Change is on everyone’s mind at this time of year – or more particularly people are preoccupied with resolutions of change. Hopes of transformation fly high. But most of us will lapse from whatever pledges we make, not because we don’t really want to change necessarily but because the habit of what we have done or know well is too comfortable for change to endure.
Companies are no different. As Professor Robert Sull put it so well back in 1999 in a paper titled “Why Good Companies Go Bad”, organisations, just like individuals, tend to snub the transformation they really need to decisively shift their reputation or market share in favour of persisting with established patterns of behaviour that they are comfortable with.
Sull dubbed this phenomenon not just as inertia but as “active inertia”, because companies keep themselves busy with activities that, conciously or not, are often directed away from the transformation they claim to want and towards variations of business as usual.
Professor Sull’s point was that such sustained patterns of behaviour degrade in their value and contribution to the business over time. Ironically, the very pillars that are meant to drive progress and support reputation come to act as anchors to innovation and business change as organisations turn inward. Strategic frames, he pointed out, become blinders; processes turn into routines; relationships devolve into shackles; and values transform into dogmas.
As a result, business change programmes become the corporate equivalent of a fight in a paper bag. Everyone’s told they need to change, but most people are left guessing as to what difference these upheavals will make to the brand’s reputation and/or what they are going to get out of all this change. Preferring the devil they know to the transformation they don’t, they opt for inertia.
You can of course try and fight this tendency to look inward (good luck!) or you can draw on it. One very effective way to do that is to take a serious look at the purpose flag under which you sail. In other words, channel the intense internal energy that most companies generate to reset your aspirations as a brand. Reframe your thinking so that the focus is less on ‘what we’re doing’ and more on ‘why would we want to do that’. Taking the cue from Sull, the key issue for most organisations who recognise a need to move on from where they are competitively is not what they are doing or even what they are changing but what they need to become.
After reading Blue Ocean Strategy many years ago, I made this note: “Uncompetitive companies can sell out, tough it out or invent their way out of where they are.”
The last option daunts many, but it’s really not that difficult. It starts with this sentence: “What if we were …?”
Here are my five simple questions to help overcome active inertia and guide effective transformation.
1. Who do we most aim to be as a company? (What reputation would most excite us as a culture?)
2. As a consequence of that, what do we most need to do to gain that reputation? (irrespective of what others are doing or what we ourselves have been doing)
3. As a consequence of pursuing those actions, what will need to change?
And then the simplest but for many people the most telling questions of all:
4. Of all the major projects the brand has running at the moment, how many of them are helping that transformation?
5. Of all the work that our teams have on their desks at the moment, how much of that is helping that transformation?
So many change programmes start with the need to admit failure or defeat. The intention is to make the case for not doing more of the same. But I have watched such sessions quickly descend into a self-absorbing blame game that stirs those concerned to make bold commitments by way of redemption that, subsequently, wither and die under a number of guises.
Despite the promises and reassurances that many will give, if you are uncompetitive, you are where you are for a reason – and “active inertia” may well be your biggest threat. As Marshall Goldsmith so brilliantly observed about transformation, “What got you here won’t get you there”.
But, just like New Year’s resolutions, looking to just make changes, however well intentioned or sincere, won’t necessarily get you anywhere. All you are doing in many cases is entering a very long, dark tunnel at speed with your fingers crossed.
To really succeed, you need to know what, why and where “there” is for your brand, and you need to be constantly and consistently measuring your progress towards that point of purpose, financially, perceptively and culturally.
Change must be a consequence of seeking to become that brand, not the other way round.