This article is based on Vuolle’s forthcoming book, “Lead Now, Manage Later: The Straight Shooter´s Guide to Business Success” to (Koehler Books: October, 2019).
When I have led change in organizations, the most striking comments from people involved have been that they do not know what will happen after the change. And this is the quintessence of change!
If we know that changes will bring positives, we would probably not resist it. Resistance to change is common and can become a real trap for many people in their personal lives as well as in corporations and businesses; for instance, people stay in failing marriages or they stay in unfulfilling jobs because they are afraid of the unknown. I’m miserable, they will say, but at least it’s a familiar misery. This, of course, makes no sense if one were to step back.
Luddite CEOs and business leaders who grit their teeth and ignore the inevitable in always-fluid and changing market forces are doomed.
One important lesson is that most companies change only when they are forced to. Unfortunately, this often occurs too late, when the wolves are breaking down the front door. Executives might resist change because of a low financial inertia—or it could be that they won’t welcome change at any level. Things are fine, they will say. Things have worked OK for years. They close their eyes. They don’t see the sucker punch coming from a new and aggressive competitor.
Too many managers are not willing to change unless they are forced to do so. Generally, we do not admit to this phenomenon.
Let´s face it; business life is all about change.
Companies develop cunning strategies to disrupt the market or just to make the financial performance grow by double digits. Or a CEO sets target to cut products costs by 30% and the plan is there and execution is running. These kind of typical real-life business examples require change. The set bold targets are not achieved by doing things as the company has been doing.
The goals may been in place already months or years, but frustration on top level grows because despite all the nice strategies and initiatives, results are not there!
This frustration slowly flows down to managers and employees.
Here are two real-life examples of resistance to change, that are unfortunately not rare:
- In one company (a legal entity of a stock-listed company), the cash flow for years has been negative. The reasons are well known in top management; however, nothing really has been done. And the good things that were reached under an interim manager soon disappeared after his mandate expired. The key issue in this company is that CEO and management cannot walk the talk. They do not seem to grasp the concept. The CEO and other top managers regularly run meetings full of micromanaging, cutting into the time employees have to report their work onsite in detail so that the customer can be invoiced and accept the invoice—and setting an example that missing time targets is acceptable.
- Another company (privately owned) lost 50% of its customers in the last eight years, and it continued to stay on edge to insolvency! No change was in sight, although the reasons for this dire situation were well-known all the time. The CEO/owner was frustrated and put all the blame on a trusted employee that had been working for him for years.
Does this sound unbelievable? I have been going through these cases during my interim management career and I have stopped wondering. The procrastination of human beings, particularly CEOs and company owners, can sometimes reach unbelievable dimensions.
Despite the fact that results are still missing, top management continues to blindly pay annual rewards to managers who have been unable to execute the plans. To be fair to the managers, in many cases the support for executing those plans was not available from the top management. Despite all the “talk” from the top.
Now the top management starts to search for external help; a consultant or perhaps an interim manager to fix the problems. Sometimes an “army of consultants” arrives.
All this is usually followed by even more control and reporting, which in turn makes the managers and employees confused, because less time is used for actually serving the customer.
The sheer amount of emails and lack of proper communication from top down and also within and between teams makes things for all involved even more confusing. In most companies, people are “managed by email.” This is totally wrong approach. It doesn´t work and it certainly is not leadership.
What do all these cases have in common? The lack of execution competence and lack of trust throughout the organization.
A successful execution of change requires top leadership to:
1. Walk the talk
The CEO and top management must be very disciplined in their behaviour. Only then will credibility and trust in the organization increase.
Example: If CEO overruns scheduled meeting times and at the same time talks about process accuracy and timeliness in organization, people will not follow. As simple as that.
Truly empowering managers and employees takes boldness from top management, and few have it. Building trust starts by having less control and reporting and this is the first step in empowering.
Empowerment is again, walking the talk. If you want it, “put your shoes on and start walking”.
2. Invest in building teams
In business generally and particularly in change situations, high-performing teams are the key for change.
This does not happen in one- or two-day event or in class room. Team-building is a mid-term activity that usually lasts six to 12 months. So a CEO needs to address team-building very early and invest in it over time. Trust, taking care, delegation, communication and feedback are critical, just to mention a few
3. Invest in processes
Processes must be simple and clear. Too often I see too complicated and confusing processes that nobody follows.
Processes must have enough leeway to truly empower employees and managers, and have leadership to make sure protocol is followed—and useless steps are eliminated or improved.
4. Change players instantly if things are not moving
Procrastination, after realizing that someone is not able get results even after giving several fair chances, is really bad for the change process and morale in the team and company.
5. Believe that everybody, including the CEO, is dispensable
If a manager or CEO thinks they are indispensable, they haven´t understood the leadership concept. Being a leader means enabling people to always perform higher. It is not being or becoming the expert in certain areas and everybody needs to ask him
6. Celebrate successes – even small ones
7. Celebrate failures and thank people for trying
Just make sure that lessons learned are analysed and understood in the organization.
8. Invest in training
If you are a scrooge in investing in relevant continuous employee training, it will backfire. Employees need training and they sense whether they want to ask for it or not. Be open, but make sure that after each training session at least the immediate team knows what the individual learned from it. Spread the knowledge.
R. Paul Vuolle, CEO of Bellevue SME Advisors GmbH in Switzerland and Germany, works actively with small and medium (SME) size manufacturing companies in Europe in SCM/Outsourcing, logistics, turnaround and restructuring, market expansion, as well as succession planning and financing. He also frequently supports technology start- ups in building up their business.
