When traditions are challenged, change management process begins
21 Oct 2012 - {{hitsCtrl.values.hits}}
By Lionel Wijesiri
In times of crisis, how do we keep ahead of our competitors? We realize the market place is changing rapidly that nothing stays the same for more than a moment. How do we get a workforce and the company to shift directions fast to face a future that is almost unknowable?
In such complex and challenging times, most business bosses keep saying, “We need to be more strategic.” The problem is, we generally don’t say what we really mean by that or more important, how to do it.
I would suggest a simple definition: Being strategic means consistently focusing on those core directional choices that will best move you toward your hoped-for future.
That might be a deceptively simple sentence. It implies that we know where we are starting from, that we are clear about where we want to go and that we will make core choices about how to get there with a consistent and focused effort to travel down our clear path.
Erika Andersen, Management Consultant and author of ‘Stay Ahead of Change’ has created a practical approach for doing just that, for creating realistic vision and strategic map for a business and then using that map to navigate through rough waters or calm.
wDecide what you’re solving for. Amazingly, often business people try to solve problems without first getting completely clear on what those problems are. That can lead to the team arguing about solving a problem that hasn’t been properly identified. Only once you have a clear and agreed-on sense of the core challenge you’re trying to address-- from “How can we provide a uniquely valuable customer experience that drives our business’ success?” to “How can we build a manufacturing team that delivers on our business model?”--can you begin addressing that challenge.
wKnow where you’re starting from. Once you’re clear on your challenge, it’s important to have an accurate and balanced picture of your current reality relative to that challenge. It’s all too easy to avoid looking at or to underestimate the less pleasant aspects of your situation. Is the slump in July sales just an anomaly, for instance, or is it part of a larger trend? Being a fair witness of your own business is an essential and underutilized skill.
wGet clear about your hoped-for future. In difficult times it’s always easy to retreat into survival mode. Having--and consistently articulating--a clear sense of your hoped-for future for the business gives your employees a positive frame for action and offers an antidote to fear. If your people know that, say you intend to double your number of retail outlets over the next five years; they’ll respond with significantly improved morale and productivity.
wFace the obstacles. Once you’ve decided and articulated the future you want to create, it’s essential that you be very accurate about the obstacles you’ll have to overcome to make it happen. Executives--and human beings in general--tend to either over- or underestimate the importance and impact of obstacles. Here again, it’s critical that you be a fair witness. Look at the possible obstacles to your vision in a dispassionate and objective way.
wMake core directional choices and then get specific. Strategies mark out the pathways that will lead to your hoped-for future. For example, ‘concentrate on new product growth’ or ‘build a national sales force’. Strategies are core-level decisions about how to best focus your time and energy. Business people often move straight from vision to tactics without establishing clear strategies and they end up with uncoordinated efforts that don’t make the best use of important resources.
Erika says, “Your goal is to navigate through these changing times while positioning yourself and your company for future success. Following these basic steps can take you from simply saying, “We need to be more strategic” to actually doing so and reaping the rewards that follow.”
Status quo police
“That’s not how we do things around here.” How often have you heard that? And what does it really mean? It is said to stop someone from doing something new. It is no way to promote innovation, is it?
Organisations lock in on the things that helped them succeed early on. They perpetuate what worked last year. The ‘status quo police’ make sure that happens. Hierarchies make sure nobody runs off the reservation spending money on crazy, new ideas.
“That’s not your problem,” you hear, or “The bosses won’t go for it” or “That doesn’t seem practical or necessary.”
Commitment to the company’s existing technology, product line and distribution system or customer base becomes a sacred cow. Microsoft’s commitment to PC technology has kept it investing in operating system and office automation software for the last two decades, while losing more than two-thirds of its market share in smartphone operating systems and delaying its entry into the fast-growing tablet business, where Apple has had astoundingly profitable revenue growth.
Dell likewise missed both markets as it kept its focus on its supply chain strength. Both Microsoft and Dell have stagnated in market capitalization as customers shifted to newer technologies.
The status quo police institutionalize initial metrics. They insist that any innovation should achieve the proper margin, order size or net price or be abandoned--regardless of shifting market demand and potential future growth. Motorola avoided smartphones, seeing them as a small business even if one with higher than traditional margins. Instead, the company focused on maintaining its market share targets with its lower-margin sales of ordinary cellphones. Its profits disappeared while Apple soared with an iPhone that had less than 5% market share but a business designed to reap much higher margins.
Such destructive norms couldn’t be sustained if there weren’t people anointed to enforce rigid adherence to them. Those are the status quo police. Their job, first and foremost, is to make sure that historical ways of doing business are not altered. It is not to focus on positive business results. To the contrary, it is to make sure the organisation stays with the tried and true regardless of results. The police simply assume that results will be good if the status quo continues.
Evaluation
Take a hard look. Does your human resources department seek to hire ‘the right kind of person for our company’? Does its employee review process focus as much on getting along with peers and supporting cultural norms and supporting the company purpose as on meeting business objectives and getting measurable results? Such HR practices keep a company from hiring, promoting and rewarding people who don’t maintain the status quo.
Does your finance department review all proposals concerning new products, distributors, manufacturing processes or market entries and comment on whether they meet internal hurdles for gross margin, net margin and risk-adjusted return on investment? Does it require detailed financial models for anything new, challenging the numbers for anything outside the most common historical practice? If so, your finance managers are the status quo police, keeping the business from doing what may be competitively necessary though frighteningly new.
Does your marketing department tightly control what products can carry the company’s brand name? Or resist selling through new distribution channels for fear of upsetting old distribution lines? Marketing department managers enforce status quo adherence by making sure they protect old norms first and they avoid venturing into new products or new ways of distribution regardless of what is happening in the marketplace.
Talent
I believe that the key to helping a company survive is the talent. It takes a team of people who have the same vision, the same perseverance, the same courage of conviction, who are willing to walk in the darkness, every day, one foot in front of the other, until they see the light. Without vision you can’t rebuild. Most companies die because they stagnate; they don’t change, and they lose the innovation. So in the end to truly add value, you need to breathe new life through innovation.
It’s the merging of cash and creativity, which means, first, you must stop the bleeding, stop spending what you don’t have, in the hope that it will return. But then the second step is truly about innovating, understanding where the world is going, where the industry is going, where the economy is going. The closer you can get to touching that customer yourself, the better your business will be, because you will understand how and what they want and need. (The writer is a corporate director with over 25 years’ senior managerial experience. He can be contacted at [email protected])
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By Lionel Wijesiri.jpg)
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