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How we react is entirely within our control and appreciating this can make all the difference. As leaders of change, this is the message we must impart to our people if we wish to be successful. For only your people can deliver your business strategy. Only your people can deliver the change your business requires.
Article by Campbell Macpherson, Author of The Change Catalyst 2018 Business Book of the Year
According to a 2016 Bain & Company survey of 250 large companies, 88% of change initiatives fail. A similar proportion of business strategies, mergers and acquisitions suffer the same fate. The 7 out of 8 change initiatives that fail do so because of inadequate leadership. The one that succeeds does so because the leadership team has provided their people with the clarity, structure, freedom and confidence they need to deliver. Of course, the question on every HR Director’s and CEO’s lips is, ‘How do I equip my leadership team to do this’? Here are my secrets to success: All change is personal. Even the largest of organisational changes is actually the culmination of a plethora of small, individual changes. The problem is that we humans hate change. Especially when it comes to business, we fight against it at every opportunity. We fear it and this fear comes in many shapes and sizes. The most powerful fear in the corporate world is the fear of failure; not only are we afraid of failing but we are often even more afraid of suffering the consequences of that failure. We fear the unknown. We are a fundamentally tribal species; a fact we see playing out in the news on a daily basis. It is the same when it comes to business; we have a penchant for creating walls and mini-tribes throughout our organisations. Sales v Marketing, IT v Propositions, Operations v Finance. As change leaders, we must break down these walls and remove the tribes. We fear the future. Often we also fear being blamed for not changing earlier. But most of all, we are afraid of not being in control. Whilst designing the Leading Change and Embracing Change workshops that I run for organisational leaders and their people respectively, I devised a simple 2 x 2 matrix (as any good business consultant does), to describe the types of change that we all face. The Y-axis of ‘The Change Matrix’ is simply the size of the change we face, from small change to big change, and the X-axis is the degree of personal control we feel – from no control to total control. Even though each axis contains countless gradations of size and degrees of control, I divided the matrix into four quadrants for the sake of simplicity and the result was remarkably effective – especially when it comes to big change. For it explains the difference between big change that you instigate (‘Quantum Leap’) and big change that is thrust upon you (‘Burning Platform’).
“Never be fooled by a good, solid process, it is merely an enabler. A process without an outcome is a road to nowhere. I have seen far too many flawless and detailed change processes fail to deliver: ‘The operation was a complete success. Unfortunately the patient died’”
Whenever you instigate large organisational change, your people will be firmly in the ‘Burning Platform’ quadrant. Meanwhile, the leadership team will be in the ‘Quantum Leap’ quadrant. They couldn’t be further apart. Your first reaction to the change is ‘excitement’. The first reaction that your people experience is ‘shock’. To be successful, you need to close this gap; you need to help our people understand that what they are feeling is completely and utterly normal. The way we react to change is uniform and predictable. Swiss psychiatrist, Elisabeth Kubler-Ross first described our natural reactions to ‘Burning Platform’ change in 1969. A modified version of her ‘change curve’ is shown here. Every one of us follows this sequence of events when big change is done to us. We start with ‘shock’ before moving onto ‘denial’, hoping that the leadership will come to their senses. Once we realise this isn’t going to happen, we get angry, then fearful before sinking into a form of depression. The good thing about being at the bottom of the curve is that, with help, the next step is upwards – the head is finally engaged in ‘understanding’ before the heart is engaged in ‘acceptance’ and we can finally move on. Without help, we are likely to stay in the trough and retreat into the cold comfort of victimhood. As change leaders, our most important skill is empathy; we need to understand that our people will be going through these steps and we need to help them navigate this emotional journey. When they get angry, understand that they are not being vindictive. It is a normal step on the curve.
Interestingly, even when the change is ‘good’; when it is big change that we have instigated, we still experience a form of Kubler-Ross’s curve. The Quantum Leap Change Curve starts with excitement before morphing into apprehension, a little bit of fear and then remorse – we have all experienced buyer’s remorse and/or seller’s remorse in our lives – before our head understands, our heart accepts the change and we can fully embrace the change. If your people are going to deliver the change you require, they must be completely clear about what the end result needs to be, what success looks like and how it will be measured. They also need to know why it needs to be achieved. No-one delivers anything of value simply because they are told to. They need to know why. And in business there is a ‘right’ reason and a ‘real’ reason for just about everything. This is particularly true when it comes to change. The ‘real’ reason may not be one that you wish to broadcast – for example it may be to prepare the business for sale – but it needs to be understood fully by the team leading the change. The ‘right’ reason needs to be as true as the ‘real’ reason and it must be something that will motivate your people to deliver. ‘Implications’ is the most forgotten word in the business lexicon and yet unintended consequences have scuppered many a new plan. Every change comes with its own set of consequences: implications for the team, the department, the organisation and the individuals involved. Leaders need to work with their people to unearth as many of these implications as possible in advance as some of them will be so significant that the strategy itself may need to be altered.
Never be fooled by a good, solid process, it is merely an enabler. A process without an outcome is a road to nowhere. I have seen far too many flawless and detailed change processes fail to deliver: ‘The operation was a complete success. Unfortunately the patient died’. As a change leader, you need to be focused to the point of obsession with outcomes – continually checking whether the original outcomes are still valid; continually bringing the project back to what it is trying to achieve; continually probing whether the project is on track to deliver the outcomes the business needs. Remember that emotions trump logic every time, emotions rule our decisions. This fact was proven by Portuguese neuroscientist, Professor Antonio Damasio after a study of brain damage victims that left them unable to feel emotions. A surprising consequence was that they also couldn’t make decisions – even simple decisions such as what to eat. For evidence of the power of emotions in decision-making, we need look no further than David Cameron’s disastrous campaign for Britain to remain in the EU. As he amply demonstrated, logic alone is an inadequate motivator. To follow a leader, people need to be motivated emotionally. People voted to leave the EU for emotional reasons – they felt they had nothing to lose; they wished to be free of the expensive and controlling yoke of Brussels; they wanted to take back control of their borders; or for the patriotic belief that an unshackled Britain could be ‘Great’ again. When it comes to decisions, emotion wins the day every time.
“It is incredibly difficult for a market leader to innovate or change to any great degree. But you have to – or you will be usurped. Just ask Kodak or Woolworths or RBS or Blockbuster”
It is the same when it comes to business. A brilliant study by the Corporate Leadership Council of 50,000 employees back in 2004 concluded that, when it comes to employee performance, emotional commitment is four times more powerful than rational commitment. Four times! It also concluded that the most important drivers of an employee’s emotional commitment are; strategic clarity from the leadership, and the attitude and competence of the employee’s direct line manager. Investing in clarifying your strategy and developing your people managers will be two of the best investments a board could make. To be successful we have to appeal to our people’s emotions; we have to find their emotional triggers. As change leaders, we ignore emotions at our peril. Change projects that fail, fail to communicate effectively. They fail to genuinely engage their stakeholders – especially the employees who they need to deliver the change. Too many leaders think that broadcast-style town hall sessions and all-staff emails are sufficient modes of communication. They aren’t. Too many change leaders forget that genuine communication includes listening. The forces against change are unrelenting. Inertia is a major barrier to successful change and there are three types of inertia. The first is initial inertia; the difficulty of moving from talk to action. The design phases of a change initiative are challenging enough. A great deal of work has been done just to develop the plan. Inevitably, there comes a time when the leadership needs to dedicate their energy to other things. This usually coincides with the implementation phase and it is a mistake.
Mid-term inertia is a very common cause of change failure. Most change initiatives, especially costly IT projects, can be likened to a run-away locomotive. Once it gains momentum, it is almost impossible to stop or change course. Few people are politically brave enough to try. Yet circumstances change. Often the most valuable thing to do is to recognise mid-term inertia as a genuine phenomenon and build at least one pause for reflection into your change process. Give the team the freedom to pause and assess whether the planned outcomes are still possible – or still desired. The third form of inertia is good old fashioned complacency which is the cancer that has killed many a successful corporation. I dedicate a whole chapter to this in the book. It is incredibly difficult for a market leader to innovate or change to any great degree. But you have to – or you will be usurped. Just ask Kodak or Woolworths or RBS or Blockbuster. What will be your organisation’s ‘Kodak moment’? Set your change initiative up to succeed. The ‘set up to fail’ syndrome is a well-documented phenomenon. Too many change projects are handicapped from the very beginning with unclear and/or inappropriate governance. I have seen change projects where it is unclear who is accountable for what and who is responsible for what. I have seen change programs led by steering committees too large to conduct meaningful discussions or make timely decisions. I have seen change projects where the ultimate decision-maker is unclear. I have seen change initiatives swamped by bureaucracy. I have seen working groups so large that they have become talking shops rather than doers of the work. Not enough time is invested in establishing clear governance roles and decision-making processes upfront. Your governance and your processes need to fit your culture and be designed to provide maximum clarity, minimum political interference and clear decision-making.
An organisation’s culture underpins its success – or failure. The way your people interact with one another drives the way they treat your customers. Your culture drives your decision-making processes, your ability to respond to challenges and opportunities, and your ability to change. Your people will need help if they are to embrace change willingly. They will need help to overcome their fear of the unknown, their fear of failure, and/or their fear of being blamed. Enabling this on an organisation-wide scale requires the establishment of an environment where people eagerly look for improvements in the way things are done, are allowed to question the status quo, encouraged to learn from failure, and open to new processes, procedures and structures. It requires the establishment of a change-ready culture. The ever-increasing pace of change in today’s business world means that the leadership need to be able to take their organisation in new directions swiftly and decisively when the need arises. One of the most important ingredients for successfully instigating sustainable change is the identification of a Change Catalyst: someone to guide the organisation to the ultimate delivery of the outcomes the business needs. A Change Catalyst’s strength lies in their focus on outcomes. A program or project manager’s strength lies in their ability to drive the process. The Change Catalyst is the yin to the project manager’s yang. You will need both. Leading change is tough but it is the most critical skill required of any successful leadership team. After all, if they are not leading change, what are they leading?
Campbell Macpherson is the author of The Change Catalyst: Secrets to Successful and Sustainable Business Change – winner of the Business Book of the Year at the 2018 Business Book Awards.