Facebook CEO Mark Zuckerberg speaks at the F8 summit in San Francisco, California, on March 25, 2015 (Josh Edelson/AFP/Getty Images)
Photograph by Josh Edelson — AFP/Getty Images
By Bill Pasmore
September 11, 2015

Change may be the only constant, but it’s also complex, difficult, and often overwhelming. In this excerpt from his new book, Leading Continuous Change, Bill Pasmore looks at why tech’s leading players are so good at getting it right.

Improving our individual skills to lead change can be challenging. Helping our organizations benefit from what we have learned can be even tougher. What does it take to apply new ways of leading complex, continuous change to help our organizations navigate churn in the real world?

There’s an old Indian saying that it is easier to help an elephant get up if it’s already in the process of getting up rather than in the process of sitting down. If your organization is concerned about this issue, and has already designed some flexibility into how people approach their work, you’ll be ahead of the curve.

Let’s contrast a couple of examples. Some years ago colleagues and I decided to see if we could keep a manufacturing plant in Cleveland from closing, by engaging employees in transforming the operation. Executives of the corporation that owned the plant agreed that if we could improve productivity and reduce costs, they would reopen their decision to relocate production offshore.

 

The plant was very old, with outdated equipment and a traditional hierarchical culture. People were slotted into narrow jobs, most of which allowed little opportunity for creativity. Despite this the plant manager was a student of change and was interested in supporting our experiment.

We worked diligently for several weeks with the help of a number of employee task forces to come up with a prioritized list of changes to pursue. To our surprise, when it came time to implement the changes, we asked for volunteers to help with the implementation—and no one signed on! When we investigated further, we found that employees, having heard months earlier that the plant would close, had already made other plans for their futures. No one was excited about extending their time in a setting that they experienced as old, dirty, and unpleasant. They had little energy for trying to change an organization that had not engaged them in change before. They knew how difficult it would be to shift their culture, change the organization’s approach to management, redefine their jobs, introduce new technology, and win the confidence of senior leadership. It was easier to simply exit and move on. The plant closed.

Contrast this example with Google (GOOG), Facebook (FB), or Silicon Valley startups. Their cultures are entrepreneurial, change is constant, roles are loosely defined, and people are dedicated to learning. Strategies shift as new ideas are explored or competitors make moves. Structures and processes are introduced but are designed to allow continuous innovation. People are expected to contribute their ideas. Leadership is top-down, bottom-up, and sideways, all at the same time.

Which of these examples (the plant in Cleveland or a Silicon Valley startup) would be more receptive to adopting new approaches to leading complex, continuous change? The answer is obvious. When rigid organizations face complex change challenges, they want to control how they respond. They want to divide their response into a series of independent projects, each with its own plans, schedules, and leaders. They want elaborate plans and regular progress metrics so that leaders can intervene when issues arise. They want to keep things under control, as if complex change can actually be controlled.

 

Entrepreneurial organizations expect change to happen and design for it. They leave room for people to react without central guidance, although they expect people to engage one another as they do so. Big decisions about major new projects, acquisitions, or company strategies are made centrally with a lot of input, but there is little or no micromanagement. People know what they bring to the table, but they don’t know what work they will be doing in the future because priorities will change. Boundaries are permeable across units, teams, and levels in the organization. People are more concerned about the well-being and continued existence of the organization than accumulating power and influence.

When faced with change, these entrepreneurial companies do not try to formulate projects with precise budgets, deadlines, and metrics. They start working on things and see what happens. Projects shrink or grow with the promise they show and the excitement they generate. Priorities shift but not people’s commitment to the ultimate success of the company. No one feels like he or she is working on a production line under tight constraints.

Everyone is free to comment and to try to contribute in the best way he or she knows how.

It is not that entrepreneurial organizations are better than more tightly structured companies. Each is designed to be fit for a purpose. Yet when it comes to being ready for complex, continuous change, the entrepreneurial organization has the clear advantage. If you are in a tightly structured company, is the situation hopeless? No. Michael Tushman and Charles O’Reilly have written extensively on the topic of ambidextrous organizations, by which they mean that organizations should develop the capability of operating in a tightly structured manner when they need to and in a looser fashion when that is called for. Although learning to become ambidextrous isn’t easy, there’s no law against it. It just requires intention and effort. What keeps organizations from becoming more ambidextrous? Not laws of nature but rather leaders who say “we can’t” or “we won’t.”

To achieve breakthroughs in organizational agility, leaders need to help their organizations learn by engaging in Discovering, Deciding, Doing, and Discerning. Just like individuals, organizations learn from practice, provided the learning is well directed and well supported.

Leaders need to support greater ambidexterity because no one else has permission to change the rules. At first the rules don’t need to be changed permanently; they just have to be suspended for a period of time as people are invited to experiment with different approaches to continuous change. Once an organization gains greater insights into what works and what doesn’t, more-permanent rule changes can be considered. Only then will true breakthroughs in responding to complex, continuous change occur.

Excerpted from Leading Continuous Change: Navigating Churn in the Real World. Reprinted by arrangement with Berrett-Koehler Publishers. Copyright © Bill Pasmore, 2015.

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