer industry, were considered to be very well managed, highly efficient and innovative firms. However, when technology shifted away from microcomputers, their highly stable, vertical-integrated structure was completely cut off from the knowledge they would need to compete. The highly connected Silicon Valley firms, on the other hand, thrived.

Studies have found similar patterns in the German auto industry, among currency traders and even in Broadway plays. Wherever we see significant change today, it tends to happen side-to-side in networks rather than top-down in hierarchies.

Flipping The Model

When Barry Libenson first arrived at Experian as Global CIO in 2015, he knew that the job would be a challenge. As one of the world’s largest data companies, with leading positions in the credit, automotive and healthcare markets, the CIO’s role is especially crucial for driving the business. He was also new to the industry and needed to build a learning curve quickly.

So he devoted his first few months at the firm to looking around, talking to people and taking the measure of the place. “I especially wanted to see what our customers had on their roadmap for the next 12-24 months,” he told me and everywhere he went he heard the same thing. They wanted access to real-time data.

As an experienced CIO, Libenson knew a cloud computing architecture could solve that problem, but concerns that would need to be addressed. First, many insiders had concerns that moving from batched processed credit reports to real-time access would undermine Experian’s business model.. There were concerns about cybersecurity. The move would also necessitate a shift to agile product management, which would be controversial.

As CIO, Libenson had a lot of clout and could have, as traditional change management models suggest, created a “sense of urgency” among his fellow senior executives and then gotten a commitment to the change he sought. After the decision had been made, they then would have been able to design a communication campaign to persuade 16,000 employees that the change was a good one. The evidence suggests that effort would have failed.

Instead, he flipped the model and began working with a small team that was already enthusiastic about the move. He created an “API Center of Excellence” to help willing project managers to learn agile development and launch cloud-enabled products. After about a year, the program had gained significant traction and after three years the transformation to the cloud was complete.

Becoming The Change That You Want To See

The practice of change management got its start because businesses needed to adapt. The shift that Burroughs made to electronics was no small thing. Investments needed to be made in equipment, technology, training, marketing and so on. That required a multi-year commitment. Its competitor, NCR, was unable or unwilling to change and paid a dear price for it.

Yet change today looks much more like Experian’s shift to the cloud than it does Burroughs’ move into electronics. It’s hard, if not impossible, to persuade a product manager to make a shift if she’s convinced it will kill her business model, just it’s hard to get a project manager to adopt agile methodologies if she feels she’s been successful with more traditional methods. .

Libenson succeeded at Experian not because he was more persuasive, but because he had a better plan. Instead of trying to convince everyone at once, he focused his efforts on empowering those that were already enthusiastic. As their efforts became successful, others joined them and the program gathered steam. Those that couldn’t keep up got left behind.

The truth is that today we can’t transform organizations unless we transform the people in them and that’s why change management has got to change. It is no longer enough to simply communicate decisions made at the top. Rather, we need to put people at the center and empower them to succeed.

— Article courtesy of the Digital Tonto blog
— Image credit: Pexels

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Announcing Human-Centered Change & Innovation Weekly

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Human-Centered Change and Innovation Weekly Newsletter

We’re about two months into the re-birth and re-branding of Blogging Innovation as Human-Centered Change and Innovation.

At the same time I brought my multiple author blog back to life, I also created a weekly newsletter to bring all of this great content to your inbox every Tuesday.

Human-Centered Change & Innovation Weekly brings four or five great articles as an email to you from myself and a growing roster of talented and insightful contributing authors, including:

Robert B. Tucker, Janet Sernack, Greg Satell, Linda Naiman, Howard Tiersky, Paul Sloane, Rachel Audige, Arlen Meyers, John Bessant, Phil Buckley, Jesse Nieminen, Anthony Mills, Nicolas Bry and your host Braden Kelley.

You can sign up for the newsletter here:


I would be interested to know whether you prefer:

  1. Tuesday
  2. Sunday

And, if you’ve missed out on previous issues and would like to explore them, you’ll find the links below:

Human-Centered Change & Innovation Weekly

Finally, if you know a globally recognized human-centered design, change, innovation, transformation or customer experience author that should be contributing guest articles to the blog and newsletter, have them contact us.

I hope you continue to find value in everyone’s contributions to the conversations around human-centered change, innovation, transformation and experience design!

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Creating a Movement that Drives Transformational Change

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Creating a Movement that Drives Transformational Change

A while ago I had the opportunity to interview Greg Satell, author of the new book Cascades: How to Create a Movement that Drives Transformational Change.

Greg Satell is a bestselling author, speaker and adviser, who frequently contributes here to my blog Human-Centered Change and Innovation, Harvard Business Review, Inc. and other A-list publications. His first book, MAPPING INNOVATION, was chosen as one of the best business books of 2017 by 800-CEO-READ. His latest book, CASCADES, was recently published by McGraw-Hill Education.

Today, he helps leading businesses overcome disruption through impactful programs and powerful tools he developed researching the world’s best innovators and most effective changemakers.

Without further ado, here is the transcript of that interview:

1. People love to tell the story of Netflix disrupting Blockbuster. What do they get wrong?

It’s funny. People so easily assume that Blockbuster just completely ignored the Netflix threat, when actually nothing could be further from the truth. In fact, the leadership came up with an effective strategy to meet that threat, executed it well and began to surpass Netflix in adding new subscribers.

The real reason that Blockbuster failed was that the leadership failed to manage internal networks—particularly franchisees and investors—and the stock price crashed. That attracted the corporate raider Carl Icahn, who had a heavy handed style. Eventually, things came to a head and he initiated a compensation dispute with the CEO, John Antioco., who left in frustration. The new CEO came in and reversed the strategy. Three years later, Blockbuster went bankrupt.

One of the most interesting parts of the story came out when I interviewed Antioco, who was—and is—something of a retail genius. He told me that, throughout his career, anytime he wanted to do something innovative, he always met resistance. He had always succeeded by pushing through that resistance. This time though, it got the better of him.

We tend to think that if we have the right idea and execute it well, we’ll be successful. The real lesson of Blockbuster is that isn’t always true. We also need to manage stakeholder networks.

2. To be efficient at scale, businesses introduce hierarchies as they grow. What weaknesses does this introduce and how should companies manage these?

To be honest, I don’t see anything inherently wrong with hierarchies. They’ve been put in place because they are effective at executing processes efficiently. Every organization needs that. However, hierarchies tend to be rigid and slow to adapt. That can be a real problem when the marketplace changes.

So what I think leaders need to focus on is building strong informal networks to supplement the formal organization. Chris Fussell calls this a “hybrid organization.” That’s what’s really key, to have the formal organization and the informal organization working hand-in-hand.

Unfortunately, there’s been so much emphasis on “breaking down silos,” that business leaders often miss that silos can be very positive things. They are essentially “centers of capability.” So you don’t want to break them up. What you do want to do is to connect silos so that they can adapt and collaborate.

3. Some would say that hierarchies are created to cascade information. How does information cascade differently within networks? How is better?

Well, hierarchies are essentially vertical networks, so information tends to move up and down fairly well, but not so good side to side, which makes it hard for an organization to adapt laterally. The types of networks I write about in Cascades are horizontal, so are much better set up to transfer information between disparate groups.

Clearly, you need both. The problem is that we tend to ignore the informal networks, which is why organizations over time become vertically driven and rigid.

Greg Satell - Digital Tonto4. What causes some movements to grow and others to be sidelined at the periphery?

That’s a great and complicated question (in fact, I wrote a whole book about it!). The truth is that, much as Tolstoy said about families, successful movements tend to look very much alike, while unsuccessful movements fail in their own way.

However, if there is one key thing that makes the difference it is to always connect out. Research has shown that the key metric that best determines success is participation. That may seem obvious, but many movements get caught up in idealogical purity and shut out potential allies. If you want to kill a change movement quickly, that’s probably the best way to do it. It’s not the fervor of zealots that brings change about, but when you get everybody else to join in that a true revolution can take place.

A great example of this kind of failure is the Occupy Movement. At first, they gained a lot of sympathy for their “99% vs. the 1%” message. However they were so extreme, and so intent on demonizing anyone who didn’t believe 100% what they believed, that they turned many people off. At one point, the legendary civil rights leader John Lewis asked to speak at a rally and was refused. I mean, John Lewis! Talk about shooting yourself in the foot!

The same is true in the business context. Think about VHS vs. Betamax. Betamax was the better technology, but VHS was more inclusive. VHS won.

Another great example is the Ignaz Semmelweis story. Semmelweis had discovered that hand washing in hospitals greatly reduced infection rates. It was a major discovery. However, rather than working to build a movement around his idea, he railed against anyone who didn’t agree with him. It would take another 20 years for antiseptic practices to gain traction and millions of people died needlessly because of it.

More recently, Jim Allison had a similar challenge with cancer immunotherapy. Pharmaceutical companies didn’t believe it would work and refused to invest in it. I still remember the sound of despair in his voice when he told me the story—and this was 20 years after it happened! But Jim kept pounding the pavement, kept working to bring others in and thousands upon thousands of people are alive today because of Jim.

So again, you have to constantly be connecting out and bringing people in. That’s why Jim Allison won the Nobel Prize last fall instead of dying in an insane asylum like Ignaz Semmelweis.

5. Why do successful movements or revolutions seem to need rules?

I think it’s better to say that movements need values. Values play two important roles: First, they provide constraints and, second, they provide rules for adaptation.

For example, during the Anti-Apartheid movement in South Africa, Nelson Mandela was accused of being an anarchist, a communist and worse. When asked about his beliefs though, he always pointed to the Freedom Charter, which was written way back in 1955. So he could point to something concrete that outlined his values and that of his movement. That commitment to values was crucial for getting support from institutions outside of South Africa and it was the support from those institutions that enabled Mandela and his movement to succeed.

When he got into power those constraints became even more important. Because one of the core values spelled out in the Freedom Charter was that all national groups should have equal rights, he couldn’t infringe upon the rights of white people, even though many urged him to do so. It is because of those self-imposed constraints that we remember Nelson Mandela as a hero and not some tin-pot dictator.

A similar dynamic played out in the “Gerstner Revolution” at IBM in the 1990s. Gerstner famously said that the last thing IBM needed at the time was a vision. But he was very clear that he wanted to shift values, to make IBM more customer focused and more collaborative. That sent important signals to customers, partners and investors and played a big part in Gerstner’s success.

Perhaps even more importantly, the focus on values helped IBM prosper long after he left the company. Irving Wladawsky-Berger, one of Gerstner’s key lieutenants, told me that if the Gerstner Revolution had merely been about strategy and technology, it wouldn’t have survived. But because it was rooted in values, IBM was able to adapt as technology and the marketplace continued to evolve.

Clearly, IBM has had its challenges since Gerstner left in 2002, but it’s still a highly profitable company that continues to be on the forefront of many cutting edge technologies, such as artificial intelligence, blockchain and quantum computing, just to name a few. It’s hard to see how that could have happened if the company was still stuck in a strategy developed in the 90s. That’s the role that values play.

6. How would you contrast the theory behind Cascades with W. Chan Kim and Renée Mauborgne’s Tipping Point Leadership?

I think on the surface they are somewhat similar ideas. However, there are important differences “under the hood.”

First, while “Tipping Point Leadership” implicitly refers to the importance of networks, Cascades is deeply and explicitly rooted in network science. In fact, Duncan Watts and Steven Strogatz, who pioneered modern network theory, have both endorsed the book (although Strogatz has done so more informally). I believe that scientific approach really helps provide a stronger framework to understand how change occurs.

Another important difference is that while Kim and Mauborgne basically built their framework from scratch, Cascades is more of a synthesis of ideas that have already been proven successful in social, political and business contexts.

There has been a lot great thinking about this stuff for a long time, so I saw no reason to try and reinvent the wheel. Rather, I tried to shape already powerful ideas—some of which have been battle-tested for decades—into a coherent framework that people can put to good use. In that way, Cascades is very similar to my previous book, Mapping Innovation.

Of course I’m biased on this point, but I believe the result is a much richer, detailed and useful framework for driving change. When you are driving change in the real world, details matter.

7. What is wrong with the theory of influentials being central to successful change?

Well, first it’s wrong because it’s empirically been shown not to be true. Scientific research has clearly shown, across multiple studies, that you don’t need “influentials” to create a viral cascade or, as Gladwell puts it, a “social epidemic.” I reference many of these studies in the book, so that readers can go check for themselves.

Conceptually, the influentials hypothesis breaks down because you need large chains of influence to create a viral cascade. Somebody may be influential because they are a connector, a maven, or whatever, but unless the people they influence pass on their ideas to others who pass them on to others still, the movement will die out. As I write in the book, it is small groups, loosely connected, but united by a shared purpose that drives transformational change.

The one exception is celebrities like Oprah Winfrey. They can really move the needle if they choose to promote an idea, but not because they have any “rare social gifts.” It’s because what they say is broadcasted by mass media. So there’s nothing really mysterious about it.

Cascades by Greg Satell8. What are some of the critical raw materials for fueling a cascade?

The three most important elements are small groups, loose connections and shared purpose.

Small groups engender strong bonds and that’s super important. Creating change is hard. So it’s important to build deep trustful relationships that lead to effective collaboration. That’s at the root of any successful movement. For example, the Otpor Movement in Serbia started with just 11 founders.

However, a small group can’t do much on its own. So it’s important for small groups to connect to other small groups. It’s that continuous linking that creates the conditions upon which a cascade can arise. That’s how Otpor eventually grew to 70,000 members and took down the dictator, Slobodan Milošević. As I explain the book, organizational change movements, such as those in the US Army and at companies like Experian and Wyeth Pharmaceuticals, play out in very much the same way.

Lastly, you need a sense of shared purpose. That’s what ties everything together. It’s also why effective leadership is so important. You need leaders to provide that purpose. As I write in the book, the role of leaders is no longer merely to plan and direct action, but to inspire and empower belief.

9. What’s your view on the phases of a successful change

Generally speaking, change movements have three phases: planning, mobilization and the victory phase.

In the planning phase, you need to formulate your Vision of Tomorrow and your values and also map out the specific constituencies you want to mobilize and the institutions you will need to influence. It’s important to not mobilize too soon, because every revolution inspires a counterrevolution. So by mobilizing too early you run the risk of inspiring opposition as much as you do supporters. This is a very common mistake.

Mobilization is largely about planning and executing tactics and there are a couple of important points to keep in mind. First, you are always mobilizing specific constituencies to influence particular institutions. You are always mobilizing somebody to influence something. You’re never mobilizing just for the sake of mobilizing or to “raise awareness” or anything like that. Everything you do needs to have a strategy in mind.

Another point is that you always want to be mobilizing out and bringing people in. And when you recruit new people you want to immediately train them and get them to act, even if the action is small. It is through action that people take ownership of change, so getting people to act is incredibly important. One of the cases I researched was Experian’s digital transformation. They really focused on this aspect and had enormous success.

The last phase is the victory phase and it’s often the most dangerous. For example, in Ukraine’s Orange Revolution, which I took part in and inspired me to write the book, we thought we had won. As it turned out, we hadn’t and soon the country descended back into chaos, which resulted in a second revolution, the Euromaidan protests in 2013 and 2014.

We’ve seen the same thing happen more recently in Egypt, where they overthrew Mubarak and ended up with el-Sisi, who is very much the same. It’s also common in startups and in corporate transformation, an early surge and then things go awry.

So you need to plan to “survive victory” ahead of time. You do that by focusing on shared values, rather than specific personalities or objectives. You never want to make a change movement about yourself or your organization. It always needs to be about values.

There is a fourth phase and it’s one you want to avoid. It is the failure phase. Almost every movement I researched had a massive early failure. In most cases, it arose from a failure to prepare and build the movement methodically. The successful movements learned from those failures and continued to evolve. The unsuccessful ones didn’t.

10. When it comes to participation and mobilization, what should people keep in mind to accelerate both?

Again, you just want to keep building out and networking the movement. Keep building links. Eventually, you will build critical mass and the movement will accelerate by itself. That’s what a cascade is, when your movement goes viral.

However, before that happens, you want to prepare as much as possible or your movement can spin out of control, if you haven’t invested in building values, training, etc. We’ve seen that happen with Occupy, Black Lives Matter and, to some extent, the modern women’s movement. Values always need to be upfront.

Perhaps most of all, you need to keep in mind that change is always possible. If you looked at Serbia in 1999, what you would have seen was a country ruled by a ruthless dictator with no effective opposition. Occupy only had a few hundred members at the time. A year later, Occupy had grown to 70,000 members and Milošević was out of office. A few years after that, he died in his cell at The Hague.

Very few change efforts have to overcome those kinds of odds, but using the same principle—those that I write about in Cascades—you can bring real change about, whether that change is in your organization, your industry, your community or throughout society as a whole.

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Overcoming Change Resistance

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Addressing Common Barriers to Change

Overcoming Change Resistance

GUEST POST from Art Inteligencia

Change is the only constant in today’s fast-paced world. Despite this, organizations often encounter significant resistance to change from their employees. As a change and innovation thought leader, my aim is to provide actionable insights to navigate these barriers effectively. In this article, we will delve into the common barriers to change and present real-world case studies to illuminate practical solutions.

Understanding the Common Barriers to Change

Resistance to change is natural. It often stems from fear of the unknown, loss of control, bad timing, or previously unsuccessful change initiatives. By recognizing these barriers early, leaders can strategize on how to address them effectively.

Case Study 1: Transforming a Legacy Retail Company

Background: A well-established retail company with a legacy of over 70 years in the industry was facing declining sales due to increased competition and a shift towards e-commerce. They decided to undergo a digital transformation to stay relevant.

Challenges: The employees were resistant to change as they were comfortable with traditional business processes. There was a significant apprehension regarding the adoption of new technology.

Approach: The leadership team implemented a change management strategy focusing on communication, training, and involvement. They organized town hall meetings to explain the vision and benefits of digital transformation. Training programs were launched to upskill employees in new technologies, and an innovation lab was created, encouraging employees to contribute ideas and test new digital tools.

Outcome: The combination of transparent communication, ongoing training, and employee involvement helped in reducing fear and building a sense of ownership among the staff. Eventually, the company saw a successful transformation with a significant increase in online sales and improved overall efficiency.

Case Study 2: Revamping the Organizational Culture of a Manufacturing Firm

Background: A mid-sized manufacturing firm recognized the need to shift from a hierarchical culture to a more collaborative and innovative work environment in order to drive growth and improve employee satisfaction.

Challenges: Long-standing employees were resistant to this cultural shift, worrying about the loss of status and changes in their work roles.

Approach: The firm’s leadership took a phased approach, starting with the creation of cross-functional teams for specific projects. They encouraged open communication and feedback through regular workshops and surveys. Leadership also modeled collaborative behavior and rewarded teams for innovative solutions.

Outcome: Gradually, employees began to see the positive impact of a collaborative culture on their productivity and job satisfaction. As trust was built and employees felt more valued, resistance decreased. The firm reported an increase in innovation and employee engagement, which translated into business growth.

Key Takeaways

These case studies underscore the importance of addressing resistance to change through clear communication, active involvement, and ongoing support. By understanding and mitigating the emotional and practical concerns of employees, organizations can facilitate smoother transitions and foster a culture of continuous improvement.

Embrace change as a journey rather than a destination, and remember—empathy, patience, and perseverance are your allies in making lasting transformations.

Bottom line: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Pixabay

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Creating 21st Century Transformational Learning

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Creating 21st Century Transformational Learning

GUEST POST from Janet Sernack

I was privileged to attend one of the first Theory U; Presencing Leadership for Profound Innovation and Change Workshops presented by the Sloane School of Management, in Boston in 2008. This means that I have been able to observe, engage with and participate, from both Israel and Australia, in the evolution of Presencing and Theory U as powerful resources and vehicles for effecting profound transformational change and learning.

Intentional Change and Learning

I have seen and experienced the growth of the global Presencing community, as it transformed from a small, diverse, thought-leading group in the USA, seeding a range of deeply disruptive core concepts, as described in their groundbreaking book – Presence: Human Purpose and the Field of the Future into a global movement.

Where they introduced a radical new theory about change and learning, I also participated in its evolution into its current manifestation, as a global movement for profound transformational change. Which seeks to create, within the whole system, intentional shifts that break old patterns of seeing and acting that continually create results, on a planetary level, that are no longer needed or wanted. Achieving this by encouraging deeper levels of attention and intention, as well as deep and continuous learning, to create an awareness of the larger systemic whole, ultimately leading to us to adopt new and different mindsets, behaviors, actions, and systems that can help to shape our evolution and our futures.

A Turning Point

It is suggested by many, that we are at a turning point, a critical moment in time, where all of us, individually and collectively, have the chance to focus our attention toward activating, harnessing, and mobilizing transformational change and learning to shape our evolution and our futures intelligently. To maximize the emergence, divergence, and convergence of new patterns of consumer and business behaviors that have emerged at extraordinary speed and can be sustained over long periods of time because digitization, coupled with the impact of the global pandemic, have accelerated changes faster than many of us believed previously possible.

Paradoxically, we are facing an uncertain future, where according to the World Economic Forum Job Reset Summit – “While vaccine rollout has begun and the growth outlook is predicted to improve, and even socio-economic recovery is far from certain” no matter where you are located or professionally aligned.

Leveraging the Turning Point

This turning point, is full of possibilities and innovative opportunities potentially enabling organizations, leaders, teams, people, and customers to embrace the opportunity to change and learning in creative and inventive ways to shape our evolution and to co-create our futures, in ways that are:

  • Purposeful and meaningful,
  • Embrace speed, agility, and simplicity,
  • Scale our confidence, capacity, and competence through unlearning, relearning, and innovation.

Resulting in improving equity for all, resilience, sustainability, growth, and future-fitness, in an ever-changing landscape, deeply impacted by the technologies created by accelerated digitization, by putting ourselves into the service of what is wanting to emerge in this unique turning point and moment of time.

Forward-looking leadership

This is validated by the Boston Consulting Group (BCG), who outlined, in a recent article the key strategies employed by most innovative companies in 2021 that “forward-looking leaders soon looked to broader needs affecting their companies’ futures, such as resilience, digital transformation, and customer relevance”.

Realizing, like the authors of Presence: Human Purpose and the Field of the Future, the need to build the systemic ability to drive change, learning and innovation, by transforming their ambitious aspirations into real results through:

  1. Clarifying a clear ambition: that is meaningful and purposeful, compelling and engaging that aligns to people’s values and helps build “one team” mindsets.
  2. Building systemic innovation domains: that are strategically and culturally aligned, enabling people and technology to connect, explore, discover, design, and deliver the ambition through making changes and learning, collective and ecosystems approach that provides clear lines of sight to stakeholders, users, and customers.
  3. Performance management: that acknowledges and rewards collaborative achievements, results in transformational change and learning through smart risk-taking, experimentation and drives accountability, and celebrates success.
  4. Project management: that provides rigor and discipline, through taking a human-centered, and agile approach that allows people and teams to make the necessary shifts in assigning and delivering commercially astute, ambitious, radical, and challenging breakthrough and Moonshot projects.
  5. Talent and culture: by exercising leadership that brings people and teams together, collaborating by fostering openness, transparency, permission, and trust so people can safely unlearn, relearn, adapt and innovate. By supporting and sponsoring change initiatives, by harnessing and mobilizing collective genius, by granting prestige to innovation roles and valuing radical candor, generating discovery and challenges to the status quo.

A Moment in Time

Some thirteen years later, in a recent Letter, Otto Scharmer, one of the original authors of the Presence book, shared with the global Presencing community, that it:

“feels as if we have collectively crossed a threshold and entered a new time. A time that was there already before, but more as a background presence. A time that some geologists proposed to refer to as the Anthropocene, the age of humans. Living in the Anthropocene means that basically all the problems, all the challenges we face on a planetary scale are caused by… ourselves”.

He then stated that “Being alive at such a profound planetary threshold moment poses a critical question to each and every one of us: What is my response to all of this, what is our response to this condition, how am I – and how are we – going to show up at this moment?

Showing up at this moment

Change and learning today involve people, developing their knowledge, mindsets, and behaviors, skills and habits. So, making a fundamental choice about how you wish to show up right now, as a leader or manager, business owner or employee, consultant, trainer, or coach, is crucial to making your contribution and commitment to shaping your own individual, and our collective evolution and our futures.

Taking just a moment

It may, in fact, be beneficial, to take just a moment – to hit your pause button, retreat into reflection, stillness, and silence and ask yourself Otto’s question – how am I, and how are we as a business practice, team or organization going to show up at this moment?

Drawing on my experience as an innovative start-up entrepreneur in Israel, people can either be forced to change and learn through necessity, conflict, and adversity in order to survive. Alternately, they can choose to change through seeing the world with fresh eyes, full of possibility, positivity, optimism, and self-transcendence, to innovate and thrive.

  • How might you develop the courage to make transformational and systemic changes and learning and innovation your key priorities to survive through necessity and adversity, or thrive through unleashing possibilities, optimism, and positivity?
  • How might you develop the compassion to focus on developing both customer and human centricity in ways that are purposefully meaningful and aligned to people’s values and contribute to the good of the whole (people, profit, and planet)?
  • How might you be creative in transforming your time, people, and financial investments in ways that drive out complacency, build change readiness and deliver the deep and continuous change and learning that equips and empowers people to deliver tangible results that are valued, appreciated, and cherished, now and in the future?

Not only to take advantage of the moment in time but to also use transformational change and learning to extend your practice or organizations future fitness and life expectancy, because, according to a recent article in Forbes –  “Half of the giants we now know may no longer exist by the next decade. In 1964, a company on the S&P 500 had an average life expectancy of 33 years. This number was reduced to 24 years in 2016 and is forecast to shrink further to 12 years by 2027”.

This is the final blog in our series of blogs, podcasts, and webinars on Developing a Human-Centric Future-Fitness organization.

Find out about our learning products and tools, including The Coach for Innovators Certified Program, a collaborative, intimate, and deep personalized innovation coaching and learning program, supported by a global group of peers over 8-weeks, starting Tuesday, October 19, 2021.

It is a blended and transformational change and learning program that will give you a deep understanding of the language, principles, and applications of a human-centered approach and emergent structure (Theory U) to innovation, within your unique context.  Find out more

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Leading Change

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Strategies for Successful Organizational Transformation

Leading Change - Strategies for Successful Organizational Transformation

GUEST POST from Art Inteligencia

Effective organizational transformation is not just about making changes; it’s about making the right changes in the right way. As a leader, your role is to guide your organization through the challenges and uncertainties that accompany transformation. This article explores key strategies for successful organizational transformation and illustrates them with two compelling case studies.

Key Strategies for Organizational Transformation

  1. Establish a Clear Vision and Communicate it Effectively

    A clear vision provides direction and purpose. Communicate this vision consistently across all levels of the organization to ensure alignment and buy-in.

  2. Engage and Empower Your Team

    Involving employees in the transformation process boosts morale and commitment. Empower them to take ownership of their roles in the change process.

  3. Measure Progress and Adapt

    Set measurable objectives and keep track of progress. Be prepared to adapt strategies based on feedback and changing circumstances.

  4. Build a Culture of Continuous Improvement

    Encourage a mindset of innovation and continuous improvement. This ensures the organization remains agile and responsive to new opportunities and challenges.

Case Study 1: Zappos – Creating a Customer-Centric Culture

Zappos, an online shoe and clothing retailer, is renowned for its exceptional customer service. Tony Hsieh, the former CEO, led a transformation that put the customer at the core of the business. Here’s how they did it:

Strategy in Action:

  • Clear Vision: Hsieh communicated the vision of delivering “WOW” through service and instilled this vision into every aspect of the business.
  • Employee Engagement: Zappos invested heavily in employee training and development, ensuring that every employee was aligned with the company’s values.
  • Continuous Improvement: The company maintained an open-feedback culture where employees could contribute ideas for enhancing customer experiences.

The result was a culture that celebrated extraordinary customer service, making Zappos a model for customer-centricity in retail and driving sustained business growth.

Case Study 2: Microsoft – From a Culture of Know-it-All to Learn-it-All

Under the leadership of CEO Satya Nadella, Microsoft underwent a cultural transformation that shifted the company from a “know-it-all” to a “learn-it-all” mentality. Here’s a look at the strategies employed:

Strategy in Action:

  • Clear Vision: Nadella emphasized a vision of empathy, collaboration, and a growth mindset. He communicated this vision through regular town halls and personal storytelling.
  • Employee Empowerment: Microsoft encouraged cross-functional collaboration and learning from failures. Employees were empowered to pursue creative solutions and explore new technologies.
  • Measuring Progress: The company set quantifiable goals related to innovation and employee engagement, regularly reviewing performance and making necessary adjustments.

This cultural shift rejuvenated Microsoft, fostering innovation and establishing the company as a leader in cloud computing, artificial intelligence, and other cutting-edge technologies.

Conclusion

Organizational transformation is a journey that requires intentionality, leadership, and persistence. By establishing a clear vision, engaging and empowering your team, measuring progress, and fostering a culture of continuous improvement, you can navigate the complexities of change and achieve sustainable success.

Remember, transformation is not a one-time event; it’s an ongoing process. The cases of Zappos and Microsoft highlight that with the right strategies, any organization can transform itself to meet future challenges and opportunities head-on.

Bottom line: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Dall-E

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Why Change Failure Occurs

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Why Change Failure Occurs

GUEST POST from Greg Satell

Never has the need for transformation been so dire or so clear. Still, that’s no guarantee that we will muster the wisdom to make the changes we need to. After all, President Bush warned us about the risks of a global pandemic way back in 2005 and, in the end, we were left wholly vulnerable and exposed.

It’s not like pandemics are the only thing to worry about either. A 2018 climate assessment warns of major economic impacts unless we make some serious shifts. Public debt, already high before the current crisis, is now exploding upwards. Our electricity grid is insecure and vulnerable to cyberattack. The list goes on.

All too often, we assume that mere necessity can drive change forward, yet history has shown that not to be the case. There’s a reason why nations fail and businesses go bankrupt. The truth is that if a change is important, some people won’t like it and they will work to undermine it in underhanded and insidious ways. That’s what we need to overcome.

A Short History Of Change

For most of history, until the industrial revolution, people existed as they had for millennia and could live their entire lives without seeing much change. They farmed or herded for a living, used animals for power and rarely travelled far from home. Even in the 20th century, most people worked in an industry that changed little during their career.

In the 1980s, management consultants began to notice that industries were beginning to evolve more rapidly and firms that didn’t adapt would lose out in the marketplace. One famous case study showed how Burroughs moved aggressively into electronic computing and prospered while its competitor NCR lagged and faded into obscurity.

In 1983, McKinsey consultant Julien Phillips published a paper in the journal, Human Resource Management, that described an “adoption penalty” for firms that didn’t adapt to changes in the marketplace quickly enough. His ideas became McKinsey’s first change management model that it sold to clients.

Yet consider that research shows in 1975, during the period Phillips studied, 83% of the average US corporation’s assets were tangible, such as plant, machinery and buildings, while by 2015, 84% of corporate assets were intangible, such as licenses, patents and human capital. In other words, change today involves mostly people, their knowledge and behaviors than it does strategic assets.

Clearly, that changes the game entirely.

What Change Looks Like Today

Think about how America was transformed after World War II. We created the Interstate Highway System to tie our nation together. We established a new scientific infrastructure that made us a technological superpower. We built airports, shopping malls and department stores. We even sent a man to the moon.

Despite the enormous impact of these accomplishments, none of those things demanded that people had to dramatically change their behavior. Nobody had to drive on an Interstate highway, work in a lab, travel in space or move to the suburbs. Many chose to do those things, but others did not and paid little or no penalty for their failure to change with the times.

Today the story is vastly different. A crisis like Covid-19 required us to significantly alter our behavior and, not surprisingly, some people didn’t like it and resisted. We could, as individuals, choose to wear a mask, but if others didn’t follow suit the danger remained. We can, as a society, invest billions in a vaccine, but if a significant portion don’t take it, the virus will continue to mutate at a rapid rate, undermining the effectiveness of the entire enterprise.

Organizations face similar challenges. Sure they invest in tangible assets, such as plant and equipment, but any significant change will involve changing people’s beliefs and behaviors and that is a different matter altogether. Today, even technological transformations have a significant human component.

Making Room For Identity And Dignity

In the early 19th century, a movement of textile workers known as the Luddites smashed machines to protest the new, automated mode of work. As skilled workers, they saw their way of life being destroyed in the name of progress because the new technology could make fabrics faster and cheaper with less workers of lower skill.

Today, “Luddite” has become a pejorative term to describe people who are unable or unwilling to accept technological change. Many observers point out that the rise of industry created new and different jobs and increased overall prosperity. Yet that largely misses the point. Weavers were skilled artisans who worked for years to hone their craft. What they did wasn’t just a job, it was who they were and what they took pride in.

One of the great misconceptions of our modern age is that people make decisions based on rational calculations of utility and that, by engineering the right incentives, we can control behavior. Yet people are far more than economic entities, They crave dignity and recognition, to be valued, in other words, as ends in themselves rather than as merely means to an end.

That’s why changing behaviors can be such a tricky thing. While some may see being told to wear a mask or socially distance as simply doing what “science says,” for others it is an imposition on their identity and dignity from outside their community. Perhaps not surprisingly, they rebel and demand to have their right to choose be recognized.

Building Change On Common Ground

The biggest misconception about change is that once people understand it, they will embrace and so the best way to drive change forward is to explain the need for change in a very convincing and persuasive way. Change, in this view, is essentially a communication exercise and the right combination of words and images is all that is required.

Yet as should be clear by now that is clearly not true. People will often oppose change because it asks them to alter their identity. The Luddites didn’t just oppose textile machinery on economic grounds, but because it failed to recognize their skills as weavers. People don’t necessarily oppose wearing masks because they are “anti-science,” but because they resent having their behavior mandated from outside their community.

In other words, change is always, at some level, about what people value. That’s why to bring change about you need to identify shared values that reaffirm, rather than undermine, people’s sense of identity. Recognition is often a more powerful incentive than even financial rewards. In the final analysis, lasting change always needs to be built on common ground.

Over the next decade, we will undergo some of the most profound shifts in history, encompassing technology, resources, migration patterns and demography and, if we are to compete, we will need to achieve enormous transformation in business and society. Whether we are able to do that or not depends less on economics or “science” than it does on our ability to trust each other again.

— Article courtesy of the Digital Tonto blog
— Image credit: Pexels

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