When it comes to navigating difficulty and disruption, the old adage “never let a good crisis go to waste” is especially true. Although leaders can be triggered to change for many reasons, a crisis such as the pandemic represents a unique opportunity to rethink entrenched methodologies, revise outdated protocols and reorient around a new, long-term vision for recovery and new ways to operate and manage employees.
In other words, a crisis can be the impetus for much-needed organizational improvement. This idea seems to land more squarely with some leaders than others. Agile and visionary executives easily pivot, seizing the chance to transform their companies for long-term success. The rest continue to dig in their heels, maintaining unwarranted fealty to the status quo.
Unfortunately, the cost of stagnation is enormous, and it’s often magnified when multiple triggers ignite simultaneously.
Here are five key reasons leaders resist change and prevent their companies from moving forward, even in times of crisis. Identifying and evaluating these can propel leaders to foster forward-thinking organizations that continue to innovate, develop, and mature.
#1 Prioritization of urgent over important issues.
It’s not uncommon for leaders to confuse these terms. Important issues don’t have explicit deadlines, but they have some impact, large or small, on a business. In contrast, urgent issues have hard deadlines that need to be met to avoid potentially significant repercussions.
Too often, owners and managers spend too much time attuned to day-to-day (urgent) operations, putting out proverbial fires rather than delegating downstream and allocating personal capacity to big-picture (important) business development.
#2 Limited resources to initiate change.
Change can come with upfront financial and organizational costs. Therefore, while many leaders understand the value of innovation, they feel powerless to enact change because they lack resources, institutional support or other critical elements needed for transformation.
Organizations can be guilty of allocating too many financial resources to urgent or reactionary activities, preventing strategic initiatives from producing value.
#3 Lack of a roadmap for transformation. Trial and error rarely produce effective change. Without a clear roadmap, leaders often defer transformation rather than develop a strategic plan.
While it’s not uncommon for leaders to know the difference between where their company is and where it could be, they often don’t have a focused plan laid out on how to proceed. An effective plan should build on a clear definition of the scope of work. Having seen this many times in my career, I developed the ALICE method to help companies properly define the scope of their business transformation.
1. Articulate the problem to be solved.
2. List the ways or solutions to correct the problem.
3. Identify the means available to solve the problem.
4. Capture the enablers who will help move the transformation forward.
5. Evaluate synergies and interdependencies from existing initiatives.
Having an effective change methodology is the other catalyst for a successful transformation. It’s important to define activity streams that are well-linked to the challenge at hand. The combined effect of the right scope of work and a good change management approach is key to a well-executed transformation.
Some leaders develop their own expertise, while others hire experienced professionals to implement a smooth and successful transformation. Regardless of the approach, creating an understandable vision and plan of action will make the difference in either case.
#4 Incentivized to stay the same.
When an organization’s incentive structure supports stagnation, change is impossible. Short-term personal incentives inevitably override long-term transformation initiatives, causing companies to miss opportunities to create a structure for long-term success. For example, I represented a medium-size manufacturing company that had incentives for its leaders primarily based on meeting budget numbers. The transformation was designed to achieve step changes in performance, yet, as with many transformations, it was costly and disruptive. Not surprisingly, the program was not approved because the payback period exceeded the review cycle.
#5 Lack of courage or leadership abilities.
Organizational change requires uniquely equipped leaders capable of motivating, delegating, applying, advocating, convincing and mobilizing. It also requires the appetite for immense personal risk. In the case of the previous medium-sized company example, it would have required the courage of the leaders to go forward.
There are various risks associated with a business transformation. The most common are financial risk (to the organization), engagement risk (losing employee commitment) and opportunity risk (what the organization could have done with the time and resources had it not engaged in the transformation). The materialization of any such risk could potentially result in a career or reputational risk for the leader. It’s the courage of leadership to see beyond these hurdles.
Undoubtedly, it can be intimidating to take on such a challenging task. Not all leaders are well-prepared to confront reality, take risks and chart a new path forward. Most importantly, leaders must be authentic, demonstrating empathy while connecting and communicating with their teams.
Organizational change can feel like moving mountains. It’s a challenging task. The first obstacle to great achievements is conviction; the rest is just hard work.
Edwin Bosso, the author of 6,000 Dreams: The Leader’s Guide To A Successful Business Transformation Journey, is the founder and CEO of Myrtle Consulting Group, now a part of Accenture. Bosso specializes in operations improvement and change management, and his project history includes work for major brands such as Heineken, Texas Petrochemicals, T-Mobile, Anheuser-Busch, Rohm and Haas, Campbells Soup Company, Kellogg’s and Morton Salt.