Transformation. Many a manager already shudders at the word. Because how often are the objectives of such a transformation actually achieved? They don’t have to think long about the biggest challenge: getting the people on board. But aren’t people the organisation’s most important asset? According to People Change, employees can be an important driving force in any transformation. The new book ‘Strategic Transformation’ explains how.
It is perhaps the problem of the 21st century company: transformation is necessary, but it is also notorious. In this age of continuous disruption, even the biggest players have to keep renewing themselves. The next innovative startup is always ready to snatch some more market share or even change the whole game. The constant threat has made digital transformation services a billion-dollar industry.
However, the need to change has not translated into a higher success rate of transformation projects. The amount of money pumped into the projects is not to blame – the problem is more fundamental: you can spend capitals on the most advanced technology, but if you don’t invest the necessary time in your employees, they will never be able to make the best use of it. If companies continue to claim that people are their most important asset, they must act accordingly and put their people at the heart of any transformation.
This is where the strategic consultancy firm People Change comes in. The Utrecht-based agency works from the philosophy that personal leadership change is the cornerstone of organisational transformation. To help companies better understand why this people and leadership driven approach to change is so crucial, People Change has published a new book. ‘Strategic Transformation: ‘Essential Insights for Organisations in the 21st Century’ outlines the four key stages of a successful transformation: insight, inspiration, implementation and integration.
“Every transformation stands or falls with the way it is deployed,” said co-author and People Change founder Rogier Offerhaus at the book’s presentation. “In this, the human approach is crucial. For change to happen, the organisation needs the full involvement and commitment of all managers and professionals. Every person reacts differently to change and very often people themselves do not know how to react to a transformation. The trick is to facilitate the transformation in such a way that people and teams feel invited to change – to contribute a position from her or his unique talent, vision and intuition. Personal change and organisational transformation go hand in hand.”
The book explains how companies historically undergo three types of change. In gradual change, the current level of performance is increased step by step. In transitional change, the existing way of working is changed primarily by moving toward a new and challenging goal. The goal or the desired outcome is the main motivator for everyone to participate. The sports world is of course a good example of this, where every day better goals have to be met to get the 1st place or the gold medal. Everything is done for that.
However, the third form of change – transformation – is a lot less straightforward. The creation of a new way of operating comes from a period of uncertainty, decay and chaos that reveals the unsustainability of the old way of operating. In transformation, existing approaches and processes no longer work. A different way of working must be found to continue to serve the changing customer requirements and to continue to exist as a company. To remain relevant. We see this happening a lot now where companies need to work online that have always worked offline. They have to transform from a physical company to a virtual internet company. Like many travel companies have already had to do. You also see this in the auto industry where the organisation must be transformed into developing and building electric cars instead of the familiar gasoline or diesel engine driven cars. What makes this radical form of change so challenging is the high degree of uncertainty involved: you never know in advance exactly where you will end up.
Dividing the transformation into four key phases offers a handhold in the midst of all this uncertainty. Each phase has its own points of attention. By keeping a close eye on these, the chances of success increase considerably.
Phase 1: Insight
First, when deploying transformation, it is essential to have the best possible picture of the organisation’s most important asset: its people. What kind of people does your organisation consist of, and what is their attitude towards change?
To make this clear, People Change has developed the People Change Scan. It allows organisations to measure which mindsets are dominant within individual employees, teams and the organisation as a whole. In addition to leadership styles, the scan also identifies the willingness to change. Using the scan, it becomes very clear what the skills of the people are in the area of change and transformation. Based on the insights from the scan it becomes transparent where the people and the organisation currently stand and how much change they can handle. The insights and the results are also the basis for the transformation plan that is formulated in the next phase.
Phase 2: Inspiration
In addition to the initial situation, every transformation naturally has an intention, vision, product or service that they want to get to. The challenging part of a transformation is that it is not known in advance exactly how far you can get. The entrepreneur Elon Musk also did not know if and when his new rockets and electric cars would be ready for market. This makes it all the more important that employees know the vision, believe in it and keep faith with it.
“As a CEO, you can’t just impose a digital transformation from the top down,” Offerhaus says. “You have to communicate a shared vision of an inspiring future, of why the transformation is necessary, why digital is a must, and why leaders must seize the situation to transform themselves as well. This is how you prevent people from throwing in the towel halfway through a challenging transformation.”
Good communication consists of two-way communication. Some traditional leaders struggle with this, but they do well to listen to their employees anyway. When the benefits of the transformation are clearly explained and the employees feel heard, they will be inspired and energized to start the change process.
To make the desired shared vision, culture and structure more tangible, People Change advocates always holding a vision and culture session. “The insight phase provides specific information about the desired organisation, leadership and culture in terms of mindsets and value systems,” Offerhaus explains. “For leaders and employees, this can seem abstract. That’s why it’s good to have a vision and strategy session after the analysis, in which we co-create with the leaders and employees the vision and strategy on their own desired organisation. This allows us to identify the gap between the current and desired leadership, culture and structure, and discuss steps to embed the desired leadership, culture and structure into the organisation.”
Phase 3: Implementation
After this thorough preparation, the actual implementation can begin. The third phase revolves around building the desired organisational and leadership transformation. In this implementation phase, People Change deploys various interventions, including GROW group sessions, leadership and team development, change coaching and training, and support for organisational change projects.
The GROW model enables employees and teams to achieve growth objectives. The four letters each represent a step in the model. In the first step – Goal – the goal is established. In the second – Reality – the current situation and obstacles to change are identified. In the third – Options – possible actions that can be taken are explored. The fourth – Will, or Way Forward – determines what action will actually be taken.
The observant reader will notice that the GROW model has partly the same structure as the four phases of People Change’s model for organisational change. This, of course, is not accidental. It reflects the firm’s vision, in which change at the individual and team level is an essential component of organisational change. The steps taken within a GROW case are always discussed in coaching sessions. In this way, not only is the concrete GROW goal effectively worked towards, but also the change power of individual employees and teams is built.
Phase 4: Integration
When the implementation phase is over, the desired situation has been achieved. However, this does not end the transformation. Everyone knows how easy it is to fall back into old patterns. The integration phase should prevent this.
“How do we stay here? This question is central to the integration phase,” Offerhaus explains. “You have taken your organisation to the next level – how do you anchor this? What have we learned together and how do we take this into the organisation so that future generations can benefit from it and build on it?”
Lasting transformational power
Building on that is more important than ever in the business landscape of the 21st century. Moments to sit back do not exist today. In that sense, the transformation is not complete even after the integration phase – in fact, one of the most important messages Offerhaus wants to convey is that transformation is an ongoing process.
“For that ongoing transformation to succeed, coherence between the people and goals of the organisation is essential,” he emphasizes. “It’s up to leaders to ensure that during the transformation the company moves toward a shared vision, and that all layers of the organisation continue to behave as one unit that faces future challenges together. People Change helps with this by embedding change in the organisation’s DNA. So that the power of transformation remains, even long after we have left.”
This artikel was first published on consultancy.nl