In my most recent post, I reviewed research from McKinsey, MIT and others on successful organization transformation. While the success rate of transformations remains stubbornly around 30%, research and experience with organizational transformation has exploded in recent years. In this blog, I want to focus specifically on research regarding the role of the CEO and Executive Team in leading successful transformation.

Here are the common themes from my research and experience with multiple companies engaged in transformations of different kinds:

• “The most important starting point of a transformation, and the best predictor of success, is a CEO who recognizes that only a new approach will dramatically improve the company’s performance.” (McKinsey Quarterly, November 2016)
• Leading a successful transformation requires of CEOs the following:
  • Make the transformation meaningful
    • A particularly powerful way to do this is by crafting a compelling vision story that is personal to the CEO and connects with employees. At TBG, we often use the analogy of an 1850s journey to Oregon to make transformation compelling and meaningful.
  • Transforming how you personally work as well
    • Most CEOs are inexperienced at leading transformations and often their behaviors and mindset at the beginning is a barrier to success
    • CEOs and other executive leaders must look inward to understand their habits of thoughts, emotions and behaviors in various situations and what drives them at the moment of taking action to close the performance gap between what they know they should do and what they actually do
      • At The Bailey Group, we use assessments and coaching to support individual leader growth and the growth of cohorts of leaders in organizations
    • Build a strong executive team
      • A CEO client of mine says it this way: “In an increasingly complex environment my competence is an extension of the competence of my team”.
      • Each member of the executive team must be on board and have the necessary commitment to growth as a leader. If you have made clear what must be done and modeled the target mindset and behavior and the team member is not responding, the CEO must act to replace the team member.
      • MIT/Sloan research finds that high turnover (defined as greater than 20% of all officers) had a positive impact on the success of a transformation
    • Pursue impact and hold people accountable
      • Transformation can’t be delegated. Commitment and accountability must be driven from the top. This means recognizing the key decisions that require direct CEO involvement and being the face of the transformation to the organization.

• A study jointly conducted by Heidrich and Struggles and the University of Oxford Said School of Business identified four critical competencies for CEOs leading transformation:
  • Think systemically
  • Manage personal feelings of doubt
  • Be authentic and adaptable
  • Manage paradox (deciding between two “right” answers)

Applying these insights to the unique circumstances of CEO and Executive Teams is the focus of CEO And Team Advising at The Bailey Group. Send me an email or give us a call, we’d love to have a conversation about how we might be able to assist you and your team in leading a successful transformation.