Do You Have Change Fatigue?
Many corporate change efforts are greeted with rolling eyes from employees. Harvard Business School professors David Garvin and Rosabeth Moss Kanter help identify the keys to a successful company transformation.
Chances are you've got a story like Andrea Zintz's. Now president of Andrea Zintz & Associates, a consulting firm in Pennington, N.J., she was working for a health-care concern in 1997 when the firm's executive committee decided to launch an innovation initiative for 800 managers across all of its operating companies. Two weeks after the kickoff event—three fabulous days of inspirational talks by inventors, creators, and consultants—each attendee received a big box with the words "Tool Kit" on the front. It was filled with binders, pamphlets, videotapes, all kinds of useful information—and it sat on managers' shelves. No follow-up ever took place.
You're probably laughing—or wincing—in recognition of what has become a familiar tale of corporate change efforts. Indeed, with all the transformation efforts going on these days, the workplace seems to have transmogrified into one continual change initiative. Maybe it's a relief to know that only a few of these efforts will actually be carried through to completion, but that knowledge doesn't do much for morale. Change fatigue is rampant, and it's exacerbated by a natural tendency to distrust change that is imposed from above.
The remedy, say the experts, flies in the face of the revolutionary approach to change that reigned during the dot-com era's heyday: Pare down the number of initiatives. Be less preoccupied with large-scale transformation, and focus instead on small improvements. Above all, lose the notion that you need heroic leaders in order to have meaningful, sustained change.
Why change efforts fail
"Change is one of the few areas where experts have been in violent agreement for decades," declares David A. Garvin, Robert and Jane Cizik Professor of Business Administration at Harvard Business School and author of nine books, including Learning in Action. The details vary, but in the main, all organizational change involves three phases: an initial stage of recognition and preparation, followed by the implementation of the actual changes and, finally, a period of consolidation (see Close Up). These phases are not linear, Garvin emphasizes: all three must take place for the change to work, but not necessarily in the order just described. Moreover, for each stage to be even marginally successful, certain conditions must be met.
In the first stage, the organization must evince widespread dissatisfaction with the status quo. Someone must develop a vision for the future and a plan to get there. During the second stage, there must be a real willingness to take on the resisters—the most dangerous of these, warns consultant Mike Hammer, are the ones who give you "the kiss of yes." The consolidation phase is the time for measurement and rewards. The organization must be ready to make changes to the change plan, based on an honest assessment of what's working and what isn't. It is at these moments that the flexibility of an organization is put to the test.
Change efforts fail for two main reasons, says Garvin:
- Poor design. These include the failure to address the underlying processes used to get the work done (for example, the performance management system, or the way resources are allocated), relying on IT to provide the magic bullet, and not explicitly tackling the necessary behavioral changes.
- Poor communication. A change initiative is like the start of a marathon: change will be occurring rapidly in some units, whereas in others it won't even have gotten under way. Change leaders need to be prepared to give the same speech at least six times or it won't get heard. Unclear intent is another problem. A change effort at Xerox foundered amid mutual recrimination and finger-pointing when an economic downturn revealed a lack of clarity about who was really in charge. Change leaders must explain the particular initiative thoroughly, letting employees hear the arguments for and against the options that were rejected. In addition, they must address employees' fears: "People want to know why you think they can make it through the change," Garvin observes. "They also want to know how you're going to help them through it."
Meaningful change isn't easy, but you don't have to be omniscient to pull it off, Garvin insists. Like a 19th-century Mississippi riverboat captain steering his boat from one bend in the river to the next, you just need to rely on point-to-point navigation.
Putting lipstick on a bulldog
Not only are know-it-all leaders unnecessary for successful change, they often muck it up. Echoing Garvin, Rosabeth Moss Kanter notes that it's very difficult for leaders to spell out in advance precisely what the future state should look like—so many who try merely get it wrong. A good leader uses a humbler approach that Kanter calls IKIWISI (I'll know it when I see it). She compares it to improvisational theatre: you make the best judgment you can in the moment and remain prepared to adjust to whatever new conditions arise.
"Personally, I hate change," acknowledges Kanter, Ernest L. Arbuckle Professor of Business Administration at Harvard Business School and author of 15 books, including Evolve! "But I love renovating my house." Her point: nobody likes change when it's something that's done to us. But change that we think up or embrace on our own is different—that kind of change we never grow tired of.
Kanter likens the typical change effort to "putting lipstick on a bulldog." Here, the business leader sees something that's ugly, such as a process or a product that needs improvement. The leader wrestles with the change, and finding it difficult to get the thing to behave properly, decides just to make it look superficially better and move on. And the typical result of this misguided cosmetic effort? The bulldog's "appearance hasn't improved, but now it's really angry," says Kanter. Instead, she claims, "the key to substantive improvement lies in creating an environment in which employees don't even know that they're changing." Ricardo Semler, president of Semco, a privately held manufacturing and services company in São Paulo, Brazil, heartily agrees: by giving up the need to be in constant control, management allows change to happen on its own. Such a formula, he believes, has enabled his company to eliminate the "boarding-school issues" that take up 20% to 30% of managers' time—and that many formal change programs are designed to address.
Often described as "the world's most unusual company," Semco epitomizes the bottom-up approach to change. Employees choose their jobs, titles, places, and hours of work, and even pay. Everyone in the company has a 360-degree evaluation every six months; these evaluations form the core of any needed change. Leaders are picked by their subordinates, and almost always come from within the company, so that no radical changes are imposed by new leaders from the outside trying to make a good impression. The CEO's position changes continually: four people regularly rotate through the job every year. The company doesn't even try to do annual budgets—six months is as far down the road as it can see. In short, Semco redefines change: instead of being the work of senior leaders, it's the responsibility of what Semler calls "atoms," groups of eight to twelve employees who see to the company's basic processes. As a result, change becomes continual, gradual, low-level—and virtually unnoticed.
Kill the hero, save the change
The applicability of Semco's model to large corporations is a matter of some debate. Nevertheless, Henry Mintzberg, a professor of management studies at McGill University in Montreal, finds Semler's views well worth emulating. They're so refreshing, he says, because they run counter to most companies' tendency to overmanage; they manifest "the brilliance of knowing when to lay off." The notion that "change comes from the top," Mintzberg declares, is a fallacy "driven by ego," the "cult of heroic management," and the peculiarly American overemphasis on taking action. If companies in fact depended on dramatic, top-down change, few would survive. Instead, most organizations succeed because of the small change efforts that begin at the middle or bottom of the company and are only belatedly recognized as successful by senior management.
Enron, with its "loose-tight" management policy, is an example of an organization that has figured out how to effect change without the usual pitfalls, says Mintzberg. The Houston-based energy company manages only two corporate processes very tightly: performance evaluation and risk management. Everything else is managed loosely, and local leaders get an enormous amount of discretion in figuring out how to get things done.
Change leaders need to be prepared to give the same speech at least six times or it won't get heard.
Mintzberg argues that the best kind of leader doesn't try to effect much change. Rather, she functions like a queen bee, which "does nothing but make babies and exude a chemical that keeps everything together." It is the other bees that busy themselves in going out to sense the environment, find sources of sustenance for the hive, and make the changes necessary to keep the hive alive in the face of an evolving environment.
To a certain extent, the media hype of the dot-com era required that leaders present a heroic face to the capital markets. Here's one reason to be thankful that the bubble has burst: no longer obsessed with the need for larger-than-life leaders and their grand strategies, we can now focus on a quieter, more evolutionary approach to change, one that relies on employee motivation instead of directives from on high.
Reprinted with permission from "How to Overcome Change Fatigue," Harvard Management Communication Letter, Vol.4, No. 7, July 2001.
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Nick Morgan is the editor of the Harvard Management Communication Letter. He can be reached at email@example.com.