Perhaps the title for this post should be ‘Why organisations resist change’ but in today’s pacy business environment, change is the standard against which the business agility of companies is measured. In the words of the Borg, ‘resistance is futile’. Yet change doesn’t happen easily.
Despite reports of the upswing in the UK economy, the financial pages are littered with examples of organisations who failed because they couldn’t or wouldn’t change. In reality, business transformation occurs because a) there is a burning platform and the business must change to survive; b) external forces such as competitor activity, technology or customers require it; or c) the board genuinely want things to be different…(see reasons a and b above!)
Of course, business transformation is not something binary, nor is it transactional. People matter, and if your aim is successful corporate evolution, it’s important to have the right people making the right changes at the right time. Change is relatively easy if you are the one inflicting it. Not so much if you are on the receiving end. Which is probably why some organisations resist change so successfully, by the time the burning platform is in sight, it’s too late to call for rescue.
So how do successful organisations bring their employees along with them? Much as the CEO might want to embed change by dint of a strong personality, stakeholder engagement is key if you want the change to stick. But is it enough? Tempting though it might be to adopt a hammer approach, your people aren’t accessories in a hardware store!
Really transformational business change targets leadership, but also engages people across the organisation, while making sure that organisational structure and key enabling processes such as performance management align with the future vision for change. As well as making a rational case for change, stellar organisations also create the ’emotional’ case – to enable people to connect with, and buy into, the new reality they are facing. Their leaders become role models of the change – not simply paying lip service, but actually demonstrating the change they want to see – in everything they say and do. Most importantly, they stay focused and stay the course. Change is inevitable. Failure to change, doesn’t have to be.
Recent headlines documenting the ongoing saga at Tesco bring to mind Lao Tzu, who wrote: ‘If you do not change direction, you will end up where you are heading’. No doubt many column inches will be devoted to the analysis of what went wrong and why. Did management ignore the warning signs within? Or did they simply fail to adapt and react to changing circumstances in their external environment?
Whatever the outcome, one thing is certain. If it is to appease shareholders and customers, Tesco’s incumbent CEO, Dave Lewis will need to transform it’s business, to do so radically – and in a short space of time. In this case, the £250m hole in Tesco’s finances, a property portfolio of large and unprofitable stores, and a devalued ClubCard and brand, are all powerful incentives for change. But, what happens when the organisation isn’t ready?
In my experience, things only change, when you do. Such change may be conceived in the boardroom, but it is delivered with and through the people inside the wider organisation. And this is where the challenges begin. I often say that business transformation is about psychology, not methodology. So it’s just as important to understand the ‘who you are dealing with’ as well as the ‘what needs to be different’. Just ask the team who are transforming the Co-Op!
Instead of charging headlong down the transformation tunnel, it might be wise to ask:
Is the vision clear?
Is the appetite for change genuine?
Are management’s messages consistent with their actions?
How ready is the organisation to make the change?
Do the resources and business conditions support change?
The greater the complexity of change, the more vital it is to understand where you are starting from. Otherwise, ready steady go ends up as ready steady stall.
What do Chameleons, Stick Insects and Squid have in common? They are all creatures that change colour depending on their surroundings, enemies, temperature or mood. In the natural world this ability is known as signalling, and has evolved as an evolutionary means to communicate or camouflage.
You are probably wondering what bearing this has on the modern business habitat?
Well, it may not be a jungle out there, but to survive – and thrive – corporate leaders and managers need to be comfortable with change. Adaptability is key. The financial pages are littered with stories of organisations who were looking the other way when the winds of change blew in. In 2009, UK retailer Woolworths went bust after 100 years of trading history. 30,000 people lost their jobs. While there are many reasons for the decline, the contributing fail factor was a lack of focus on their core retail strengths (you could buy anything and everything) and an inability to respond fast enough to inclement market conditions. In these credit-crunching times it any wonder that these premises are now occupied by discount retailers such as Poundland – squarely aimed at budget-constrained consumers?
Savvy organisations recognise that change is a constant – and are able to respond to their environment. Super-savvy organisations actually build this type of reflex into their strategy. I’m reminded of the latest TV campaign for Amazon, who claim they ‘make the revolutionary, routine’– the premise being that innovating for change is the new normal. For such businesses, change is not merely something that happens, but something that the leaders of these organisations actively shape.
Sharks may be the ultimate predator, but their corporate repertoire is somewhat limited. Far better to be a chameleon. Not only can they change their spots in 20 seconds flat, they can focus on two objects at the same time. They also catch prey at about 30 thousandths of a second. Now that’s what I call a reflex! Managerial mimicry, anyone?
What do you think? Can being a corporate chameleon help you adapt? Comments on the blog, please.
As a consultant who specialises in stakeholder engagement, I am by turns amused and horrified by the abject levels of treatment that pass for customer service in the UK. Many organisations, lured by the cost savings that can be made by installing automated customer management systems, or outsourcing their call centres, or whatever pea-brained managerial trend is current…seem to have forgotten one thing. While cash may be king, customers represent cash. Engaging the people that buy your product or service is not only good for your brand, it’s good for your bottom line!
Today was a case in point for me. My car insurance is with a company who claim to be ‘winning the battle for cheaper insurance’. Sadly, they haven’t won the battle for my heart and mind. ‘There have been several errors with the policy – all of them as a result of adminstrative bungles by the people who inhabit the parallel universe on the other end of the phone. Yesterday I received a letter saying that my policy had been cancelled. Oh really? That’s strange since the insurance premiums keep going out of my account on a regular basis. This was in addition to a letter that queried my no claims bonus information & practically accused me of insurance fraud – information that the insurer already had since this was the 2nd year I’d renewed my policy with them. What a fabulous way to reward customer loyalty. Needless to say, I shall be voting with my wallet and cancelling the policy for real this time.
But the hilarity continues. In the spirit of good customer service, my energy supplier wrote to me to say that a meter reading had been scheduled. Now, this is progress because usually the meter readers turn up when you aren’t at home – yes, I do work for a living! Even better, they left a number for me to call, to rearrange should this not be convenient. So, I did. Cue…an automated customer service system which asked me to put in my account number and then said…‘Sorry’ before it disconnected. What on earth were they apologising for…? The fact that they placed so much reliance on IT that it had let them down, when in fact employing a real human being might in the end be a better option? The fact that they weren’t actually providing a service, just wasting my time, and dime? Really, these machines should have an option that says…Press #5 and hang up if you want to speak to someone who actually gives a monkeys!
Mary Kay Ash, the US businesswoman who founded a cosmetics empire based on personal service is well known for saying; ‘A company is only as good as the people it keeps’. While this certainly applies to talent retention, it’s a maxim that UK retailers, recruitment agencies, banks, energy providers and insurance brokers would do well to take to heart when it comes to their customers.