Concepts & Methods
...in the moment
...in the meeting
...in the macro process of organizational transformation
The Process of Organizational Transformation
The Process of Organizational Transformation
Compelling Needs and Opportunities
The source of transformation in an organization or system is the set of compelling needs and opportunities, which confront it in its market environment. While change in the environment is continuous, and the ideal organization continually adapts, in reality, transformation, and as we address it here, is launched out of a sense of urgency. Effective transformation enhances the organization's capability for future adaptations to its changing environment.
Existing Mental Model(s)
In an organization the mental model(s) may represent the business model as to how the business differentiates itself, seeks to achieve competitive advantage and grows sustainably. Mental models guide our perceptions and also may represent ideas concerning effective culture, business processes and organization design.
Our existing mental models are frequently disconfirmed by emerging compelling needs and opportunities. This disconfirmation triggers the need for transformation.
The disconfirmation of existing mental models by the emerging compelling needs and opportunities creates a turning point. The system is poised either for a planned process of dialogue and ensuing virtuous circles of performance or for an unplanned process of resistance and denial and the vicious cycle of dysfunctional behavior.
Resistance and Denial
Not infrequently the challenge posed by the disconfirmation of existing mental models is met by resistance to enter into dialogue. This is coupled with denial and the associated frictions between perceived proponents and resistors of change. This dynamic creates a vicious cycle in the system of poor communications and dysfunctional relationships. Cultural pre-conditions can pre-dispose the organization to this pattern. Some individuals and cultures are more inflexible and sealed than others and these usually tend toward authoritarian values and behaviors. Other individuals and cultures are so geared toward and invested in certain goals (the proverbial "idée fixe") that when those goals are compromised, the threats are inadvertently ignored.
As the need for transformation builds in the face of resistance and denial, the turning point evolves into a crisis. The choice, conscious or unconscious, becomes more urgent either finally to address the disconfirmation of existing mental models through a planned dialogue process and seek a new vision or to continue to resist and deny that the need exists.
In the crisis, when the need for transformation continues to build and resistance and denial persist, the inevitable outcome is the vicious cycle ends relationships-i.e., termination. Examples include firing, quitting, bankruptcy, divorce, etc.
Decide and commence a transformation process which is grounded in dialogue
Some leaders and systems are inherently open to seek and explore emerging compelling needs and opportunities and how they may disconfirm existing mental models. They have built in numerous feedback loops, formal and informal, personally and organizationally. These leaders and systems are the early adopters of transformation. They see the processes of disconfirmation earlier than their peers and competitors. Innovation leaders are prime examples. They invent new products, services, businesses or even industries. They see, before others do, the new needs and opportunities and how existing mental models are not suited to address them. They decide to engage the organization in a transformation process, which is grounded in dialogue.
The first question addressed by the leadership team in the transformation process concerns the new direction. What should be our new, urgent vision? Over the years in working with numerous client organizations, we have refined our framework for helping clients develop their "Urgent Vision™". It includes the following dimensions:
- Sustainable business model by which the company
- grows revenue and profit
- differentiates itself
- develops and implements its strategy
- balances the short, medium and long term for sustainable competitive advantage
- Inspiring values by which
- senior management leads the organization individually and collectively
- organizational members are guided to behave
- HR policies, processes and systems are aligned to support the values, principles and behaviors
- the culture is defined
- Competitive Business Processes: how the business does its work and what must be the core competencies of the business. Typically the competitive business processes include
- Business and strategic planning
- Innovation, R&D, product development
- Supply Chain, Manufacturing or service delivery
- Marketing and sales or customer management
- Enabling processes: Finance, HR, IT, Governmental Relations, etc.
- Synergistic organization design:
- The organization structure and the allocation of roles, responsibilities and decision authorities across the business processes.
- Clarity in the interfaces between those responsible for brands/products, geographies and functions.
The potential agenda for action in the Urgent Vision can be huge. The top management team decides on transformation priorities for the first iteration of the transformation process to assure quick wins and adequate allocation of resources.
Launch Teams and Implement
Detailed action plans are completed and implementation occurs with and through the launching of cross-functional teams. Teams are guided and facilitated utilizing the ground rules for dialogue.
Implementation is refined and solidified as behaviors are aligned to support the new direction, including the new culture and strategy. In our experience, several actions are essential to the process of aligning behaviors consistent with the new vision.
Revisit the Urgent Vision
- Role modeling by leaders
When leaders "walk the talk", others in the organization learn what kinds of new behaviors are expected and frequently emulate that behavior.
- Feedback on behavior
This means that colleagues learn to give one another feedback on their respective behavior. This includes describing the behavior and sharing the impact the behavior has had substantively and emotionally. It also includes testing assumptions about why we think the person behaved as he or she did. In our experience, effective relationships are characterized by skillful feedback on behavior.
Organizations are characterized by objective and subjective outcomes. The disciplines of total quality, including such formal manifestations as the Baldrige Award in the USA, the European Foundation for Quality Management and the Six Sigma process, are all grounded in rigorously measuring outcomes to assess the degree to which goals are achieved and changes may be needed in processes.
Achieving aligned behavior across and organization is also a function of formal and informal reward systems which focus on desirable behaviors. This may include compensation, career development, recognition, etc.
New behaviors also may require conscious learning within the framework of training and leadership development.
- Freedom within the Framework
The elements of the Urgent Vision serve as a guiding framework, which all organizational members are encouraged to utilize as a guide to their own behavior. In a complex organization is neither possible nor desirable to prescribe every detail. The concept of "freedom with the framework" empowers consistent, aligned behavior.
The process of transformation in systems is dynamic and continuous. Periodically, the leadership will find it necessary to update the vision in consideration of new emerging compelling needs and opportunities and introduce other cycles of transformation.