Leading Change

Leading Change
by John Kotter

The eight reasons firms fail to achieve changes are outlined and converted into tips and actions to counteract these risks. Kotter subsequently published a book on Error #1, Allowing Complacency. This later book is written because of the critical nature of the Sense of Urgency, and the frequency with which companies get it wrong. His research demonstrates the critical aspect of that step. This book provides the whole sequential approach for more effective change processes.

Turning these eight mistakes into a recipe for success, they are:

Establishing a sense of urgency
Creating the guiding coalition
Developing a vision and strategy
Communicating the change vision
Empowering broad-based action
Generating short-term wins
Consolidating gains and producing more change
Anchoring new approaches in the culture

These are provided in sequence. Naturally aspects of a change program will be occurring in different parts of the organization at different stages, but the sequence is critical. While there may be some back tracking and then resuming, one phase must be successfully implemented before advancing to the next.

The management versus leadership debate is mentioned here. I agree with his point that both are needed. I am familiar with hot debates about the relative importance of one over the other. Kotter summarizes management as planning, budgeting, organizing, staffing, controlling and problem solving. All of those are essential elements to accomplishing the work of a group.

Leadership “defines what the future should look like, aligns people with that vision, and inspires them to make it happen.” The focus of this book is on change, and change is at least 70% based in leadership. Management which becomes too bureaucratic certainly needs strong leadership to return to a strategic and visionary view. Strong leadership is essential for establishing a sense of urgency. And change is only sustainable when supported by strong managers.

1. Establishing a sense of urgency

It’s important to note here that for leaders to “establish” a sense of urgency is in no way to be confused with creating an artificial franticness of activity, or false urgency. Urgency is a fact of our current economic and business climate. Company leaders who do not recognize the constant need for vigilance, for attending to the changing needs of the market place, and the impact of technology and communication methods, are already behind. Establishing a sense of urgency is simply translating the fact of that vigilance into the corporate culture.

The enemy of urgency is complacency, which results from prior success, arrogance, and a general unwillingness to take in reality, or data from outside the organization. Satisfactory revenue and profits (currently) can cause complacency among leaders and even throughout the organization. Metrics which are misleading (and generally have a lag time) as well as too many resources, can all contribute to complacency. A history of high control and low risk taking can add to this, as well as an absence of current crisis. Without strong leadership, Kotter argues, complacency is the default.

2. Creating the guiding coalition

In today’s fast paced environment no leader can go it alone, when it comes to change. Diverse perspectives, experts with attention on different facts, are necessary to stay alert to opportunities and risks. Our culture is still significantly oriented towards the individual (though that may be changing) rather than to the group. This creates the conditions for independent action rather than vigorous dialogue.

The author advocates for a team orientation and recommends four characteristics for membership in the change-management team: position power, expertise, credibility and leadership. Thus it is not necessarily comprised of the entire senior management team. It should include those with both management and leadership competencies. He also identifies who to exclude: those who only have their own agenda, and those who create mistrust.

It turns out, trust is the key, and it can be difficult to find or create. Team building can help create trust, which usually has to occur away from the office, at an off-site. It is only in this kind of intense meeting, away from the day-to-day pressures, that substantial meaningful strategic conversations can occur, with the guidance of skilled facilitators.

Trust occurs, when hearts and minds are engaged, when the outcome matters, and when the goal seems worthy.

3. Developing a vision and strategy

Since change is difficult, and requires discomfort of those involved, it can’t be mandated. It requires leaders to paint a compelling picture of the future. The vision must motivate. Without such clarity of vision, there is too much room for variation in each member’s view of the future. That dilutes the clarity of focus. Vision helps managers terminate projects that aren’t on point. It also must inspire employees to act for the long term good, even in the face of short term inconvenience (or worse). Vision serves to align team members, which results in leverage.

A compelling vision has to be regarded as achievable, even if it is a stretch. It has to be simple enough to be able to be visualized. It must be succinct; Kotter says leaders must be able to describe it in five minutes. It must be endorsed by the guiding coalition, and engage both head and heart.

4. Communicating the change vision

Surveys demonstrate over and over, that leaders believe they communicate effectively, and a huge percentage of the work force feels they are missing important information. The need to close this gap becomes even more critical in the process of rolling out change. The “gravitational pull” is towards day-to-day information, which by definition will wildly overpower the leaders’ vision conversation.

Metaphors, repetition, multiple kinds of media and report formats, all help deliver more effective communication. Then more repetition.

By far the most effective form of communication is for leaders to walk the talk. (In fact I recommend to clients to hold off on the big flashy roll-out until some substantive changes are already happening).

Communication is not just one-way. Effective leaders are listening to questions and doubts, and addressing them.

5. Empowering employees for broad-based action

The only reason empowerment got a bad name was when organizations talked about it but didn’t do it. Employees throughout the organization generally are as interested as senior management, in being with a winning team. They are even closer to the customer, have ideas about eliminating waste, and are yearning for the chance to actually make a difference. (That’s my experience).

Consistency throughout the organization systems are also necessary. If customers are the number one priority, the performance evaluation and compensation structure has to reflect that. If it’s teamwork, managers have to walk that talk. Including employees throughout the organization is the only reasonable way to proceed.

6. Generating short term wins

Short term wins are easy to achieve and demonstrate what is meant by the vision. They can serve to rebuff cynics, and build momentum towards the desired change. Although they create added pressure, the payoff is in assuring participants that the efforts are headed in the right direction.

7. Consolidating gains and producing more change

Most organizations today are highly interdependent rather than comprised of departments and divisions operating separately. Here a compelling visual is offered. Imagine trying to move the furniture in an office when all parts are interconnected by large strong rubber bands. That’s what it’s like to make change in organizations today.

Sometimes the interconnectedness is not necessary, or is in place due to a legacy, such as managers who worked very well or very badly together. Where the interconnectedness serves the organization, strong leadership and clarity is necessary to keep from sliding back to the old ways of working.

8. Anchoring new approaches in the culture

Culture becomes deeply ingrained in members, because they are rewarded and promoted for the values that fit. It gets reinforced in many ways, which eventually are almost invisible to leaders and participants because it is just the way we do business.

When the existing culture can accommodate the necessary change, perhaps with a few modifications, it is much more likely to be sustained. When the culture needs to appreciably change to incorporate the direction, a combination of sustained communication is necessary. In addition, rigorous attention to recruitment and selection, and promotion deliberately based on explicit values helps to reinforce the desired reality.

Summary by Janet Britcher