Friday, 2 June 2017

What Elite Running Can Teach Business About Measuring Performance

There are many parallels between business and sports. They are both highly competitive, performance based, and operate within variable environments. Both identify objectives for a period of time ranking, speed, and endurance for elite runners and market position, growth, and profitability for business. 

Running is often used as a metaphor for business because of its similar operating conditions. They employ strategies to best deploy limited resources to accomplish aggressive goals. They also strive to maximize results by managing inputs of production – people, process, and technology. 

Adages such as "it's a marathon, not a sprint" and "run your own race" help to broaden perspectives on how to win within ever-changing environments. Nike's recent Breaking2 quest to beat the two-hour marathon threshold is the ultimate metaphor for businesses setting and implementing strategies to maximize outputs. All inputs  talent, course, climate, fuel, and equipment  were optimized to achieve record-breaking performance. The lead runner, Eliud Kipochoge, improved the world record time by two minute and 32 seconds and missed the target goal of two hours by only 25 seconds. He is planning for his second attempt.

A skill business can learn from elite running is how to measure performance against objectives. 

Businesses track performance against their target objective, noting gaps or overages. Anything below the objective is viewed as failure and above is a success. Elite runners take a different approach: They track against their current average performance. Anything below this level is a failure and above is a success.


Measuring gaps versus objectives can direct analysis toward justifications (conditions weren't right) compared to improvements (this condition was right). Dan Sullivan describes how this focus effects people in his book Learning How to Avoid The Gap: "The result is a continual sense of missing the mark, feeling deficient, accompanied by a sense of frustration." As performance improves, the gap reduces, and yet capability gains may not stick because they are not reinforced. Successive failures can lead to despondency and decreased confidence, reducing the probability of future success.


The opposite effect is true for elite runners. Each performance improvement is acknowledged, capability builds, and confidence increases. As Judd Hoekstra explains in his book Crunch Time: How to Be Your Best When It Matters Most, "As your performance improves, your average shifts, which takes your game to the next level." Achievements lead to stronger capabilities and further progress toward the objective.

The benefits of focusing on performance improvement are equally applicable to any type of change made to how people work. New behaviours, processes or systems take time to fully adopt and recognition of advances through the transition motivates future gains. It may even lower resistance to new ways of working.

Where to focus is a strategy in itself. Measurement of performance improvement acknowledges that success comes in increments; measurement of performance gaps reinforces the size of the performance improvement that is needed. It's a choice between beating the world record by two minutes and 32 seconds or missing the objective by 25 seconds. Which one would you choose?

Another running adage comes to mind: "Champions do not become champions when they win the event, but in the hours, weeks, months, and years they spend preparing for it." Feeling like a champion along the way usually leads to the best performance.

Phil

Monday, 1 May 2017

Does Digital Transformation pose anything new for Change Managers?

Digital transformation is a hot topic in the media. Many news sites and consulting firms have published their takes on the opportunities and threats associated with it. A Google search will direct you to numerous articles with instructive titles like “5 Winning Ways,” “Six Stages,” “Nine Elements,” and “Top 10 Trends” of digital change. There is even a link to a specialized Executive MBA in Digital Transformation.

Digital transformation is defined as an organization’s use of digital technologies (e.g. mobile, cloud, social, big data, robotics) to improve how it operates to achieve its goals. It typically alters a company’s business and operating models, including how the organization creates value through products and services, processes are designed, and employees, suppliers, customers and consumers communicate and transact.

Ford Motor Company is an example of a digitally transforming organization. Responding to socio-economic, environmental, and consumer trends, it is evolving from being an automaker to a car and mobility services business. As Mark Fields, President and CEO explains, “We have to recognize what is going on in the world around us, embrace consumers’ desire for connectivity and mobility, and use the data available to us and new enabling technology to better anticipate and foresee their needs.”

An account manager for a digital platform provider told me that installing digital technology is rarely an issue. The problem is the low levels of adoption by employees after it has been implemented. The new functionality (or the system itself) is not used as intended, which reduces the benefits realized from the initiative. This is not a new challenge for change managers.

Bigazzi, a UK-based consulting company, reports similar findings: "The main obstacles [to digital transformation] relate to company culture, organizational complexity, and the lack of processes that enable employees to engage, collaborate and innovate." These potential barriers are not unique to digital transformation; they apply to any large-scale organizational change.

Digital transformation doesn’t pose anything new for change managers. It is a type of change just like a merger, restructure or efficiency drive. The specifics of the future destination may include different elements or have different levels of importance, but the process to define it and approaches to help people take on new ways of working (mindsets, actions and behaviours) to get there are the same.

One element that appears essential to digital transformation is trust among stakeholder groups (networks or “ecosystems”). As Klaus Schwabs, author of The Fourth Industrial Revolution counsels, “You are about to define a new level of trust between yourself and your employees, between yourself and your customers, between yourself and your key stakeholders and shareholders, and... between you and your partners.”

Earning greater trust implies changes to how leaders and their teams think about their stakeholders, how they engage with them, and how they behave when doing so. As Accenture’s Technology Vision 2017 report suggests, “To become a true partner, companies will need to shift their thinking, and replace the immediate sales goals of the past with goals that customers and employees have themselves.”

Digital transformation, like all other large change initiatives, requires sound change management strategy and implementation for the defined outcomes and benefits to be realized. Boston Consulting Group and the MIT Center for Information Systems Research (CISR) conducted a two-year research study of designing digital organizations. Its analysis suggests three requirements to design a digital business:
-      Develop a visionary business strategy
-      Identify gaps in the current operating model and identify needed changes to them – roles, processes, ways of working, stakeholder networks
-      Create a team accountable for implementing the changes


This looks like solid change management to me.

Phil

Tuesday, 4 April 2017

How to Sustain Change with No Extra Resources

Most benefits are realized many months after a change is made, and yet few, if any, resources are invested during this time to realize them. Often, organizations believe the projected benefits will materialize over time after a short period of post-change monitoring. If no major issues arise, success is declared, future benefits are assumed, and the implementation team is disbanded.

The reality is that people need more time to master difficult, uncomfortable, and untested new ways of working that create productivity gains. As people try out new practices they compare them to the old ones they know well. A tension between the two creates a barrier to change because, as James Belasco and Ralph Stayer have observed, “People overestimate the value of what they have and underestimate the value of what they may gain by giving that up.” 

Without ongoing support mechanisms, many people choose personal preferences over leadership mandates. They revert to old routines and behaviours, forfeiting benefits tied to the new ones. Old and new practices clash as people try to do their work. This leads to confusion, frustration, sub-optimal decisions and results. Without ongoing reinforcement and measurement, it can take many months before leaders discover the change wasn't adopted and benefits were lost. 

Ideally, implementation resources would be retained to support embedding the change into day-to-day operations and track its benefits. For most organizations, this is a luxury they can't afford. Resources are limited and other change initiatives need to be implemented.

So how do you sustain a change and realize its benefits without ongoing change support? The implementation team must achieve two objectives: establish mechanisms to support the change and transfer accountability for them to people who operate the business. Here is a list of activities to do so: 

Ownership
  • Ensure a leadership team member (ideally the one most affected by the change) is accountable for updating their peers on barriers to adoption, progress made, and benefits gained
  • Identify a business owner for every process impacted by the change
  • Appoint someone to measure benefits realized across the business
Measurement
  • Document early wins (including verbatim testimonials from employees)
  • Confirm that the leadership team has scheduled time on their regular meeting agendas for updates over the next nine to twelve months
  • Identify where remedial training is needed and who will deliver it
Process
  • Remove access to old ways of working so they can’t be used, e.g. databases, templates, and systems 
  • Establish a benefit tracking process including metrics and data sources
  • Ensure new behaviours and actions are incorporated into HR systems – performance management, talent assessment, leadership development, and new employee orientation
Engagement 
  • Involve people in lessons learned exercises to keep practices top-of-mind 
  • Establish forums, chaired by process owners, where people can share challenges and recommended improvements
  • Coordinate early adopters to help peers overcome difficulties with new operating procedures
Rewards
  • Profile leaders who are following the new ways of working
  • Publicly acknowledge people who are gaining benefits from the new practices
  • Include new role requirements and demonstration of new behaviours in annual goals
Communication
  • Develop a communication plan to update leaders and employees (e.g. town hall meeting, news blasts, newsletter columns, etc.)
  • Share stories of how people are incorporating new actions and behaviours into their day-to-day tasks (include pictures of them in their work environments)
  • Communicate results (good and bad) with the leadership team followed by all employees


The degree of change adoption directly influences the benefits gained from it. Most organizations can’t afford to dedicate resources to ongoing change implementation support. The next best approach is to create mechanisms that encourage adoption of new practices and assign accountability to business operators for maintaining them. This will increase the likelihood that new ways of working will stick and benefits will be realized. Doing so will also build change management capability through the organization, which is a benefit in itself.

Phil

Tuesday, 21 March 2017

Powerful Change Strategies from Monopoly's Makeover

In January, Hasbro invited people to choose the next set of Monopoly game pieces through an online voting campaign. The company presented 64 figurines to choose from including the eight already in play.

After 4.3 million votes were tallied, five traditional pieces (Scottie dog, top hat, race car, battleship, and cat) and three new ones (T-Rex, penguin, and rubber ducky) were selected, retiring three from the game (boot, wheelbarrow, and thimble).

Change is no stranger to “the world’s favourite family game.” Over the years, new pieces have been introduced (1937, 1942, 1999, and 2013) and rules modified. Also, a multitude of special editions have been launched including localized and themed boards, special dies and a 'no-money' electronic banking format. Over 300 versions of the game demonstrates that Monopoly moves with the times.

Hasbro's approach to modernizing Monopoly is a master class in change management practices to help people adopt change with the least amount of disruption. Here is a list of strategies that helped them manage their latest transition: 

Provide opportunities to co-create the future
Hasbro reached out to game players with the goal of assessing its current pieces and deciding what, if any, changes were needed. "Only time will tell if fans will decide to stay with the classics, keep a few favourites or pick an entirely new line up of tokens," said Jonathan Berkowitz, Senior Vice President of Marketing. The open crowdsourcing approach was balanced by strategic oversight. The set of piece options was determined by the company as was the decision to colour the new pieces gold. Co-creating change is the best way to align strategy and execution.

Engage people to maximize participation
The company leveraged its long and evolutionary history, sharing stories about each piece and what it represented at the time it was introduced. Promotional materials added excitement and passion by encouraging people to "save their favourite piece." Collectives were quickly formed through social media to encourage voters to lobby for their best-loved pieces: Singer Sewing Machine Company rooted for the thimble, Ace Hardware got behind the wheelbarrow, and Zipcar defended the race car. Rallying around common beliefs leads to spirited support.

Be clear on how decisions on what is changing will be made
The election process was simple. The eight tokens receiving the most votes would win. After voting closed, scores were shared under the banner "the global Monopoly community has spoken." Knowing that the Scottie dog was most popular with 212,467 votes and the rain boot came in last with 7,239 added transparency and legitimacy to the process. Hasbro also provided commentary, such as the boot being voted off first, to provide context for the data. Clearly communicating decision rules increases trust and acceptance and decreases frustration and resistance.

Honour the past
Hasbro is proud of Monopoly's past. It highlighted the game's popularity around the world and loyalty people feel toward it. After announcing the winners and losers, Jonathan Berkowitz empathized the emotional connection people have with their favourite pieces. "We were a little bit surprised that the thimble got among the lowest votes because it's been in the game for so long. Personally, I've always especially liked the boot token." For nostalgic fans, the company is offering two special editions before the new one is released: Monopoly Token Madness includes the eight current silver tokens and an assortment of eight golden new ones, and Monopoly Signature Token Collection includes the full set of 64 contenders. Celebrating the past lets people give tribute to their accomplishments before applying themselves to create new ones. 

Raise expectations for future changes
Change is a continuum that must be managed. Building a culture of perpetual change encodes it into people's mindsets so they can anticipate and prepare for it. After reminding fans of past changes, Jonathan Berkowitz expressed openness to new ones to come: "We want [our fan base] to continue to weigh in with ideas." Managing expectations around change helps people be their best when faced with it.


These strategies apply to any organization going through change. Co-creation earns people's participation and making the task personal inspires engagement. Honouring the past helps people pay homage to it before moving on to create the future, one that is guided through clear direction and realistic expectations.

"The next generation of tokens clearly represents the interests of our fans around the world and we're proud to have our iconic game impacted by the people that feel most passionate about playing it." By following these strategies you might be able to say something similar about your organization.

Phil


Friday, 24 February 2017

6 Little-known Ways to Enable Culture Change at Toronto Police Service


Transforming culture is the hardest change an organization can make. It also is the one that produces the greatest benefits.

Every organization has a culture – a collection of mindsets, actions and behaviours that define how things get done and how people interact. Changing them is difficult because they are hardwired into all aspects of the organization. Also, these norms are constantly reinforced by stories told (good and bad), visual symbols seen, and rewards and punishments given. They don't change easily.

Culture change is definitely worth the effort. It can eliminate unproductive behaviours, build capabilities, and realize outcomes currently not possible. It also can increase people’s engagement, create personal meaning in their work, and enable achievements they can take pride in. 

In February 2016, Toronto Police Service formed a Transformational Task Force with a mandate to "develop and recommend a modernized policing model that is innovative, sustainable and affordable." Recently, the task force published its final report: Action Plan: The Way Forward, Modernizing Community Safety in Toronto.

The report identifies cultural change as being central to implementing all recommendations. It also notes the size of the task given the highly regulated, procedure-driven and, as some stakeholders have said, "restrictive and inflexible" nature of emergency service organizations.

Wendy Gillis' Toronto Star article, Neighbourhood Policing at Centre of Toronto Force's Plans for Change, explores the types of cultural change needed to adopt a recommended "neighbourhood-centric policing" model. Officers will be dedicated to specific communities for a minimum of three years and will have a mandate to partner with communities and support agencies to co-develop solutions to issues. 

The officers will be more empowered to make decisions to customize service-delivery based on the needs of the community. They will be selected based on their interaction, collaboration, partnering, engagement and empathy skills. Importantly, the ability to demonstrate these capabilities will be a key part of their career development including evaluation, rewards and promotion.


The report identifies cultural change as being central to implementing all recommendations. It also notes the size of the task given the highly regulated, procedure-driven and, as some stakeholders have said, "restrictive and inflexible" nature of emergency service organizations.

Wendy Gillis' Toronto Star article, Preparing for the Changing of the Guard, explores the types of cultural change needed to adopt a recommended "neighbourhood-centric policing" model. Officers will be dedicated to specific communities for a minimum of three years and will have a mandate to partner with communities and support agencies to co-develop solutions to issues.

The new model requires significant changes to how officers operate and are managed. They will be more empowered to make decisions to customize service-delivery based on the needs of the community. They will be selected for these roles based on demonstrated supportive skills – interaction, collaboration, partnering, engagement and empathy. Importantly, demonstrating these capabilities will be a key part of their career development including evaluation, rewards, and promotion.

Here are six ways Toronto Police Service can enable the culture change needed to implement task force recommendations:

Set expectations for cultural change success
The report acknowledges that culture change takes time. Be more specific. It will take at least a year to define current and future mindsets and behaviours and build awareness of them across the 8,000 members and external stakeholders.  The new ways will also need to be integrated into training programs and people management processes. Year one will show few gains on their performance scorecard even if they execute perfectly – culture change is a multi-year initiative.

Include members of all key stakeholder groups on the implementation team
Full participation will ensure breadth of planning, reduce risk and enable faster transition. This includes the police union that has been critical of the report's findings; engaging now will reduce resistance and save time later. As Alok Mukherjee, former Toronto Police Board Chair cautions, "Unless the association agrees, you won't be able to do it.” All partnerships need to begin on the implementation team.

Align HR processes with the new culture before building it
People's behaviour is guided by their managers and the rewards they give. Launching culture change that conflicts with how incentives are earned leads to resistance and preservation of the status quo. Force-wide hiring profiles, training, goals, assessments, rewards and promotion criteria all need to be in sync with the new culture before building begins. HR processes consistently aligned with future expectations send a powerful message that leaders are serious about transforming the organization.

Clearly define leaders' roles and provide support to fulfil them
Leaders' behaviour define an organization's culture. Since people emulate their leaders, being clear on the mindsets, actions and behaviors they need to demonstrate to their teams is an important early step. 

The report states that transformation is the Toronto Police Service Board's most important priority for the next few years. Board members will provide support through "resources, advocacy, advice, and priority setting." Being clear on how they will do so needs to be a key part of the change management strategy. They will need support to fulfil their roles including knowledge, skill building, feedback, and coaching. Plan and resource for it.

Design and schedule leadership review meetings now
Progress reviews are essential to ongoing transformation management. The performance scorecard designed to facilitate them looks comprehensive and complete. Define the ways of working around using it now, before time pressures risk deprioritization and cutting corners – how it will be discussed, how much time will it require to properly do so and what process the team will use to follow up on advice given are important decisions that will impact the quality of reviews. A bonus tip: secure an early spot on the Board's agenda to minimize risk of shortened time slots or member fatigue.

Begin with pilot tests to refine thinking and demonstrate value
Translating recommendations into effective implementation plans requires pre-testing. Small trials provide feedback on what does and doesn’t work and uncover practical adjustments to achieve desired outcomes. Pilot tests also produce positive results observed by stakeholder group members. Testimonials from these people can make believers of skeptics and create demand for quicker roll-out of the program.

Successful culture change is a requirement for any large transformation. It aligns people's mindset, actions, and behaviours to enable adoption of new ways of working. It also builds capabilities and creates outcomes that could not be achieved within the status quo. As Chief of Police Saunders said in the report, "the members of Toronto Police Service are the organization's greatest assets." Building a new culture will enable them to create their recommended future.


Phil

Wednesday, 18 January 2017

How to Convice Leaders that Change Management is Worth the Investment

The evidence is conclusive: excellent change management increases business outcomes of change initiatives. Why is this so difficult to communicate to business leaders?

Change management return on investment (ROI) is a popular topic at conference workshops and on LinkedIn chat groups. People are keen to demonstrate the investment case for change support so they can secure the resources to provide it. How can we prove that change management is worth the investment?

This is an important question because many leaders need to be convinced of the financial value of change management. It's more difficult to justify compared to technical guidance because it has fewer tangible measures. Leaders typically understand technical support is required to successfully install a new system, but may not feel that leadership coaching is essential or even necessary throughout the transition. "We have managed without it in the past; why should we spend the money to provide it now?"

The challenge is not about lack of data. Many acclaimed and credible organizations  Bain, Gartner Group, HBR, KPMG, IBM, McKinsey, Oxford University, Prosci, Towers Watson  have studied business transformations for decades. Most proclaim greater likelihood of achieving desired outcomes and higher ROI when people are well-supported through change.

So what's the issue? Statistics by themselves are not convincing. They are data points that lack context or examples; numbers alone rarely influence thinking or behaviour. Also, generic data can raise questions and skepticism about its relevance to a business' circumstances  does the data reflect my industry, geography or business environment?

Last week, a colleague and I tried a new approach when conveying the value of change management. We used a simple narrative, metaphors and statistics to build the business case. The story began with why transformations fail and destroy value. An iceberg metaphor (inspired by Torben Rick) conveyed the striking research. High-level statistics were positioned above the waterline and contributing factors placed below it. 

We shared examples of initiatives that had struggled and what we had done to realign them. We also inquired about past initiatives that had failed and why. The illustration and statistics guided the discussion without leading it.


Moving to the value creating side of the equation, we used a mountain metaphor to convey statistics advocating change management support. The tallest mountain represented the higher ROI gained from excellent change management programs. Below the peak were growth-multiplier statistics to reinforce the higher ROI. 

A smaller mountain provided a ROI comparison with organizations that had poor or no change support. Finally, a statistic on the importance of leadership sponsorship to success completed the change management support picture.

We shared stories of successful initiatives and what made them so, and heard about the company's past successes and how they had been achieved. The discussion progressed to how these benefits could be consistently achieved in the future. 

By themselves, statistics do not make persuasive cases. Painting pictures around them through simple metaphors and stories brings them to life so they are more tangible and relevant. The best investment case is the one that the person you are trying to convince helps build. Pictures and stories give them the tools to do so.

Phil




Monday, 2 January 2017

What three words will guide you to success in 2017?

This is the fourth year I am using Chris Brogan's "My Three Words" exercise to help achieve my goals for the upcoming year.

This is how it works: select three words that will guide your actions and behaviours toward achieving your goals for the year. Keep them visible, like taping them to your laptop or monitor, to ensure they are considered as you make decisions throughout the year – is this decision aligned with my three words and the goals they support?

This simple exercise has kept my goals top-of-mind and on track, increasing the odds of achieving them. They have also encouraged me to reconsider choices I have made hastily or without fully considering the consequences of them. 

Looking at the words I selected over the years provides an accurate summary of my ambitions over time including some consistent themes and new directions:

2016
Excite the people I work with to help them accomplish their goals
Create new mindsets, approaches and tools for managing change
Focus to minimize distractions, either time wasters or low-value activities

2015
Choiceful in my decisions to align with my goals
New change support offers and different ways of providing them
Flexible scheduling so I leave room for unanticipated requirements and opportunities

2014
Purposeful in everything I do to fulfil my purpose of helping people and organizations be more successful by working in new ways
Groundbreaking change support offerings and different ways of providing them that move me out of my comfort zone
Global clients and perspectives for breadth and universality 

Some words have worked better than others. Last year, "excite" led me to taking on the most speaking engagements I have done in the five years of leading Change with Confidence. It was the best format to maximize the number of people I communicated with and expanded the number of industries I have worked in. 

On the ineffective side, "focus" provided little value. It helped me realize that knowing I was unfocused wasn't enough to trigger an action to refocus me, something I have corrected for this year. 

I have been considering my 2017 words over the holidays, replacing or refining ones that don't have the power to guide me. All of them will help me write my second book, which is a big goal for this year. Here they are:

Aspire to aim higher, moving beyond what I have accomplished before (I am best out of my comfort zone)
Prioritize my time and activities to keep me on my path and avoid detours
Permission to speak the truth as I see it because that is the best value I can provide

I am ready to succeed.

The "My Three Words" exercise is an excellent way to kick-off a new year: assessing last year's words helps you evaluate your accomplishments and shortfalls; selecting your new words builds inspiration and motivation; and following them keeps you on track by heightening the implications of the choices you make. 

So what do you think? What three words will guide you to success in 2017?

Phil