Thursday, December 01, 2016

Sustaining the momentum of a transformation
By Michael Bucy, Kevin Carmody, Jennifer Davies, and Greg Peacocke

Five elements can keep bad habits from reasserting themselves.

Sorry for not having any postings in November. A few things contributed:
Recovering from the U.S. elections (this is NOT a political statement)
Some client work

Let’s now continue our dialog

The importance of sustaining a transformation may sound obvious—and the actions required straightforward. But they’re not. Companies typically neglect this long-term imperative because, understandably, they’re obsessed by the short-term gains. They underestimate the difficulty of kicking old habits and developing a healthy new approach that will be manifest in thousands of everyday actions rather than referenced by a simple checklist. New skills, intense discipline, and strong personal relationships are needed to maintain the momentum. 
The key to sustaining a transformation is to embed what we call an “execution engine,” a replicable process that fundamentally changes performance rhythms and decision making in the business. It’s about raising sights beyond the strategic choices and daily initiatives to change how the organization 

1. Take an independent perspective.
Challenging everything is exhausting, but companies that sustain change are never satisfied with the situation today. They continue to look for fresh facts, rather than accepting the status quo. They guard constantly against falling back on negotiated targets that managers will accept easily. 

2. Think like an investor (particularly, a private-equity firm).
This mind-set is not always popular inside organizations, but adopting it is not just for the executive team. We all know how passive employees kill the dynamism of a business. Employees in successful companies sustain their transformation by constantly challenging colleagues, not just getting along. They refuse to settle back into a leisurely pace of decision making. And they pursue new sources of value. 

3. Ensure ownership in the line.

During the transformation program per se there is an inevitable tendency for management and outside advisers to set the targets (as happened with the North American engineering company). This should be resisted. Businesses with large central teams that own centrally imposed initiatives, embedded in budgets without buy-in from managers, are most at risk of falling back into their old ways. 

4. Execute relentlessly.
It’s all too easy for companies to allow the pace to let up once the initial improvement targets are achieved. It’s simpler to delegate, after all. But when senior executives go back to high-level target setting and avoid immersing themselves in the details—perhaps on the dubious pretext that they don’t want to micromanage—the warning lights should be starting to flash. 

5. Address underlying mind-sets.
Inspired employees make all the difference in an organization and in our experience conspicuously outperform those imprisoned by a traditional command-and-control culture. Managers should not just challenge; they must instill meaning. They must recognize extra effort. And they should not assume that employees necessarily understand why the company has to operate in a different way in the future.

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