Leading Change

LEADING CHANGE: WHY TRANSFORMATION EFFORTS FAIL

John Kotter (who teaches Leadership at Harvard Business School) has made it his business to study both success and failure in change initiatives in business. "The most general lesson to be learned from the more successful cases is that the change process goes through a series of phases that, in total, usually require a considerable length of time. Skipping steps creates only the illusion of speed and never produces satisfactory

results" and "making critical mistakes in any of the phases can have a devastating impact, slowing momentum and negating hard-won gains". Kotter summarizes the eight phases as follows.

1) ESTABLISH A SENSE OF URGENCY

Talk of change typically begins with some people noticing a vulnerability in the organization. The threat of losing ground in some way sparks these people into action, and they in turn try to communicate that sense of urgency to others. Kotter notes that over half the companies he has observed have never been able to create enough urgency to prompt action. "Without motivation, people won't help and the effort goes nowhere....

Executives underestimate how hard it can be to drive people out of their comfort zones". In the more successful cases the leadership group facilitates a frank discussion of potentially unpleasant facts: about the new competition, flat earnings, decreasing market share, or other relevant indicators. It is helpful to use outsiders who can share the "big picture" from a different perspective and help broaden the awareness of organization members. When is the urgency level high enough? Kotter suggests it is when 75% of your leadership is honestly convinced that business as usual is no longer an acceptable plan.

2) FORM A POWERFUL GUIDING COALITION

Change efforts often start with just one or two people, and should grow continually to include more and more who believe the changes are necessary. The need in this phase is to gather a large enough initial core of believers. This initial group should be pretty powerful in terms of the roles they hold in the organization, the reputations they have, the skills they bring and the relationships they have. Regardless of size of your organization, the "guiding coalition" for change needs to have 3-5 people leading the effort. This group, in turn, helps bring others on board with the new ideas. The building of this coalition - their sense of urgency, their sense of what's happening and what's needed - is crucial. Involving respected leaders in this coalition will pay great dividends later.

3) CREATE A VISION

Successful transformation rests on "a picture of the future that is relatively easy to communicate and appeals to customers, stockholders, and employees. A vision helps clarify the direction in which an organization needs to move". The vision functions in many different ways: it helps spark motivation; it helps keep all the projects and changes aligned, it provides a filter to evaluate how the organization is doing, and it provides a rationale for the changes the organization will have to weather. "A useful rule of thumb: if you can't communicate the vision to someone in five minutes or less and get a reaction that signifies both understanding and interest, you are not yet done with this phase of the transformation process".

4) COMMUNICATE THE VISION

Kotter suggests the leadership should estimate how much communication of the vision is needed, and then multiply that effort by a factor of ten. Do not limit it to one management meeting, a President's address, or a few news articles. Leaders must be seen "walking the talk" - another form of communication -- if people are going to perceive the effort as important. Deeds along with words are powerful communicators of the new ways. The bottom line is that a transformation effort will fail unless most of the members understand, appreciate, commit and try to make the effort happen. The guiding principle is simple: use every existing communication channel and opportunity.

5) EMPOWER OTHERS TO ACT ON THE VISION

This entails several different actions. Allow organization members to make changes in their areas of involvement. Allocate budget money to the new initiative. Carve out time on meeting agendas to talk about the vision.