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Three Essential Elements for Change

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By Ed Powers, COO at Cateway
All organizations face periodic turning points due to sagging profits, aggressive competitors, disruptive technologies, or beckoning markets. Yet, if leaders do not enact changes swiftly, they can watch their enterprises spiral downward.
 
Change is never easy, and surprisingly, strategy itself is not the problem. According to Fortune, approximately 70% of CEOs who lost their jobs did so not because they had a bad plan, but because they failed to execute. Figuring out what to do is relatively easy, but few organizations are good at the hard stuff— following through. When change is complex and so much hinges on the outcome, CEOs can’t afford missteps. 
There are three essential elements to executing successful change (in this order):
 
1. The CEO’s total personal commitment. It all starts in the corner office. CEOs must actively participate, delegating tasks but not their ultimate responsibility for success. Larry Bossidy, former CEO of AlliedSignal and co-author of Execution: The Discipline of Getting Things Done says, “The leader has to be engaged personally and deeply in the business… and only the leader can make execution happen, through his or her deep personal involvement in the substance and even the details of execution.” The chief executive must do whatever it takes—make unpopular decisions, terminate non-performing managers, even overcome personal shortcomings—to push forward and get results. Jim Collins, author of Good to Great, says top leaders who successfully transformed their organizations demonstrated a quiet, but “fierce resolve to do whatever was needed to be done.” Without this level of personal commitment on the part of the CEO, few enterprise-wide initiatives stand a chance.
 
2. Emotional engagement of the right people in the right numbers. CEOs can’t do it alone. They must build solid coalitions of executives with the right skills, knowledge, and leadership to affect change. John Kotter, a leading expert and author of Leading Change says the first step is to mobilize people by creating a sense of urgency. His secret ingredient? Appeal to emotions rather than logic. People must personally experience a truth, feel it rather than think about it, to want to change. Kotter studied hundreds of initiatives and discovered that the “see-feel-change” progression was far more effective than the usual “analyze-think-change.” By forming the right, emotionally motivated team, the senior leader creates a juggernaut with the capabilities, size, and momentum to overcome obstacles.
 
3. A systematic approach. Organizational transformation always involves tackling tough, far-ranging issues. For example, a defense company re-purposing itself to capitalize on growing commercial markets requires a major shift that affects people, systems, and processes in every department. When an organization deals with challenges haphazardly or fails to create early wins, the change initiative quickly loses steam. However, a project replete with good analysis, prioritization, planning, investment, coordination, communication, deployment, and review becomes ripe for success. The real trick is achieving balance; organizations must limit turmoil and remain healthy while in transition. Those adept at execution use strategic management systems to incorporate enterprise-wide initiatives into day-to-day operations, minimizing disruptions and protecting their bottom line throughout. These managers skillfully harmonize their strategic planning, scorecards, product and process improvements, and performance evaluation systems to balance both short-term and long-term objectives.
 
Worse than a waste of time, change initiatives devoid of any of these three essential elements can cost companies progress, revenue, and profit. In today’s world, failing to adapt and execute change can quickly put companies in decline. And, as Fortune points out, that makes CEO’s lose their livelihoods.

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