Blog Archives

Adapting to Change and Managing the Transition Successfully

Life is about adapting to change and ever-increasing demands. William Bridges was right: “It’s not the changes that do you in. Ifs the transitions.”

Organizations must continually change. The question is “how?” The leader’s task is to make change work by helping others through transition.

A successful transition …

  • Explains what is and what isn’t over. Some things never change: You will continue to serve customers and produce products. What changes is not what you do but how you do it. Help people identify what is and is not over.
  • Respects the past. The practices that frustrate you today were someone’s innovative solutions of the past. Do not criticize widely accepted practices. Accept them as right for that time while recognizing that times change.
  • Ensures the “important stuff” continues. What is the important stuff to you? Service? Ethics? Whatever it is, it must continue. Involve others in defining the “important stuff” and ensure that the change does not disregard them. This increases support for the change.
  • Sets the stage for the future. Today’s change will open your eyes to new opportunities. As you evolve, set goals for what you want to achieve. Measure and evaluate progress. And, show others how the change will move them toward a positive future.
  • Recognizes its day will end. Don’t assume that today’s solution will work forever. And don’t think that this will be the last change.

Long-term success depends on anticipating and responding to change and making the transition.

Posted in Management and Leadership Uncategorized

Leadership Manifesto

Leadership Manifesto

Leadership is in a state of retreat bordering on confusion, as we go from crisis to crisis, scandal to scandal, outrage to outrage. Normalcy is waiting for the other shoe to drop. More CEOs and CFOs are coming in conflict with the law. Once powerful companies are going belly up for cooking company books, creating fictitious bottom lines. Perpetrators are hauled off to jail in Armani suits. These outrages manifest the arrogance of power and greed. We are adrift in a maelstrom without a rudder.

People are partners to leadership. They control the rudder. Yet, most are passive, obedient obsequious, polite, conforming, dependent, submissive, rudderless, or clueless. They are of no service to themselves, or their leadership. This translates into learned helplessness and irresponsibility. We get the leadership we deserve. Crisis and scandal do not occur in a vacuum.

All are vulnerable. Our culture abhors a snitch, stoolie, or tattletale. We don’t “challenge authority“. We react to it.

I can’t divine what will replace CEOs and presidents, but many “leaders” no longer lead and never learned how to follow. Their eyes are guided by history, not vision, by what they know, not what they can find out, by what has worked, not what is failing now, by a sense of power, not a sense of people.

I contend that most work can be conducted much better without managers.

Leadership is often personified in a charismatic leader (political leader), a central figure (Pope) or a person that sits at the top (CEO). I find this perspective too narrow. Leadership is far more universal, pervasive, organic, and encompassing. Everyone is a leader, or no one is!

Posted in Management and Leadership

How To Fail Successfully

How To Fail Successfully

If you’re going to be a skillful sailor, you have to weather some storms. We build and expand skills by testing them, and that means that failure is an essential ingredient of success. It’s the weight that we lift for one set of repetitions but not three that we should be tackling in the gym. After we succeed at one weight, we seek the next weight that will ensure our failure.

The key to mastery is failing successfully. We fail successfully when failure does not take us out of the game (risk management) and when failure sparks adaptation and innovation. If we want to become a world class skier, we can’t remain content with tackling small hills. But we also can’t start at the highest peaks. In conquering trading hills we prepare ourselves to master the mountains.

Source: Brett Steenbarger

Posted in Philosophy and Wisdom

Barriers to Successful Strategy Execution

Barriers to Successful Strategy Execution

As managers, we learn the truth what Dwight D. Eisenhower once said: “Plans are useless; planning is everything.” Indeed, execution—more than planning—determines success. Planning should be a process for building clarity and alignment, and positioning for efficient and effective execution.

Each year managers spend countless hours planning, budgeting, and forecasting. Most expect significant results from their plans. Unfortunately, even seasoned managers struggle to bring together people, strategies, and operations to achieve results.

We have identified five critical barriers to successful execution.

Barrier 1: The underlying strategy is not clear.

Confusion ranges from “fuzziness” in direction to not understanding what strategy is. A strategy represents set of decisions regarding the future and how to achieve success. Without a crisp articulation of these decisions, executives must reinvent them every time a new idea, opportunity, or problem arises—resulting in endless meetings, missed opportunities, a culture of indecision, and lower returns on executives’ time. A lack of clarity and agreement regarding the direction creates a void where personalities, politics, and oneupmanship prevail. Disagreements are played out in fragments of daily conversations and emails about what initiative is the priority at that moment, resulting in diluted progress, frustration, and missed opportunities.

Solution: Invest the time to get clear. Every executive team must agree on three points: Who are we? Where are we going? How are we going to get there? The level of clarity required for execution is derived from focusing on actionable answers. For example, there may be more value in defining the basic competitive advantage of the enterprise than in wordsmithing a mission statement. We suggest using a strategic framework to unify all aspects of strategy, one important element being a Quantified Vision. In addressing where are we going, it is powerful to paint a picture of the future with numbers to depict the evolution—not just financially, but also in terms of customers, products, and locations.

Barrier 2: The plan is overly optimistic.

Most executive teams tend to take on too much. The opportunities and issues they face make it difficult to prioritize initiatives and activities. As organizations evolve, they collect initiatives, processes, and pet projects that dilute focus and soak up resources. In addition, when executives plan, they often assume a perfect world—one free of distractions and problems. Such environments don’t exist. Runaway optimism builds failure into the plan, corrupting the notion of execution in the minds of the people required to follow-through and maintain the plan.

Solution: Define priorities. Creating an executable plan requires putting as much discipline and focus on those things that are not considered a priority for execution as those that are. The Not Do’ s must be identified along with Must-Do’s. From a list of initiatives, projects, and activities underway or planned, assign each item to one of three buckets: 1) must-do this year, 2) nice-to-have this year, and 3) not-do this year. Ask which items are most critical to executing them and achieving the vision. Put nice-to-have items in a holding bin. Put not-do activities and pet projects on hold. Cease activities relating to the not-do’s.

Barrier 3: No one is accountable for results.

Accountability motivates people to follow-through on their commitments. A driver of accountability is clarity on “who is on the hook for what.” Unfortunately, most managers focus the accountabilities on activities, as opposed to results. This creates challenges. You must ask: “Does all of this activity add up to real progress against strategic objectives?” “Are people makll1g progress against their commitments?” Without a clearly defined “finish line,” accountability will be confused or diluted.

Solution: Raise the stakes. As initiatives are prioritized, tie the initiative to a time horizon. Define a specific business result associated with effective execution of that initiative. What do we expect to get out of this initiative? When? Who is on the hook to make this happen? Defining initiatives in this manner raises the stakes for execution and enables people to fully commit. These initiatives become your business commitments.

Accountability for Results

Barrier 4: The plan has not been actively deployed.

Many executives complain about the difficulty of aligning around a vision or strategy. When asked what they do to deploy the vision or strategy, they respond with puzzled looks or explanations of communications programs. Issues of strategic importance require more than a 60-minute presentation in order for people to internalize and act on them. Treating complex issues in this manner usually reaps confusion at best. At worst, the result is mismatched expectations. To do their jobs, managers need to apply the strategy to their part of the business, ideally by working shoulder-to-shoulder with the primary authors of the strategic plan.

Solution: Mobilize the troops. Leaders should articulate the new strategy or plan to groups of managers in a series of deployment workshops. Leaders and managers participate in planning exercises in which the managers make decisions regarding what they must do differently as a result of the new strategic plan. This approach aligns, motivates, and mobilizes people to execute the strategy, as it builds momentum.

Barrier 5: The plan is static.

Within many expensive but ineffective plans is an unspoken assumption that nothing can change the validity of the plan. Of course, this is not true. Today major changes in the competitive landscape, economy, and key strategic areas must assumed. Strategic plans that do not account for change are doomed.

As internal and external conditions drive changes in priorities and resource allocations, one of three things impedes the use of the strategic plan:

  1. the plan not visible—after planning, it is locked away, disconnected from decision-making;
  2. the plan is not accessible it is held in secret, restricted to a few senior executives; or
  3. the plan is not changeable—it is a dense amalgam, making it difficult to update and manage.

If any of these situations exists, the effort required to maintain the plan becomes unwieldy and the plan becomes obsolete. Executives must then do so without the benefit of the analysis encompassed in the strategic plan or an understanding of how resources are to be applied to aid quick decision-making.

Solution: Create an execution process. Use strategy as a weapon to drive progress, manage accountabilities, evaluate performance and support decision-making. Make the plan visible, accessible and changeable. Use annual planning not to develop static plans, but to create dynamic processes: single-page executive dashboards, single-page management action plans, and strategy progress meetings. A dynamic planning and execution process helps an executive team understand progress, make decisions, and take action.


Successful strategy execution is a dynamic process. Strategy begins as a set of agreements about markets, products, revenues, and growth. The rest is execution. Unless there is a process for evaluating execution, making decisions, and closing the loop with the original strategy, the effort dies. Execution is a process for maintaining strategic progress. Refocus your planning activities on execution of plans. Use your planning process to steer around these barriers and on to success.

Posted in Business and Strategy Management and Leadership

Servant Leadership: See and Serve

Servant Leadership

For the past decade, we have focused primarily on the what of leadership, and only tangentially on the why of leadership. Of course, the whole concept of leadership is problematic today because modern technology has produced prosperity and a growing professional class of independence, competence, security, and self-confidence.

All of this has led to the egalitarian anti-hierarchical spirit of the age, which threatens to make traditional management unimportant and leaders dispensable. The mystical charm of “being managers” has been drastically reduced as the fulcrum of the problem-solving has shifted to professionals, of course, without the power or authority.

Servant Leadership Today

I now define leadership simply as the vision to see, the ability to serve, and the skill to design and sell and implement a strategy that meets the first two criteria.

The vision to see is to have an accurate assessment of where you are, where you want to go, and how you plan to get there. The vision to see includes manpower, methods, and motivation. Organizations, like individuals, are born, grow to maturity, establish their identity, and use this to create their niche in the marketplace, and then grow less nimble and flexible and ultimately decline.

As the individual has to reinvent himself at different stages of his life to remain competent and competitive, so also does an organization. As the individual’s vision becomes more myopic, requiring the aid of glasses, contacts, or laser surgery, so also must an organization install corrective devices to focus and see things as they are rather than as they once were or as they should be.

The organization’s culture, communications, and competence are closely tied to manpower, methods, and motivation.

Culture is the invisible hand that dictates what is acceptable and what is not acceptable. The structure of work determines the workplace culture; the culture represents the values and beliefs; these drive behaviors. The function of work determines the structure of work, the structure of work determines the workplace culture, and the culture prescribes organizational behavior. If the organization knows what it wants to achieve and is structured to accomplish that goal, behavior will be purposeful, and the goal will be achieved. The goal or objective plus the appropriate culture equals purposeful performance.

Manpower relates to having the right mix of people to do the jobs required with the appropriate training and skills. This demands an assessment of readiness of skills available, a talent bank, and a critical analysis of changing manpower needs.

Servant Leadership: Motivation and Methods

Methods involve the infrastructure of how work is done. If you design a company where there are discrete departments, work will follow territorial imperatives out of which develop pecking orders, levels of elitism, and status. Conversely, teamwork cells represent an organic approach where departments and functions are integrated into a common goal, and support each other in user-friendly terms.

Motivation is the litmus test of productivity, which is based on the perception of control and satisfaction as a function of structure. Morale and motivation are often confused. You can have high morale and low productivity. You likely won’t have high motivation and low productivity. Morale is an effect, not a cause. Motivation is a cause, and motivation is not directly tied to incentives.

Incentives are meant to put a fire under you. Motivation involves creating a fire in you. Motivation ties into the third part of my definition of leadership where selling is involved. Incentives are external stimuli in the form of rewards to workers who are dependent on the reward giver. Motivation is inner directed and represents the self-satisfaction of a job well done. Incentives are manipulative devices successful with other-directedness, while motivation is enabling or selfdirected. It is the difference between a worker going to management with a problem and a worker going to management with a solution.

Incentives work well when a passive work force is the norm, where management acts as parent to workers. Those days are gone. No organization can afford a passive and dependent work force.

Today 80 percent of the work force is white-collar and college-trained. Knowledge power beats position power. Lateral communications or horizontal integration of effort at the operating level is critical to success, not vertical directives from policy makers remotely located at the top. Timeliness is critical in decision-making, meaning most decisions must be made at the level of consequences to ensure success.

Servant Leadership: Motivation and Morale

Motivation and morale dovetail if success is to be realized. Motivation is based on the attitude of the individual. Attitude is a predisposition to act in a certain way. Morale is a corporate or group index. These have been confused, as companies have created cultures of comfort and complacency in an attempt to raise morale, thinking high morale was the key to productivity and that motivation would follow naturally. Supporters of this concept give workers everything but the kitchen sinkrecreational complexes, liberal policies, generous benefits, paid leaves-and few, if any, of these benefits are tied to productivity measures. Even performance appraisal becomes a routine exercise for incremental raises. Cultures of comfort and complacency are merely fun places to go and socialize; work is not necessarily the primary focus. What motivates people most is a culture that provides clear work objectives, the training and tools to accomplish tasks, the trust that they will perform well, the freedom and control of the work, the support needed when they fall short of the mark, and a fair economic split in company profits. These people don’t need a lot of bells and beads, slogans, or rah-rah sessions. This is the culture of contribution as opposed to that of comfort and complacency because workers own what they do and are pro-active rather than reactive.

When people are provided with challenging work and measured and rewarded fairly with regard to that work, motivation, morale, and productivity follow. The focus of morale is on the work climate; the focus of motivation is on the job. Leadership with a vision to see blends these two factors to support productive work.

The second factor in leadership is the ability to serve. Leaders must be complete followers. They must have the best interests of those they serve in mind, and know them as they know themselves—how they think, feel, believe and behave; what they value, why they value it, and what are their greatest hopes and fears. Otherwise, their ability to serve is a charade. That does not mean the leader gives people all that they want, but rather that he helps them find the way to what they need. The goals of the company and the needs of the workers are interdependent. It would be wrong to meet goals at the expense of the workers, but it would be equally counter-productive to meet the needs of the workers at the expense of company goals. The leader behaves not as a concerned parent but as an honest broker, sharing with workers his vision of where they are, where they are going, and how they might get there. This means he shares information strategically, enabling workers to make decisions appropriate to the work at hand and the company’s best interests.

Moreover, the ability to serve does not suggest that what is proposed is always necessarily supported by the majority. The majority often has a vested interest in the status quo, and the status quo may be what is derailing the operation.

Some CEOs are culpable for malfeasance, corruption, cover-up, or cooking the books, but to me their greatest crimes are lack of vision, betrayal of those they serve, and failure to create a cohesive and winning strategy in the face of bold new challenges.

Posted in Management and Leadership

Learn to Make Paranoia Work for You

Learn to Make Paranoia Work for You

For most leaders, decision-making involves the dualities of increasing productivity but retaining quality; satisfying ecology but maintaining profitability; reducing service costs but insuring customer satisfaction. Leaders serve many constituencies: senior staffs, employees, stockholders, board members, customers.

Leaders are often unaware of their personal limits and the limits of their jobs: the job is often soul-consuming; martyrdom is a frequent refuge; and super-human responses still fall short.

In the past, leaders were encouraged to live with the demands of their jobs, reduce excesses through delegation, appreciate the achievements—the rush, respect, even admiration of those they valued. But such consolation didn’t last.

Why? It was a sane approach. It blended knowledge of both the nature of the job with that of the client. But the fears persisted: not being equal to the challenges; surrounded by untrustworthy and even back-stabbing associates; and an array of external forces and factors making success problematic. The net result was frequent and urgent callbacks in which CEOs spent all the time venting. The inevitable question then came: “Am I crazy? What’s wrong with me?”

Once I answered: “The job is crazy, and so are you. It is a mirror match. No divorce is possible. You have a tiger by the tail. Neither one of you will let go, and it will never change its stripes. Your paranoia goes with the job and with who you are. We have to bring it to the surface and accept paranoia as a norm. Then we need to find ways of making that paranoia work for you—making it protective, purposeful, and proactive.”

The executive was thoughtful. Then he said: “Clearly, I am not comfortable thinking of myself or my job in terms of paranoia. So, what’s the next step?”

I told him: “First, make a list of daunting tasks, people out to get you, and those cheering you on to failure.” As a result, this leader went from accepting to embracing the limitations of the job, from believing that there was nothing wrong with him to recognizing his paranoia.

I coach protective, purposeful, and proactive paranoia for leaders. Coaching should be situational: “If you had to deal with this situation how would you handle it?” Although coaching should focus on solutions, these should come from the mentee. But here the client was puzzled.

Three situations surfaced: threats, quandaries, and discontinuities.

Threats-protective Paranoia

I asked the CEO to make a list of threats, including: who is out to get me, who wants my job, who is undermining me or my plans, what factions are forming, what is the rumor mill saying about me, what is my standing with the rank and file, stockholders, and board members? Along with a to-do list, paranoia creates a to-worry-about list.

Heeding paranoia and making it serve protective ends, the CEO finds he has to make some changes. The first one is changing style and schedule of appointments. Meetings now need to be supplemented by information-gathering. Breaks become occasions for surprise visits. Early arrival can be coupled with buying breakfast for managers never known before. Lunches are devoted to disarming threats and spiking the guns of those who may be out to get you. Evening engagements involve inviting senior staff members and spouses for dinner or to attend a show or concert together. It’s sage advice: “Keep your enemies dose.”

The second major change is a reexamination of the CEO’s sources of information. Who tells the emperor that he has no clothes? What has been his relationship with his senior staff? Has he surrounded himself with “yes men”? Does he require constant approval with little or no dissent? Does he shoot the messenger? In short, has he inspired and developed ” followship”? Has he created a team that will protect him?

By operating from a base of paranoia, threats can be accepted as a norm not a personal leadership failing. The CEO needs to have an early warning system. Internal intelligence gathering should match the external monitoring of market and competition. Indeed, the first may feed into the second. Learning about internal capacity may directly affect market performance. Worrying about threats may save his job and his company.

Proactive Paranoia

Quandries-purposeful Paranoia

One benefit of valuing paranoia is relieving the CEO of the burden of having to be all knowing, all powerful, all successful, and indispensable. The CEO can’t be the only problem solver. The coach suggests the compilation of another list: what at work drives you crazy? What frustrates or compromises what you believe should be done? This paranoia requires a more reflective exchange. These are not direct threats as much as powerful enigmas that cause sleepless nights and undermine companies. And so the coach and the CEO seek to identify and unravel Gordian knots.

Although many will surface, the most difficult is how to persuade people to change behaviors or to alter basic attitudes and belief systems. The coach might ask the CEO: How often have you changed or resisted change? What helped or hindered you? What have you learned that can be applied? A second approach requires reconfiguring structures and roles so that change is welcomed not required, invited not coerced. In short, change the outside as a way of changing the inside.

To stimulate such thinking, the coach may introduce distributed leadership, including a leadership component in every employee’s job. Or, rotate leadership among team members. Or, shift the focus from changing people to changing environments that change people. The fear or paranoia of failure compels such actions because they facilitate thinking out of the box, and reduce attribution of failure to executive limitations. As with threats, paranoic inadequacy can be turned upon itself for insight, quandaries can become transparent enigmas; and the challenge of internal change can be converted to the challenge of external structures.

Discontinuities-proactive Paranoia

Increasingly, nothing remains constant and familiar. Twists and turns, breaks and new directions, shrinking of old markets, seeking new ones—these are the daily fluctuations leaders face.

Given such regular dislocations, the desire to hold on reinforces the resistance to change. The future then abandons the organization. Whep the coach and the CEO address the future, what surfaces is the stuff of which nightmares are made: assumptions, planning, and coherence.

  • Assumptions that good times will continue, that growth is assured, and that market share will remain secure make for happy days. But when discontinuity becomes a norm, assumptions analysis has to become the data of decision making.
  • Forecasts and strategic planning fail to serve as an early warning system, suffering from a reliance on assumptions. If the CEO asked all employees to invent the future, that would make everyone a strategic planner who would forecast how their jobs might change and what to do to prepare.
  • Coherence. The key is for the leader to find and articulate new common ground. It may be a combination of some previous beliefs that still have binding power with some new sources of coherence that await us in the future. Together these give commonality of purpose and flexibility to face discontinuity. Having graduated from the College of Paranoia, you are ready to lead others out of the wilderness of threats, quandaries, and discontinuities.
Posted in Investing and Finance Management and Leadership Mental Models and Psychology

Shared Leadership to Use Hidden Assets Around You

Shared Leadership to Use Hidden Assets Around You

Most leadership development efforts only focus on formal leaders, or persons being groomed for leadership. However, followers also need to be included in leadership development efforts to prepare them for responsible self-leadership and to effectively practice shared leadership, especially in team-based knowledge work.

To prepare for the leadership challenges of tomorrow, we need to abandon some popular myths regarding the meaning of leadership today. This mythology centers on the romantic conception of top-down “heroic leadership.” Many people are drawn to the image of a larger-than-life, charismatic, all-knowing, heroic leader who can inspire and single-handedly transform work systems and the people who work in them. This image is an oversimplification of leadership.

Self Leadership And Shared Leadership

Self-leadership and shared leadership are at the heart of the new leadership forms needed to meet our challenges.

  • Self-leadership. People are capable of leading themselves. Self-leadership goes beyond participation and empowerment. Self-leadership does involve self-management of behavior to meet existing standards and objectives, but it also includes evaluating the standards and setting or changing them. It looks at what should be done and why it should be done in addition to how to do it. And it includes internal motivation, self management of thoughts, and developing various specific self-leadership skills, including self-observation, self-goal-setting, self-reward, rehearsal, self-job redesign, self-management of internal dialogues, and mental imagery. Such self-leadership strategies hold promise for meeting the empowerment challenges posed for members in teambased knowledge work systems.
  • Shared Leadership. Shared leadership occurs when all members are fully engaged in the leadership of the team. It includes ongoing and mutual leadership from both official and unofficial leaders. It is a key characteristic of empowerment in teams, providing more robust leadership than simple reliance on top leadership. This is particularly important in knowledge work, since a formal leader is often at a significant knowledge disadvantage relative to many team members on many important issues for the team.

Here are five ways you can unleash self and shared leadership to leverage the abilities of knowledge workers:

  • Avoid authoritarian control, of knowledge workers. Empower everyone.
  • Don’t rely too much on any one individual in knowledge creation. Encourage everyone to be involved.
  • Avoid the ego trap of wanting to be the top-down heroic leader. Encourage others to step forward as leaders when they have the key skills and knowledge.
  • Avoid hoarding power and influence. Provide the training and resources that enable others to step up to the plate.
  • Don’t always offer your opinion first. Ask the four most important words in management, “What do you think?”

Shared leadership is a better predictor of team success and team performance than the leadership of a formally designated leader.

Posted in Education and Career Management and Leadership

25 Best Quotes on Managing Change

Successfully Lead in Change Management

“We are all prisoners of our past. It is hard to think of things except in the way we have always thought of them. But that solves no problems and seldom changes anything.”
Charles Handy (b. 1932), British Management Guru

“Not everything that is faced can be changed. But nothing can be changed until it is faced.”
James Baldwin (1924–1987), American Novelist

“If anything is certain, it is that change is certain. The world we are planning for today will not exist in this form tomorrow.”
Philip Crosby (1926–2001), Expert on Quality Management

“Every new change forces all the companies in an industry to adapt their strategies to that change.”
Bill Gates (b. 1955), Computer Pioneer and Philanthropist

“Change is the law of life. And those who look only to the past or the present are certain to miss the future.”
John F. Kennedy (1917–63), American Head of State

'Leading Change' by John P. Kotter (ISBN 1422186431) “To exist is to change, to change is to mature, to mature is to go on creating oneself endlessly.”
Henri Bergson (1859–1941), French Philosopher

“Change masters are – literally – the right people in the right place at the right time. The right people are the ones with the ideas that move beyond the organization’s established practice, ideas they can form into visions. The right places are the integrative environments that support innovation, encourage the building of coalitions and teams to support and implement visions. The right times are those moments in the flow of organizational history when it is possible to reconstruct reality on the basis on accumulated innovations to shape a more productive and successful future.”
Rosabeth Moss Kanter (b. 1943), Harvard Professor of Management

“If you want truly to understand something, try to change it.”
Kurt Lewin (1890–1947), American Psychologist

“Producing major change in an organization is not just about signing up one charismatic leader. You need a group – a team – to be able to drive the change. One person, even a terrific charismatic leader, is never strong enough to make all this happen.”
John Kotter (b. 1947), American Management Consultant

“The art of progress is to preserve order amid change and to preserve change amid order.”
Alfred North Whitehead (1861–1947), English Mathematician and Philosopher

'Managing Change (Pocket Mentor)' by Harvard Business School Press (ISBN 1422129691) “There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things.”
Nicolo Machiavelli (1469–1527), Italian Diplomat and Author

“Where there are changes, there are always business opportunities.”
Minoru Makihara (b. 1930), Japanese Executive and CEO of Mitsubishi Corporation

“Change is inevitable – except from a vending machine.”
Robert C. Gallagher, American Humorist

Change Management is about People Management

“The new always carries with it the sense of violation, of sacrilege. What is dead is sacred; what is new, that is, different, is evil, dangerous, or subversive.”
Henry Miller (1891–1980), American writer

“The manager, in today’s world, doesn’t get paid to be a steward of resources, a favored term not so many years ago. He or she gets paid for one and only one thing: to make things better (incrementally and dramatically), to change things, to act – today.”
Tom Peters (b. 1942), American Management Guru

'Managing Change in Organizations: A Practice Guide' by Project Management Institute (ISBN 1628250151) “We cannot become what we need to be, by remaining what we are.”
Max De Pree (b. 1924), American Business Executive

“Change is scientific, progress is ethical; change is indubitable, whereas progress is a matter of controversy.”
Bertrand Russell (1872–1970), British Philosopher, Logician, and Mathematician

“If you can’t change your fate, change your attitude.”
Amy Tan (b. 1952), American Author

“There are companies which are prepared to change the way they work. They realize that nothing can be based on what used to be, that there is a better way. But, 99 percent of companies are not ready, [they are] caught in an industrial Jurassic Park.”
Ricardo Semler (b. 1959), Brazilian Business Executive and Author

“Change Management: The process of paying outsiders to create the pain that will motivate insiders to change, thereby transferring the change from the company’s coffers into those of the consultants.”
Eileen Shapiro, American Management Author

'Lean Change Managment: Innovative Practices For Managing Organizational Change' by Jason Little (ISBN 0990466507) “If an organization is to meet the challenges of a changing world, it must be prepared to change everything about itself except beliefs…. The only sacred cow in an organization should be its basic philosophy of doing business.”
Thomas Watson Jr. (1914–93), American Business Executive

“A change of heart is the essence of all other change and it is brought about by a re-education of the mind.”
Emmeline Pethick-Lawrence (1867–1954), English Women’s Rights Activist

“Organizations need employees who understand that change is the norm and employees who are prepared to learn continuously.”
Beverly Goldberg, American Management Author

“We are living through the most profound changes in the economy since the Industrial Revolution. Technology, globalization, and the accelerating pace of change have yielded chaotic markets, fierce competition, and unpredictable staff requirements.”
Bruce Tulgan (b. 1967), American Business Author

“You can’t move so fast that you try to change the [norms] faster than people can accept it. That doesn’t mean you do nothing, but it means that you do the things that need to be done according to priority.”
Eleanor Roosevelt (1884–1962), American First and Author

Recommended Books on Change Management

Posted in Management and Leadership

Turbocharge Your Value Creation to Build Market Value

Value Creation to Build Market Value

Earnings now make up comprise only 50 percent of the market value of publicly traded companies, down from 95 percent of market value in 1965.

What is the 45 to 50 percent of market value that is not earnings? Intangibles. Intangibles are not precisely related to earnings, but they boost or shrink the value of a business. Intangibles include reputation, brand, quality leaders, and other variables. Accountants who don’t like the word intangibles call these factors “future earnings.”

Two companies in the same industry with the same earnings can have very different market value, as the company with bigger intangibles is perceived by investors to do better in the future.

Accountants try to measure these intangibles, often using the Balanced Scorecard—a necessary but insufficient step. Leaders must learn how to build intangible value faster.

Build Intangible Value

Organizational Capabilities Building intangible value means creating real capability to keep promises about future growth. Leaders who can deliver on their promises are rewarded with a higher price: earnings ratio—the quality of their current earnings is worth more than the current earnings of their competitors.

Leaders can increase intangible value in four ways:

  1. Keep promises—deliver on earnings. In a public company, the most visible promise is to deliver quarterly earnings. Delivering a consistent and predictable pattern of earnings gives your company credibility. If you say you will deliver earnings but don’t, you lose credibility.
  2. Articulate a growth vision. Stakeholders want to know how your company will grow in the future. To grow, companies can sell more to existing customers, innovate around their products and services, or expand geographically. Pick one primary growth strategy with the other two supporting it.
  3. Match growth vision with supporting core competencies. Put your money where your mouth is. If you espouse product innovation, then investors and employees expect to see higher, investment spending in R&D and marketing. When there is a gap between the direction of future growth that is promised and how money, time, and attention are allocated, skepticism grows.
  4. Improve capabilities. Capabilities represent how the organization competes. Capabilities include: talent that is competent and committed; speed to make important changes happen fast; shared mindset to know and deliver what customers want; accountability that ensures that high performance counts; collaboration that ensures both efficiency and leverage; learning generates and generalizes ideas with impact; and leaders who deliver the right results the right way.

Of the four, improving capabilities as the most potential to provide a sustainable source of competitive advantage. Capabilities are the most difficult for a competitor to duplicate, and they delight customers.

By building intangibles, leaders turbo-charge the value creation process.

Posted in Management and Leadership

To Change Culture, Focus on the Prime Movers

Organizational Culture Change

Culture change has occupied the attention of management gurus for decades. Some argue for the “big bang” approach—boldly trying to redefine norms, values, beliefs (culture) along with the “the way things are done here.” Others opt for an incremental approach. Between the two extremes lies a middle ground: focusing on resolving specific issues that can trigger wider changes in the way everyone thinks, behaves, and performs. We call These “prime mover” issues.

For example, consider the move from a hierarchical to a horizontal way of operating. Today, when speed is paramount, where growing complexity puts a premium on pooling intelligence, where the decision-making action must take place close to the customer, there is an urgent need to reframe authority, roles, accountabilities, decision-making processes, and the nature of business relationships. This shift is not merely structural, but a profound cultural one.

Rather than try to barrel through a culture change head-on, we focus on a prime mover issue—for example, the need to bring teams to much higher performance levels—and use it as a platform for wider change.

A Case in Point

An $8 billion European consumer products company, a division of a global leader in the industry, faced an uncertain future, given growing competition, shorter product life-cycles, mounting costs, shrinking profits, finicky customers and new government regulations. The senior team realized that the old way of operating, in which each successive tier managed the tier below, led to a downward focus. Executives were absorbed in fire-fighting and execution rather than strategy.

The top team moved to put in place worldwide, high-performance teams, each responsible for setting strategy and resolving key operational issues. When the team approach was cascaded down, the senior team operated like a board of directors, focusing on strategic issues, capital markets, and longer-term growth and return. As teams and units assumed greater responsibility and authority, performance improved; cycle time was reduced; innovation improved measurably; turnover declined; people felt a greater commitment; and the growth trajectory continued.

The high-performance team became a powerful force for cultural change.

Baseline of Change

When you move to a horizontal operation, four elements must change:

  1. Individuals must change their view of themselves. They must think of themselves as accountable not only for their own performance, but for that of their colleagues—even those who do not report to them directly. This is the ultimate rung on the ladder of accountability. Rung one is being accountable for one’s own performance. Rung two is assuming accountability for direct reports. Rung three is assuming accountability for peers. On rung four, employees become accountable for their leader’s success. The fifth rung is being accountable for the success of the organization.
  2. New skills must be acquired. People must become adept at influencing others and managing conflict. Boss-subordinate relationships are replaced by patterns of indirect influence and persuasion vis-a-vis colleagues over whom there is no direct control.
  3. Protocols or ground rules must be put in place to guide decisions and behaviors. For example, everyone must commit to ground rules relating to when and under what conditions decisions get made unilaterally, consultatively, and by consensus. One protocol is “don’t bring issues to a third-party rescuer.”
  4. The performance system and reward structure must reflect the new culture. Here, skin in the game is crucial. For example, the compensation system must provide positive consequences for behaviors that reflect the move to a horizontal organization, including pay for (team) performance.
Posted in Management and Leadership