Leading Change, Kotter, 2012
Transforming Organizations: Why Firms Fail:
• Allowing too much complacency: Overestimating how much big changes can be forced. Underestimating how hard it is to drive people out of their comfort zones. Not recognizing that leadership actions can inadvertently reinforce the status quo. Lack of patience. Becoming paralyzed by the downside possibilities.
• Failing to create a sufficiently powerful guiding coalition: To be successful the coalition must be powerful – formal titles, information, expertise, reputation, relationships and capacity for leadership.
• Underestimating the power of vision: Whenever you cannot describe the vision of a driving change in two minutes or less and get a reaction of understanding and interest, you are in trouble.
• Under communicating the vision: both words and deeds. Deeds are more powerful.
• Permitting obstacles to block the new vision: avoiding confrontation of obstacles disempowers employees and undermines change.
• Failing to create short-term wins: Successful transformation requires obtaining clear performance improvements, establishing goals, achieving the goals, and rewarding the people involved with recognition, promotions, or mone.
• Declaring victory too soon:
• Neglecting to anchor changes firmly in the culture: change sticks when it becomes “the way we do things around here”. Show people how specific behaviors and attitudes have helped improve performance. Ensure the next generation of management personifies the new approach.
Successful change and the force that drives it
• The eight step process must be implemented in sequence.
• Projects within projects: Most projects are a multistep process. At anyone time pieces are in different stages, like wheels within wheels.
• Successful transformation is 90% leadership and 10% management.
• Overmanaged, underled culture p. 31
• It is enormously difficult to enact by sheer force the big changes needed to improve organizational performance. Transformation requires sacrifice, dedication, and creativity, none of which comes with coercion.
• Leadership often begins with a small group that needs to grow over time. Organizations are too complex to be transformed by a single charismatic individual. Many people need to help with the leadership task by modestly assisting with the agenda.
Establishing a sense of urgency (stage 1)
• In an organization with 100 employees at least 24 must go far beyond the normal call of duty to produce a significant change.
• People will find a thousand ingenious ways to withhold cooperation from a process they sincerely think is unnecessary.
• When employees see no tornado-like threat, urgency is low.
• Data from external stakeholders is critical.
• Never underestimate the magnitude of the forces that reinforce complacency and help maintain the status quo.
• Increasing urgency demands that you remove sources of complacency. For example: eliminate signs of excess, set higher standards, change internal measurement systems that focus on the wrong indexes, vastly increase the amount of external performance feedback everyone gets, reward honest talk and people willing to confront problems, stop baseless happy talk from the top.
• Ways to raise the urgency level
o Create a crisis by exposing managers to major weaknesses, competitors, or allow errors to blow up instead of being corrected.
o Eliminate obvious examples of excess.
o Set productivity, customer satisfaction, and targets so high they can’t be achieved by business as ususal.
o Stop measuring subunit perfomance based on nawwor goals. Insist that more people be accountable for broader measures of performance.
o Send more data about customer satisfaction and performance to more employees.
o Use consultants to force more relevant data and honest discussion into management meetings.
o Put more honest discussion of the firm’s problems in newsletters, and senior management speeches. Stop senior management “happy talk.”
o Bombard people with info about future opportunity and the rewards for obtaining them. Also, emphasize the organization’s current inability to pursue those opportunities.
• It is better to create problems yourself then waiting for one. Then help people see the crisislike nature of the situation without inducing crippling losses.
• A majority of employees and 75% of management and all top executives need to believe that considerable change is essential.
Creating the guiding coalition (Stage 2)
• The guiding coalition team must include: position power, expertise, credibility, leadership.
• A guiding coalition made up of only managers will fail.
• Avoid: Egos and people who create mistrust that kills teamwork.
• Teamwork requires trust. The most common vehicle now used is some form of off-site set of meetings. Talk, analyze, climb mountains, and play games for purpose of increasing mutual understanding and trust.
Developing a vision and a strategy (stage 3)
• Vision is a picture of the future with commentary on why people should strive to create that future.
• A good vision
o Clarifying the general direction for change
o Motivates people to take action in the right direction
o Coordinates the actions of different people
o Characteristics of an effective vision
o Imaginable: conveys a picture of what the future will look like
o Desirable: appeals to the long-term interest of stakeholders
o Feasible: Comprises realistic, attainable goals
o Focused: Is clear enough to provide guidance in decision making:
o Flexible: Is general enough to allow individual inititative and alternative responses in light of changing conditions
o Communicable: Is easy to communicate; can be succefflully explained within five minutes
• A good vision captures the head and the heart, takes some time, involves a group of people, and is tough to do well.
Communicating the change vision (stage 4)
• The real power of a vision is unleashed when most of those involved have a common understanding of its goals and direction.
• The emotional work is the most difficult: letting go of the status quo and other future options, coming to grip with sacrifices, trusting others.
• Key elements in the effective communication of vision
o Simplicity: all jargon and technobabble must be eliminated.
o Metaphor, analogy, and example: a verbal picture is worth a thousand words.
o Multiple forums: big meetings and small, memos and newspapers, formal and informal interaction – all needed to spread the word.
o Repitition: Ideas sink in deeply only after they have been heard many times.
o Leadership by example: Behavior from important people must be consistent.
o Explanation of seeming inconsistencies
o Give and take: two-way communication is more powerful than one-way.
• The challenge of simple and direct communication is that it requires great clarity of thought and courage.
• The vision is first created by the guiding coalition.
Empowering employees for broad-based action (stage 5)
• The biggest obstacles are usually: structures, skills, systems, and supervisors.
• Attitude training is often as important as skills training.
• Empowering people to effect change
o Communicate a sensible vision to employees: create a shared sense of purpose.
o Make structures compatible with the vision: unaligned structures block needed action.
o Provide training employees need:
o Align information and personnel systems to the vision.
o Confront supervisors who undercut needed change.
Generating short term wins (stage 6)
• Characteristics of a short term win
o Visible, lots of people can see if the result is real or hype.
o It’s unambiguous; there can be no argument over the call.
o It’s clearly related to the change effort.
• Quick performance improvements undermine the efforts of resistors.
• The job of management is to win I the short term while making sure you’re in an even stronger position to win in the future.
• The essence of management: systematically targeting objectives and budgeting for them, creating plans to achieve the objectives, organizing for implementation and controlling the process to keep it on track.
Consolidating gains and producing more change (stage 7)
• Whenever you letup before the job is done, critical momentum can be lost and regression may follow.
• Running twenty change projects simultaneously is possible is a) senior executives focus mostly on the overall leadership tasks and b) senior execs delegate responsibility for management and more detailed leadership as low as possible in the organization.
• Eliminate unnecessary interdependencies.
• Stage 7
o More change, not less: the guiding coalition uses the credibility from short-term wins to tackle additional and bigger change projects.
o More help: more people brought in, promoted, and developed to help with changes.
o Leadership from senior management: maintaining clarity of shared purpose and keeping urgency levels up.
o Project management and leadership from below
o Reduction of unnecessary interdependencies.
Anchoring new approaches in the culture (stage 8)
• Culture changes after you have successfully altered peoples actions, after the new behavior produces some group benefit for a period of time, an dafter people see the connection between the new actions and the performance improvement. Thus, most cultural change happens in stage 8, not stage 1.
The organization of the future
• A high urgency rate is essential to complete all the stages of a transformation process.
• Systems cannot be designed to make the organization look good. They need to be created to provide honest and unvarnished news, especially about performance.
• The combination of valid data from a number of external sources, broad communication of that information inside the organization, and a willingness to deal honestly with the feedback will help squash complacency.
• Because management deals mostly with the status quo and leadership deals mostly with change, in the next century we have to become more skilled at creating leaders.
• Managerially empowered employees.
Leadership and lifelong learning
• The best leaders develop their leadership capacity and other skills with the power of compounded growth (professional development).
• Mental habits that support lifelong learning
o Risk taking: willingness to push oneself out of comfort zones.
o Humble self-reflection: honest assessment of successes and failures.
o Solicitation of opinions: Aggressive collection of information and ideas from others.
o Careful listening
o Openness to new ideas
• The best lifelong learners and leaders have high standards, ambitious goals, and a sense of mission in their lives.
• Union rules discourage personal growth.
• People who are attempting to grow, become more comfortable with change, develop leadership skills are driven by a sense that they are doing what is right for themselves, their families, and their organizations. That sense of purpose spurs them on and in spires them during rough periods.
Transforming Organizations: Why Firms Fail:
• Allowing too much complacency: Overestimating how much big changes can be forced. Underestimating how hard it is to drive people out of their comfort zones. Not recognizing that leadership actions can inadvertently reinforce the status quo. Lack of patience. Becoming paralyzed by the downside possibilities.
• Failing to create a sufficiently powerful guiding coalition: To be successful the coalition must be powerful – formal titles, information, expertise, reputation, relationships and capacity for leadership.
• Underestimating the power of vision: Whenever you cannot describe the vision of a driving change in two minutes or less and get a reaction of understanding and interest, you are in trouble.
• Under communicating the vision: both words and deeds. Deeds are more powerful.
• Permitting obstacles to block the new vision: avoiding confrontation of obstacles disempowers employees and undermines change.
• Failing to create short-term wins: Successful transformation requires obtaining clear performance improvements, establishing goals, achieving the goals, and rewarding the people involved with recognition, promotions, or mone.
• Declaring victory too soon:
• Neglecting to anchor changes firmly in the culture: change sticks when it becomes “the way we do things around here”. Show people how specific behaviors and attitudes have helped improve performance. Ensure the next generation of management personifies the new approach.
Successful change and the force that drives it
• The eight step process must be implemented in sequence.
• Projects within projects: Most projects are a multistep process. At anyone time pieces are in different stages, like wheels within wheels.
• Successful transformation is 90% leadership and 10% management.
• Overmanaged, underled culture p. 31
• It is enormously difficult to enact by sheer force the big changes needed to improve organizational performance. Transformation requires sacrifice, dedication, and creativity, none of which comes with coercion.
• Leadership often begins with a small group that needs to grow over time. Organizations are too complex to be transformed by a single charismatic individual. Many people need to help with the leadership task by modestly assisting with the agenda.
Establishing a sense of urgency (stage 1)
• In an organization with 100 employees at least 24 must go far beyond the normal call of duty to produce a significant change.
• People will find a thousand ingenious ways to withhold cooperation from a process they sincerely think is unnecessary.
• When employees see no tornado-like threat, urgency is low.
• Data from external stakeholders is critical.
• Never underestimate the magnitude of the forces that reinforce complacency and help maintain the status quo.
• Increasing urgency demands that you remove sources of complacency. For example: eliminate signs of excess, set higher standards, change internal measurement systems that focus on the wrong indexes, vastly increase the amount of external performance feedback everyone gets, reward honest talk and people willing to confront problems, stop baseless happy talk from the top.
• Ways to raise the urgency level
o Create a crisis by exposing managers to major weaknesses, competitors, or allow errors to blow up instead of being corrected.
o Eliminate obvious examples of excess.
o Set productivity, customer satisfaction, and targets so high they can’t be achieved by business as ususal.
o Stop measuring subunit perfomance based on nawwor goals. Insist that more people be accountable for broader measures of performance.
o Send more data about customer satisfaction and performance to more employees.
o Use consultants to force more relevant data and honest discussion into management meetings.
o Put more honest discussion of the firm’s problems in newsletters, and senior management speeches. Stop senior management “happy talk.”
o Bombard people with info about future opportunity and the rewards for obtaining them. Also, emphasize the organization’s current inability to pursue those opportunities.
• It is better to create problems yourself then waiting for one. Then help people see the crisislike nature of the situation without inducing crippling losses.
• A majority of employees and 75% of management and all top executives need to believe that considerable change is essential.
Creating the guiding coalition (Stage 2)
• The guiding coalition team must include: position power, expertise, credibility, leadership.
• A guiding coalition made up of only managers will fail.
• Avoid: Egos and people who create mistrust that kills teamwork.
• Teamwork requires trust. The most common vehicle now used is some form of off-site set of meetings. Talk, analyze, climb mountains, and play games for purpose of increasing mutual understanding and trust.
Developing a vision and a strategy (stage 3)
• Vision is a picture of the future with commentary on why people should strive to create that future.
• A good vision
o Clarifying the general direction for change
o Motivates people to take action in the right direction
o Coordinates the actions of different people
o Characteristics of an effective vision
o Imaginable: conveys a picture of what the future will look like
o Desirable: appeals to the long-term interest of stakeholders
o Feasible: Comprises realistic, attainable goals
o Focused: Is clear enough to provide guidance in decision making:
o Flexible: Is general enough to allow individual inititative and alternative responses in light of changing conditions
o Communicable: Is easy to communicate; can be succefflully explained within five minutes
• A good vision captures the head and the heart, takes some time, involves a group of people, and is tough to do well.
Communicating the change vision (stage 4)
• The real power of a vision is unleashed when most of those involved have a common understanding of its goals and direction.
• The emotional work is the most difficult: letting go of the status quo and other future options, coming to grip with sacrifices, trusting others.
• Key elements in the effective communication of vision
o Simplicity: all jargon and technobabble must be eliminated.
o Metaphor, analogy, and example: a verbal picture is worth a thousand words.
o Multiple forums: big meetings and small, memos and newspapers, formal and informal interaction – all needed to spread the word.
o Repitition: Ideas sink in deeply only after they have been heard many times.
o Leadership by example: Behavior from important people must be consistent.
o Explanation of seeming inconsistencies
o Give and take: two-way communication is more powerful than one-way.
• The challenge of simple and direct communication is that it requires great clarity of thought and courage.
• The vision is first created by the guiding coalition.
Empowering employees for broad-based action (stage 5)
• The biggest obstacles are usually: structures, skills, systems, and supervisors.
• Attitude training is often as important as skills training.
• Empowering people to effect change
o Communicate a sensible vision to employees: create a shared sense of purpose.
o Make structures compatible with the vision: unaligned structures block needed action.
o Provide training employees need:
o Align information and personnel systems to the vision.
o Confront supervisors who undercut needed change.
Generating short term wins (stage 6)
• Characteristics of a short term win
o Visible, lots of people can see if the result is real or hype.
o It’s unambiguous; there can be no argument over the call.
o It’s clearly related to the change effort.
• Quick performance improvements undermine the efforts of resistors.
• The job of management is to win I the short term while making sure you’re in an even stronger position to win in the future.
• The essence of management: systematically targeting objectives and budgeting for them, creating plans to achieve the objectives, organizing for implementation and controlling the process to keep it on track.
Consolidating gains and producing more change (stage 7)
• Whenever you letup before the job is done, critical momentum can be lost and regression may follow.
• Running twenty change projects simultaneously is possible is a) senior executives focus mostly on the overall leadership tasks and b) senior execs delegate responsibility for management and more detailed leadership as low as possible in the organization.
• Eliminate unnecessary interdependencies.
• Stage 7
o More change, not less: the guiding coalition uses the credibility from short-term wins to tackle additional and bigger change projects.
o More help: more people brought in, promoted, and developed to help with changes.
o Leadership from senior management: maintaining clarity of shared purpose and keeping urgency levels up.
o Project management and leadership from below
o Reduction of unnecessary interdependencies.
Anchoring new approaches in the culture (stage 8)
• Culture changes after you have successfully altered peoples actions, after the new behavior produces some group benefit for a period of time, an dafter people see the connection between the new actions and the performance improvement. Thus, most cultural change happens in stage 8, not stage 1.
The organization of the future
• A high urgency rate is essential to complete all the stages of a transformation process.
• Systems cannot be designed to make the organization look good. They need to be created to provide honest and unvarnished news, especially about performance.
• The combination of valid data from a number of external sources, broad communication of that information inside the organization, and a willingness to deal honestly with the feedback will help squash complacency.
• Because management deals mostly with the status quo and leadership deals mostly with change, in the next century we have to become more skilled at creating leaders.
• Managerially empowered employees.
Leadership and lifelong learning
• The best leaders develop their leadership capacity and other skills with the power of compounded growth (professional development).
• Mental habits that support lifelong learning
o Risk taking: willingness to push oneself out of comfort zones.
o Humble self-reflection: honest assessment of successes and failures.
o Solicitation of opinions: Aggressive collection of information and ideas from others.
o Careful listening
o Openness to new ideas
• The best lifelong learners and leaders have high standards, ambitious goals, and a sense of mission in their lives.
• Union rules discourage personal growth.
• People who are attempting to grow, become more comfortable with change, develop leadership skills are driven by a sense that they are doing what is right for themselves, their families, and their organizations. That sense of purpose spurs them on and in spires them during rough periods.