We live in times of exponential transformation and CHANGE [C]. Companies, that have been around for more than 100 years die, while others, that didn’t exist yesterday, become world leaders tomorrow. So, what does it take to survive?
We believe the formula to achieving successful change comprises of six key levers:
Define the what
First, you need a VISION [V] about the future of your business. That sounds easy but actually is a very difficult task. As human beings, we use to think in linear extrapolation. This is also the way how we approach strategy, planning, and budgeting. However, our brain – perception, and cognition – finds it hard to work in exponential mode. We can easily calculate 2×10, but we find it hard to imagine 2^10 – actually, it is 1024. Moreover, we tend to average things. If we have ten competitors we know, we find it hard to anticipate the impact a ‘new kid on the block’ might have. Any ‘black swan’ hits us by surprise. So anticipating the potential degree of change to an industry and defining a corresponding vision is hard. Bloody hard. Because it often means to forget everything you believe to know about the industry you are operating in.
Second, in order for people to engage themselves in something, they need to believe in it. Without meaning, it will be hard for anyone to be motivated to jump the barriers of persistence and move forward into an uncertain future. Because there is nothing that feels more comfortable and secure than the status quo – even if everyone knows that things can’t go on as they used to. Thus, you need to anchor your vision in an aspirational and shared PURPOSE [P] that truly resonates with people – both, their hearts and minds. An aspirational destination that everyone finds to be worth engaging themselves in and fighting for.
Third, you need to translate your vision and purpose into a sound, inclusive and actionable STRATEGY [S]. It’s good to know where you want to go and why, but if you don’t know how to get there, you will fail. It’s as bad as being a trained wanderer without a clear destination, just walking on and on and on … Thus, your strategy should include all initial investments, initiatives, processes, responsibilities, and timelines that you aim to put into action to achieve your vision.
Manage the how
Fourth, culture eats strategy for breakfast. So, the key task of you as a leader that needs to manage transformation and change, is to evolve your business’ culture to support the strategy. This is where the real change begins and your whole business needs to step out of its comfort zone. What worked well yesterday might not work as good anymore when everyone starts trying to deliver against your vision, purpose, and strategy. By default, this is the bumpy part of the journey where most change initiatives fail.
Thus, the key skill your organization needs to develop is RESILIENCE [R]. Because changing business culture is a rollercoaster journey with lots of ups and downs. Here, the highs are not the issue, but getting out of the lows without giving up is crucial.
Fifth, all your efforts need to be tailored to the degree of DISRUPTION [D] that you envision, or anticipate for your business. This can be defined by your own ambition, or by the degree of change forced on you by other players inside and outside your industry. Black swans sometimes not even turn out to be swans, making the job of fore-sighting and anticipation as hard as never before.
Finally, all of the above is not a linear ‘plan, execute & control’ process, as you might have been able to follow in the past. Anticipating industry disruption and the need for corporate transformation and cultural change is an ongoing, iterative process that needs to happen in real-time. It means constant evaluation and revision of all elements over TIME [T] – as needed.