1. Study Organisations in Environment that Calls for Rapid Change - Article is a result from analysing a number of organisations that operate in environments where they dynamically need to change on a frequent basis and offers up their change methods for wider consideration2. Not applicable everywhere - Realise not all are applicable everywhere but hope that these methods provide some thought starters3. Scope: Studied the new school exemplar firms such as Google and Facebook and more traditional businesses that needed to demonstrate step change such as the launch of the UK’s first 4G services and rebrand of EE and the UK Government’s preparation for London20124. Is transformation capability an issue? Seems to be in discussion with senior executives in a number of sectors. More and more leadership has moved from an 80% focus on operations and 20% on delivery of transformation to an almost balanced level of attention. An example, a recent report in private equity demonstrated that operational transformation is becoming the largest source of deal value.
So there was a perfectly operational old model and the firms in this study found that it simply wasn’t up to scratch for their updated requirements
So what is different about the new model that some firms use.I have broken this presentation down into aspects of leadership that are different and aspects of the organisation.
5 principles of a new change leadership model
Get minimum viable product out, test market, sounds like common sense but many still do it wrongDon’t do large scale waterfall – human nature to go off with some requirements and want to come back later with the finished product that wows stakeholders. Environment does not permit that, things change and the supply side is ill equipped to decide the trade offs. Its like blindly stumbling down execution based on the letterbox vision of a few without any substantiation.EXAMPLES:Olympics – ODA, even here, iterative business case options analysis – got early design concepts out amongst stakeholders and brought them along with decision making, get trajectory of project right at start to avoid later disappointmentGoogle Nexus – launched without 3g whilst apple got the mini iPad ready, iterated and kept great market share, won many awards, great device
Plan Dates Rapidly - The usefulness of investing time to detail specific project plans far into the future is called into question in volatile environments where the plan becomes outdated very rapidly. Rough Planning & Attention to Detail - Instead, plans matched to these environments roughly hash out the approach to the next test of the product or service’s value hypothesis. Gantt Overhead to high - In these circumstances extensive Gantt charts and enterprise planning systems are looked on with similar scorn to the fixed strategic planning processes of large corporates in the 80’s: corporate comfort zones that tempt the investment of significant effort yet in reality offer rapidly diminishing returns and spurious accuracy.Works in some places, not here - Its useful and easy in areas like construction to perform extensively detailed top down and bottom up planning, here its feasible to estimate how long a task such as pouring foundations might take. Its different however to estimate how long a sales cycle will be for a new product
Maxim of CEO “Creativity loves constraints”EE Dates - Olaf Swantee CEO at EE made claims that seemed ridiculous on merging of Orange and T-mobile and the launch of 4G but the clarity of the brief and priorities enabled the organisation to creatively get thereL2012 Dates - The immovable deadline of London 2012 bread the same behaviours
There are 2 levels to thisOrganisations have to move from never killing any projects to at least stopping someNext iteration is keeping the good stuff from the projects that have to stop and weaving it into other initiatives. Catch projects that are off track / invalidated early and capture their valueEXAMPLECombined retail systems for EE
Quoted from Google Evidence over theoreticians - This principle is embodied by a way of working where theory is considered yet data and prototyped examples are paramount. Not HIPPO - Operating by HIPPO, the highest paid person’s opinion is seen as a quick route to fall off the path to getting the answer right. Avoid Ambiguity of Opinion - Rather than the ambiguity of opinion the drive to experiment is favoured. Facebook takes this further with its famous posters within its offices that state such things as “Code wins over opinion” and “Move fast and break things”. All of these are aimed at removing organisational conflicts of interest and maintaining the firm’s focus on validating its change and future with its customers as rapidly as possible.
If the previous slides are focused on a new model of leadership the next are focused on the organisation itself
Maxim that the best people in any industry are as valuable as 10 – 20 average people.Talent Focus - We found an incredible focus on talent in our study.London 2012 First 9mo - At London 2012’s Olympic Delivery Authority the first 9 months of the tenure of the CEO was focused on getting the right people into the organisation. A Player - At Google the concept of ‘if you are an A player we are always hiring’ runs throughout the operation. A’s Hire A stars - At Facebook discussions centred around the concept that A players hire A stars and B players hire C’s. In all of the organisations the focus on talent and taking a talent centric approach is seen to be paramount.ISSUES - This has its issues; top talent is seen to be fickle and companies have to come up with a strong roster of career rocketing projects to entice the talent to stay. The culture of the firm focused on its top talent runs the risk of being thin and strongly influenced by its current set of stars. Firms in these circumstances have strived to remain flexible homes for top talent whilst retaining strong values.
No Resource Pool Command and Control - The previous world of resource pools in which people are attributed to projects in a top down manner are not so prevalent. Woo Talent - Rather there is a culture of project leaders wooing talent to spend time on the project via pitching to them. Stoke the Appetite - The appetite to take part in a good portfolio of projects is stoked by 360 reviews and scorecards that measure people not on efficiency based metrics but rather metrics based around change. Facebook notably has one of its top ranked metrics focused on how much its employees have ‘changed the world’.
There is no time for silos here - Silo based structures can work well to optimise large scale stable operations where business units require little interaction. In volatile markets where interaction is required they often lead to sub-optimal decision making. Conflict - Business unit leaders can be conflicted in decisions whether to invest in making an existing operation efficient or re-prioritising resources to other silos and at worst case silo based perspectives optimise towards empire building. Flat Structure - EE, Facebook and Google uphold the flat hierarchy principle which comes at some cost in terms of coordination but ensures that new ideas get rapidly across many units and considered quickly. Such organisations are supported through extensive information available to all on who is doing what.
Its more fun to be a pirate than to join the navy…Pirate Cultures - In all of the organisations interviewed change is deep within the culture and this is the foundation upon which many of the practices above rely. Pirates taking on telco - At Everything Everywhere born out of a joint venture between France Telecom and Deutsche telecom the culture of the ‘to be’ organisation is moving to be that of the change programme itself that scrubbed up the best parts of the previous incumbent operations of its parents and added some parts. Pirates taking on tech - At Google and Facebook the organisations embody change and flexibility and at London 2012 the organisation was wholly put in place to deliver the change involved in putting on an Olympic Games. Culture cost - This change culture comes at some cost. Members in the organisation often find it confusing that sets of stable KPIs are not available to aim at, their work can be discarded when the organisations or business units pivot and building consensus is an ambiguous process.
A new model for business transformation
Lessons in Changefrom New School Firms Such as Google andFacebook and Old School Exemplars Such asEE and London 2012June 2013A Model for Business Transformation