All organizations have business processes, such as order-to-cash and new product development. And today’s organizations are constantly trying to transform – from a holding company to an integrated operating company, from manufacturing to brand-led, from domestic to global. But if you ask these organizations that are rich in process discipline for the process that guides the way they manage the organization through change, you may get a blank stare.
Strategic change is a process, but all too often, it’s managed as a series of independent events led by functions. It’s not the process itself but how it’s executed that differentiates the winners from the losers. Over the last 20 years, we’ve found that organizations that “win” have a few unwavering principles that guide the way they lead the strategic change process.
They force collaboration and shared meaning across functional boundaries while maintaining functional ownership and accountability. We can appreciate this concept in sports, but we fail to apply it in business. As a football fan, I know that even though players have a playbook that details what they’re expected to do, the team practices a core set of plays countless times before they’re ever called in a game. We never question why they practice the plays over and over. They do so to make sure that every player has shared meaning and has developed muscle memory for how the play should be run and the type of adjustments they may need to make.
Likewise, in business transformation, playbooks are often handed to functional leaders, and the next step is “game day” execution. Six to 12 months later, the Sales group and the Marketing group don’t look like they are on the same team. It may be because, as the defense or environment has changed, it’s become painfully obvious that these two functions never had shared meaning on the organization’s desired future state and strategic priorities to begin with. The winning organizations allocate “practice” time when functional leaders collaborate to form a clear picture of the desired future state and strategy that everyone sees in the same way. Then, when “audibles” are called in the midst of the transformation, they’re executed with a common mental model in mind.
They invest in capability-building at all levels, starting with the top leaders. Change is very difficult. We often ask others to change before we are willing to change ourselves, and senior executives aren’t immune to this. They often chart a course for strategic change without considering how they need to change and grow. At the executive level, these capability shifts are usually tied to observable behaviors, such as how leaders spend their time or what they reward. Employees often model their leaders’ behaviors, and for an organization to effectively change, leadership behaviors must change first. Winning organizations clearly define and track the observable behavioral shifts that are required by leaders if the organization is to achieve its desired future state.
They shatter traditional hierarchies and enroll a larger group of leaders as advocates in the change. “Strategy” and “change” are usually very confidential terms. Only the top 10 or 20 senior leaders plan the change, while the other 4,880 employees are informed on a “need to know” basis. When this happens, the transformation effort usually crumbles under its own weight, because the only “advocates” are the critical few who drafted the change. The winning organizations enroll a broad group of leaders in the change. This next level of leaders often brings truth statements, barriers and, most important, new solutions to the executive team.
The point is that, without crafting a process for managing the change you’ve planned, you’re making your game much more difficult to win.