26 Feb 2016
Change is the lifeblood of organisations. It is essential in our products, technology, organisational models and every aspect of how we work and produce for the benefit of our stakeholders and ourselves. Everyone can think of organisations that failed to change quickly enough, perhaps the best example being Kodak.
The virtual shelves are full of books written through the eyes of the executive who is trying to make change happen. In almost every case, the assumption is that the change proposed is the right one and that anyone opposing change is a negative for the business. The persona of the obstacle is all too often an aging middle manager who is stuck in their ways and unwilling to embrace modernity.
Everyone is keen to denounce doubters of new ideas as being stuck in their ways. However, few also point to all of those bad ideas that weren’t guiding the organisation to a better future but rather were just genuinely bad ideas! Maybe if there had been a few more obstacles to change we might still have companies like Pan Am and HIH in Australia.
How do you know whether someone’s objection to change is recalcitrance and when it is a genuine insight that the change is a bad one?
Everyone is capable of producing ideas but most great ideas are recognised only after they are tested in the crucible of the real world. No one, regardless of how smart they are, comes up with something brilliant every time. For every “hit” there are multiple “misses” which looked just as good when written down but fail the same real world test. While the best leaders are better than most at recognising the hits and misses, no one is able to spot them all.
It sounds obvious, but it is important to seek feedback from others no matter how confident you are in the approach you want to take. It doesn’t matter if it is an organisation structure, new product or a marketing campaign.
Feedback may not come from the obvious places and the challenge is to look for it from people who have insight into unintended consequences. This is more important than ever as our organisations and products have become more complex. I’ve looked before at why our organisations don’t operate the way we expect when I asked why I aren’t I working a four hour day. I’ve also suggested that it is important to make simplicity a goal in its own right, but recognise that it is a goal that will never be reached (see Trading your way to IT simplicity).
Testing the ideas
Beyond feedback, there are two ways that a leader can test their ideas. The first is by evidence and the second is by debate.
Testing by evidence requires rigour. While it is tempting to make the available data fit the hypothesis, it really only works if an experiment is designed in advance with two distinct outcomes, the status quo (or “null hypothesis”) and the alternative which represents the proposed change.
In almost every case of business transformation, new product or investment, it is hard to define experiments. The advice that has come through observing companies like Netflix and Capital One is that investing in designing tests is extremely effective no matter how difficult it seems.
Another method that leaders can apply is the running of short, sharp, debates. Recruit six candidates from a variety of backgrounds and randomly assign them to argue for and against the proposal. The debates work best with an enthusiastic audience who are instructed to vote for the best argued position (and not just for the idea they like). Of course, the strongest arguments are usually based on the best available data!
A great leader will listen to feedback and be prepared to walk away from change that doesn’t stand up to testing or debate. When these leaders do commit to change, they are seen to have taken a considered approach and will not only lead their organisations further but they will keep them at their destination for longer.