Success at large-scale transformation demands more than the best strategic and tactical plans, the traditional focus of senior executives and their advisers. It requires an intimate understanding of the human side, as well — the company’s culture, values, people, and behaviors that must be changed to deliver the desired results. Plans themselves do not capture value. Value is realized only through the sustained, collective actions of thousands or tens of thousands of employees who are responsible for designing, executing, and living the change.
Long-term structural transformation is characterized by scale — it affects all or most of the organization; by magnitude — it involves significant alterations from the status quo; by duration — the change program lasts for months if not years; and by its strategic importance. Yet companies will reap the rewards only when change occurs at the level of the individual employee.
Many senior executives recognize this, and it worries them. When asked what keeps them up at night, CEOs often wonder about “how the workforce will react,” “getting my team to work together and pull this off,” “leading my people through this,” “retaining our unique values and sense of identity,” or “creating a culture of commitment and performance.” Leadership teams that fail to plan for the human side of change often find themselves wondering why their best-laid plans go awry. Strategy& has partnered with dozens of companies to plan and execute sweeping change. Through the course of these engagements, we have developed a unique perspective on managing the human side of change. No single methodology fits every company, but a set of practices, tools, and techniques can be adapted to a variety of situations. With these as a systematic, holistic framework, we can help executives understand what to expect, how to manage their own personal change and how to engage the entire organization in the process. What follows is our Top Ten list of guiding principles for transformational change
The senior team of a large consumer services company rolled out an initiative to improve the efficiency and performance of its corporate and field staff before addressing change issues at the officer level. The initiative realized initial cost savings but stalled as employees began to question the leadership team’s vision and commitment to the change program.
Middle managers didn’t embrace the program, not wanting to take risks until they the direction and permanence of the initiative were clear. Only after the leadership team went through the process of aligning and committing to the change initiative was the workforce able to deliver downstream results.
Most leaders contemplating change know that people matter. It is all too tempting, however, to dwell on the plans and processes, which don’t talk back and don’t respond emotionally, than to face up to the more difficult, and more critical, human issues. These guidelines should help dispel some of the mystery of successfully mastering the “soft” side of change.