5 Images to Guide Organization Renewal

I've spent decades helping executive teams renew their organizations to keep them healthy and relevant.  I've learned  a lot while working for marquee clients around the world.  In fact I often feel swamped by my learnings - they sometimes seem to be contradictory.

So recently I sat down to answer the question: "what are the basic principles for organizational renewal?"  What is the core to my work?  Where are the safe harbors to which I return when the seas of change are in turmoil.  I came up with five principles and added an image to each.  They should be self-explanatory.  

Here you go.  Enjoy!

Well, that's my career in organizational renewal.  

I'm looking to share what I have learned through: keynote addresses, workshops, and intense consulting assignments.  I'd like to hear from you, so click here to send me a direct email so we can find time to talk.

Organization Renewal – The Key To Being Healthy & Relevant

Renewal for Health & Relevance

As organizations mature they face the prospect of death through atrophy and disruption.  All companies start the same way: someone has a unique idea for a service or good for a specific customer; sales grow exponentially, then competitors enter the field.  Soon the organization enters the "desert of despair" where the market is saturated with look-a-likes that are "faster, better, cheaper." 

To maintain profitability, the next step for the company is to go to the premium end of customers and pricing.  Then they wake up to find that their mass market has disappeared and they have become a niche player in a disappearing market.  Death by a thousand cuts and irrelevance.  Blockbuster, Kodak, Blackberry, Nokia.

This doesn't have to be part of the natural business cycle; and some companies know this: Samsung, Pixar, Starbucks, P&G.  What do they know that others don't?  This question has fascinated me for my entire career.  What I have come to realize is that some companies understand that organizations aren’t build to change: we build them for efficiency, consistency, and low risk. 

Some leaders recognize that improving their organizations sets up a dilemma where constantly making the right decision is eventually the wrong decision.  They know, as Nokia learned, that excellence as the world's leading manufacturer of cell phone handsets comes at a cost of not developing smartphone technology - now Nokia is the handset manufacturer for Microsoft.  No amount of urgency or burning platforms could transform Nokia and prevent its demise through its success.

Some companies like the once dying Pixar, clue into the notion of what I call "organization renewal."  They know that protection against irrelevance comes from inside - death is not dictated by the market.  They avoid the need for "change management" and "organization transformation."  They know they must build a culture of renewal.  They know that everyone in the organization must be sensitized to the signals of decay, and they must have the knowledge of what to do and access to the organization to make changes.

This is not chaos or leadership through consensus on everything all the time.  It's about knowing what the organization is and protecting that core while testing, learning, and moving into unchartered territories.  Sometimes it's a simple operational improvement like putting healthy food choices at the grocery checkout; other times it's a simple work improvement like cutting most of the authorities needed for a regular purchase; and other times it moving into new domains like mobile apps for the growing Millennial market.  These changes cannot be controlled from the center - they are too unpredictable.  They must come from a culture of trust and openness where everyone knows how to influence the organization.

In my experience with marquee clients around the world - like Whirlpool, Microsoft Europe, Canadian Pacific, Toyota South Africa, and Korea Telecom – I stress the following essential principles:

1. Know who you are

What can you become - not what do you want to become?  Change

the right things.

2. Engage Employees through Trust, Openness, and Tolerance for failure

·   Know leadership behaviors that shut down the organization.  Learn to listen.  Be inclusive and even vulnerable.

3. Ideate based on Insight

·   Build a discipline and capability for Ideation.  Get ideas from everyone, everywhere.  Show people how to spot trends in their area of interest; understand customers and their unarticulated needs; challenge the organizational beliefs that once were required but now hold you back.

4. Identify & Test renewal opportunities

·    Show people how to convert an idea into a business opportunity.  Be sure employees really know: the customer, the product or service, and how it will make money - or at least a difference.  After defining the opportunity, identify its fatal assumptions then develop a hypothesis to test, learn, and commercialize at low risk.

Organization renewal is the ability to take what you have and keep it fresh so that your organization will always be healthy and relevant.  It's a mindset supported by disciplined tools that can be applied to specific problems. 

The Timeliness of Organization Renewal

Renewal Isn't a Fad

I’m a big believer that organizations must constantly renew themselves if they are to remain healthy and relevant.  I never shy away from the “fad of the month” allegation.  People may complain but it is these perceived fads, when used properly as levers, that keep energy, inspiration, and thinking in organizations. 

Organizations need ideas from everyone, everywhere if they are to remain sharp.  The toolbox to do this has become an expansive cornucopia.  But what are the origins and limits to this cornucopia?  Has it become a Hydra?

I got thinking about this a few weeks ago when a good friend of mine retired.  He’d been a senior finance executive and through his career he went to many “executive development” programs.  He was kind enough to sort through his papers and give me a file of some of the premier courses he’d attended.  Wow!  What an eye opener.

The documents in the file went back to the late 1970’s.  The contents spanned all the usual suspects: change, employee involvement, customer focus, and systems thinking.  My favorite is the HBR article of 1985 titled: Managing Innovation: controlled chaos. 

In reviewing the file I was shocked at how the basic concepts haven’t changed.  You could present the content of these courses to executives today if you genuflect to Apple rather than Kodak and Christensen rather than McGregor.

I was intrigued so I dug deeper into my own files.  Among other things I found a 1970’s Manual for Planning, Programming, and Budgeting .  This was a field guide for one of my first jobs.  It sprung from Robert McNamara’s time at the US-DOT.   As I reviewed the manual I realized that it contained most of what I know about planning and financial systems in large complex organization.

So, what’s my point in our new world where we’ve transitioned from paper to digital files; and where face to face sharing has given way to Webinars, Facebook, LinkedIn, and Tweeted hash tags?  Well, I’m concerned that we learn less because we have more.  Let me explain.

We have access to an incredible richness of thinking and practice in management science; however, we tend to select and refine our knowledge within functional silos.  As we drift further from the seminal source of an insight we get multiple interpretations of it cloaked in a myriad of case studies to support a single purpose.  There comes a point of unintelligible background noise that numbs the senses. 

For example, the concept of “jobs to be done” is attributed to Clay Christiansen, as a way to deeply understand the unarticulated needs of customers.  Recently the Human Resource community has taken this engaging concept and interpreted it into improved job descriptions.  Not to be outdone, Simplification professionals now use it to explain organizational roles.  We now have one concept living in three silos that can’t talk with one another.

It seems to me that “confusing the client” can’t be the purpose of all of this rich information and thinking.  We can do better.  Here’s a modest proposal: maybe organizations should have a designated center of “renewal” to regularize the organization’s point of view on the discipline of management science.  What are the organization’s consistent set of principles, definitions, practices, and methods that make sense out of the “fad of the month?”

I have consulted in several organizations that do this.  For example, I lead a Customer Loyalty project at Whirlpool when it was also engaged in a global initiative to build Innovation capability.  My team was “required” to learn and use Whirlpool’s accredited innovation toolbox for ideation, opportunity elaboration, and rapid experimentation as we worked with client teams to improve Whirlpool’s customer experience.

I know the flaw in this proposal: how do you control information flow in a world of free flowing information?  Well maybe technology doesn’t have to be a bane to management science; maybe it can solve this challenge.  I’d certainly prefer effort in this direction as opposed to what I see today where the “fad of the month” is stalled and resisted under the slogan: “if we stand still long enough we’ll be in the lead.”