If your first step as a new CEO is to lead a company-wide transformation, make sure you focus on shifting the company culture. The people in your company are where your success begins and ends.
New CEOs are watched like hawks, and the pressure on you to do great things can be immense. In our last article we talked about the importance of taking the time to do some investigating, and assess what your company needs.
If your first step is transformation, these seven steps will guide you towards success, and sustainability.
You might know intuitively what problem your transformation is going to solve. But how clearly can you communicate it?
When a former CEO of shipping company DHL stood up in front of 350 of his stakeholders at a conference and played a fading heartbeat on a giant screen, he held all present in the palm of his hand. When the heartbeat stopped, his message was already clear: They needed to act, or the company would fail.
Your own understanding of the problem that has led the company to its current situation isn’t enough. You need everyone else to see the problem, too. If you can do that as dramatically as Ken Allen did, you’re already one step ahead.
When you interrupt the business-as-usual narrative in such a way that you immediately demonstrate the rationale for the change, you are preventing the existing culture from simply reinforcing itself.
You can understand culture to mean mindset plus behaviours. Therefore, your role becomes knowing how to change the current company view of reality, and then working out how to create behaviours to fit.
According to PwC, one of the biggest barriers to successful change is change fatigue.
If you’re going to enable transformation using the company culture, you’ll have to think carefully about how you drive it, and how you intend to sustain it.
Change fatigue is what happens when people are asked to deliver on too many changes at once. It also happens when you don’t have the internal capabilities that will make the change stick.
Transformation, as you’ll remember from our last article is a complete reboot of the company.
This means that you need to change your language.
Instead of talking about change, which is constant, speak plainly about changing the very essence of the company.
It’s critical to be methodical, so that you don’t just exhaust your people or your company’s intrinsic motivators. In an article in 2015, Forbes pointed out that being methodical isn’t sexy; but that it is one of the only ways to ensure that your employees are involved in the change.
Other organisations describe this idea of ‘method’ as creating a strong strategy, and then designing iteffectively. PwC suggests that the way you need to design the transformation framework is to design for trust.
Designing for trust is a double-sided activity.
On one hand, it’s internal. Beginning at the top of the company, you rethink how you motivate your people. On the other hand, it’s external. It asks you to consider what your transformation means for your customers.
Careful design will allow you to consider what measures you need, in order to demonstrate your outcomes.
You’ll recall from our last article that if your senior leadership isn’t performing, then fixing it might mean you don’t need transformation. In the same vein, if you do need the transformation, then you need your senior leadership to be all in.
If you don’t have your entire executive on board, your boat is going to sink.
It’s important for you, as a new CEO, to understand that you’ve probably got a 50% chance of your transformation succeeding. However, there is a silver lining: Being able to lead from the front becomes an important risk mitigation factor.
Your people need to see you representing the change that you want them to embody.
Step 5: Tell a compelling story about the transformation, and align outcomes with behaviours
This is the one common factor in article after article about successful transformations. You need to tell a compelling story.
Compelling stories are what will ‘foster understanding and conviction’, which is one of McKinsey’s four building blocks of change.
The article suggests that communicating the rationale and purpose of your transformation program is much deeper than reeling off a single, catchy line about why it is necessary. In contrast to this blasé method of talking to the ‘why’, a compelling story allows you to demonstrate the journey from where you are now, to the vision of where you want to be.
Once you know the story of that journey, it’s easier to see the behaviours that will drive you towards your outcomes.
Successful transformations take place because the designed program is aligned with the right behaviours, which become embedded in the process. Of course, how people achieve this will be different in every business. One way might be to create an internal certification that reinforces what you want to continue (or create), because it realigns employees’ thinking and behaviours with the new direction.
In the situation of DHL, with which this article opened, the leadership enthusiastically sang songs at employee conferences.
It sounds terrifying, I know! In their case, song was identified as something that helps a story to stick. As a result, the leadership team leaned on different famous songs to represent the attitudes and behaviours they wanted their employees to exhibit. This helped them to make their new strategy clear and relatable extremely quickly.
As Ken Allen, former CEO of DHL, wrote for the Harvard Business Review, ‘I still remember the shock — some might say horror — on our managers’ faces when, at a management conference in 2010, I introduced our first landmark profit target by treating them to a solo rendition of the Bruno Mars chorus from “Billionaire,” the Travie McCoy song.’
Whatever your version of enthusiasm is, make sure you do it, and continue it. Your employees need to see that you are in this game for real, heart and soul. That’s the only way they’ll start to let go of their resistance to significant change.
This is really a “part two” of bringing your senior leadership along with you. Imagine if you set up a program of transformation and then stepped back from it. How would you know whether or not what you’re putting in place is working?
Right: You wouldn’t.
When you stay connected, are visible, and are accessible, you find yourself with some excellent benefits. It allows you to see whether or not your program is working, whether your measures are effective, and how the change is progressing.
Even more importantly, it shows that you – the one person from whom everyone else takes his or her lead – have skin in the game.
Your team needs to be able to grasp the reasons for your transformation program quickly and easily. And you need to create the right conditions that encourage their buy-in.
Not only does your team need to see you, and your executive, representing the new way – whatever that new way looks like, but they need to see your enthusiasm for it.
Business transformation isn’t for the faint of heart. You need to be all-in if your program is going to be a success.
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