The State of Organizations 2023 - Flipbook - Page 31
to coach, and the organization will need to establish
new processes and structures for individuals and
teams who will be working in shorter cycles.
The CEO can then work with senior leaders to commit
the resources (finances, people, time, and assets)
needed to create a robust leadership development
engine that addresses the organization’s needs.
To sustain the changes, the CEO and other senior
leaders should measure the impact of the leadership
development efforts: How did leaders’ behaviors
change? How did employees’ behaviors change?
How has the culture changed?
Changing behavior at scale
To unleash the full potential of organizations, CEOs
will likely need to make changes that affect company
health and performance. As anyone who has ever
led or worked in an organization understands, at
scale change can be difficult to accomplish and even
harder to sustain, especially now. Leaders’ messages
don’t always break through to employees who may
be working outside of an office, thinking differently
about the nature of workplace relationships, and
already feeling overwhelmed by the idea of yet
another business transformation.
Changing
behaviors and
underlying
mindsets requires
changing the
context in which
employees
operate.
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The State of Organizations 2023
Change becomes more manageable, however, when
CEOs adopt a human-focused approach to it and
break it down to its essentials. If organizations need
different behaviors (the patterns and practices of how
employers work), they need to encourage different
mindsets (what employees feel, think, and value). And
to foster those new mindsets, leaders need to change
the system (the set of the experiences that influence
mindsets). CEOs must engage employees’ hearts, as
well as their hands and heads.
CEOs will need to act in all three of those areas and,
perhaps most important, commit to inspiring others
by sharing their own personal change stories. In our
experience in working with a range of organizations
across all industries and regions, at scale change
really does need to start from the top. If a CEO
acts in a deliberate way and publicly demonstrates
support for change, there can be a multiplier
effect across the organization. Conversely, change
efforts can stall if leaders’ words and deeds don’t
match. Four key change principles—setting bold
aspirations, looking for role models everywhere,
doubling down on institutional capability building,
and making change personal—can help break down
the transformation challenge.
Set bold aspirations
Using benchmarks and fact-based targets, CEOs
should craft and communicate a bold change story
that clarifies both performance goals and associated
cultural behaviors—for instance, “We are going to be
number one in our market, based on TSR, and we are
going to be an organization that leverages the talent
of every employee.” A corollary to this principle would
be “change; don’t add!”
Purposeful communication is a skill and an art. To
achieve it, leaders, managers, and influencers will
need to be prepared to craft and deliver authentic
messages that show vulnerability and empathy. Many
transformations fall short when CEOs and other
business leaders cast them as special projects rather
than opportunities to change systems and behaviors
for the longer term. If an organization is shifting to a
new reporting system, for instance, it isn’t enough
to offer employees a onetime bonus for using the
system. Rewards and incentives should reflect the
company’s longer-term goal of changing how the
business approaches the reporting task overall.
Look for role models everywhere
Change starts at the top, with the CEO. Beacon
organizations identify and celebrate early the positive
deviants—individuals who are already modeling
the desired future behaviors. But it’s important to
engage a critical mass of people across all levels of
an organization to help define opportunities, design
solutions, and deliver outcomes. Increasingly, the
people with the most social capital aren’t necessarily
found at the top of the organizational chart. To inspire
more commitment to change initiatives, CEOs should
tap into the networks of key influencers across their
organizations.
One technology company, for instance, used
advanced analytics and network mapping to identify
the employees with the greatest number of contacts
and successfully engaged these employees in
discussions involving a large-scale transformation of
the its operating model. These individuals became
effective change champions. CEOs may also want
to reach out to leaders of corporate affinity groups
to ensure that any proposed change efforts are
inclusive and incorporate diverse perspectives.
Double down on institutional capability building
To succeed with transformations, organizations
must learn how to learn and double down on their
investments in capability building. This will mean
evaluating the skills required to succeed with a
particular strategy, process, or system change;
diagnosing the opportunity gaps; and devising and
deploying appropriate training programs (digital
and in person). The new skills required may be
technical (for example, business essentials and data
visualization) or cognitive or emotional (for example,
active listening and leading in a hybrid environment)
in nature. Either way, organizations can leverage
technology—such as digital nudges and training
platforms—to reinforce the lessons learned in training
programs and to institutionalize behavior changes.
their managers. This created ownership and a formal
mechanism for feedback, allowing the leaders and
the organization to deliver on their aspirations.
Make change personal
Changing employees’ behaviors and underlying
mindsets requires changing the context in which
employees operate. Ultimately it’s employees
themselves who must decide to change. To
encourage them, organizations must give leaders
and employees alike the space to explore a proposed
change and understand how it relates to their own
values and behaviors. An organization might segment
employees by how much they would be affected by
a proposed change—for instance, senior leaders,
middle managers, and frontline employees—and then
create tailored change experiences for each group.
An organization might also convene a workshop
for leaders in which they could reflect on current
behaviors. For instance, leaders could ask, “What did
we do—or not do—to create the current environment,
and what’s our role in changing it?” They could also
consider organizational goals against their own
personal objectives. Through this exercise, leaders
may shift to a learning mindset and view change as
an opportunity to test new initiatives and adopt new
microhabits.
Unleashing an organization’s full potential is
hard—even harder in today’s unsettled business
environment. But as our research and discussions
with leaders in beacon organizations demonstrate,
doing so is very possible with the commitment and
collaboration from CEOs and other leaders across an
organization, a desire to inspire, and leaders’ ability to
maintain their bearings in disorienting times.
Investment in capability building can pay off over
time by improving organizations’ ability to attract,
develop, and retain top talent. Building the capability
of an institution goes beyond individual skills; it
includes rewiring some key processes and systems
to build the new capabilities into a company. One
telecommunications organization explicitly included
desired behaviors in the 360° review feedback of
March 2023
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