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Organisational Change: High-Risk – High-Reward & How to Do It Right

Most organisational change efforts take longer and cost more money than leaders and managers anticipate. In fact, research from McKinsey & Company shows that 70% of all transformations fail. Why does this happen though?

For many reasons: a weak culture that isn’t aligned with the mission, leadership misalignment, lack of participation and buy-in, under-communicating a powerful vision, over-communicating a poor vision, competing priorities, not enough training or resources, and so on. But one very critical roadblock standing in the way of bringing a change vision to fruition is what experts call ‘change battle fatigue’. Change battle fatigue is the result of many elements such as past failures plaguing the minds of employees, the sacrifices made during the arduous change process, and rollout strategies taking longer than anticipated. When a transformation is poorly led, fatigue can set in quickly.

And not only do 70% of organisational change fails, but that failure rate may even be increasing. According to older but still very relevant 2008 research from IBM, the need to lead change is growing, but our ability to fulfill a change vision is shrinking. Hence why people often get discouraged and eventually give up. Even when companies make great strides while building a change culture and preparing for the ‘change battle’, fatigue can derail even the most valiant efforts for change—essentially leading to losing the ‘change battle’.

It’s difficult for managers and staff to get motivated when they believe that the latest ‘new initiative’ being preached from above is going to die just like the last one—no matter what they do. Furthermore, fear makes change intensely personal. People become concerned about their jobs, families, and long-term career path. When people are afraid, most can’t hear or think as well. It’s much harder for them to absorb important information when panic starts to set in. This can be a big distraction that undermines the team’s ability to focus and stay productive. And times of change are when you need them more focused than ever.

Thus, the often-cited failure rate of organisational change continues to hover around 70%. If you’ve got a major change on the horizon, here’s how to avoid the most common ‘saboteurs’ of organisational change.

Underestimating the work

Simply put, most leaders want organisational change to be easier than it is. By its nature, transformational change creates discontinuity because it touches the entire company. In the case of a financial services company, shifting from product to service centricity meant every aspect of the organisation, from sales to operations, is going to be touched by the need for change.

By contrast, incremental change — for example, implementing a new technology platform or launching a new product — touches discrete aspects of the organisation. Most companies makee the same mistake: They assume that a larger volume of incremental changes would add up to a complete transformation. Henceforth, they spray the organisation with numerous, disconnected initiatives whose efforts weren’t coordinated, that were actually under-resourced for what they were expected to deliver, and whose project leaders lacked the authority to make material decisions or impose consequences on those unwilling to cooperate. Instead of accelerated change, the result was obstructed change — a system clogged with an overload of disparate efforts that everyone stopped caring about.

A multifaceted transformational change needs to be appropriately scoped, resourced, and integrated. Every initiative must be linked to every other initiative. In the case of most organisations, efforts to market the benefits of newly positioned services need to be synchronised with the efforts of operations people to actually deliver those services. Messages to customers needed to sync with new skills those delivering the services needed to acquire. Centralised services from corporate needed to work closely with local branch offices’ ability to customise services. And it all needs to be sequenced and paced in a way the organisation could productively absorb. Once these efforts are appropriately integrated, means and ends will begin to match, and real organisational change eventually aligns with the messages.

Creating Cultural Experiences That Support The Vision

Cultural experiences are imperative to instill the proper mindsets and beliefs that drive actions that get results. What are cultural experiences? They can be anything from how people interact, the work environment, how the company approaches its customers, company meetings and events, hiring mechanism, to where people sit.

There are four types of cultural experiences as they relate to organisational change:

(1) positively impact change and needs no interpretation;

(2) positively impact change but needs more interpretation to engage the team;

(3) has no positive or negative impact the change effort;

(4) has a negative impact on the organisation.

Type 1 and type 2 cultural experiences help drive engagement and belief in the mission. They keep the team energised.

Emotional Intelligence & Increasing Situational Awareness

In combat, situational awareness is an obvious necessity. Not always easily achieved but a constant priority requiring good communication and leadership at every level. Situational awareness at the individual level could also be described as self-awareness – a key component of emotional intelligence.

Emotional intelligence is widely known to be a key component of effective leadership, especially when navigating change and uncertainty. The ability to be perceptively in tune with yourself and your emotions, as well as having sound situational awareness, can be a powerful tool for leading a team in VUCA (volatile, uncertain, complex, ambiguous) environments. The act of knowing, understanding, and responding to emotions, overcoming stress in the moment, and being aware of how your words and actions affect others is described as emotional intelligence. Emotional intelligence consists of these four attributes: self-awareness, self-management, social awareness, and relationship management.

For example, a study of over forty Fortune 500 companies showed that salespeople with high emotional intelligence outperformed those with low to medium emotional intelligence by 50%. The same study showed that technical programmers who fell in the top 10% of emotional intelligence competencies were producing new software at a rate three times faster than those who fell in the lower ratings.

Emotional intelligence also improves employee satisfaction, something vitally important during any change effort. A West Coast bank was forced to cut almost one-third of its staff due to the economic downturn back in 2008. Determined to survive the ‘change battle’, the leadership team invested in assessing the remaining staff for their levels of emotional intelligence. The results supported their transformation goals to ensure they not only had the right people on the bus but that those people were in the right seats—doing jobs best suited to their capabilities. The company survived and is now more productive and more profitable with fewer employees.

It’s hard to make organisational change turn out the way you want to. But by doing your due diligence and creating the plan that makes the most sense for your company, you’ll increase the chances your change management efforts are successful. As a result, you’ll have a strong, healthy company that’s well-positioned to keep dominating for some time to come.

Given our current situation knowing that your colleagues or employees are best suited for this new scenario we find ourselves in. Finding the right talent, the best fit for the job and your organisation can be a very challenging task. It is now important to find out whether your managers or your team is well-equipped of working together from various locations. It requires deep knowledge of their personalities, strengths, weaknesses, interests, work style and other characteristics. Our technology and solutions will do the work for you, helping you discover if your people are resilient during times of hardship, if they are autonomous, if they are team players, without actual human contact. Given that our platform is cloud-based, everyone can use it from home as well. Humanity finds itself at a crossroad for various reasons now, why not help people discover and develop themselves from the comfort of their own homes?

Request a free demo:

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Sources:

https://hbr.org/2021/04/how-leaders-get-in-the-way-of-organizational-change
https://www.pulselearning.com/blog/6-steps-effective-organizational-change-management/
https://www.tinypulse.com/blog/sk-successful-organizational-change-examples

Has the CEO Position Evolved to a Two-Person Job?

When Netflix announced this summer that it was elevating Chief Content Officer Ted Sarandos to co-CEO, sharing the title with founder Reed Hastings, the move cut against conventional wisdom. Salesforce.com, SAP, and Oracle all had abandoned co-CEO structures within the last year, leading The Wall Street Journal to ask: “Co-CEOs Are Out of Style. Why Is Netflix Resurrecting the Management Model?”

In the hierarchies of corporate America, there’s nothing ambiguous about the position of “chief executive officer.” Whoever holds the CEO title sits at the tip-top of the org chart; it’s right there in the capital C. But what happens when that designation—and the power it implies—is shared? 

That’s the unusual experiment that several companies have undertaken in the past few months, splitting the role of CEO between two executives. In September, WeWork’s parent named two interim CEOs, Sebastian Gunningham and Artie Minson, to replace founder and spiritual guru Adam Neumann, who stepped down as the embattled shared-office giant postponed its IPO. (The pair will be replaced in February by a single new CEO, Sandeep Mathrani.) Software giant SAP in October named Jennifer Morgan and Christian Klein co-CEOs—the third time the German company has opted for the dual-leader arrangement. And in January, luggage startup Away wound up with two CEOs after former chief Steph Korey returned to cohead the company just weeks after reports of toxic work behaviour prompted her to step down. She’s now splitting the position with Stuart Haselden, the former Lululemon executive whom Away had initially tapped as Korey’s lone replacement.

The truth is the archetype of the omnipotent CEO — the lone commander atop the corporate pyramid — is increasingly a relic of 20th century management thinking. There are some notable exceptions: Founders like Jeff Bezos, Elon Musk, and Mark Zuckerberg still command and control. But in our research with the American Psychological Association, we’ve found that for most mere mortals, it’s simply too hard to go it alone. The modern business landscape is too fast-moving and the demands on a CEO have become too innumerable for a single person to set an organization’s strategic direction and oversee a multitude of internal decisions, all while acting as its public face to stakeholders.

Tellingly, while executive teams have doubled in size over the last three decades as different corporate functions have gained importance (human resources) or have come into existence (digital strategy and data security), the top job has largely remained a solitary grind. As entrepreneur Joe Procopio has observed, “The math on giving 110% usually breaks down to giving 10% across 11 different priorities.”

At the same time, the expectations of modern leadership have evolved. Organisations are more agile, less hierarchical, and must adapt quickly to the sudden dislocations we have today. Generational shifts in the workforce and society bring rising social consciousness of inequalities and a mandate for including others with different experiences into decision-making. These exigencies have made non-traditional soft skills essential additives to leadership.

There are four basic rules on how to 2 CEOs should cooperate when they both are running the company.

1. Pick the right partner. Co-CEOs are in a very real sense professionally married. The foundational qualities of such an enduring personal relationship also apply in a shared C-suite: a common vision, clear communication, and most important, deep trust. This sustains the partnership when, inevitably, there is a disagreement. Each must remember the other’s talents and make decisions knowing it’s still one P&L both must own. You cannot go into this arrangement without believing in the character of the other and vice-versa.

2. Set expectations. Critics of dual CEOs argue that shared accountability amounts to no accountability at all — if two are in charge, no one is. But properly managed, the opposite is true. The idea of joint accountability means setting performance standards that put each partner in the position of having to live up to the other. Ideally, this creates a healthy competition. Would-be CEOs are typically high-performing individuals, so clear lanes help each partner drive improvements in the other. Indeed, a 2011 paper published in Financial Review found that co-CEOs’ mutual monitoring can generate enough accountability to substitute for board supervision.

3. Define roles and responsibilities. The organization must understand who is in charge of which aspects of the company and where decision-making authority lies. We have a highly decentralized workforce — the two of us live in different cities — yet our managers intersect with us with a clear understanding of what types of decisions we are each responsible for. This is liberating in that it takes some daily responsibilities off each CEO’s plate. It also frees up time for skill-building around one’s dedicated areas, yielding more focused mentorship. And one leader can come into another’s problem from a fresh outside perspective. Clearly delineating areas of responsibility also mitigates another common criticism — that co-CEOs are a bottleneck. In fact, the structure often facilitates a quicker response because one individual has authority to make a decision from a greater depth of experience and knowledge.

4. Distribute authority but not responsibility. While each partner has individual duties, both must fundamentally remain a leadership unit, one in which successes and setbacks alike are owned together. These successes and setbacks should be reflected in short- and long-term compensation. They must be prepared to be rewarded or penalized as a unit and accept the consequences. With the right chemistry and trust, it incentivizes both healthy competition and having each other’s back. Another benefit of this conjoined career planning is that it can both temporary or long term. Some companies may see a co-CEO arrangement as a grooming opportunity for a junior leader.

Let’s be honest: The modern CEO is often overwhelmed by unrealistic demands. Netflix’s move to co-CEOs says less about the limitations of individual leaders than about a system that sets them up to fail. We believe business pyramids are stifling innovation, when a division of authority can unleash it. In unprecedented times like these, more companies should rethink their structures and embrace co-CEOs, putting their leaders in positions to succeed.

Given our current situation knowing that your colleagues or employees are best suited for this new scenario we find ourselves in. Finding the right talent, the best fit for the job and your organisation can be a very challenging task. It is now important to find out whether your managers or your team is well-equipped of working together from various locations. It requires deep knowledge of their personalities, strengths, weaknesses, interests, work style and other characteristics. Our technology and solutions will do the work for you, helping you discover if your people are resilient during times of hardship, if they are autonomous, if they are team players, without actual human contact. Given that our platform is cloud-based, everyone can use it from home as well. Humanity finds itself at a crossroad for various reasons now, why not help people discover and develop themselves from the comfort of their own homes?

Request a free demo:

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Sources:

https://hbr.org/2020/09/is-ceo-a-two-person-job?ab=hero-main-text
https://marker.medium.com/heres-when-it-actually-makes-sense-to-have-2ceos-64827d0ddb5c
https://fortune.com/2020/02/17/co-ceos-model-companies/

Does Productivity Soar by Working from Home?

Amid the Covid-19 crisis, working from home has become the norm for many. But even as remote work has normalised, it’s a recent development: doing your job from your couch was less mainstream before the coronavirus – and even stigmatised.

“Have you punched into Google image search, ‘working from home’, and looked at the top 20 images? They’re basically naked people, a guy drinking champagne in what looks like a jacuzzi. I mean, almost none of them are positive images,” says Nicholas Bloom, a professor at Stanford University in California. He’s made a career out of studying work practices, including remote work. And he thinks the attitudes around working from home are finally changing.

“One silver lining with the Covid pandemic: it’s going to kickstart working from home [moving from the] fringe to a mainstream technology that is commonly used across the country,” he says. That process is already under way; firms including Fujitsu and Twitter have already announced plans to make remote work a permanent option, even after the pandemic.

A study done by Nicholas Bloom, professor at Stanford University, back in 2013 somewhat forecast this trend: in his experiment, Bloom worked with a Chinese company to study remote-work productivity. Somewhat to Bloom’s surprise, the company’s staff became notably more productive by working from home four days a week.

Now, six months into the global pandemic, an increasing number of companies are asking: should we work from home indefinitely? And if they do decide to make major organisational changes about remote work, could they see similar leaps in productivity?

How Do Knowledge Workers Spend Their Time?

In 2013, knowledge workers spent two-thirds of their time either “managing across” in meetings, often with many colleagues, or doing “desk-based work” on their own. Externally focused work (e.g. talking to customers), managing down (coaching and supporting subordinates) and managing up (interacting with the boss and other senior people) all got very little time, while training and personal development got almost none.

How has this picture changed during lockdown? There were two significant shifts: 12% less time managing across through meetings and 9% more time doing externally focused work. Desk-based work continues to take a third of our time. Other changes — a little less time managing up and a little more time on training and development — were not statistically significant.

Standing back, the evidence suggests lockdown has helped us more effectively prioritize our work. We still need to get through our emails and report-writing. But we are significantly less likely to get drawn into large meetings, and this leaves us more time for client or customer work and for training and development, which most people would argue is a good thing. However, lockdown doesn’t seem to have helped with hierarchy-spanning activities (managing up and down), presumably because it’s impossible to have the short, spontaneous meetings that used to be possible.

How Do Knowledge Workers Decide What to Do? 

While most knowledge workers have a written job description somewhere, it is well understood that they take responsibility for choosing what to do and when to do it based on a variety of factors, including tasks outside of their formal role when it appears sensible to do so.

To get a sense for how these decisions are made, we asked study subjects to choose among four options for every activity: It’s a standard part of my job/my boss asked, a peer or colleagues asked me, I did it spontaneously, or it was important and I found time. In 2013, respondents said 52% of their activities were standard, 18% requested by a peer , 24% independent but important, and 3% independent and spontaneous. In 2020, we are still spending half our time on standard activities, but we are doing only 8% because a colleague asked, and a full 35% because we thought the activity was critical.  Both these differences were statistically significant. Spontaneity rose to 6% but this difference was not statistically significant.

What’s going on here?  It seems we have been taking more direct charge of our time during lockdown. Working from home gives us a bit of breathing space: We don’t have colleagues or bosses badgering us, and we don’t get drawn into meetings by force of habit, just because we happen to be around. The result is a reassuring increase in us making time for work that matters most to us.

Concerns and Challenges

Working in lockdown has helped us to focus and to take responsibility. But that’s not the whole story. Follow-up interviews revealed some of the areas of concern that we as individuals — and as leaders of others — need to understand.

Some respondents cited the potential for shirking: “I am worried there is some slackening of effort. People are starting to get a bit too comfortable working from home,” said one. In our view, this is not a huge problem: There are many ways of informally monitoring how much time your colleagues are putting in via Outlook, Slack and other tools, and we should really be evaluating knowledge workers on their outputs not their inputs anyway.

The bigger areas of concern were around the things people couldn’t do well in a virtual environment. Take managing across first: It’s not so hard for an existing working group to stay on course when working remotely, but the challenges of getting started on something new (the forming/storming stages of team development) or resolving internal conflicts are enormous. Of course, these activities can be done over Zoom – just not as well. Few people are energized by informal online get-togethers. As one person said, “We are slowly losing the social glue that holds us together.”

Managing up and down are no less tricky under lockdown. Most respondents had instituted regular one-on-one catch-ups with their teams and bosses, but they usually focused on immediate task and personal well-being issues, rather than longer-term development. They missed the opportunity to bottom out difficult issues: “You cannot challenge a person quite so well over Zoom. You tend to hold back,” said one. They also lamented the loss of growth opportunities for their teams: “I used to throw people into new assignments, where they learned on the job, watching and learning from experienced colleagues. That’s almost impossible to do in a virtual setting.”

Finally, some people worried about their own development. While time spent on self-education went up during lockdown, this was mostly due to online webinar and course attendance — which helps build knowledge but doesn’t encourage the active experimentation and personal reflection that help us really grow.

For many of us, the new socially distanced mode of working may continue for some time.  The good news for knowledge workers from the first phase of this experiment is that lockdown has helped us better manage and prioritize our schedules to favor the most value-added work. The challenge — as we move into the next phase where some face-to-face meetings are allowed — will be to bring back the informal and social elements of office life that are so vital to organizational and individual success.

Given our current situation knowing that your colleagues or employees are best suited for this new scenario we find ourselves in. Finding the right talent, the best fit for the job and your organisation can be a very challenging task. It is now important to find out whether your managers or your team is well-equipped of working together from various locations. It requires deep knowledge of their personalities, strengths, weaknesses, interests, work style and other characteristics. Our technology and solutions will do the work for you, helping you discover if your people are resilient during times of hardship, if they are autonomous, if they are team players, without actual human contact. Given that our platform is cloud-based, everyone can use it from home as well. Humanity finds itself at a crossroad for various reasons now, why not help people discover and develop themselves from the comfort of their own homes?

Request a free demo:

B_txt_14

Sources:

https://www.bbc.com/worklife/article/20200710-the-remote-work-experiment-that-made-staff-more-productive
https://www.techrepublic.com/article/study-working-from-home-means-more-time-on-computers-but-workers-arent-more-productive/
https://hbr.org/2020/08/research-knowledge-workers-are-more-productive-from-home?ab=hero-main-text