Per here (and a lot of other research), we’ve got stats saying that:
- 85% of leaders have had to undergo a “business transformation” in the past decade
- 75% of those efforts fail
That’s a huge failure rate. 75% wrong is a 25 on a test in high school. Your father might go get the belt, naw mean?
But business transformation is seemingly important. If it fails — which it does 3 out of 4 times, good Lord — couldn’t that be a bad sign for the future of your business?
You’d think so, but if you’ve ever worked anywhere white-collar, you know the drill:
“We’ve always done things this way!” frequently wins the day, and as long as some growth metric can be cited in some all-hands meeting, we good. Just keep rinsing and repeating whatever you were doing. This is why the smartest, best people in organizations burn out and leave, and the drones who drink the Kool-Aid rise to the top.
But that’s not the point of this post.
If transformation is so crucial — especially in the face of supposed disruption — then why does it fail so much?
It ignores psychology
Here’s a pull quote from that above article:
The result is that transforming a business also depends on transforming individuals — beginning with the most senior leaders and influencers. Few of them, in our experience, have spent much time observing and understanding their own motivations, challenging their assumptions, or pushing beyond their intellectual and emotional comfort zones. The result is something that the psychologists Lisa Lahey and Robert Kegan have termed “immunity to change.”
Right. See, automation isn’t fully at scale yet. A business is still a collection of individuals. So if they don’t change, how would the business change?
On its face, the team was aligned, focused, and committed to a new multi-faceted strategy with a strong digital component. But when we looked at the team’s mindset more deeply, we discovered that they shared several underlying beliefs including, “Everything we do is equally important,” “More is always better,” and “It has to be perfect or we don’t do it.” They summarized these beliefs in a single sentence: “If we don’t keep running as hard as we can, and attend to every detail, everything will fall apart.”
Not surprisingly, the leaders found they were spreading themselves too thin, struggling to pull the trigger on new initiatives, and feeling exhausted.
That second team was facing disruption from a startup. They were floundering. See why?
“The closest thing many men have to fun…”
Now, by this point, we all know the workaholic is a bad thing. It does a lot of negative stuff, including:
- Weaker family bonds
- Poor health
- Lack of priority
- Too much attention to detail = missing the bigger picture
But see, we all have holes to fill in our lives. And a lot of guys who come to run companies or big divisions of companies fill this hole by essentially marrying themselves to work. Everything is crucial. They always gotta be running 100 MPH. We’ve all worked with these guys. And we all know they get to the top, even if they have no clue what “strategy” even means.
You can’t ignore the psychology.
Think about something like “trying to be more agile.” To a lot of guys, that means they have less work to review. Bottlenecks — i.e. them as leaders — are being removed. But that’s tremendously threatening to a guy who has a ton of self-worth tied up in work. Relevance is threatened.
Think about the standard context of a 48 year-old male in enterprise
Everyone is different, of course. Big caveat.
But if you’ve worked in 5–6 offices, let me explain to you a standard late 40s male in enterprise:
- Travels all the time for work “closing deals”
- Regularly puts in 12–13 hours/day
- Probably hasn’t been consistently intimate with his significant other in three years or more
- Kids are at the age where they’re starting to withdraw/create distance
- He’s secretly tremendously lonely
- Getting a fat bonus and a nice base is one of his best quantifiable measures that he’s “doing it”
You understand how important work, and narrow definitions of work success, would be to this man?
So when you come at him with transformation ideas or “digital initiatives,” what’s the first thing he’s going to think about?
“Yes, that’s beneficial for the company.”
“Shit, that’s not what I’m used to and that kind of affects my relevance a lot…”
I’d bet the house on Option B.
So what do we do?
A normal business article would go into a bunch of bullshit about “purpose” and “mission” and “finding the True North of our organizations.”
All of that is complete garbage and no one actually believes it. It’s just stuff you say.
If we want to fix organizations and make transformations work, it’s very simple:
- We need better managers
- We need to more clearly articulate the purpose of the transformation
- Our focus needs to be on the underlying attitudes and behaviors, instead of what we can manage in a spreadsheet
That’s the path. Now, getting better managers is a tough one, but here’s one list of what you should be looking for. Asking people in a company to go above and beyond “Who owns this and what spreadsheet does it reside on?” is a tough one too, but teaching managers the value of context has some potential.
What else have you seen about transformations working/not working?