After years of research on organizational transformation by McKinsey, the results from their Global Survey in 2015 indicated that few executives say their companies’ transformations succeed.
In that survey, just 26 % of respondents said the transformations they’re most familiar with have been very or completely successful at both improving performance and equipping the organization to sustain improvements over time. (Meaning that 74% have not been successful.)
In their 2012 survey, 20% of executives said the same.
A CEO of a multinational organization is in trouble. With so much pressure from the digital world and the constant increase of staff costs his business desperately needs to become more entrepreneurial, particularly in its ability to form internal and external partnerships to reduce time-to-market. Yet his organization has a silo mentality, with highly competitive teams secretly working against one another. How can this CEO change the way thousands of people at his company think and behave every day?
This is common in a lot of multinational organizations!
In 2006 David Rock and Jeffrey Schwartz published an article “Breakthroughs in brain research explain how to make organizational transformation succeed.”
Why in 2015 does 74% of transformational projects still fail?
Businesses everywhere face this kind of problem and success isn’t possible without changing the day-to-day behaviour of people throughout the company. But changing behaviour is hard, even for individuals, and even when new habits can mean the difference between life and death. In many studies of patients who have undergone coronary bypass surgery, only one in nine people, on average, adopts healthier day-to-day habits. The others’ lives are at significantly greater risk unless they exercise and lose weight, and they clearly see the value of changing their behaviour. But they don’t follow through. So, what about changing the way a whole organization behaves? The consistently poor track record in this area tells us it’s a challenging aspiration at best.
Boris Ewenstein, Wesley Smith, and Ashvin Sologar reported “that research tells us that most change efforts fail. Yet change methodologies are stuck in a pre-digital era. It’s high time to start catching up. Change management as it is traditionally applied is outdated. We know, for example, that 70 percent of change programs fail to achieve their goals, largely due to employee resistance and lack of management support. We also know that when people are truly invested in change it is 30 percent more likely to stick. While companies have been obsessing about how to use digital to improve their customer-facing businesses, the application of digital tools to promote and accelerate internal change has received far less scrutiny. However, applying new digital tools can make change more meaningful—and durable—both for the individuals who are experiencing it and for those who are implementing it. Organizations today must simultaneously deliver rapid results and sustainable growth in an increasingly competitive environment. They are being forced to adapt and change to an unprecedented degree: leaders have to make decisions more quickly; managers have to react more rapidly to opportunities and threats; employees on the front line have to be more flexible and collaborative. Mastering the art of changing quickly is now a critical competitive advantage.”
It is true that technology requires people to adapt and change to an unprecedented degree, but I am not convinced digital tools will change organizations.
I think the key lies in teaching people how to learn, unlearn and relearn faster.
“The illiterate of the 21st Century are not those who cannot read and write but those who cannot learn, unlearn and relearn.” – Alvin Toffler
During the last two decades, scientists have gained a new, far more accurate view of human nature and behaviour change, because of the integration of psychology (the study of the human mind and human behaviour) and neuroscience (the study of the anatomy and physiology of the brain).
The implications of this new research are particularly relevant for organizational leaders. It is now clear that human behaviour in the workplace doesn’t work the way many executives think it does. That in turn helps explain why many leadership efforts and organizational change initiatives fall flat. And it also helps explain the success of companies like Toyota and Springfield Remanufacturing Corporation, whose shop-floor or meeting-room practices resonate deeply with the innate predispositions of the human brain.
In business, people are the main drivers, they create the technology, the tools, the processes, the policies. Lasting change will occur only once enough people have changed. People change when they make the decision to change, not because their manager or the organization say they must change.
To create lasting change in an organization requires work on 4 different levels:
1. Personal Mindset: Values, beliefs and identity
2. Individual skills: behaviour and competence
3. Group Culture: Assumptions, Unwritten rules
4. Corporate Policy: Structure, policy, technology, workflow
Most organizations are good at 2 and 4 but very few focus on 1 and 3.
I believe it is Education on how the body and in particular the brain and mind works, that will help more people to change, because education physically change the brain. If you can can do it once you can do it again, but to many people don’t even start.
Business leaders who can shift their own emotional resilience and move into creating the vision for their organization will survive the application of digital tools.
“Education is the great engine of personal development. It is through education that the daughter of a peasant can become a doctor, that the son of a mine worker can become the head of the mine, that a child of farm workers can become the president of a great nation. It is what we make out of what we have, not what we are given, that separates one person from another.” – Nelson Mandela
