Insights / Thought leadership
Our thought leadership taps into the talent, experience and passion inside our firm and from our community of practice. Together we address the biggest questions our clients are asking and offer up the best and deepest answers.
Putting the "I" in change
There’s a good chance the missing link in your organization’s change program is you. By identifying your performance gap, you can set the stage for lasting change.
By Alex Wray
Knowing that half of all acquisitions fail didn’t help Jack get back to sleep. After all, he was CEO. The buck stopped with him. And one year after his tech company had acquired another, things were going from bad to worse.
Integrating the two companies’ starkly different cultures had proved more difficult than anyone expected. Decisions about everything from advertising to IT had sparked bitter fights and bogged down business. Costs were rising, morale was cratering, and the much-touted “synergies” that were the reason for the acquisition had yet to materialize. Some of Jack’s best people were heading for the exits.
What nagged at Jack most was that all of this was happening even though he and his team knew better. They had MBAs. They’d attended executive programs at prestigious universities. They’d paid an army of consultants a ton of money. They could teach this stuff. Yet they were failing. As Jack stared at the ceiling at 3 a.m., one question echoed relentlessly in his mind: Why?
THE MAN IN THE MIRROR
Jack’s first impulse was to blame the usual suspects: poor planning, inadequate resources and the inevitable “unforeseen events.” But according to research by McKinsey & Company, such factors account for failed change programs less than 30 percent of the time. The rest of the time, people are to blame—specifically, people who don’t “get with the program” and do their part. And while managers like Jack, upon hearing that statistic, might be tempted to look around them for the weak links, they should instead look in the mirror: the same McKinsey study found that 46 percent of change programs fail because management’s own behaviors don’t support them. As the comic strip Pogo put it, “We have met the enemy and he is us.”
To make change stick, leaders must change their own behavior first. Doing so demands unflinching self-examination. It requires managers to identify where they are falling short—their performance gap. But for those who do the work, it’s a powerful first step in making the personal changes that enable them to lead change in their organizations.
A GREAT PLAN ISN'T ENOUGH
It’s not unusual for organizations to plan well for change, as Jack’s company had done. They adopt proven, research-based methodologies. They get smart guidance from outside experts. But as research shows—and as we’ve seen at Wray Group time and again—even the most airtight plan is only part of the solution. Leaders must remember to write themselves into their change programs. If management isn’t leading by example or bringing their unique influence to bear where it matters most, change is likely to stall. But when leaders play their part, change has a much greater chance of taking root—four times as great, according to McKinsey. What did this mean for Jack, a Wray Group Client whose name we’ve changed for the sake of privacy? It meant if he wanted to change his company, he had to start with himself.
ORGANIZATIONS DON'T CHANGE—PEOPLE DO
Another Wray Group client story illustrates the cultural changes that are possible when management changes its behavior first: A century-old financial services company was in a change-or-die situation because of the 2008 financial meltdown. The company had been hit with multiple ethics charges after a number of its traders played fast and loose with the rules. Faced with ruin, the company got serious: It brought in a global leader in strategy consultation to develop a comprehensive plan for clarifying expectations and setting behavioral standards for its 10,000-plus employees worldwide.
But the company didn’t stop there. It also brought in a team of experts—including Wray Group—to coach 200 of its most influential leaders in adopting the transformative behaviors. These included increased collaboration and what the company called “challenge.” In a siloed corporation where smart, high-performing leaders were used to autonomy and rarely challenged by their peers, let alone subordinates, managers learned to hold each other accountable. Maybe more important, they learned to receive criticism without it triggering a defensive response. Their culture moved from being less about “me” and more about “we.” That change, along with a renewed, enterprise-wide focus on integrity, is credited with pulling the company back from the brink.
Of course, changing entrenched behaviors is never easy. The managers had coaches to support them in pushing beyond their comfort zone, building new habits, and, most important, deactivating old ones. Jack, the tech company CEO, went through the same process when faced with his own challenges. In each case, the work began with the leader identifying his/her performance gaps. This is an essential part of the process, and one that can be done in three straightforward steps.
STEP 1: IDENTIFY THE CHANGE THAT MOST NEEDS YOUR SUPPORT
For Jack, this step was the easiest. The change that most needed his attention was the integration of the cultures of the acquired companies. He knew this was the right answer because:
- it was the change that mattered most;
- it was a change the company was struggling to execute; and
- his involvement could make all the difference.
Jack could say with confidence that focusing on integration would be his optimal point of impact.
Changing from the inside out
To make change stick, we must change from the inside out. For most of us, this is new territory. The science of habit change offers a powerful solution to transform performance in the areas that matter most.
By Alex Wray
Improvement is at the top of every organization’s agenda. Collectively, organizations spend billions of dollars and enormous amounts of time on change. Yet the return on that investment is paltry compared to what it could be.
A study by the world’s leading strategy consultancy, McKinsey & Company, showed 70 percent of all change efforts fail.* Further analysis reveals a theme across the majority of failures.
The Achilles’ heel of virtually every change program? Old habits. Despite living in a world offering an endless stream of remedies, we fail to change because we cannot shake old habits. We literally get in our own way. Despite genuinely wanting to change, we fail. The ultimate self-sabotage was revealed in a different study showing heart patients who were told to change their lifestyle to avoid, well, death. Only 10 percent were able to override their old habits to develop new ones. If people can’t change when their very lives are on the line, what hope do we have of changing when there is far less at stake?
The good news is research into habit change is exploding. The power of habits is drawing the attention of universities like Harvard, Yale and Duke, and the investment of corporations like Google, Microsoft and Proctor & Gamble. As a result, we know far more about how habits are formed—and how to break them—than we did even a decade ago.
At my firm, Wray Group, we capitalize on the science of habit change to support people to make the changes that matter most. We target the control center of habits, the mind-set. We teach clients how to identify the limiting beliefs that compel them to cling to old habits. We help them create change from the inside out.
To illustrate how, I’ll share the story of a client who learned to change some less-than-congenial ways of dealing with co-workers—habits that earned him the nickname “Powderkeg.”
It didn’t take much to set him off. As his nickname implied, Powderkeg had a reputation for a hair-trigger temper marked by sudden outbursts of “industrial language.” He was hotheaded, in your face, intimidating. And he was proud of it. His way of dealing with people, he believed, was necessary for success in a tough, industrial workplace. He wasn’t the only one who thought so. The other managers all admired him, because he got results. Then, one day, everything changed.
The executives at Powderkeg’s company announced it was time for a new management style—a new culture. Instead of imposing management’s agenda from above, their strategy was now to engage employees by “collaborating” with them and “empowering” them. The game had seriously changed.
But could Powderkeg? He was in his mid-50s. He had been a good soldier, defending the interests of management for 20 long years. He had the look of the grizzled veteran that ABC Sports loves to zoom in on during double-overtime in game 7 of the NHL playoffs—piercing eyes, lined and leathered face, more salt than pepper in his hair. He was one of the old dogs. And now he needed to learn some new tricks. The habits that had made Powderkeg a success looked like they could now be his undoing.
Fortunately, his employer was as committed to him as he’d been to the company. His superiors were willing to help him change to fit the new corporate culture. But he needed more than just a few adjustments around the margins—he needed a serious behavioural makeover. That’s how we came to know Powderkeg at Wray Group.
Follow Powderkeg as he embarks on his journey to habit change. We’ll also be sharing the story—and the science behind it—on April 26, 2016 at the HRMA Conference in Vancouver, BC.
*Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage, Scott Keller, Colin Price, 2011
Adaptive vs Technical Challenges
When an orca (killer whale) threatens a pod of other whales, the orca can occasionally succeed in picking off a stray. Whales know how to respond to this kind of threat. Yet today, when faced with whaling ships using cannon-launched, grenade-tipped harpoons, whales' instincts fail. Whales risk extinction unless they figure out how to disarm this new threat. Professor Ronald Heifetz of Harvard University has called this an "adaptive challenge."
In contrast, Heifetz would classify the challenge the whale hunters face as a "technical challenge," that is, how to retrieve a harpooned whale before it sinks in the ocean. The hunters successfully addressed their technical challenges, and today, the latest technology ensures them an optimal kill.
When organizations cannot learn to adapt to new challenges, they risk facing their own form of extinction. Yet, in truth, it's not organizations that are changing; it is the people within them. And when people must change their habits and routines, statistics show that we prove as adaptive as an endangered species.
The essence of the difficulty in addressing an adaptive challenge is that we are up against instincts, old habits, and established routines—all of which die hard (and most of which live on, long past when the changes are launched).
Before embarking on change, assess whether the challenge you face requires a technical solution or an adaptive solution. If it is the latter, the approach must recognize the intricacies of adaptive change to increase the odds that people will successfully overcome the challenges they face.
Why a Burning Platform Is Not Enough
The “burning platform” story has become a permanent part of organization change language. The expression came from the reports of an oil rig disaster in 1988, when an injured Andy Mochan was faced with plunging 15 stories from the burning platform, with no guarantee of rescue, into a frigid sea full of flames and debris.
He said, “It was either jump or fry.” He chose possible death over certain death. Andy jumped because he felt he had no choice—the price of staying on the platform was too high.
Traditional advice in organization change instructs leaders to fan the flames—create the proverbial burning platform and a high cost to maintaining the status quo. How does this logic measure up?
In their book entitled "Immunity to Change," * Harvard Professors Robert Kegan and Lisa Lahey address this question with a reference to a recent medical study. The study showed that "...when heart doctors told their seriously at-risk heart patients that they would literally die if they did not make changes to their lifestyle, still only one in seven could make the change. We can safely assume that the other six wanted to live, see more sunsets, and watch their grandchildren grow up. They knew the urgency. They felt the incentives. The understood the change required. Still they couldn’t do it.
If a heart patient cannot make changes when their very lives are on the line, then how can leaders at any level, in any kind of organization, expect to support processes of change—even those they and their subordinates may passionately believe in—when the stakes and the payoffs are not nearly as high?"
It is not a surprise therefore that of the failed attempts at organizational change, 72% are due to Employee Resistance and Management Behaviour not supporting the change**. But to condemn those leaders and their subordinates as "lacking the will" to change would be unjust. Chances are many of them wanted to change, but couldn't.
If senior leaders are to successfully change themselves and their organizations, what is needed is an understanding of how to close the gap between what we genuinely, even passionately, want and what we are actually able to do.
*Immunity to Change: How to Overcome It and Unlock Potential in Yourself and Your Organization, Robert Kegan and Lisa Laskow Lahey, Harvard Business Press, 2009.
**Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage, Scott Keller and Colin Price, John Wiley & Sons, 2011.