OrganizationalChange

Today’s Customer Is Not Going To Be The Same As Tomorrow’s Customer

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There’s an old Wayne Gretzky quote that I love, “I skate to where the puck is going to be, not to where it has been”. Similarly, an organization must focus the business around tomorrow’s customer, not today’s customer. The organization must continually learn from its customers to guide the business. It is imperative that the organization considers where, why and how the customer will be using the product.

For example, consider the evolution of the personal banking user experience. Traditionally, the bank’s customers would ask the teller at the bank to complete their transaction. Banks optimized this by creating ATM banking machines. ATMs were revolutionary because the banks could place the units in any retail space, providing the same core services to customers, at a greater convenience and less cost (fewer tellers needed) towards the organization. Banks have continued to optimize the experience for their customer by introducing internet banking and now, mobile banking.

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Banks valued evolution over optimization. If they continued to optimize the tellers’ workflow, the banks would have highly efficient tellers without many customers entering the bank. If your organization don’t continually evolve, another organization will.

Predicting the future is not easy. If it were, I would be in the stock market. However, there are certain processes change agents can implement in an organization to guide the product:

  • Customer Councils: Regular meetings with customers to discuss the product
  • Active User Community: Having an online presence where the users can interact with each other and your organization’s employees. Building active user communities will retain customers who may have been looking at other options.

Organizations that focus on maximizing ROI will inevitably fail. The organization fixates on the receiving the highest margin possible at the cost of losing sight of the customer. Instead, I suggest that the organization should focus on customer value, as satisfied customers will continue to buy the organization’s product thereby generating more ROI. This is a win-win for both parties.

David Dame

 

tomorrow's customer

At the end of the day, organizations need to transition from operational to strategic. They must take risks to predict and target where the customer is going, not just where it is today.

Building Change Momentum

This is the final post in a three part series. Please like, share and comment. Please click here for Part 1 and here for Part 2.

Suppose you have a persistent group in your organization who has been completing its job the same way for a significant period of time. They refuse to change despite multiple suggestions on areas where the team could improve. Why will the team not accept the change?

The group refuses to change because it does not see benefits of changing. Transforming an organization is a time consuming process and change agents will commonly go for the home run when implementing change. Spontaneously implementing a “large” scale change event every few years will lead to changes not supported by employees. Employees need to see the short-term wins, organizational improvement that can be implemented in 3 to 18 months. These short wins will create momentum and keep the organization engaged.

 

Organizational change is not a one-sized fits all solution. I size change into one of three sections:

  • Small: Small scoped, operational changes that are not dramatic changes to the organization. The scope of the change is contained in one function, department or level. For example, removing waste from your current processes (See my blog post on Organizational Hoarding for more).
  • Medium: Medium sized changes commonly span more than one function, department, or level within the organization. For example, ...re-defining a new workflow that spans across departments like release processes.
  • Large: Large scope changes span across numerous functions, departments and/or levels, involving a large number of people. These are changes that are radically new or foreign to the organization’s current environment or culture. For example, introducing new performance review practices, huge organizational structure/team/people design, a Fail Fast, Fail Often methodology, or continuous delivery/integration.

 

In my previous blog post titled “Is change ever over? Do we need middle management?”, I discuss how an organization must move from sporadic transformations to an environment setup to continually change if wants to succeed in today’s ever-evolving environment. Implementing major change takes time. Organizations cannot continually rollout “large” scale changes one after another. This will lead to chaos. Instead, the change agents should implement a few smaller, operational changes in between larger, strategic changes. Implementing these smaller changes will give the change efforts immediate visibility, manage the resisters of change, and provide all three layers (i.e. top, middle, and operational)) of the organization real feedback about the validity of the change.

The Change Team will learn how to work together

More importantly, the knowledge the ‘change team’ will gain from working together on small ‘quicker’ changes will help them evolve to a more cohesive, stronger team. The change team will go through phases that all teams do. Bruce Tuskman defined the five step process that most teams follow to achieve high performance. Many newly formed change teams never progress beyond the first stage: forming. In this stage, team members are cautious, positive and polite. Some might be anxious with the new team members. It is imperative that the change team moves past this stage and onto the next stages quickly. The team will need to deal with its own dysfunctions before it can tackle the organizations’. The longer the change team remains uncomfortable with each other, the longer implementing change will take. Team members must feel comfortable enough to giving and receiving feedback. Rolling out change cannot be done individually, the team must roll out the change as a unit together. Change teams are a microcosm of the organization. They need to update their membership regularly to provide new insights, perspectives, and  to adapt to the ever-changing environment.  

At the end of the day, the organization’s main goal is to continue delivering products or services, not implement changes. As change agents, your role is to make the implementation of changes as seamless as possible. Smaller sized chunks will prevent a large disruption in the workflow. The changes will allow the employees to grow accustomed to environment that is continually evolving, refocus the status quo and continue to make the organization deliver high value services.

David Dame

Organizational Change and the Vertical Slicing Approach

When implementing an agile transformation, do you start from the top or bottom of the organization? My experience has shown it is best to take a complete vertical slice of top, middle, and the bottom.

“Organizational design is the methodology which identifies dysfunctional aspects of your organization’s workflow and realigns them to fit current business goals (and supporting values).” (Dr. Allen, 2012).   The best way to align the organization’s workflow to fit the current business ways is an approach I call “vertical slicing”. 

Vertical Slicing is a holistic process where an organization is split the organization into small cross level and cross functional change teams. Each change team consists of members from each level of the organization (i.e. Scrum teams, middle management and executives). The organization will be moving together as all three levels will be involved in the implementation of change. Selecting a few of these teams as the change champions (pilot teams to test the change on), will provide you with a small sample of the organization to experiment with and test the interconnections between the different levels of the change. This is a cross-level approach.

There’s an important distinction to make between a cross-functional approach and the cross-level approach. The cross-functional approach involves removing barriers between roles within the same level. For instance, an organization employing the cross-functional approach would share knowledge between developers, testing and QA. The cross-level approach involves removing barriers between different levels of the organization. For instance, an organization employing the cross-level approach would be sharing relevant knowledge between finance, developers, and post-sales. The vertical slicing approach encourages you, as change agents, to combine cross-functional and cross-level approaches forming teams of different roles and different levels. This will increase the variety of your change champions and limit the areas of the change that are not tested.

Any change moving the organization from traditional job models to new job models, from individuals to teams changes the interconnections of the organization. To re-align these interconnections, you will need to visibly show the employees how this benefits them. This can be achieved through incentives:

  • Learning Paths: Employees will be able to interact with different facets of the organization. This allows them to experiment and learn. This will motivate employees as they will see the vertical slice teams as way to progress through the organization.
  • Performance Reviews: Employees will be evaluated on how well they interact with their new role from individual to  team

Vertical slicing will improve the communication between the different levels of the organization thereby increasing the feedback loops and ensuring the middle management stays involved. The middle management's main role is to find the balance of where the organization currently is and where it wants to be. However, the middle layer is typically forgotten about as the change agents prioritize convincing the executives to implement the change and the Scrum teams to adapt the change. Without the middle management, there is a lack of communication between the organization’s executives and Scrum teams. Implementing vertical management will start the the transformation of your traditional middle managers into new middle coaches (Providing customer focus/empathy, company values, relationship/professional development). 

Vertical slicing will guide the organization towards a culture of innovation and leadership. Each “change team” will consist of different levels of the organization where each level will be interconnected and allow the change agents to validate their experiments. Yielding control of change validation from the individuals to the teams will push autonomy down and build an environment where decisions can be made at any level. 

David Dame

Change is specific to your Organization...let your organization own their change.

Through my years of trial and error,  I have learned there is no one size fits all solution to transitioning organizations to agile..context is king! Every model is based on different organizational contexts. Each model’s context has its own starting and ending point. There’s no guarantee that your organization is at the same starting point and aiming to end at the same ending point.

 

Organizations commonly introduce (SAFEe) large agile models. A common misconception is if it’s big and prescriptive, it must be good! However, this leads to high disruption to the organization and a steep learning curve. This slows down the people as they must use new, foreign practices. The organization’s rush to become agile overnight by introducing a heavy weight model causes them to   lose sight of the fact that the primary purpose of the organization is deliver products/services, not to be agile. When organizations transition to agile, they need to walk the line between gaining adoption of agile practices and continual delivery of their product/service. They do this by phasing their rollout as a series of experiential learning by groups of people who do the work.



The Composite Model

I have developed a composite model based off the works of Jason Little. This model is separated into small bite sized chunks that can be consumed in any order. You do not need to implement this model linearly.

 

To achieve agility , you must fully understand the organization’s context. Organizations are built from the efforts of their people. These people can identify the impediments that are prohibiting their  team from delivering product or service to market quickly (i.e. the pain points).  Identifying impediments requires you to visually illustrate where the impediments are and select employees at all levels of the organization who are affected by this change. Involve them with every step of the process.  (HINT: This is the topic of the next blog post. Subscribe on the right and I’ll email you when the post comes out)

 

Once the impediments are identified, organizations should list out some possible solutions and identify success criteria for each impediment. Next, they can run experiments to test each proposed solution and solve them incrementally. The solution to the impediments may not be found from the first experiment. It might require several trials until the desired outcome is found.

 

This model is fairly generic intentionally. There’s no magic formula to solve how to make your organization agile. Every organization is different and will be facing different impediments. It’s up to you as the change agents to determine what those impediments are by encouraging small, incremental changes and prioritizing the people ahead of the processes and tools.

 

Organizational Agility is a journey, not a destination.

David Dame


This is the first post in a three part series. Please like, share and comment and I’ll be sure to update you when the next post in the series comes out.

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Are your HR Practices Lean Enough? - Scale Engagement Agility

In today's rapidly changing world of disruptive innovation organizations need to be nimble enough to support this.  We are asking our workforce to do this by becoming 'agile'.  We want the agility to quickly pivot and seize new opportunities.  We want to deliver to market sooner. We want our employees to innovate and deliver highly complex work more rapidly.  

Today's organizations are moving away from large transformational events and moving toward doing continuous change.  These organizations are flat.  How do we create a culture that inspire employee engagement to enable these organizations to thrive in this continuous change?

Agility is no longer just an IT or Engineering movement, it is something that the entire organization needs to embrace.  For this to be effective and long lived it needs the full involvement of human resources, organizational leaders, and change agents.  There is some thought leaders that are already forward thinking and creating events for all these disciplines to come together to align to this common purpose.  The Spark the Change event held in Toronto facilitated this movement.

"Individual commitment to a group effort--that is what makes a team work, a company work, a society work, a civilization work." --Vince Lombardi

In my last blog post - Scaling Engagement Agility, I voiced my concern Agilists (change agents) to think beyond scaling frameworks and tooling.  As Agilists, we need to rethink and adapt our beliefs.  For example, in the 1990s and early 2000's we took a strong stand on co-located teams.  We said this was a critical for an organization to adopt agile.  Although, co-location is the highest fidelity for interacting, it does not match trends in the workforce of home offices.  The technology tools available for collaboration has narrowed the gap of communication challenges with distributed teams.  This can help support the workforce trend of working from home or in coffee shops.

HR traditionally believed it's function is to put order and structure to the organization, yet Agile believes in rapid change by breaking down structure and order. - James Cleaver

Human resource practices need to adapt to this new fast-paced environment.  They need to become 'lean', they need to become 'flexible', they need to become 'agile'. There is no longer a guaranteed long relationship between employee and employer.  The balance of power used to be with the employer. The employer would be their only one for the duration of the employee's career.  In today's world there is more of a balance between employer and employee.   

Our workforce doesn't look at getting a job with you and staying there the rest of their lives unconditionally.  They see their job as a reflection of who they are, not merely what they do to earn money.  Our employees will always desire to grow and evolve because of this connection between what they do and who they are.  They have more opportunities available to them.  No longer are they restricted by the geographic location.  They have an ability to work for any organization around the world.  

The average worker today stays at each of his or her jobs for 4.4 years, according to the most recent available data from the Bureau of Labor Statistics, but the expected tenure of the workforce’s youngest employees is about half that.

Ninety-one percent of Millennials (born between 1977-1997) expect to stay in a job for less than three years, according to the Future Workplace “Multiple Generations @ Work” survey of 1,189 employees and 150 managers. That means they would have 15 – 20 jobs over the course of their working lives!

In this new equilibrium of power we need to treat our employees like potential customers.  I always hear the phrase that we need to make it easy for customers to do business with us.  I also contend we need to make it very easy for employees to work for us.  So how do we create an employee centric atmosphere in this new workforce?  We need to take a holistic approach in creating this employee centric environment.

Dr. Philip A Foster stated, "It was predicted that by the year 2000 that less than 50% of the working population would be in full time employment. In 2011 the number was actually less than 45%. If we play that trend out, by the year 2040 it is anticipated that there will be less than 30% in full time employment."

What are some things we can look at to connect with employees quicker and continually?

Job models.  How do we adjust this for the new rapid workforce?  If we want our organizations to innovate and change, how can we lock down long term career paths?  We still need some sense of how an employee will fit and grow within an organization but it doesn't make sense to make them so long and rigid.  Instead of projecting their career for the next 5 to 10 years we should shorten the horizon to 2 to 3 years.  We keep these as lean and flexible as possible.  As your organization innovates and changes new roles and job models will arise. Keeping open and flexible models allows employees to see themselves in a continually changing organization.

Training.  How do we training budgets closer to the employees?  How do we allow for more autonomy to the person of what they can choose for training?  If the training can only be approved based on today's goals, how do we open our employees minds up to training that might help the organization pivot to new opportunities?  We need to make these resources closer to the employee so they have more direct access.

Performance reviews.  In today's environment of rapid and continual change, I believe we need to accelerate from twice a year to continual performance reviews.  Continual performance reviews are just continual feedback loops.  These feedback loops are no longer just between manager and employee, but all the people that this employee interfaces with so they get this 360 continual view.  This continual feedback allows for continual positive reinforcement, frequent course corrections, and initiatives as needed.

Building a relationship with your people.  Your regular touch points with your employees need to be frequent and about them. This is all about them, not their projects or tasks.  Where do they see themselves? What's on their minds?  What are they dealing with.  If you are not doing this regularly, I guarantee that a recruiter from another company is. In today's connected world outsiders have access to our people and they know it's about them to steal them away.

The whole organization needs to work together to retain their best talent and keep them engaged.  No longer can there be disconnected independent initiatives working in silos.  We all need to work together HR, Leaders, Agilists, change agents and others.  I would love to hear your thoughts and what your organization is doing.

"Coming together is a beginning. Keeping together is progress. Working together is success." --Henry Ford

David Dame

Please join the LinkedIn Group to have discussions and share what your organization is doing on Engagement Agility



It's all about the results

On your journey towards organizational agility you will have to use many tools out of your toolkit.  You will use agile/lean models and practices, older models and practices, custom solutions, and common sense.  Organizational agility is about achieving the results not the means of getting those results.

Nobody is going to give you a gold star if you implement a purely agile solution.  There is no industry model that can be implemented out of the box to meet your organization's needs.  These models are a good start… But any transformation agent worth their weight does not stop there.  They involve this model in through numerous inspect and adapt cycles to constantly fit the context of your organization.


Authority vs. Influence in Leading Organizational Change

Authority – the power or right to give orders, make decisions, and enforce obedience.

Influence – the capacity to have an effect on the character, development, or behavior of someone or something, or the effect itself.

Authority is power.  If you want to rule the galaxy by power, then join the dark side of the force.  Influence is ability. If you want to lead the galaxy by working together with the citizens to solve the problems, then continue your training to become a Jedi Knight.


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Early on in my career I would always say to myself… If only he had the authority to make these things happen. It would be easy. I had some misconceived notion that being able to say what needs to be done would equate to those things actually being done.  I would simply create a vision, tell the organization that they had to follow this vision and I can move on to the next challenge.

As I progressed through my career I moved into positions with authority.  My dream finally came true… I would not need to spend a long time campaigning to the mass number of people to get their buy in, I could simply give the marching orders.  Although this helped change move quicker, it was not long-lived.  The moment we achieved the goal or I redirected my focus to the next opportunity, the previous initiative would fall back to its previous state.

Authority gives you immediate change but it's not long-lived. You can tell somebody what to do.  They may do it for the moment.  Unless they understand what the problem is that you're trying to solve and why you're doing it, they will not continue doing so after the change.  

Authority causes people to act on orders/tasks.  Influence is working with people to understand and solve the problem collaboratively together.

In dealing with organizational change, I have learned a great deal of what is needed to help move the critical mass from their current state to the desired state, and to ensure sustainability.  I have had to develop a skill set to connect with people, build their trust, unleash their passion, grow their confidence, and move toward a shared vision.  Being able to influence takes a lot of work.  You don't get there overnight.  You need relentless pursuit. The ability to be open to refine the vision as you get insight from these people.  Give autonomy to those people affected by the change.  Lead by example.  Build long-lasting relationships.  Earn respect.

Influence is when others accept your ideas or direction. It means that people have internalized your message. They believe it. They might even be excited about it. 

Authority causes people to act on orders/tasks.  Influence is working together to understand and solve the problem.

For long-lived organizational change you need to put in hard work toward influencing the people.  People are very habitual.  To develop these habits it takes time.  We do not quit bad habits, rather replace them with good habits.  Make being a positive influence your habit.  Having influence with others does not only make you a fantastic change agent, it also makes you an fantastic colleague.

In future posts I will speak to this specifically in the context of Organizational Agility Transformations.

David Dame

Organizational Innovation requires Guts and Investment

We all have heard those stories of people on their death bed saying that their biggest regret in life was not taking more chances… I'm sure that there are companies that are no longer around echoing those same words.

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Medium to large organizations are good at putting out fires or dealing with crisis as death is imminent.

Complacency is the silent organization killer.  It is not in immediate death, rather a slow death by bleeding slowly until there is no more life in the organization to innovate and compete.

Organizations are always striving to improve their efficiency and productivity.  They put all of their time and effort into continuously improving their current processes and practices.  This is good to do, but it will only give you marginal gains. We see minimal benefit to this as people don't want to seem to put the effort in because the see a low return on their investment.

However, to achieve the biggest gains, organizations need to invest hugely in new and bold ways to do things.  They need to have the guts and take a chance to be able to embrace a managed disruptive environment to the current status quo.  They need to put an investment of time and resources independent from the ones that are running current operations to introduce out-of-the-box thinking that will totally innovate the way they deliver their products and services today.  They need a lot of courage to have a substantial return on investment.  

One Person with Courage Has Success, Others Afraid Fail

 

Referencing Dr. John Kotter's change model, as an organizational coach, you need to work with the leadership and create that sense of urgency.

Organizations (like people), have a threshold for handling change.  As an organizational coach, you need to be aware of what your organization's upper boundary is to change.  Although we strive to get them to be confident to handle the operational innovation disruption, you do not want to create an anxiety that cripples the company from functioning.  Working with them over time, you get to improve their confidence to embrace change and you also have a pulse on the upper boundary limit to which they can handle the disruption.

How can you manage this organizational risk effectively?  Use the scrum framework as a tool in leading these organizational change initiatives.  Establish a good time boxed cadence and leverage the built-in inspect and adapt component of the framework will help provide transparency to allow the organization to pivot to move toward their goal.

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Your continuous improvement strategy needs to incorporate both  operational innovation initiatives  as well as continuous improvement of current processes.  These two things working in concert will help your organization to have a balanced portfolio to be able to lead and compete to an ever-changing environment to support their customers in the ever changing marketplace.

Organizations need to fully invest time & money to get a dedicated guiding coalition.

When companies go through a major organizational transformation (like bringing in agile).  The organizations that do not staff this change appropriately struggle in their agile adoption.  Asking employees to lead major operational innovations but still having to do there regular day-to-day job will stifle the innovation initiative.  Those organizations that staff  properly by either re-shifting internal resources, hiring new full-time resources, or by engaging in external consultants or change agents have had greater success in their organizational transformation.  

How do you create this sense of urgency and get the investment needed?

Develop a Change Vision.

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If you can visualize it, you can make it real.  You need to have a vision.  More importantly you need to communicate this vision effectively.  If you can't make this vision easily consumable to the organizational leadership team, its stakeholders, the people affected by this innovation, it will not get traction.  People already have a fear of change..  An effective vision will mitigate the fear of the unknown.  Jason Little, one of the most brilliant organizational change agent peers that I've come across has an awesome strategy on how to map this vision out.  You can review the slides here.

You can't compete in tomorrow's world with what you're doing today.  Instead of putting all your resources in trying not to fall, spend that time to be courageous enough to have your organization to succeed  Don't just say you want to do it… Put the resources into making this happen.

I rather talk about the success I have had from the mistakes that I learned from than the regret of not taking chances that might have helped me succeed.  

David Dame