Critical Steps for making lasting Transformational Change
A successful transformation is the outcome from a major change effort. A journey rather than a ‘big bang’ point in time. A successful business transformation is a process with a consists of a number of discrete stages. These stages build upon each other and are essentially dependent building blocks, meaning that ignoring, or a light touch at any stage will impact on the overall transformation process.
In his dissertation, Leading Change: Why Transformation Efforts Fail, John P. Kotter outlines eight critical steps which have become highly respected in the business world for establishing lasting change.
I’ve built up his findings, added my own insight to outlined what I feel are the most essential requirements in the transformation process.
Kotter believes successful change programmes go through a series of eight stages. Each stage has a corresponding common errors. These are the critical mistakes that are typically made at each of the stages and which can single-handedly bring the whole change effort down.
The eight common errors are:
- Not establishing a great enough sense of urgency,
- Not creating a powerful enough guiding coalition,
- Lacking a vision,
- Under communicating the vision by a factor of ten,
- Not removing obstacles to the new vision,
- Not systematically planning for and creating short-term wins,
- Declaring victory too soon,
- Not anchoring changes in the corporation’s culture.
So if you take each point and turn it on its head, then you have a set of high level guiding principles.
When to use it
The Eight Stages can be used to:
- Help leaders and teams understand the key pitfalls in trying to achieve transformation without managing the process effectively (useful for those who are sceptical about the impact / value of change management).
- Help stakeholders understand the support that is required through the change process – what are the big things to get right and in what order.
How to use it
- Use the Eight Stages or Eight Errors to structure your thinking, support planning and in making recommendations;
- Use them in leading and manage change yourself, and
- Use them to challenge complacency, particularly at the beginning of change projects where real commitment is lacking.
Health warning: Kotter acknowledges that there are many other things to get right or avoid getting wrong in successful change programmes. These eight are just the big ones.
The 8 Stages in more Detail
Establishing a sense of urgency
A decisive, collaborative effort is necessary for fuelling change.
In rallying support, it is necessary to promote commitment – in which people actively desire change – over compliance – in which people agree to change because they are instructed to do the task. Because change implies an overhaul of existing practices and the adoption of a new system, strong leadership is also necessary. Only when the majority of management is convinced of the need for and motivated to seek change can the transformation process be successful. Part of step involves:
- the examination of market and competitive realities;
- identifying and discussing crises and potential crises, and
- identifying major opportunities.
Essentially urgency is based on a large degree of dissatisfaction at the status quo.
Formulating a powerful guiding coalition
While it is important that the objectives of the transformation initiative be embodied by the whole, it is also necessary for there to be a strong, guiding body. This body must span the existing organisational structure which includes top management, but could also include outside advisers. Sharing a strong dedication to development and transformation, this body must be able to operate both formally and informally within the organisational structure in order to enable change. This includes:
- assembling a group with enough power to lead the change effort, and
- encouraging the group to work as a team.
Creating a vision
In order to ensure the collaboration and dedication of the organisation, it is necessary that there is a coherent vision. All the complexities of the transformation initiative must be distilled into a communicable message which can be understood and supported by all employees. Without such a vision, the transformation effort may disband into innumerable projects which are incompatible. Such a vision should be both unambiguous and compelling, going beyond finance or statistical projections to make it real to all involved. The overall aim of the vision is to:
- unify the organisation;
- help direct the change effort, and
- develop strategies for achieving that vision.
Communication: Spreading the vision
In order to uphold and expand the sense of urgency and dedication to the change initiative, it is necessary to utilise all means of communication. Employees will not make personal sacrifices unless they harbour a strong belief in what is being done and why? Communication of the vision must be integrated into every possible channel. Importantly, behaviour especially leadership must be consistent with values. Success is impossible without gathering resounding support at all levels in the organisation. Spreading the vision means:
- utilising every vehicle possible to communicate the new vision and strategies, and
- teaching new behaviours by the example of the guiding coalition.
Empower action by removing obstacles
Communication is not the sole ingredient to success. As the number of individuals rallying around the change initiative escalates, it is necessary to move forward in a proactive manner. Increased support will empower individuals to develop new ideas and inspire them to act on them. Should obstacles arise, as the they inevitably will, it is important that the organisation seeks to eliminate them and move forward in action. Hindrances may come in the form of organisational structure, friction caused by compensation or performance appraisal systems, or staff incompatibility. Eliminating obstacles such as these are necessary for achieving the vision in the long term and will ensure the initiative’s success. This involves:
- empowering others to act on the vision;
- getting rid of obstacles to change;
- changing systems or structures that seriously undermine the vision, and
- encouraging risk taking and non-traditional ideas, activities and actions.
Planning for and creating Quick Wins
No matter how strong the initial support around the change process may be, ultimately the passage of time has the potential deflate momentum and rekindle opposition. The creation of unambiguous, short-term ‘quick wins’ can boost the credibility of the transformation process. Quick wins may come in the form of productivity improvements, efficiency improvements or an increase in quality on certain organisation performance measures. Establishing goals, the organisation must look for ways in which to obtain conspicuous performance improvement while simultaneously rewarding individuals involved. Such wins must be planned for, not hoped for, so as to ensure morale around the vision and sustain momentum. This involves:
- planning for visible performance improvements;
- creating those improvements;
- recognising and rewarding employees involved in the improvements.
Consolidate improvements by building on them to produce further change
As the transformation process comes into fruition and the organisation begins to show signs of improvement and success, it is important that victory is not declared too soon. Changes take time to become ingrained and it is important to recognise that new changes are fragile and are subject to deterioration should they not be sustained. Full realisation of the vision may be thwarted should fatigue lead to hasty acceptance of initial gains. The credibility afforded by quick wins must be utilised to tackle even greater problems; successes must be seen as opportunities to build confidence and apply resources to tackle more significant transformation changes. This involves:
- using increased credibility to change systems, structures, and policies that don’t fit the vision;
- hiring, promoting and developing employees who can implement the vision, and
- reinvigorating the process with new projects, themes and change agents.
In order for transformation to be sustained, it is necessary that the changes realised become engrained. New behaviours and values must become cemented as organisational norms so that once the movement for change is reduced the behaviours do not begin to disintegrate. It is important that such changes are maintained by consciously attempting to demonstrate how new approaches, behaviours and ideas have contributed to improved performance. This can be achieved by making sure that a desire to continue to seek out improvement and uphold best practice remains in place as an ongoing leadership and management aspiration and objective. This includes:
- articulating the connections between the new behaviours and corporate success, and
- developing the means to ensure leadership development.
Want to know more?
Professor John P. Kotter first expounded his Eight Stages in a 1995 Harvard Business Review article “Leading Change: Why Transformation Efforts Fail”. In 1996 he published a best-selling book “Leading Change” which looks in more detail at each of the Stages. The Eight Stages are also explored in Kotter’s fable about a penguin colony, “Our Iceberg is Melting”, published in 2006.