Are your leaders ready for change?
Static organizations are often left behind, and without change, companies often perish. Sears did not change; Amazon did. Yet change requires that company leadership embrace a future vision and wholeheartedly propel the organization toward it. That said, the board can foster a leadership team that is ready for the strategic shifts that not only drive stakeholder value but may even be fundamental to survival. How? Consideration should be given to whether company leaders and the employees they lead can do the following.
- Be in the right frame of mind for change. Are leaders distracted by large, lingering, day-to-day problems that need to be resolved before transformation can take place? If daily pain points are not addressed, there won’t be a lot of positive energy left to strategically champion change.
- Believe the change is reasonable and achievable. Has the CEO mentioned any practical barriers? Is the board getting any hints that leaders believe the change is too large to be surmountable? Can the CEO celebrate what people already are doing that aligns with the new direction the company will follow? Are leaders able to talk about the change in terms of what already has worked for other companies, or analogize the change to a success elsewhere within the company?
- Believe the change will result in a positive outcome for others and for themselves. Leaders may go through the motions but still not believe that modifying current practices will net the expected results. Do they understand the tangible effects of the change on others—employees, vendors, customers, shareholders? And can they explain the change in a convincing fashion?
- Know exactly what they are supposed to do and what they expect their employees to do. This is more difficult than it sounds because people tend to overestimate their own performance and some assume changes don’t apply to them. Also, absent clearly defined steps, it is easy for leaders and employees to have different interpretations on new ways of doing business. Are leaders thinking abstractly, or will they provide concrete direction so that changes are manageable and well-defined?
- Know that they may need to stop doing something in order to make time for change. People value what they are used to doing, so when asked to do something new, they assume it is in addition to what they already do. Will every request for something new be accompanied by a request to stop doing something else? It is important that leaders and their employees know what to stop doing in order to create capacity. If it is not possible to simply stop, are they able to delegate tasks?
- Believe they will be accountable to make change happen. Leaders and employees generally make time for those tasks for which they are held accountable. Unless individuals are held directly accountable for implementing change, many will resist the change out of fear that, at least in the short term, it will hurt their performance metrics. If implementing a change is critical to achieving a larger strategy, individuals have to be held accountable for making the requisite adjustments from where they sit within the organization. Consider breaking a change into concrete goals at specific intervals. It’s difficult to hold someone accountable for vague goals.
- Perceive they are role models. People tend to follow the herd. Once you get the herd moving, people will naturally follow because no one wants to be left behind. On the other hand, it can be difficult to get the herd moving. Will leaders have appropriate messaging to motivate people to implement change? Strong emotion can have a ripple effect and help change resonate with everyone. This includes equipping other influential leaders—for example, division, local, and plant heads—to lead their teams through the transition period. When a company announces a change, employees will look closely to see how their team leaders react. Are leaders willing to carefully equip team champions to deliver change messages? Cursory attention at the team level undermines the corporate message.
Article originally appeared in NACD's Directorship magazine May/June 2019 issue.