STRATEGY Leadership Lighting a fire under theni Why urgency—not panic—is the key to getting ahead in a recession John Kotter got an enviable—if unintentional—endorsement when then-candidiitc liarack Obama began inserting the phrase it sense ofurgeney into his comments about the economy. A Sense ofUrgeney (Harvard Business Press, 2008) is the title of Kotter s latest book on fostering change in organizations—a subject the Harvard Business School professor has owned since publishing the seminal Leading Change, in 1996. Kotter believes there arc two kinds of urgency—and, like cholesterol, one is good and one is bad. The good kind is characterized by constant scrutiny of external promise and peril. It involves relentless focus on doing only those things that move the business forward in the marketplace and on doing them right now, if not sooner. 'I'he bad kind—to which many companies have recently succumbed^—is panic driven and charac- terized by breathless activity that winds up prodticing nothing demonstrably new, Kotter advises leaders to stamp out the bad urgency, which demoralizes and drains people, and use the^—tiare we say it?—opportunity of the economic crisis to remake their organizations with a lean and hungry look. And he encourages them to sustain that newfound urgency even when flush times return. Editor-at- large I.eigh Fiuchanan spoke with Kotter about his urgent call to urgency. Samue! Johnson said nothing focuses the mind like a hanging. Has that happened with the recession? Has it focused the minds of company leaders and created the sense of urgency you advocate? 1 Relentless Leadership guru John Kotter, author of 4 Sense oí Urgency, says you should be doing something right now, today this very moment, to move your company forward. I wish that it had. Many companies probably think they're responding with urgency, and there are certainly a lot ot people running aroujid tr)ing to come up with solutions. But most ofthat activity is going to be ineffectual, because it is driven by a fear of losing. It's not that gut-level determination to win and to make abso- lutely sure that they do something every single day to keep pushing that goal forward. That's true urgency. How can you distinguish good urgency fronn bad urgency? There are lots of signs of false urgency. Frenetic activity. Everyone is exhausted, working 14-hour days. One red flag is how difficult it is to schedule a meeting. With true urgency, people leave lots of white space on their calendars, because they recognize that the important stuft^—the stuff they need to deal with immediately—is going to happen. If 8 6 . I N C SEPTEMBER 2009 PHOTOGRAPH BY ADAM AMENGUAL STRATEGY you're overbooked, you can't manage pressing problems or even recognize they're pressing until tot) late. People think that in urgent situations, they're expected to take on Enore and more. They're worried about keeping their jobs, so they try to demonstrate their value hy being incredihh' b.

1. STRATEGY
Leadership
Lighting a fire under theni
Why urgency—not panic—is the key
to getting ahead in a recession
John Kotter got an enviable—if
unintentional—endorsement when
then-candidiitc liarack Obama began
inserting the phrase it sense ofurgeney
into his comments about the economy.
A Sense ofUrgeney (Harvard Business
Press, 2008) is the title of Kotter s
latest book on fostering change in
organizations—a subject the Harvard
Business School professor has owned
since publishing the seminal Leading
Change, in 1996.
Kotter believes there arc two kinds
of urgency—and, like cholesterol, one
is good and one is bad. The good kind
is characterized by constant scrutiny of
external promise and peril. It involves
relentless focus on doing only those
things that move the business forward in
the marketplace and on doing them right
now, if not sooner. 'I'he bad kind—to
which many companies have recently
succumbed^—is panic driven and charac-

2. terized by breathless activity that winds
up prodticing nothing demonstrably new,
Kotter advises leaders to stamp out
the bad urgency, which demoralizes and
drains people, and use the^—tiare we say
it?—opportunity of the economic crisis
to remake their organizations with a lean
and hungry look. And he encourages
them to sustain that newfound urgency
even when flush times return. Editor-at-
large I.eigh Fiuchanan spoke with Kotter
about his urgent call to urgency.
Samue! Johnson said nothing focuses
the mind like a hanging. Has that
happened with the recession? Has
it focused the minds of company
leaders and created the sense of
urgency you advocate?
1
Relentless Leadership guru John Kotter, author of 4 Sense oí
Urgency,
says you should be doing something right now, today this very
moment,
to move your company forward.
I wish that it had. Many companies
probably think they're responding with
urgency, and there are certainly a lot ot
people running aroujid tr)ing to come up
with solutions. But most ofthat activity is
going to be ineffectual, because it is driven
by a fear of losing. It's not that gut-level
determination to win and to make abso-

3. lutely sure that they do something every
single day to keep pushing that goal
forward. That's true urgency.
How can you distinguish good urgency
fronn bad urgency?
There are lots of signs of false urgency.
Frenetic activity. Everyone is exhausted,
working 14-hour days. One red flag is
how difficult it is to schedule a meeting.
With true urgency, people leave lots of
white space on their calendars, because
they recognize that the important
stuft^—the stuff they need to deal with
immediately—is going to happen. If
8 6 . I N C SEPTEMBER 2009 PHOTOGRAPH BY ADAM
AMENGUAL
STRATEGY
you're overbooked, you can't manage
pressing problems or even recognize
they're pressing until tot) late.
People think that in urgent situations,
they're expected to take on Enore and
more. They're worried about keeping
their jobs, so they try to demonstrate
their value hy being incredihh' busy.
But the leader should be telling them
to do just the opposite. He should say, "1
want everyone to look at your calendars.
What's on there that doesn't clearly

4. move us forward? Get rid of it!"
True urgency is the most important
precursor of real change. Seventy
percent of change efforts fail or never
launcli at all, and one reason is that
C()mpany leaders don't create a sense
of urgency around what they're dtiing.
They go straight to solving the problem.
So, with true urgency, you would expect
to see change. Something new should
be happening. How many companies
are going to come out of this doing
things in a new wa)'? Not just dimin-
ished but actually changed?
One of the hest—or worst—examples
of this is Washington, I ).C :. Are the two
parties interacting with eacb other in a
new way to reflect (he new situation in the
economyi Are the special-interest groups
behaving in a new way? Is tbe administra-
tion staffing ilself in a fundamentally new
way? No. But they're all extremely bus)'.
If the economy and job loss don't
jump-start change there, what will?
It's bard to imagine that these days
anyone could feel complacent, hut the
fact is, Washington is crammed with
complacency. Because the country has
done pretty well over the last 250 or 300
years. (. Congress is full of people who
get reelected and reelected. How can
you have urgency when there are all of
[hose safe seats? Obama started using

5. the phrase ÍÍ sense of urgency during his
campaign. That's a good sign.
But then he waited two months to get
change started, because "there's only
one President at a time."
von should sav that. I wrote an
op-ed piece that I never sent to any-
body, in which I talked ahout what I
would do if 1 had been elected Presi-
dent. On November 5, the day after
the election, I would have made a
15-minute speech on T'. I would have
said that our economic problems are
significant, and they're going to stop
me frt)m fulfilling all my promises. And
1 would have made it very clear that,
though I'm not President now, I pledge
to you that starting tomorrow morn-
ing—on November 6th, 7th, 8th, 9th,
10th—I am going to make damn sure
that the people around me and 1 are
making headway on this. And 1 want
If you've been successful long enough,
complacency doesn't disappear easily.
And it's ñnc to celebrate success: You
have a sales appreciation meeting and
give out a bunch of awards to your
employees. They deserve it. They
helped you to grow 30 percent this
year. Hut that's history. So you ask them,
"What do you have on your calendiir
for tomorrow that's going to help us

6. grow 30 percent next year?"
In my recent book, I wrote ahout a
manager I met at a company in India—
it's an outsourcing business, and he's in
charge of three or four offices. This man
is a walking urgency machine, And what
"Decay in a company or industry
happens gradually, microscopically,
one day at a time. Sometinies, you
have to make the point: This thing
is weaker than you think."
you to help me, because I think that
collectively, we can turn something
horrible into something that might
even energize us in some way.
There's something similar going on
right now at an 8()-year-old manufactur-
ing company 1 studied. It's in the middle
of a corporate succession. The new guy
is taking over in October And he's trying
very hard not to be disrespectful and
start pretending he's running the place
before the CEO is gone. That's a mistake.
1 le should get in front of the crowd and
make his urgency speech. With a real
sense of urgency; you're not held hack by
protocols or concern about hurting
someone s
This month, we're publishing the Inc.
500, our list of the fastest-growing

7. private companies in the United
States. As you say, it's hard to imagine
anyone feeling complacent these
days. But I wonder whether
companies are most vulnerable to
complacency after a big success.
he always says is that historical success
guarantees nothing. Nothing, Nothing.
Nothing. He's not a negative guy. But
he's relentlessly realistic.
You say something pretty provocative
in the book: that sometimes, in the
face of complacency, it's actually OK
to manufacture a crisis.
Obviously, you need to be careful with
this. If people think the boss is manipu-
lating them to get them to work harder,
it backfires. It works best if the crisis is
real but no one has been paying atten-
tion. Decay in a company or an indus-
try happens gradually, microscopically,
one day at a time. Sometimes, you have
to make the point: This thing is weaker
than you think.
I wrote a while ago about the CEO
of a health care firm who took his com-
pany through a turnaround. But then
they got so far ahead, everyone settled
back into a deep complacency. So he
changed the context. He started asking,
"Whom should we be comparing our-
8 8 INC. SEPTËMBER2009

8. STRATEGY
selves to? Yes, we're beating everybody
in the marketplace. But what if the
relevant question was, 'Are we beating
them in the^'na«dii/marketplace?'?
Investors don't make choices iust
among companies in the same industry.
c:ompanies in different sectors are
competing with us for funding. And
when you run those numbers, we don't
look as good." That woke people up.
It's a great question: "Whom should
we be comparing ourselves to?" Detroit
didn't ask it soon enough. The broadcast
networks didn't ask it soon enough.
Don't ¡ust look for new customers but
Metrics are very useful, but they
have to change like everything else. If
you always measure the same things,
you may always get the same answers.
We think numbers keep us alert. But
maybe they're putting us to sleep.
How much attention should you
direct to the outside world versus
Internal matters?
There should be no meetings that are
only about internal matters, without
any connection to the outside world.
In some way, the outside world always

9. provides the "why" we are doing some-
'Talk about the big dangers and
the big opportunities. You're not
trying to get people to panic.
You're trying to get them to think,"
also for new competitors. Broaden your
definition of competition. You go from
"Here we are, the dominant player" to
"Here we are, this dinky business in a
much larger pool."
One exercise I've seen leaders do is
come up with a company that doesn't
exist. Then they'll bring people together
and say, "You are the management of
that company. Your job is to kill our
company." They do that in the morning.
'I hen, in the afternoon, when their
thinking is a little different, they talk
about how to kill the new competitor.
Are open-book companies better
at creating and sustaining urgency,
because everyone is always aware of
exactly where the business stands?
Not necessarily. A lot of people create
heavy-duty measurement systems to
track the progress of their companies,
but that's not how leaders with the
greatest sense of urgency do it. They
pay attention to their internal numbers,
but they're much more interested in
what's going on outside. They want to
have as many metrics about their com-

10. petitors as they do about themselves.
thing. That Indian manager I men-
tioned is great at this. His meetings are
never about internal chatter. They're
always about wiiat technology is being
developed in the United States or which
competitors might enter the company's
market. It doesn't have to be strictly
competitive. For example, if you're
putting in a new software system, you
should be saying, "What other compa-
nies do we know that have done this?
What problems did they solve, and how
did they solve them? Wouldn't that be
useful information? Let's get it,"
How do you get people to think
like that?
You model it. You talk about the big
dangers and the big opportunities. You
talk in specifics: "We're a company that
helps set up trade fairs, Alibaba, which
does Internet trade fairs, grew 90 percent
last year." You're not trying to get people
to panic. You're trying to get them to
think. And you always say what you
are going to do first. Not just what you
are going to do someday; what you are
going to do tomorrow. And then you ask
everyone else what they are going to do
tomorrow. And if it doesn't advance the
ball, they shouldn't be doing it.
One of my executive students gave

11. me a two-page letter that his CEO had
sent out in November. Part One said,
"We're in a mess. Denial doesn't help.
Here are some statistics to show it." Part
Two said, "It is usefi.il to look at history.
Thirty years ago, this company was in a
worse mess. Look at us now. We're 10
times bigger 1 he U.S. ect>nomy had
deeper recessions every 20 years in the
19th century. Atid here we are—the
most powerful nation on earth." Part
Three said, "We've got to link arms and
address this thing, and it's going to start
with me. I'm going to try my damnedest
to figure out 1, how this doesn't hurt us
and 2. how we can find opportunities in
this. Because there are opportunities."
The last part was, "I Iere's what I'm going
to do, and here's what I need yt)ur help
with." The final note was hopefiji but not
naive. That's great urgent leadership.
You say that urgent leadership is
emotional. After a period like this,
when organizational life is more
than usually fraught, should you
give people a break?
No. Irue urgent leadership doesn't
drain people. It does the opposite.
it energizes them. It makes them feel
excited. And the idea isn't so much that
the leader is always showing emotion
as that he's trying to produce the right
emotions in the people he leads. But
again, he has to model it. You can
get people to respond rationally to a

12. problem, but if you haven't stirred their
hearts and minds, once the immediate
crisis has passed, you lose them. The
sense of urgency dissipate.s.
So If the Klingons were attacking,
you'd want Kirk running things,
not Spock?
I don't care what the situation is.
I always want Kirk running things.
•Icom For more articles on leadership,
including topics such as management trends,
corporate culture, team building, and succession
planning, go to www.inc.com/keyword/sep09.
9 0 INC. SEPTEMBER 2009
Week one
Read the following article:
· Kotter, J. (2009).Lighting a fire under them (Links to an
external site.)Links to an external site.. Inc, 31(7), 86.
In this interview, Kotter discusses the sense of urgency that is
required of leaders when there is an economic recession. Reflect
on the issues of complacency and urgency among businesses, as
explained by Kotterstrong.
For this discussion, write a response to the following questions.
Support your response with material from the required reading
as well as at least one outside peer-reviewed journal article.
· How does a sense of urgency motivate employees?
· Does a sense of urgency with regard to implementing
organizational change differ in times of recession, during
natural disasters, or in the face of global competition?

13. · Is a sense of urgency in strategic planning the norm in
business today? Explain.
· How do leaders motivate employees to remain inspired during
an economic down turn?
Remember that critical thinking is not just your opinion; rather,
it is a claim that provides evidence that helps you prove an
argument. Therefore, you must support your statements with
reliable outside sources.
Require:
One page with at least 2 references
Tutor – Please include 2 questions for me to ask other students
about this topic, thanks.