Many CEOs are delivering a version of this message to their organizations at the start of 2018:
“Our industry is transforming. What made us successful in the past won’t assure our success in the future. The status quo will result in our becoming obsolete (not a question of whether but when). The need for change is urgent. And…
…2017 was a great year. Profits were up, we managed expenses well, and we expect the same in 2018.”
Anyone see a problem? How can a CEO create urgency for necessary transformation when things seem to be going so well? Think about what happened to Kodak, Digital Equipment (DEC) and other organizations that failed to adapt.
Most models of organizational transformation suggest that there are at least three necessary conditions for success:
- Urgency to change
- A compelling vision of the future
- A guiding coalition of influencers to lead the transformation process
Our experience at TBG with supporting transformation in organizations suggests that CEOs who succeed focus on three key levers for aligning and inspiring change in their organizations:
1) Educate the Guiding Coalition
It is dangerous to assume your top executives and other key leaders understand and are as bought into the reasons for change as you are. They are typically much more internally than externally focused and thus less attuned to environmental and industry threats. The solution is education and dialogue. Create forums for explaining why change is urgent and make the forums dialogues, not downloads from you. Bring in an external facilitator skilled in creating dialogue and encourage and discuss the reasons why your leaders are skeptical. I cannot over-emphasize how important this is. These sessions need to take place with a variety of constituency groups in your organization to cascade the buy-in for change.
2) Create Your Journey Metaphor
A journey metaphor involves three parts:
- Leaving what is familiar (Endings)
- Struggle along the way to the “new world” (Neutral Zone)
- A compelling vision of a bright future in a new reality (Beginnings)
One of my favorites is a story about pioneers leaving behind the lives they know to travel to Oregon to begin a new life. The point is, threats alone are not very inspiring. CEOs must also be able to tell a compelling story about where their organizations are headed and why it is worth striving for.
3) Understand that Transformation is Not Accomplished by Consensus
Transformation starts with a CEO passionately convinced of the need for change. But that is not enough. No matter how eloquently the case is made by the CEO, transformation only succeeds if most leaders (and all your most influential leaders) are on board and actively working to align their functions to the new vision. Create opportunities for disagreement and challenge. But be clear that change is not optional. If a leader can’t get behind the new vision, the honorable thing is to leave the organization.
The keys to success in transformation are urgency, vision, alignment, dialogue and non-optionality. As always, send me an email or give me a call at 763-545-5997 x305 if you want to talk more.