By Rob Balmer, Managing Director, Executive Central
All organisations, regardless of sector or industry, are facing radically changing environments. In Australia, for example, the findings of the Royal Commission into the banking and finance sector will usher in transformational change in those businesses. The forecast growth in electric vehicles is another changing environment set to disrupt industries. The examples are many.
It’s so commonplace it’s almost cliched to talk about innovation and change but, in my experience, there is not a business or government department or agency that isn’t undergoing major organisational change.
However, the brutal fact is that research, and 16 years of professional observation and analysis, shows that about three quarters of organisational transformations, or major change initiatives, fail to meet their objectives.
It’s important to acknowledge what the legacy is of a failed transformation: it’s debilitating. The failed transformation process costs organisations dearly in lost productivity, unmet business goals, and, ultimately, revenue. People will feel genuinely disappointed in the organisation’s inability to adapt and innovate.
To categorise and condense the many reasons why these organisational transformations fail, Executive Central’s analysis has found three core themes.
One: Executive leadership level lacks change management skills and perspective
The skills and processes used by leaders at the executive level to manage change are poor. This stems from the fact that often the teams in charge of driving innovation and transformational change lack diversity. I am referring to deep diversity – diversity of thought, diversity of experience, diversity of style, as well as the surface level of diversity of gender, culture, and age – and when your organisation lacks that diversity, it’s actually a lack of the perspective required to develop bullet-proof solutions.
A lack of diversity could also translate as a ‘group of people who are experienced in, and comfortable with, what we are doing now’.
There are also deficiencies in the two key areas of problem-solving and decision-making skills and processes. Where we see a lack of skills in those areas, we see people jumping to solutions – often without adequate information. The discussion quickly turns to: “well I think we should do this” or “let’s start brainstorming this”. Usually this occurs before there is agreement on what the problem is. So, these leadership groups often develop the wrong answer to the wrong question.
Two: Leaders fail to sell the business case for making transformational change
The biggest problem with selling anything – and selling is just another form of influencing – is that people focus on talking about how good the product or solution is and neglect talking about why it’s required. When it comes to selling a business case for transformational change, leaders need to talk about the consequences of not undergoing that change. What does the organisation look like in five or ten years if it doesn’t innovate and undergo change?
This is absolutely fundamental to getting buy-in from the people who are charged with implementing change. If they do not adequately understand the need to transform how they do things, and feel motivated to drive change, then the organisation will not meet its goals.
Three: Organisations fail to support frontline managers to balance change with BAU
Frontline managers and staff are inevitably challenged to balance the need for implementing a change agenda – doing things differently – with completing business-as-usual tasks and meeting bottom lines. Balancing both is far easier said than done.
To strip that back: the hardest thing to get anyone to change is a process that’s currently working for them. A lot of transformational changes are brought about to processes and business models that are not necessarily causing problems. They are usually implemented to anticipate future needs and challenges. So, it’s not uncommon for frontline managers to wonder why they should change what they’re doing; or, for them to feel contempt at being told to change what is currently working.
There is not a one-size-fits-all solution to these three issues. Every manager is a unique person and they are managing different people in different contexts. This is where they need support to develop the leadership skills required to innovate and change in a dynamic environment.
Support can come in the form of coaching or mentoring: both provide crucial flexibility to work with individuals and/or teams in their specific business contexts. Leaders can receive expert support at every level and step of the transformation process, helping them to:
Develop problem-solving and decision-making skills and processes
Tap into a diversity of perspectives
Communicate change and influence others to buy into the transformation
Support frontline leaders to implement change while balancing BAU work
Coaching has not often been something considered viable for frontline managers and staff due to the cost of delivery but with new technology such as Coachlive, coaching can be delivered cost-effectively to large cohorts in remote locations.
Compared with the cost of transformation failure, a coaching solution is a guaranteed investment in your organisation’s transformation.