Leading Change

by John P. Kotter

When the same message comes at people from six different directions, it stands a better chance of being heard and remembered, on both intellectual and emotional levels.

Contrast these two scenarios: In case A, the new vision is introduced as part of three speeches at the annual management meeting and is the subject of three articles in the company newspaper, for a grand total of six repeats over a six-month period. In case B, each of the firm’s twenty-five executives pledges to find four opportunities per day to tie conversations back to the big picture.

All successful cases of major change seem to include tens of thousands of communications that help employees to grapple with difficult intellectual and emotional issues.

We often call such behavior “leadership by example.” The concept is simple. Words are cheap, but action is not. The cynical among us, in particular, tend not to believe words but will be impressed by action.

In a similar vein, telling people one thing and then behaving differently is a great way to undermine the communication of a change vision.

Another typical example would be an electrical utility whose vision of frontline employees taking on much more responsibility bumps up against a structure with too many levels and too much decision-making authority vested in the middle. As employees try to make the new vision a reality, their decisions are second-guessed and undermined by a hoard of middle managers. “Did you take this into consideration?” “You should have checked with Jones first.” “Do you realize the precedent you might be setting?” Predictably, after a while, most frontline employees give up and revert back to their old ways of operating.

Give more responsibility to lower-level employees • But there are layers of middle-level managers who second-guess and criticize employees

Speed everything up • But independent silos don’t communicate and thus slow everything down

Training is provided, but it’s not enough, or it’s not the right kind, or it’s not done at the right time. People are expected to change habits built up over years or decades with only five days of education. People are taught technical skills but not the social skills or attitudes needed to make the new arrangements work.

People are given a course before they start their new jobs, but aren’t provided with follow-up to help them with problems they encounter while performing those jobs.

attitude training is often just as important as skills training.

New experiences are needed to erase corrosive beliefs, and some of that can be done efficiently with training.

History often leaves HR people in highly bureaucratic personnel functions that discourage leadership and make altering human resource practices a big challenge.

Watching him operate, you might wonder if he didn’t get a degree in disempowerment. “We’ve tried that before,” he says again and again. “You need to do more analysis on the downside possibilities,” he tells his people. “We don’t have time for that, just do this please.” “Yeah, yeah, that’s very interesting, but . . . No, no, don’t send that report around; people don’t need that information.” “Please Martha, next time check with me first before you do anything.”

What he needs is to change all the habits as a group, but that can feel as hard as trying to quit smoking, drinking, and eating fatty foods all at the same time.

In retrospect, executives often express regret that they didn’t confront problem managers sooner in the process.

Discouraged employees do not produce the short-term wins that are vital to building momentum in a transformation effort. Discouraged employees do not help manage the large number of change projects that typically are needed in a transformation. Instead, they give up long before you have reached the finish line and anchored new approaches in the organization’s culture.

Major change takes time, sometimes lots of time. Zealous believers will often stay the course no matter what happens. Most of the rest of us expect to see convincing evidence that all the effort is paying off. Nonbelievers have even higher standards of proof. They want to see clear data indicating that the changes are working and that the change process isn’t absorbing so many resources in the short term as to endanger the organization.

Creating those wins also provided the guiding coalition with concrete feedback about the validity of their vision.

The kind of results required in stage 6 of a transformation process are both visible and unambiguous. Subtlety won’t help. Close calls don’t either.

A good short-term win has at least these three characteristics: 1. It’s visible; large numbers of people can see for themselves whether the result is real or just hype. 2. It’s unambiguous; there can be little argument over the call. 3. It’s clearly related to the change effort.

Second, for those driving the change, these little wins offer an opportunity to relax for a few minutes and celebrate. Constant tension for long periods of time is not healthy for people. The little celebration following a win can be good for the body and spirit.

short-term wins help build necessary momentum. Fence sitters are transformed into supporters, reluctant supporters into active participants, and so on.

Short-term wins don’t come about as the result of a little luck. They aren’t merely possibilities. People don’t just hope and pray for performance improvements. They plan for short-term wins, organize accordingly, and implement the plan to make things happen.

To a large degree, leadership deals with the long term and management with the immediate future. Without enough good management, the planning, organizing, and controlling for results will not be sufficient.

Up to a point, small firms can get away without much planning or control. If the company founder is a visionary who dislikes structure (not an unusual situation), he or she may resist the encroachment of managerial thinking, which can then prove to be a problem in this stage of a change effort.

short-term pressure can be a useful way to keep up the urgency rate.

as soon as the urgency rate goes down, everything becomes much harder to accomplish. Minor tasks that were completed in a month suddenly take three times as long.

Shortterm gimmicks can produce problems in the future that often can be covered up only with more short-term gimmicks. Second, it can create more cynics and resisters among the key executives who are sophisticated enough to see what is really happening. Powerful cynics can be very disruptive. Third, it can alienate people who see the practice as unethical.

Transformation is not a process involving leadership alone; good management is also essential. A balance of the two is required, as shown in figure 8–2.

Of course no one actually said, “Relax,” and the CEO was very much aware that much more was required to complete a transformation started a few years earlier. All he was trying to do was thank his executives and motivate them with sincere praise. But the message received by the audience was that the difficult work of change was behind them.

Major change often takes a long time, especially in big organizations. Many forces can stall the process far short of the finish line: turnover of key change agents, sheer exhaustion on the part of leaders, bad luck. Under these circumstances, short-term wins are essential to keep momentum going, but the celebration of those wins can be lethal if urgency is lost. With complacency up, the forces of tradition can sweep back in with remarkable force and speed.

Irrational and political resistance to change never fully dissipates. Even if you’re successful in the early stages of a transformation, you often don’t win over the self-centered manager who is appalled when a reorganization encroaches on his turf, or the narrowly focused engineer who can’t fathom why you want to spend so much time worrying about customers, or the stone-hearted finance executive who thinks empowering employees is ridiculous.

Whenever you let up before the job is done, critical momentum can be lost and regression may follow.

Imagine walking into an office and not liking the way it is arranged. So you move one chair to the left. You put a few books on the credenza. You get a hammer and rehang a painting. All this may take an hour at most, since the task is relatively straightforward. Indeed, creating change in any system of independent parts is usually not difficult. Now imagine going into another office where a series of ropes, big rubber bands, and steel cables connect the objects to one another. First, you’d have trouble even walking into the room without getting tangled up. After making your way slowly over to the chair, you try to move it, but find that this lightweight piece of furniture won’t budge. Straining harder, you do move the chair a few inches, but then you notice that a dozen books have been pulled off the bookshelf and that the sofa has also moved slightly in a direction you don’t like. You slowly work your way over to the sofa and try to push it back into the right spot, which turns out to be incredibly difficult. After thirty minutes, you succeed, but now a lamp has been pulled off the edge of the desk and is precariously hanging in midair, supported by a cable going in one direction and a rope going in the other.

You ask Mary to do something in a new way. Nothing happens. You ask again. She budges an inch. You put pressure on her. Maybe you get two inches. You become furious at Mary, making all sorts of unkind inferences about her character and motivation. But the main problem is that, just like the chair and sofa, a dozen different forces are holding Mary’s behavior in place. In her case, instead of ropes and cables and rubber bands you find supervisors, organizational structures, performance appraisal systems, personal habits, cultures, peer relationships, and (most important) an ongoing stream of demands from this group and that department and those people. Under these circumstances, convincing Mary to behave in new ways can be very difficult. Getting a thousand more employees like her to approach their work differently can be a monumental undertaking.

appreciate a crucial fact: that changing highly interdependent settings is extremely difficult because, ultimately, you have to change nearly everything

The net effect: You’ll end up making more changes than you imagined at first. The entire effort will take more time and energy than you initially expected. One piece of good news is that you’ll probably be in a better position to do something similar in the future, because you have both acquired skills and disconnected some of the useless wires and cables. And, of course, in the end, the office will be more customer friendly.

The process fails for two interrelated sets of reasons. First, the management approach back then was usually too centralized to handle twenty complex change projects. If a few senior managers try to get involved in all the details, as was often the practice then, everything slows to a crawl. Second, without the guiding vision and alignment that only leadership can provide, the people in charge of each of the projects wind up spending endless hours trying to coordinate their efforts so that they aren’t constantly stepping on each other’s toes.

This kind of questioning usually escalates when people become angry at the difficulty of producing needed change in highly interdependent systems. If channeled properly, these inquiries can be extremely helpful. All organizations have some unnecessary interdependencies that are the product of history instead of the current reality.

Because changing anything of significance in highly interdependent systems often means changing nearly everything, business transformation can become a huge exercise that plays itself out over years, not months.

What stage 7 looks like in a successful, major change effort • More change, not less: The guiding coalition uses the credibility afforded by short-term wins to tackle additional and bigger change projects. • More help: Additional people are brought in, promoted, and developed to help with all the changes. • Leadership from senior management: Senior people focus on maintaining clarity of shared purpose for the overall effort and keeping urgency levels up. • Project management and leadership from below: Lower ranks in the hierarchy both provide leadership for specific projects and manage those projects. • Reduction of unnecessary interdependencies: To make change easier in both the short and long term, managers identify unnecessary interdependencies and eliminate them.

Again: Without sufficient leadership, change stalls, and excelling in a rapidly changing world becomes problematic.

Culture refers to norms of behavior and shared values among a group of people.

Norms of behavior are common or pervasive ways of acting that are found in a group and that persist because group members tend to behave in ways that teach these practices to new members, rewarding those who fit in and sanctioning those who do not.

Shared values are important concerns and goals shared by most of the people in a group that tend to shape group behavior and that often persist over...

When the new practices made in a transformation effort are not compatible with the relevant cultures, they will always be subject to regression. Changes in a work group, a division, or an entire company can come undone, even after years of effort, because the new approaches haven’t been anchored firmly in group norms and values.

During your first year on the job, you’re eager to do well and so are particularly alert to clues about how people are accepted and promoted. As long as those practices don’t seem foolish or unethical, you try to adopt them. Often, the biggest lessons don’t come in a training session or a manual for new employees. The day your boss goes up in smoke over something you do—that is influential. The day you say something in a meeting and a stony silence comes over the group—that is influential. The day an older secretary pulls you aside and reads you the riot act—that is influential. The net result is that you learn and assimilate the culture.

After a while, although you may not be aware of it, you are teaching the new hires the culture. Indeed, at age fifty, as a senior-level manager, you may be almost oblivious to the culture. You have lived in it for so long, and found it so compatible from the beginning, that you relate to the culture as a fish does to water. Because it is everywhere yet invisible, you just don’t think about it, despite the big influence it has on you. Fish get air and food from the water. You get a certain pleasing predictability, lots of positive reinforcement, and a strong emotional attachment to your organization through its culture.

Culture is powerful for three primary reasons: 1. Because individuals are selected and indoctrinated so well. 2. Because the culture exerts itself through the actions of hundreds or thousands of people. 3. Because all of this happens without much conscious intent and thus is difficult to challenge or even discuss.