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Three Myths That Kill Change and Transformation

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Three Myths That Kill Change and Transformation

GUEST POST from Greg Satell

In 1975, more than 80% of US corporate assets were tangible assets, things like factories, equipment and real estate. When leaders in an organization made decisions about change, they tended to involve tangible, strategic assets, such as building a new factory, entering a new market or launching a new line of products.

So when the modern practice of change management arose in the 1980s, that’s what it was designed to address. Managers began to recognize the need to communicate changes to the rank and file, so that they could better understand it and contribute to its success. An entire cottage industry of consultants arose to fill that need.

But now that situation has flipped and more than 80% of corporate assets are intangible. When we talk about change today we are usually talking about changes in people themselves, in how they think and how they act. Clearly, that’s a very different type of thing and we need to approach change differently. Unfortunately, too many people are mired in the past.

Myth #1: If People Understand Change, They Will Embrace It

Leaders like to be seen at the cutting edge and, to be effective, they need to believe in themselves. That’s what makes transformational initiatives so attractive. They’re much more fun than the more mundane aspects of managing an enterprise, like improving operations or cutting costs. Change gives leaders a chance to dream.

That’s what the practice of change management was designed to support. Someone high up in an organization would get an idea to, say, launch a new product line for a new market and the consultants would be brought in to help communicate the idea so that everyone could understand just how brilliant the idea was.

Of course, even if employees thought the idea was stupid there wasn’t much they could do about it. If a CEO wants to launch a new product line, invest in new factories and equipment and hire new people, there’s nothing the rank and file can do about it. Leadership has full control over tangible, strategic assets.

But today, when the vast majority of corporate assets are intangible, transformation initiatives involve changes in how people think and what they do, which leadership does not control. People have the power to resist and you can be sure they will. That’s why change fails, not because people don’t understand it, but because they don’t like it and actively sabotage it.

The truth is that humans form attachments to other people, ideas and things. When they feel those attachments are threatened, they will often lash out. That’s why when you ask people to change how they think or what they do, you will invariably offend some people’s identity, dignity and sense of self and they will act out in ways that are dishonest, underhanded and deceptive. That doesn’t make them bad people—we all do it—it just makes them human.

Myth #2: You Have To Convince The Skeptics

There is something baffling about human nature. Whenever we have an idea we are passionately about we feel intense desire to convince skeptics. Our inner marketers want to identify specific objections and then devise airtight arguments to counter them. We envision ourselves being dazzlingly persuasive and making our case.

Change management consultants encourage this type of thinking. They advise us to “provide simple, clear choices and consequences” and “show the benefits in a real and tangible way.” They also suggest that we have “open and honest conversations” and “even make a personal appeal” in order to “convert the strongest dissenters.”

This may make sense if the objections are rational, but often they are not. In fact, the most visceral dissent almost invariably has more to do with how people see themselves. That’s why change so often offends people’s dignity, because their identity is so often wrapped up in what they think and what they do. You can’t ask people to stop being who they think they are.

The good news is that you don’t have to. Consider the scientific evidence:

  • Sociologist Everett Rogers‘ “S-curve” research estimated that it takes only 10%-20% of a system to adopt an innovation for rapid acceptance by the majority to follow.
  • Professor Erica Chenoweth’s analysis of over 300 political revolutions in the past century finds that it only took 3.5% of active participation in a society to succeed, and many campaigns prevailed with less.
  • Recent research by sociologist Damon Centola at the University of Pennsylvania suggests that the tipping point for change is getting 25% of people in an organization on board.

There’s no need to waste time trying to convince people who hate your idea and want to undermine it in any way they can. Any engagement is very unlikely to be successful and very likely to frustrate and exhaust you. You are much better off focusing your energies on empowering those who are enthusiastic about change to succeed, so that they can bring in others who can bring in others still. That’s how you build traction.

Myth #3: Things Will Get Easier After A “Quick & Easy” Win

Change management pioneer John Kotter, who first started writing books about organizational transformation in the 1970s, has long advised to establish short-term wins. He stressed that these must be unambiguously successful, visible throughout the organization and clearly related to the change effort.

The concept is problematic for a number of reasons. First, and this isn’t really Kotter’s fault, but the idea of a “short-term win” is often understood to be a “quick and easy win,” which can backfire. If a change isn’t meaningful and relevant, then touting it can make a leader seem out of touch, discrediting the transformation effort.

More problematic is the idea that we should be shooting for projects that are unambiguously successful. That level of success is exceedingly rare. If we are going to wait for perfect projects, we may be waiting a long time. What we want to do is start with a Keystone Change and then learn from whatever successes and failures we encounter on the way.

Perhaps most dangerous of all is the notion that early projects should be visible to large numbers of people. Remember, if a change is significant and has the potential for impact, there will always be people who want to undermine it in ways that are dishonest, underhanded and deceptive. Why would we want to broadcast early efforts so they can knock them down?

The truth is that things don’t get easier after initial successes. They often get harder because those who oppose change now see it is really possible. That’s why you need to build a plan to anticipate resistance and Survive Victory from the start.

Change for the World We Live In

In the early 20th century, the great sociologist Max Weber noted that the sweeping industrialization taking place would lead to a change in organization. As cottage industries were replaced by large enterprises, leadership would have to become less traditional and charismatic and more organized and rational.

He also foresaw that jobs would need to be broken down into small, specific tasks and be governed by a system of hierarchy, authority and responsibility. This would require a more formal mode of organization—a bureaucracy—in which roles and responsibilities were clearly defined. Weber’s model reigned for a full century.

Over the past few decades we’ve undergone a similar shift from bureaucratic hierarchies to connected ecosystems and that affects how we need to approach transformation. The changes we need to implement today have less to do with decisions made about strategic, tangible assets and more to do with how people think and act. That presents a very different set of challenges and we need to adapt.

What we can’t do is pretend that the world is the same as it was 30 or 40 years ago and continue with practices that are so obviously failing. Just as Weber dispelled myths about infallible leaders a century ago, we need to break free of outdated concepts that have led to unacceptably poor results.

It’s time to leave myths behind and take a more clear-eyed approach to leading change.

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

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5 Business Myths You Cannot Afford to Believe

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5 Business Myths You Cannot Afford To Believe

GUEST POST from Shep Hyken

Sometimes a business idea or strategy seems to make total sense. Yet once it is implemented, it turns out to be a mistake. We rely upon research, stories and data to help us formulate what might work best. It’s okay to fail. But if you already know something is wrong, don’t make it worse by relying on a flawed business strategy.

I’ve taken some of my favorite topics I’ve researched and written about over the years and uncovered five myths that, while seeming to make sense, could cost you money, customers and maybe even your business. So, with that in mind, here are my five favorite business myths and the explanations behind why believing them cost your organization dearly.

  1. A Repeat Customer Is a Loyal Customer – The customer keeps coming back, so they must be loyal … wrong! Just because a customer comes back doesn’t always mean they love you. You must find out why they keep coming back. Maybe you have a physical location that is two miles closer than your competitor’s location. What if a competitor builds a store between you and your customer? You may find out they were loyal to your location and not to you. Or maybe your price is the lowest. If that’s what the customer loves, guess what happens when your competition offers a lower price? It turns out they were loyal to their wallet, not your store. There are a number of reasons customers come back that have nothing to do with how much they love the experience of doing business with you. But when you find someone who is truly loyal, keep doing what they love about you, and you may have them forever.
  2. We Want Satisfied Customers – This is a perfect follow-up to A Repeat Customer Is a Loyal Customer. No, you don’t want satisfied customers. You want loyal customers. In my customer service and CX research (sponsored by RingCentral), we asked more than 1,000 U.S. consumers if they were to rate an experience as “average” or “satisfactory,” how likely would they be to come back. Almost one in four (23%) said if they had a satisfactory experience, they would not be likely to or would never come back. Satisfactory is average, and the first opportunity the customer has to do business with a place that’s even slightly better than average, it’s a good possibility that they will move on.
  3. Only the Front Line Needs Customer Service Training – Customer service is not a department. It’s a philosophy that everyone in an organization must embrace. Everyone either deals directly with a customer, supports someone who does or is part of the process that drives or supports the customer experience. Someone in the warehouse may never see a customer, but if they fail to pack merchandise properly, they will negatively impact the experience, causing the customer to call and complain and make the company double its effort to send a product that isn’t damaged. Once the employees in the warehouse realize their impact on the experience, they will view their job in a new way and be focused on creating a better customer experience.
  4. Customer Loyalty Programs Create Loyal Customers – Customer loyalty programs are often about points, perks and discounts. An important question to consider is, “If you take those perks away, would the customer still be loyal to you?” That doesn’t mean you should do away with the program. While these types of programs may not drive true loyalty, what they will do is drive repeat business. So, recognize a loyalty program for what it is: a repeat business and marketing program. And if the customer keeps coming back, each and every time is an opportunity (beyond the points and perks) to validate their decision to do so with an experience that will keep them from even considering switching to your competition.
  5. The Customer Is Always Right – No, the customer is NOT always right, but they are always the customer. This is one of my favorite myths. Ten years ago, I wrote an entire article (Your Customers Are Not Always Right) devoted to this concept. For today, I’ll summarize it in one sentence: If the customer is wrong, let them be wrong with dignity and respect.

Don’t make the mistake of believing any of these myths. Rather than clinging to conventional wisdom that sounds good but potentially fails in practice, focus on understanding what’s behind these myths and what will work. Brainstorm with your team how you can “bust” these myths and create the experience that customers love and come back for.

Image Credit: Unsplash

This article was originally published on Forbes.com.

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Four Deadly Business Myths

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Four Deadly Business Myths

GUEST POST from Greg Satell

The unicorn is perhaps unique among myths in that the creature doesn’t appear in the mythology of any culture. The ancient Greeks, for all of their centaurs, hydras and medusae, never had any stories of unicorns, they simply thought that some existed somewhere. Of course, nobody had ever seen one, but they believed others had.

Beliefs are amazing things. We don’t need any evidence or rational basis to believe something to be true. In fact, research has shown that, when confronted with scientific evidence which conflicts with preexisting views, people tend to question the objectivity of the research rather than revisit their beliefs. Also, as Sam Arbesman has explained, our notions of the facts themselves change over time.

George Soros and others have noted that information has a reflexive quality. We can’t possibly verify every proposition, so we tend to take cues from those around us, especially when they are reinforced by authority figures, like consultants and media personalities. Over time, the zeitgeist diverges further from reality and myths evolve into established doctrine.

Myth #1: We Live In A VUCA Business Environment

Today it seems that every business pundit is talking about how we operate in a VUCA (Volatile, Uncertain, Complex and Ambiguous) world. It’s not hard to see the attraction. Conjuring almost apocalyptic images of continuous industrial disruption creates demand for consulting and advisory services. It’s easier to sell aspirin than vitamins.

The data, however, tell a different story. In fact, a report from the OECD found that markets, especially in the United States, have become more concentrated and less competitive, with less churn among industry leaders. The number of young firms have decreased markedly as well, falling from roughly half of the total number of companies in 1982 to one third in 2013.

Today, in part because of lax antitrust enforcement over the past few decades, businesses have become less disruptive, less competitive and less dynamic, while our economy has become less innovative and less productive. The fact that the reality is in such stark contrast to the rhetoric, is more than worrying, it should be a flashing red light.

The truth is that we don’t really disrupt industries anymore. We disrupt people. Economic data shows that for most Americans, real wages have hardly budged since 1964. Income and wealth inequality remain at historic highs. Anxiety and depression, already at epidemic levels, worsened during the Covid-19 pandemic.

The recent great resignation, when people began leaving their jobs in droves, helps tell this story. Should anyone be surprised? We’ve been working longer hours, constantly tethered to the office even as we work remotely, under increasing levels of stress. Yes, things change. They always have and always will. We need to adapt, but all of the VUCA talk is killing us.

Myth #2: Empathy Is Absolution

Another favorite buzzword today is empathy. It is often paired with compassion in the context of creating a more beneficial workplace. That is, of course, a reasonable and worthy objective. As noted above, there’s far too much talk about disruption and uncertainty and not nearly enough about stability and well-being.

Still, the one-dimensional use of empathy is misleading. When seen only through the lens of making others more comfortable, it seems like a “nice to have,” rather than a valuable competency and an important source of competitive advantage. It’s much easier to see the advantage of imposing your will, rather than internalizing the perspectives of others.

One thing I learned living overseas for 15 years is that it is incredibly important to understand how people around you think, especially if you don’t agree with them and, as is sometimes the case, find their point of view morally reprehensible. In fact, learning more about how others think can make you a more effective leader, negotiator and manager.

Empathy is not absolution. You can internalize the ideas of others and still vehemently disagree. There is a reason that Special Forces are trained to understand the cultures in which they will operate and it isn’t because it makes them nicer people. It’s because it makes them more lethal operators.

Learning that not everyone thinks alike is one of life’s most valuable lessons. Yes, coercion is often a viable strategy in the short-term. But to build something that lasts, it’s much better if people do things for their own reasons, even if those reasons are different than yours. To achieve that, you have to understand their motivations.

Myth #3: Diversity Equity And Inclusion Is About Enforcing Rules

In recent years corporate America has pushed to implement policies for diversity, equity and inclusion. The Society for Human Resource Management even offers a diversity toolkit on its website firms can adopt, complete with guidelines, best practices and even form letters.

Many organizations have incorporated diversity awareness training for employees to learn about things like unconscious bias, microaggressions and cultural awareness. There are often strict codes of conduct with serious repercussions for violations. Those who step out of line can be terminated and see their careers derailed.

Unfortunately, these efforts can backfire, especially if diversity efforts rely to heavily on a disciplinary regime. As the philosopher Ludwig Wittgenstein pointed out long ago, strict rules-based approaches are problematic because they inevitably lead to logical contradictions. What starts out as a well-meaning effort can quickly become a capricious workplace dominated by fear.

Cultural competency is much better understood as a set of skills than a set of rules. While the prospect of getting fired for saying the wrong thing can be chilling, who wouldn’t want to be a more effective communicator, able to collaborate more effectively with colleagues who have different viewpoints, skills and perspectives?

To bring about real transformation, you need to attract. You can’t bully or overpower. Promoting inclusion should be about understanding, not intimidation.

Myth #4: People Are Best Motivated Through Carrots And Sticks

One of the things we’ve noticed when we advise organizations on transformation initiatives is that executives tend to default towards incentive structures. They quickly conjure up a Rube Goldberg-like system of bonuses and penalties designed to incentivize people to exhibit the desired behaviors. This is almost always a mistake.

If you feel the need to bribe and bully people to get what you want, you are signaling from the outset that there is something undesirable about what you’re asking for. In fact, we’ve known for decades that financial incentives often prove to be problematic.

Instead of trying to get people to do what you want, you’re much better off identifying people who want what you want and empowering them to succeed. As they prosper, they can bring others in who can attract others still. That’s how you build a movement that people feel a sense of ownership of, rather than mandate that they feel subjugated by.

The trick is that you always want to start with a majority, even if it’s three people in a room of five. The biggest influence on what we do and think is what the people around us do and think. That’s why it’s always easy to expand a majority out, but as soon as you are in the minority, you will feel immediate pushback.

We need to stop trying to engineer behavior, as if humans are assemblages of buttons and levers that we push and pull to get the results we want. Effective leaders are more like gardeners, nurturing, growing and shaping the ecosystems in which they operate, uniting others with a sense of shared identity and shared purpose.

— Article courtesy of the Digital Tonto blog
— Image credits: Unsplash

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