The leadership challenges of transformations

Successful transformations require that we think beyond leadership as individual behaviour and more as an organisational capability, writes Roger Collins

Transformations represent fundamental and irreversible changes that are required for survival and sustained success. They require deep organisational interventions akin to a frontal lobotomy rather than a dosage of aspirin. The implication is that the leadership skill demands are those of a brain surgeon rather than a pharmacist. To use Robert Burns’s terminology, the requirement is for transformational rather than transactional leadership. Paradoxically, after a long period of success, Executive Teams may be populated more by the latter than the former, because only incremental change was required in their strategy or business model.

Second, as the Chinese linguists have long recognised, change comprises both threat and opportunity. The threat arises when discontinuities in technology or markets are not foreseen or are ignored. Think Harvey Norman, Motorola, Fairfax or News Ltd. The opportunity arises from leaders who are either looking outward or intuitive and see the changes coming, or envisage a disruptive opportunity that gives their organisation a first mover advantage. Think Swatch and Apple.

Third, the discontinuities that necessitate organisational transformations are occurring more frequently. Organisations which are serious about surviving and thriving take transformational leadership and capability seriously. Whilst transformational change may be foreseen or initiated by an individual leader, the magnitude and complexity of organisational transformations requires collective and distributed leadership. If we distinguish between competencies (individual attributes) and capabilities (collective or team attributes), we can consider the need for two types of development and contribution for each category. We develop our people in terms of their performance (in our existing business model) and potential (higher-level roles and relevance for emergent business models and strategies). Increasingly we will have to invest in developing collective leadership behaviour that not only contributes to better performance (for example, cost reduction, better client service), but which also explores and identifies business models and products and services for the future. Such renewal and reinvention capability is not well developed in many organisations. Scenario planning, organisational mirrors, skunk works, and vertical and horizontal leadership slice groups are processes for challenging the present and envisioning the future and developing this capability.

Finally, the costs of failure to recognise the need for transformation, or failure to implement successfully, are extraordinarily high. Think Nokia, regional radio and TV, and energy generation. In sum, the distinction between transactional and transformational leadership has never been more important. Identifying and developing those who can make this contribution becomes more vital to sustainability. These imperatives demand that we think beyond leadership as individual behaviour to organisational capability.

The role of leaders in organisational transformations
Leaders can add value in the transformation process by making four important contributions. The first is preparing for major change by establishing the need for and readiness to accept and be involved in the change. Key elements of this step involve significant change in senior leadership behaviour or composition, direct and regular senior leadership communication and role modelling, staff surveys and town hall meetings that enable face-to-face interaction, questions and challenge, as well as comparative performance information (eg quality, productivity, service delivery assessments, innovation and overheads).

The second is signaling your aspirations, objectives, stepping stones, benefits and outcomes. Tangible signals include requesting new information, revised mission and vision statements, strategic and business plans, redefined core values, new organisational structures, new performance indicators and levels, as well as new sources of performance feedback. Symbolic signals include significant changes in time allocations and visits, different conversations, meeting agendas and discussion topics.

The third contribution can be made through enabling, empowering our people to change. This requires new behaviours, skills, structures and resources to empower people to behave and contribute in qualitatively new ways, increased real delegations, leaders removing barriers and providing encouragement and feedback, job redesign and clear role definition, as well as effective and aligned communication channels, new accessible information systems that allow more members to see what is required and current performance against objectives, and new physical layouts.

The fourth contribution involves reinforcement and management of consequences to encourage people to continue to behave in new ways. This requires courage to hold in place the changes in the face of lag effects, stakeholder feedback, employee engagement and survey results as well as recognition and celebration of achievements, consistency of action and alignment with purpose (hard decisions taken) – and “forgiveness” through learning from mistakes.

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