Tuesday, November 17, 2015

5 Ways to Mess Up Organizational Change #5: Crashing the Culture

Culture is a scary word when it comes to medical tests, and even scarier when it comes to organizational change.  Getting culture wrong may not be the quickest way to mess up organizational change, but it is definitely the most effective.  Here are five things to watch out for, or to focus on if you want to wreck your chances of successful business transformation:

1.     Misunderstanding culture

Telling sophisticated business people they don’t understand organizational culture sounds vaguely – okay, very – insulting.  Yet ten times out of ten, when you ask every member of a senior team to define their organizational culture, you get back as many answers as there are team members.
Culture can seem slippery, but actually it is pretty easy to define.  You know how different workplaces have different codes, different unwritten rules, different in-jokes and stories and values?  Those are all evidence of organizational culture: the way we do things around here.  
Luckily, legions of clever researchers have dug beneath the surface of organizational culture to identify the specific factors that drive – or destroy – employees’ engagement with their work.  For Matchpoint’s Work Culture assessment, we use the 38 aspects of organizational culture that multiple research studies have demonstrated correlate strongly with energy at work, absorption in work and general job satisfaction.  Not all these factors define the culture of any one organization, but they provide a useful menu of what could be significant.
Once you have a range of potential culture factors, it’s time to get personal.  The best way to find out exactly which culture factors apply in your organizational culture is to get input from representative samples of employees at all levels and across all functions.  You can do this via an assessment (I would say that, wouldn’t I?) or by using expert facilitators to tease out key unwritten rules. 
If you are tempted to skip this culture-definition step, don’t.  Culture is an organization’s immune system – it will attack any incompatible invaders ruthlessly and unceasingly.  To avoid disaster, start by knowing what you are dealing with when it comes to organizational culture.

2.     Pretending culture doesn’t matter

Why bother?  some change leaders ask themselves at this point.  We have urgent strategic priorities to focus on, not this wishy-washy culture nonsense.  
If only change worked like that.  But just as emotions trump logic when it comes to individual decision-making, so culture trumps strategy at the organizational level.  As noted above, misjudging or ignoring the culture can doom your change program from the start, but working with the culture is one of the most powerful levers of success.
Culturally-aligned change builds on what employees already feel proud of in their organization.  A good overarching theme for culturally-sensitive change – taken from the highest-performing public middle school in New York City – is Better All The Time.  In your change communications, link your goals to existing aspects of the culture, e.g. by emphasizing how building on intellectual property will drive growth for a culture proud of its expertise, or by talking about how working together will bring about a successful merger for a firm that sees itself as strongly team-oriented.  In change planning and implementation, check that employees are involved in ways congruent with the way things are done around here.  Be alert to potential culture-clashes, and resolve them not by storming past the inconvenient cultural obstacles but by putting culture front and center, and finding ways to achieve your change by deploying cultural levers.

3.     Trying to change culture profoundly

But what if the number one objective of your change program is to change the culture?   
If you agree, you are not alone – culture change was the number one issue in Deloitte’s recent Human Capital Trends 2015 survey.  Unfortunately, culture change is where too many change programs founder.  Not because they are trying to change culture – if an organization needs changing, its culture almost certainly needs attention – but because they are trying to change too much, too soon.
I come back to the idea of culture as the organization’s immune system.  If you fight too hard against it, you end up killing the organism / wrecking the business.  The trick is to tweak, to flex, to adapt and strengthen where necessary.  It’s a mistake to think that any culture is completely bad.  You may want your organization’s culture to be less individualistic, for example, but want people to keep on valuing hard work and competition with rival firms in the marketplace. 
In the end, there is no universal perfect culture, only the right culture balance to bring you from where you are now to the organizational future you want to realize.  It is as important for success to recognize the existing strengths of your culture (every organization that isn’t an empty building has strengths) as it is to identify the ways of working, thinking or collaborating that are not helping.

4.     Confusing culture with values

When you have identified the aspects of your culture that need to change, don’t make the mistake of focusing too much on values.
Values are fine, so far as they go, but too many change agents see them as an end in themselves.  They get senior management together, articulate and agree a set of values, then tell everyone else in the organization about them by creating a range of tchotchkes, screensavers and washroom posters.
This. Achieves. Nothing.
Values are a useful summary of key aspects of culture, but they are only tangentially related to culture change.  Culture change is all about getting people to do things differently at work – to establish relationships with suppliers instead of focusing on individual transactions, to adopt Agile ways of working instead of set-in-stone planning, to adopt a can-do attitude rather than waiting for perfect timing or resources before shipping a product.
The risk of paying too much attention to values is that senior management will forget they need to walk as well as talk (never mind the challenge of chewing gum at the same time).  If you must have them define their values, move swiftly on to making those values real for everyone, top and bottom in the organization.  Change fatigue, remember, comes not so much from too much change as from a feeling of disconnect between what is grandly stated by leaders and the reality of daily corporate life.  You need culture change to start at the top of the organization, but take care it does not end there.

5.     Trying to control too much

If there is one message I would like you to take away from this series on organizational change and this post in particular, it is that change cannot be controlled, only facilitated.
Over-controlling change always fails.  Successful organizational change depends on people taking it upon themselves to do things differently, and people resent being told what to do in anything other than an emergency evacuation situation.
What works is an involved and evolving process.  Involved change leadership means opening yourself up to change as a leader and as an individual.  If you are changing aspects of the organization’s culture, you will have to lead, manage, communicate and behave in new ways, at the same time as you are leading others through their own personal changes.  You cannot step aside and let the process run itself.  You have to be intimately involved, with all the stresses, risks and uncertainties that involves.  This involvement is in some ways the opposite of control, and much more demanding of the leader.
Successful change is also an evolving process.  As I said in an earlier post, only Pollyanna Planners expect plans to actually work out.  Plans need to be flexed in response to the reaction from employees, in response to the discretionary efforts leveraged and the new directions processes and even goals can take.  Trying to set change in stone is never going to work.  Instead, leaders must see themselves as facilitators, as inspirers, and most of all as fellow workers within the organization.

Conclusion: How NOT to Mess Up Organizational Change

As in life, there are no guarantees in change, but you definitely can stack the odds of success in your favor by avoiding the most common pitfalls.  Change is difficult, but it is not impossible, and hopefully this series has helped you think more broadly and deeply about things that can make a difference. 
The more you approach change consciously and openly, and the more you get help in the right ways from the right kind of people, the more likely you are to end up making your business better and getting greater fulfilment for yourself.  Of course you are going to make mistakes, of course you are going to wish you had done things differently, but we are not talking cold fusion here, just finding a way to lead a bunch of over-demanding, infuriating, self-centred, neurotic and capricious –i.e.  perfectly normal – people towards a better way of doing business.  It is an effort, but not a wasted one.
The effort is worth it because change is not going away.  Fewer than half of the Fortune 500 companies of 1995 were still around on the 2015 list.  Technologies that once existed only in the minds of movie-makers are now everyday reality.  Who knows what changes the next twenty, even the next five, years will bring?

As a wise man said, the future belongs to those who prepare for it.  Good luck with your organizational change.

Tuesday, November 10, 2015

5 Ways to Mess up Organisational Change #4: Pollyanna Planning

There is more smug guff written about planning than any other aspect of the change process.  If you believe just half of what you read, planning for transformational change is simply a matter of keeping a tidy schedule, knowing how to read a GANTT chart and checking in brightly with your equally organised team members.
I don’t know about your experience, but nothing in the above description matches what I’ve seen, apart perhaps from the reading of – or sobbing over – those lovely GANTT charts.
The truth is, all change plans fail. 
You start out with the best intentions, you think you have taken account of all the variables and risks, that you have been genuinely rigorous in identifying best-case, worst-case and most-likely scenarios.  Then the change starts and you realise you have called most, if not all, of the shots wrong. 
Everyone has this experience.  One of the most successful entrepreneurs I know recently looked back at the planning record of his star business, expecting to see outstanding foresight and planning accuracy, only to discover to his embarrassment that fewer than half of the goals set had ever been achieved. 

Why getting plans wrong is okay

The truth is, only Pollyanna Planners expect to get change right from the get-go.  Just like the irritatingly optimistic girl in the books, they believe that everything turns out for the best if only they do the right things: setting clear and measurable change goals, making comprehensive communication plans, setting S.M.A.R.T. targets and assigning responsibilities.
None of these thing are wrong, they just are not enough to ensure success.
Once upon a time, they almost were.  Back in the days when industrial production dominated the economy, accurate change planning was sometimes possible.  In stable markets, the cost of a change such as introducing new machinery could be measured pretty precisely, and the stages of change – disposing of the old machine, installing the new one, training operators to use it and getting it up and working – could be clearly set out, understood and implemented.
Today it’s all different.  Over half of all corporate value is locked up in people and around 70-80% of Western economic activity comes from people-intensive services rather than production. 
People have many advantages over machines, but managing them is far less predictable. 
The dynamism that makes people such valuable drivers of business success is exactly what makes it impossible to plan out change involving people in advance.  Until the change gets going, leaders simply cannot anticipate exactly how their people will respond.  The risk with Pollyanna Planning is that by getting too specific in the early stages of planning, change leaders get too wedded to their beautiful plans to notice when they are not working, or to admit that they need to be changed or even scrapped.
Is Agile Planning the answer?
Smart change leaders have recognised the need to flex and adapt plans for some time now, and many regard the Agile Methodology as the best solution to both the challenges and the opportunities of managing people-focused change.
Agile started out as an approach to software development.  It helps teams manage the inherent unpredictability of development projects by building up results through short, iterative bursts of work focused on specific, cumulative changes.  Agile builds quality assurance into every stage of the process and constantly revisits each stage of the process at each step, ensuring that the final outcome has been tested, flexed and finely adapted to project goals and outcomes.
Recently, change and HR leaders have begun to look at adapting Agile for people-focused change.  Companies such as Barclays have eagerly taken on Agile principles such as “Responding to change over following a plan”, “Individuals and interactions over processes and tools” and “Customer collaboration over contract negotiation”.
But there are limits to Agile’s applicability to people. 
Jobs are not as easy to change as lines of code, and people react in more complex ways than operating systems.  When you look at successful Agile People approaches, they have strayed some way from the Agile Manifesto and in some cases have ended up with something very much like traditional linear methodologies, only with milestones for review and adaptation built in.
The risk of Agile is, in the end, the same as the risk of using traditional waterfall change planning approaches – using the methodology can distract change leaders from the reality of people, work and organisations. 
So how should change leaders plan?  What does it mean to take into account the reality of people, work and organisations? 
Given the infinite variety of people, work and organisations, there is no one-size-fits-all answer.  But there are three principles which, when applied rigorously and continuously to change, make the difference between success and failure. 

Anti-Pollyanna Planning Priorities

1.      Engagement

People-focused change needs to be driven by, well, people.  Yes, of course change leaders are people too, but I am thinking here of real people, people at all levels of the organisation, at all phases of the change process.  There is strong evidence that people give of their best when they are truly engaged, and there is no time when those best efforts are more needed than during organisational change, whether it is a major upheaval such as a merger or the continuous, incremental changes that represent business as usual for most of us.
Engaging people matters most at the planning stage. Nobody wants to be blindsided by change and however difficult or unpopular changes may be, they will only be made worse if people are not involved from the start in planning how to address the issues.  It is a cliché to talk about taking ownership of change, but engagement is all about that sense of belonging, of the change mattering personally.  Start your change programme as you mean to go on, by involving people throughout the organisation in a meaningful way.
This is often very hard for change leaders to do, primarily because it involves giving up managerial control.  Power via facilitation is far more effective than power via diktat, but it does not always feel that way.  Change leaders need to become very self-aware, and often to change the way they themselves work, if they are going to engage the organisation in making and implementing genuinely powerful plans.

2.      Keep your Eye on the Prize

As well as engaging the workforce in change planning, leaders need to be constantly watching for the times and circumstances where plans need to change.  Cry wolf too many times and everyone will start moaning about change fatigue.  Miss out on key evidence or developments and the whole change programme gets written off as irrelevant.
So, no pressure there.
Actually, you can relax.  Making the right call when it comes to adapting plans is not difficult.  If your metrics are focused not on the change plan but on the people, you will automatically pick up on where you need to devote extra effort, perhaps where you need to go back and review your initial methods or even objectives. 
Focusing metrics on people instead of process means looking at a range of lead measures, most of which relate to behavioural change.  If nobody turns up to your launch event, you have a problem.  Ditto if managers report no difference in how people are carrying out their work.  Be careful, however, that you use metrics which have proven predictive value.  Surveys, for example, need to be designed with care and used pretty much continuously if they are to be of genuine relevance.

3.      Honesty

The most important thing you can do to ensure the success of your change programme is be honest with yourself.  Like the other Priorities, this sounds easy but is genuinely challenging in practice because it is often the most painful aspects of change that require the most honesty.
You will make mistakes.  If that’s likely in work, it’s inevitable in change.  Come up with contingency plans well in advance, so you have a starting place for deciding how to fix things.  Most of all, notice when you have implemented a sub-optimal solution and fix things pronto. 
Honesty in change is very difficult to achieve without support.  If you have a coach, now is the time to step up your interactions.  Within your change team, establish a culture of questioning, of requiring evidence, of challenging each other to get the best, not just the easiest, answer.  And balance all this interrogation with kindness, with genuine concern for each other and a focus on learning and helping each other learn – which inevitably involves making and fixing mistakes.

People-Focused Planning

Truly, there is no excuse for keeping on with Pollyanna Planning.  By taking a responsive, people-focused approach you can get so much more achieved in your planning, and energise the entire change programme.
Unfortunately, there are still more ways in which organisations can mess up change.  I could probably continue this series indefinitely, but for now I will pause after #5: Crashing the Culture.

Tuesday, November 3, 2015

5 Ways to Mess Up Organizational Change #3: Stats not Stories

Let’s play billionaires. 
No, I’m not suggesting we go out and personalize a concert hall or fund a super-PAC.  This billionaire game is about being a nice, unselfish rich person, one who wants to give generously to make the world a better place. 
Sitting comfortably?  Then let’s begin. 
Below are two needy causes, Project A and Project B.  You have $1 million in loose change to disburse.  Read the descriptions and decide how much you give to each project.
  •     Project A will make an estimated sixteen percent improvement in the median living conditions of juveniles living at or below the fifth income percentile in one of the poorer countries in the western hemisphere. Based on a meta-analysis of seventeen research studies, the project addresses the three most significant barriers to social mobility: lack of K-12 education, lack of primary health care including immunizations and other preventative medicine, and lack of access to career paths and entrepreneurial opportunities.  Evidence from other research studies suggests that this project will make a statistically significant difference to what we estimate to be some of the neediest children in the world.  Give today and make a real impact on child poverty worldwide.

  •     Project B will transform Linda’s life. Linda grew up in the slums of Rio, just miles from supermodel Gisele’s million-dollar apartment and the new Olympic stadium.  Linda doesn’t know her birthday, or remember ever having a mom or dad.  She must be about ten, but she is the size of an average American five year old.  Linda can’t remember a time when she wasn’t hungry, and scared, and alone.  Her arms and legs are covered in scars.  Her teeth are broken.  But there’s a light that shines from Linda’s eyes that makes you forget all the sorrow in her past.  Give today and ensure Linda gets the care that will help her build the stable future she deserves.


So, Mr./Ms. Billionaire, who gets the fatter check? 
If you’re like most people, even most billionaires, you will be tempted to hand out twice as much to Project B as Project A even though, as careful readers may have guessed, they are Exactly The Same Project

Stories, you see, beat stats every time. 

In 2007 there was a famous study where participants were given letters asking for support for Save the Children along with a budget of $5 to donate, or not, to the project highlighted in the letter.  Letter A gave detailed statistics about the problems facing hungry children in some of the poorest countries in the world.  Letter B focused on one little girl in Mali.  People who received Letter A and its statistics gave an average of $2.38; those who received Letter B and its story gave an average of $1.14 and those who received both A and B gave an average of $1.43. 
That’s right – not only were the stats less effective than the stories, but when stats were given in addition to the stories,  they almost halved the stories’ power to persuade people to take action.
Why Linda matters to organizational change
But how is this relevant to organizational change?  Change programs are business, not charity.  They’re about continuous progress, not a one-off impulse.  And their success does not depend – we hope – on how deeply employees reach into their pockets.
All this is true, but so is something else:

Success in change is not about what people think so much as how they feel.

There’s nothing special about change in this respect.  In most life situations, emotions trump logic every time.  We have known for years that homo economicus never existed outside the pages of freshman textbooks, but only recently has a reliable body of knowledge emerged about exactly how reason and feelings interact to make choices, how they are triggered and developed, how they influence or cancel out each other.
Stories are great examples of how reason and emotion work together.  Great stories trigger our thinking and our feeling in ways that make words – such as the described future-state of an organizational change program – viscerally real.  Great stories change people’s lives, and even a good-enough story can inspire and engage the kind of deliberate, ongoing effort and collaboration that makes all the difference when it comes to successful change.
Stories that work
Of course, not all stories are good-enough.   But you don’t have to be Dostoyevsky to get the basics right.  Here are three rules that get great results:

1.      Keep your story simple and clear

Every good story has a beginning, middle and an end, uses simple language and is delivered in a way that makes emotional sense.  By emotional sense I mean that the main character has to be someone whom readers or listeners can relate to, that he or she has to face genuinely challenging trials, and that there has to be resolution – though not necessarily outright success – at the end of the story.
Keeping your story simple is not as difficult as it sounds.  We spend about 65% of our talk time in telling stories – whether we call them gossip or anecdotes or examples.  When we tell these stories, we naturally simplify them.  We use short, specific words.  We leave out extraneous details, we combine anecdotes, we smooth out time lines and provide clear links between cause and effect.  We don’t get hung up on the numbers, on the detail and accuracy of what we are saying.  Instead, we focus on what will appeal to our audience, and we practice our delivery until we get the effects we aim for. 

2.      Get physical

One of the most impactful business stories I have read recently was a LinkedIn post by Meg Whitman, written just over a year after she was hired as the turnaround CEO of Hewlett-Packard.  In it she talked about discovering a “commando fence” – a large barbed-wire topped fence surrounding the executive parking lot – and how one of her first actions as CEO was to tear it down and move all top executives out of walled offices and into cubicles so that “we now walk in the same door as the rest of our employees”.
Whitman was talking about addressing the disconnect between employees and management, but notice how visceral her language is.  This wasn’t just a fence, it was a threatening, warlike barrier.  She didn’t just get rid of it, she tore it down.  The result was not analysis, or accounts of changed attitudes or evolved thinking, but the simple action of “walking”.  Managers are always being told to “walk the talk” at times of change.  To Whitman’s credit, she dispensed with the chat and went straight to the action.
Using such physical images in stories works because of the way our brains react to language.  When we hear stories as opposed to information, not only do the technical-processing parts of our brains light up, but so do the parts we would use when we are actually experiencing  the things the story is telling us.  When we read about Meg Whitman tearing down the fence, our motor cortex got engaged.  When we read about the barbed wire, our sensory cortex activated.  The more our brain engages, the more we feel part of the story.  The more we feel part of the story, the more likely we are to turn its messages into action and engage ourselves in organizational change.

3.      Make it personal

As I talked about in my last post, the most important thing for each of us in organizational change is WIIFM - What’s In It For Me.   Unsurprisingly, therefore, we respond better to stories that we can relate to our own experiences.  
These “own experiences” include both things that actually happen to us and things we are interested in.  Recent research into the impact of popular stories by New York Times columnists found reader response shot up when stories featured familiar details (e.g. my mention of supermodel Gisele and the Rio Olympics in the Project B story) and, especially, when the setting of the story was in or close to reader’ own backyard.  Most importantly, it also found that the more readers could relate personally to the stories, the more likely they were to take follow-up action – exactly what you need when it comes to organizational change

Replacing stats with stories

So, how can we make practical use of stories when it comes to business transformation?  I have found stories useful at all stages of the process, but two scenarios stand out: when change is first announced, and when things go wrong.
Stories make a big impact when change is first announced because they are simply the most effective way to get people engaged with the vision of what the change will entail.  Think about including them in your initial announcements, and structuring your supporting resources around simple, physically resonant, relevant stories.
Stories can also make a difference when things get tough.  When progress is slower than expected, when setbacks emerge, when goals shift and deadlines are missed, people need stories to make them believe that there still is a path to success, and that they are making progress along it.
There is a lot more to say about how stories can help during organizational change, enough – excuse the pun – to fill a book.  But as I said above even replacing just a few statistics with just a few good-enough stories can make a big difference.

Also, I am conscious that there are at least two other major ways in which too many companies wreck their chances of successful organizational change.  Next up: the perils of Pollyanna Planning.